PART I

PART II

PART III

G) CLASS “G” PREFERRED SHARES

1. INTERPRETATION

2. THE CREDIT

3. PURPOSE

4. ADVANCES, CONVERSIONS AND OPERATION OF ACCOUNTS

9. SECURITY

10. CONDITIONS PRECEDENT

11. REPRESENTATIONS AND WARRANTIES

12. COVENANTS

13. NEGATIVE COVENANTS

14. EVENTS OF DEFAULT AND REALIZATION

15. JUDGMENT CURRENCY

16. ASSIGNMENT

17. MISCELLANEOUS

18. THE AGENT AND THE LENDERS

19. FORMAL DATE

I. INTERPRETATION

II. AMENDMENTS

SCHEDULE A

PROMISSORY NOTE

SCHEDULE A

PROMISSORY NOTE

SCHEDULE A

PROMISSORY NOTE

SCHEDULE A

PROMISSORY NOTE

SCHEDULE A

PROMISSORY NOTE

ITEM 1 - IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

ITEM 2 - OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 3 - KEY INFORMATION

ITEM 4 - INFORMATION ON THE COMPANY

ITEM 5 - OPERATING AND FINANCIAL REVIEW AND PROSPECTS

ITEM 6 - DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

ITEM 7 - MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

ITEM 8 - FINANCIAL INFORMATION

ITEM 9 - THE OFFER AND LISTING

ITEM 10 - ADDITIONAL INFORMATION

ITEM 11 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 12 - DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

ITEM 13 - DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

ITEM 14 - MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

ITEM 15 - CONTROLS AND PROCEDURES

ITEM 16 - [RESERVED]

ITEM 17 - FINANCIAL STATEMENTS

ITEM 18 - FINANCIAL STATEMENTS

ITEM 19 - EXHIBITS

12.17 CF Cable Inter-Creditor Agreement

12.18 Accuracy of Reports

12.19 Transfer of Licences from Spectrum Co. to the VL Group

13.1 Liquidation and Amalgamation

13.2 Charges

13.3 Asset Dispositions

13.4 Preservation of Capital

13.5 Restrictions on Subsidiaries

13.6 Issuance and Transfer of Shares

13.7 Acquisitions

13.8 Debt and Guarantees

13.9 Financial Assistance by the VL Group

13.10 Subordinated Debt

13.11 Members of the VL Group, Related Party Transactions

13.12 Derivative Instruments

14.1 Event of Default

14.2 Remedies

14.3 Bankruptcy and Insolvency

14.4 Notice

14.5 Costs

14.6 Relations with the Borrower

14.7 Application of Proceeds

15.1 Rules of Conversion

15.2 Determination of an Equivalent Currency

16.1 Assignment by the Borrower

16.2 Assignments and Transfers by the Lenders

16.3 Transfer Agreement

16.4 Notice

16.5 Sub-Participations

16.6 General

17.1 Notices

17.2 Amendment and Waiver

17.3 Determinations Final

17.4 Entire Agreement

17.5 Indemnification and Compensation

17.6 Benefit of Agreement

17.7 Counterparts

17.8 Applicable Law

17.9 Severability

17.10 Further Assurances

17.11 Good Faith and Fair Consideration

17.12 Responsibility of the Lenders

17.13 Indemnity

17.14 Language

17.15 Foreign Lenders

8. A new Schedule “A” is attached, replacing the former Schedule “A”.

All of the words and expressions which are capitalized herein shall have the meanings ascribed to them in the Credit Agreement unless otherwise indicated herein.

1. Subsection 1.1.2 of the Credit Agreement is deleted and replaced by the following:

2. Subsection 1.1.9 of the Credit Agreement (definition of “Asset Disposition”) is amended by deleting the reference to subsection 1.1.85.1 and replacing it with a reference to subsection 1.1.89.1.

3. Subsection 1.1.50 of the Credit Agreement is deleted and replaced by the following:

4. A new subsection, 1.1.51, is hereby added to the Credit Agreement as follows. All other subsections are renumbered accordingly:

5. The last sentence of subsection 1.1.61 (now 1.1.62), the definition of “Guarantors”, is amended to refer to the “Eighth Amendment Closing Date” instead of the “Seventh Amendment Closing Date”.

6. New subsections 1.1.72, 1.1.74 and 1.1.76 are added as follows:

7. The definition of “Loan” in subsection 1.1.79 (now 1.1.83) is amended by adding the words “and Letters of Credit” on the third line after the words “Bankers Acceptances”. Consequently, the subsection now provides as follows:

8. The definition of “Margin” in subsection 1.1.82 (now 1.1.86) is deleted and replaced by the following:

9. The first line of the definition of “Net Proceeds” in subsection 1.1.85 (now 1.1.89) is amended by replacing the word “Section” with the word “Sections”.

10. New subsections 1.1.112 and 1.1.113 are added as follows:

11. The definition of “Term Facility C” in subsection 1.1.116 (now 1.1.122) is amended by replacing the words “will have been” with the word “was”. Consequently, the subsection now reads as follows:

12. Section 3.1 is amended to add Letters of Credit to the permitted purposes, and now reads as follows:

“3.1 Purpose of the Advances

13. A new Section 4.3 is added as follows, and Sections 4.3 to 4.11 are renumbered as 4.4 to 4.12; all cross-references in those Sections and elsewhere in the Agreement to Sections 4.3 to 4.11 are also modified to take into account the new numbering:

14. Section 4.10 (now 4.11) is modified to take into account Letters of Credit, and now reads as follows:

“4.11 Limits on BA Advances, Letters of Credit and Libor Advances

15. Subsection 9.2.2 is amended to replace the reference to subsection 1.1.88.7 with a reference to subsection 1.1.92.7.

16. A new subsection 9.2.10 is added as follows:

17. The last paragraph of Section 9.3 is deleted and replaced by the following:

18. Section 10.2 of the Credit Agreement is deleted and replaced by the following, to take into account the conditions precedent contemplated by this Eighth Amending Agreement:

“10.2 Initial Advance under the Revolving Facility After the Eighth Amendment Closing Date

ITEM 4A - UNRESOLVED STAFF COMMENTS

ITEM 16A - AUDIT COMMITTEE FINANCIAL EXPERT

ITEM 16B - CODE OF ETHICS

ITEM 16C - PRINCIPAL ACCOUNTANT FEES AND SERVICES

ITEM 16D - EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

ITEM 16E - PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

ITEM 16F - CHANGES IN REGISTRANT’S CERTIFYING ACCOUNTANT

ITEM 16G - CORPORATE GOVERNANCE

1.1.1 “ Acquisition ” means, with respect to any Person, any transaction or series of related transactions whereby such Person acquires, directly or indirectly, (a) a business, division, or all or a substantial portion of the assets of any other Person; (b) any Investment; or (c) by way of reorganization, consolidation, amalgamation, winding-up, merger, transfer, sale, lease or other combination, the assets or shares of any other Person; and “ Acquire ” and “Acquired ” have meanings correlative thereto;

1.1.2 “ Additional Offering ” means an Offering of unsecured Debt incurred or issued by the Borrower having a maturity date (meaning the date on which repayment can be required by the lender, not the date of any initial maturity leading to an automatic conversion or replacement) expiring after the expiry of the Term, the terms and conditions of which Offering (including any automatic conversion or replacement as aforesaid and excluding, for greater certainty, (a) pricing, and (b) the right to require a replacement via an unsecured term loan or an offering of unsecured high yield Debt in an amount equal to the Additional Offering being replaced (“ AO Replacement Debt ”)) are no more favourable to the Persons providing such Debt, in all material respects, than the provisions hereof; for greater certainty, for the purposes of paragraph (j) of Section 13.8, any such AO Replacement Debt will not be considered a new incurrence of Debt;

1.1.3 “ Advance ” means any advance by a Lender under this Agreement, including direct Advances by way of Prime Rate Advances and indirect Advances by way of BA Advances (or, in the case of Lenders who are Foreign Lenders who cannot make such forms of Advances, Libor Advances in Cdn. $, or, in the circumstances set out in Section 4.11, Libor Advances in US$);

1.1.4 “ Affiliate ” has the meaning ascribed thereto in the Canada Business Corporations Act and, with respect to any Lender that is a fund that invests in bank loans, includes any other fund that invests in bank loans and is advised or managed by the same investment advisor as such Lender or by an Affiliate of such investment advisor;

1.1.5 “ Agency Branch ” means the branch of the Agent located at Royal Bank Plaza, South Tower, 12 th Floor, in the City of Toronto, Province of Ontario, M5J 2W7, or such other address in Canada of which the Agent may notify the Borrower from time to time;

1.1.6 “ Agent ” means Royal Bank of Canada in its capacity as agent for all of the Lenders;

1.1.7 “ Agreement ”, “ Credit Agreement ”, “ these presents ”, “ herein ”, “ hereby ”, “ hereunder ” and other similar expressions refer collectively to this Credit Agreement and the Schedules and appendices hereto as same may be amended or amended and restated from time to time, and include any deed or document which is supplementary or accessory or which is made in order to

complete this Agreement, as all of same may subsequently be amended, amended and restated, modified, supplemented or replaced from time to time ;

1.1.8 “ Annual Business Plan ” means, for any financial year, (a) detailed projected balance sheets, income statements, statements of cash flows and Capital Expenditures budgets of the VL Group, prepared on a Consolidated basis, in respect of such financial year and each financial quarter therein and in respect of, and as at the last day of, each of the next two following financial years, in each case supported by appropriate explanations, notes and information and commentary; and (b) a detailed narrative of the businesses of the VL Group for the financial year then ended and for the following financial year which shall include a management discussion and analysis, in sufficient detail, all as approved by the board of directors of the Borrower;

1.1.9 “ Asset Disposition ” has the meaning ascribed to it in subsection 1.1.90.1;

1.1.10 “ Assignment ” means an assignment of all or a portion of a Lender’s rights and obligations under this Agreement in accordance with Sections 16.2 and 16.3, and “Assignee” has the meaning ascribed to it in subsection 16.2.1;

1.1.11 “ Associate ” has the meaning ascribed thereto in the Canada Business Corporations Act;

1.1.12 “ BA Advance ” means at any time the part of the Advances under the Revolving Facility which the Borrower has chosen to borrow by Bankers’ Acceptances, calculated based on the face amount of such Bankers’ Acceptances;

1.1.13 “ BA Proceeds ” means, (a) for any Bankers’ Acceptance issued hereunder, an amount calculated on the applicable Acceptance Date (as defined in subsection 6.1.1) by multiplying: i) the face amount of the Bankers’ Acceptance by ii) the following fraction:

, with such fraction being rounded up or down to the fifth decimal place and .00005 being rounded up; and (b) with respect to Assignees that are not banks or that do not accept Bankers’ Acceptances, the face amount of Discount Notes issued to them, less a discount established in the same manner as provided in (a) above (with references to “Bankers’ Acceptances” being replaced by references to “Discount Notes”);

1.1.14 “ BA Schedule I Reference Lender ” means Royal Bank of Canada or such other Lender which is a Schedule I bank under the Bank Act (Canada) appointed by the Agent with the consent of the Borrower in replacement of the said Lender;

1.1.15 “ BA Schedule II Reference Lenders ” means Bank of America, N.A. Canada Branch and Credit Suisse First Boston, Toronto Branch, or such other Lenders which are Schedule II or Schedule III banks under the Bank Act (Canada) appointed by the Agent with the consent of the Borrower in replacement of such Lenders;

1.1.16 “ Back-to-Back Debt ” means any loans made or debt instruments issued as part of a Back-to-Back Transaction and in which each party to such Back-to-Back Transaction, other than a member of the VL Group, executes a subordination agreement in favor of the Agent in substantially the form attached hereto as Schedule “N”;

1.1.17 “ Back-to-Back Preferred Shares ” means preferred shares issued:

1.1.18 “ Back-to-Back Securities ” means the Back-to-Back Preferred Shares or the Back-to-Back Debt or both, as the context requires;

1.1.19 “ Back-to-Back Transactions ” means any of the transactions described under the definition of Back-to-Back Preferred Shares;

1.1.20 “ Bankers’ Acceptance ” means a non-interest bearing draft or bill of exchange in Canadian Dollars drawn and endorsed by the Borrower and accepted by a Lender in accordance with the provisions of Article 6, and includes a Discount

Note where the context permits. Subject to the Lenders electing to use a clearing house as contemplated by the Depository Bills and Notes Act (S.C. 1998 c. 13) (the “ Act ”), “Bankers’ Acceptance” shall mean a depository bill (as defined in the Act) in Canadian Dollars signed by the Borrower and accepted by a Lender. Drafts or bills of exchange that become depository bills may nevertheless be referred to herein as “drafts”;

1.1.21 “ Bankers’ Acceptance Discount Rate ” means (a) in respect of Bankers’ Acceptances to be purchased by the Lenders which are Schedule I banks under the Bank Act (Canada), the average rate for Canadian Dollar bankers’ acceptances having Designated Periods of 1, 2, 3, or 6 months quoted on Reuters Service, page CDOR “Canadian Interbank Bid BA Rates” (the “ CDOR Rate ”), having an identical Designated Period to that of the Bankers’ Acceptance to be issued on such day, and (b) in respect of Bankers’ Acceptances to be purchased by the Lenders which are Schedule II or Schedule III banks under the Bank Act (Canada) and in respect of Discount Notes, the lesser of (i) the arithmetic average (rounded upward to the nearest one hundredth of one percent (.01%)) of the discount rates for Canadian Dollar bankers’ acceptances quoted by the BA Schedule II Reference Lenders, and (ii) the rate specified in (a) above plus 10 basis points (.10%) (in each of cases (a) and (b), the “ Discount Rates ”). In all cases, the Discount Rates shall be quoted at approximately 10:00 a.m. (Montreal time) on the Acceptance Date calculated on the basis of a year of 365 days.

In the absence of any such quote, the Bankers’ Acceptance Discount Rate which would have been determined in accordance with paragraph (a) or paragraph (b) above, respectively, shall be equal to the rate determined from time to time by the Agent as the discount rates for bankers’ acceptances of

established in accordance with its normal practices in amounts equal to the Selected Amount, having an identical Designated Period to that of the proposed Bankers’ Acceptances to be issued on such day;

1.1.22 “ Banking Day ” means any day which is at the same time a Business Day and a day on which banking institutions are not authorized by law or by local proclamation to close for business in New York (USA) and in London (England);

1.1.23 “ Branch ” means the branch of Royal Bank of Canada located at 1 Place Ville Marie, or any other branch designated by the Agent from time to time by notice to the Borrower;

1.1.24 “ Business Day ” means any day, except Saturdays, Sundays and other days which in Montreal or Toronto (Canada) are holidays or a day upon which banking institutions are not authorized or required by law or by local proclamation to close;

1.1.25 “ Canadian Dollars ” or “ Cdn. $” means the lawful currency of Canada;

1.1.26 “ Capital Expenditures ” means the aggregate amount actually paid in cash in any period by the VL Group for or in connection with the acquisition or maintenance of assets required to be capitalized, including expenditures of the type described in the last sentence of Section 13.9, determined on a Consolidated basis and otherwise in accordance with GAAP other than, for greater certainty, expenditures for Acquisitions permitted by Section 13.7;

1.1.27 “ Capital Lease ” means any lease (a) which is required to be capitalized on a balance sheet of the lessee in accordance with GAAP, or (b) for which the amount of the asset and liability thereunder should be disclosed in a note to such balance sheet as if so capitalized in accordance with GAAP;

1.1.28 “ Cash Equivalents ” means, as of the date of any determination thereof, instruments of the following types:

1.1.29 “ Cash Management Facilities ” means the cash management facilities described in the two agreements (the “ Cash Management Agreements ”) entered into among Vidéotron Télécom Ltée, the Borrower, Groupe de Divertissement Superclub Vidéotron Ltée, Le Superclub Vidéotron Ltée, Protectron Inc., Vidéotron TVN Inc., CF Cable TV Inc., 2841-8044 Québec Inc., 2759-8911 Québec Inc., 9028-9778 Québec Inc., 2516527 Canada Inc., Vidéotron Incotel Ltée, Vidéotron (1998) Ltée, Vidéotron Communications Inc., Vidéotron Télécom (1998) Ltée, as participants, the Borrower as concentrator and The Toronto-Dominion Bank dated August 9, 1999, providing for an aggregate maximum net daily overdraft of $20,000,000 (which amount has been decreased to $15,000,000), as same has or may be amended or replaced from time to time;

1.1.30 “ CF Cable Notes ” means the US $94,675,000 9 1/8% Senior Secured First Priority Notes issued by CF Cable TV Inc. ;

1.1.31 “ Change in Control ” means (a) the acquisition by any Person or group of Persons acting in concert (other than Quebecor Media Inc. or any of its wholly-owned Subsidiaries) of a majority of the votes attached to the outstanding voting shares of the Borrower or any of the Initial VL Group Guarantors, or (b) any event which results in more than a majority of the votes attached to the outstanding shares of Quebecor Media Inc. being held by a Person other than Quebecor Inc. and its Subsidiaries;

1.1.32 “ Charge ” means any right to any property, or the income or benefits flowing therefrom, which secures an obligation due to a Person or a claim of such Person, whether such interest is based on the common law, statute or contract, and

includes any security interest, hypothec, pledge, pawn, mortgage, privilege, prior claim, lien, charge, assignment, transfer, cession, encumbrance, Capital Lease, Synthetic Lease, instalment sale, conditional sale or trust receipt or a consignment or bailment for security purposes. The term “Charge” shall include reservations, exceptions, encroachments, easements, servitudes, rights-of-way, covenants, conditions, restrictions and other title exceptions and encumbrances (including, with respect to stock, stockholder agreements having the effect of restricting the ability, in any material respect, of a Person to fulfill its obligations hereunder, voting trust agreements and all similar arrangements) affecting property, but shall exclude, for greater certainty, the rights of lessors under operating leases (but not Synthetic Leases). Solely for the purposes of determining whether a Charge exists for the purposes of this Agreement, a Person shall be deemed to be the owner of any property which it has acquired or holds subject to a conditional sale agreement, Capital Lease or other arrangement pursuant to which title to the property has been retained by or vested in some other Person for security purposes and such retention or vesting shall constitute a Charge;

1.1.33 “ Closing Date ” means November 28, 2000;

1.1.34 “ Commitment ” means the portion of the Credit for which a Lender is responsible, as set out in Schedule “A” hereof;

1.1.35 “ Compliance Certificate ” has the meaning ascribed to it in subsection 12.15.1;

1.1.36 “ Consolidated ” means produced by aggregating the relevant financial statements or accounts of the VL Group on a line-by-line basis (i.e.: adding together corresponding items of assets, liabilities, revenues and expenses), eliminating inter-company balances and transactions and providing for any minority interest, all as otherwise (i.e. except for the fact that the financial information in question relates to the members of the VL Group, all of which are owned, directly or indirectly, by the same Person, Quebecor Media Inc., but are not themselves Subsidiaries of one another) determined in accordance with GAAP;

1.1.37 “ Contingent Obligation ” of any Person means all contingent liabilities required to be included in the financial statements of such Person in accordance with GAAP, excluding any notes thereto;

1.1.38 “ Core Business ” means the business described in Section 11.4;

1.1.39 “ Credit ” means the aggregate amount available to the Borrower under the Revolving Facility;

1.1.40 “ CRTC ” means the Canadian Radio-television and Telecommunications Commission, or a successor regulatory body, commission or agency;

1.1.41 “ Debenture ” means the Debenture to be issued in favour of each Lender (or in favour of a collateral agent designated by the Agent) by the Borrower and the Guarantors after the Phase II Date in accordance with the provisions of subsection 9.2.4 or 9.2.9;

1.1.42 “ Debenture Pledge ” means the pledge of the Debenture in favour of the Agent or any designated collateral agent by the Borrower and the Guarantors;

1.1.43 “ Debt ” includes, for any Person,

1.1.44 “ Default ” means an event or circumstances, the occurrence or non-occurrence of which would, with the giving of a notice, lapse of time or combination

thereof, constitute an Event of Default unless remedied within the prescribed delays or renounced to in writing by the Agent, as authorized by the Lenders;

1.1.45 “ Derivative Instrument ” means an agreement entered into from time to time by a Person in order to control, fix or regulate currency exchange fluctuations, or the rate of interest payable on borrowings, including a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or index equity swap, equity or index equity option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions and any combination of these transactions);

1.1.46 “ Derivative Obligations ” means obligations of the Borrower to one or more Lenders under Derivative Instruments;

1.1.47 “ Designated Period ” means, with respect to a Libor Advance or a BA Advance, a period designated by the Borrower in accordance with Sections 4.2, 6.1 and 6.4, respectively;

1.1.48 “ Disbursement Period ” means, with respect to the Revolving Facility, the period from the Closing Date until the expiry of the Term, subject to satisfying the applicable conditions precedent set out in Article 10;

1.1.49 “ Discount Note ” means a non-interest bearing promissory note denominated in Canadian Dollars issued by the Borrower to a Lender or a sub-participant which is a Non-BA Lender (as defined in subsection 6.1.2(b)), such note to be in the form normally used by such Lender or sub-participant;

1.1.50 “ EBITDA ” means, during a financial period, earnings of the VL Group before non-controlling interests, earnings from equity-accounted investments, extraordinary items, non-recurring gains or losses on debt extinguishment and asset sales and restructuring, Interest Expense, taxes, depreciation and amortization, foreign exchange translation gains or losses not involving the payment of cash and other non-cash financial charges, without taking into account any goodwill adjustments, calculated on a Consolidated basis, and otherwise in accordance with GAAP; for greater certainty, there shall be excluded from the calculation of EBITDA, to the extent included in such calculation, the amount of any income or expense relating to Back-to-Back Securities and the costs arising out of the termination of the Derivative Instruments associated with Term Facility B upon its repayment, in an approximate amount of $8,000,000;

1.1.51 “ Eighth Amendment Closing Date ” means March 6, 2008;

1.1.52 “ Excess Cash Flow ” means the VL Group’s EBITDA calculated as at the end of each financial quarter, plus an amount equal to any spread paid to the

Borrower resulting from Back-to-Back Securities, to the extent not previously included in EBITDA, and less

1.1.53 “ Existing Credit Agreement ” means the $800,000,000 credit agreement, dated as of December 11, 1997, among the Borrower, CF Cable TV Inc.,

Vidéotron.Net Ltée and the lenders named therein, as amended prior to the Closing Date;

1.1.54 “ Event of Default ” means one or more of the events described in Section 14.1;

1.1.55 “ Facility ” or “ Revolving Facility ” means the Credit available pursuant to Section 2.1;

1.1.56 “ Facility Fee ” has the meaning ascribed to it in subsection 5.11.1;

1.1.57 “ Fees ” means the fees payable to the Agent and to the Lenders in accordance with the provisions of Section 5.11;

1.1.58 “ First Currency ” has the meaning ascribed to it pursuant to Section 15.1;

1.1.59 “ Foreign Lenders ” has the meaning ascribed to it in Section 17.15;

1.1.60 “ Generally Accepted Accounting Principles ” or “ GAAP ” means the generally accepted accounting principles acknowledged by the Canadian Institute of Chartered Accountants and published in the Canadian Institute of Chartered Accountants’ Handbook;

1.1.61 “ Guarantees ” by any Person means all obligations (other than endorsements in the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing, or in effect guaranteeing, any Indebtedness, dividend or other obligation of any other Person (the “ Primary Obligor ”) in any manner, whether directly or indirectly, including all obligations incurred through an agreement, contingent or otherwise, by such Person: (a) to purchase such Indebtedness or obligation or any property or assets constituting security therefor, (b) to advance or supply funds (i) for the purchase or payment of such Indebtedness or obligation, or (ii) to maintain working capital or other balance sheet condition or otherwise to advance or make available funds for the purchase or payment of such Indebtedness or obligation against loss, (c) to lease property or to purchase securities or other property or services primarily for the purpose of assuring the owner of such Indebtedness or obligation, or (d) otherwise to assure the owner of the Indebtedness or obligation of the Primary Obligor against loss in respect thereof. For the purposes of all computations made under this Agreement, a Guarantee in respect of any Indebtedness for borrowed money, and a Guarantee in respect of any other obligation or liability or any dividend, shall be deemed to be Indebtedness equal to the maximum aggregate amount of such obligation, liability or dividend, unless the Guarantee is limited in amount, in which case such limit shall be used for such computation;

1.1.62 “ Guarantors ” means, (a) prior to the Phase II Date, Vidéotron (1998) ltée, Le SuperClub Vidéotron ltée and 9096-5807 Quebec Inc. (successor to the business of Vidéotron TVN Inc.) (collectively the “ Initial VL Group Guarantors ”), as well as GVL and Quebecor Media Inc., and (b) following the Phase II Date, (i) Quebecor Media Inc. but only as specified in Section 10.5, (ii) GVL, if not amalgamated with or wound up into Quebecor Media Inc. or another wholly-owned Subsidiary of Quebecor Media Inc. at such time, (iii) the Initial VL Group Guarantors, and (iv) all of the wholly-owned Subsidiaries of the Borrower and of the Initial VL Group Guarantors, excluding Consortium Câble-Axion Digitel Inc. and its Subsidiaries, and including, (a) after the CF Cable Notes have been paid or as permitted thereunder, CF Cable TV Inc. and its Subsidiaries, and (b) all Subsidiaries of the Initial VL Group Guarantors created or acquired after the Closing Date. A list of the Guarantors as of June 29, 2001 is provided in Schedule “L” hereto, and as of the Eighth Amendment Closing Date is provided in Schedule “M” hereto;

1.1.63 “ GVL ” means Le Groupe Vidéotron ltée;

1.1.64 “ HYD Offering ” means the Offering by the Borrower of approximately US$335,000,000 in senior unsecured notes due January 15, 2014 which shall have occurred on the Sixth Amendment Closing Date, the terms and conditions of which Offering will be satisfactory to the Lenders;

1.1.65 “ Initial VL Group Guarantors ” has the meaning ascribed to it in the definition of “Guarantors”;

1.1.66 “ Indebtedness ” of any Person means (without duplication) all obligations of such Person which in accordance with GAAP should be classified upon a balance sheet of such Person as liabilities of such Person, and in any event includes all Debt of such Person;

1.1.67 “ Inter-Creditor Agreement ” means that certain Inter-Creditor Agreement dated as of June 29, 2001 executed by the Agent on behalf of the Lenders, The Chase Manhattan Bank, as trustee, CF Cable TV Inc. and others in relation to the rights of various creditors of CF Cable TV Inc. and its Subsidiaries, as same may be amended or replaced from time to time;

1.1.68 “ Interest Coverage Ratio ” means, for any period, the ratio of EBITDA to Interest Expense in respect of the VL Group for such period;

1.1.69 “ Interest Expense ” for any period means all interest and all amortization of debt discount and expense (excluding fees and expenses relating to the Transaction and the financing thereof or to the HYD Offering, any Additional Offering or to any other future financing) on any particular Indebtedness for which such calculations are being made in respect of the VL Group, excluding interest on the Back-to-Back Debt to the extent offset by an equal amount of dividends on the Back-to-Back Preferred Shares, as well as any interest not paid in cash or other

assets of the Borrower on the QMI Subordinated Debt, calculated on a Consolidated basis, including the interest component of Capital Leases, and discounts and fees payable in respect of bankers’ acceptances or accounts receivable sold in connection with any asset securitization program approved by the Lenders;

1.1.70 “ Investments ” means all investments, in cash or by delivery of property, made directly or indirectly in any Person, whether by acquisition of shares of capital stock, Indebtedness or other obligations or securities or by loan, advance, capital contribution or otherwise; provided, however, that “Investments” shall not mean or include investments in cash or Cash Equivalents or routine investments in inventory, equipment and supplies to be used or consumed, or trade credit granted, in the ordinary course of business;

1.1.71 “ ISDA Master Agreement ” means the 1992 ISDA Master Agreement (Multi-Currency - Cross Border) as published by the International Swaps and Derivatives Association, Inc. and, where the context permits or requires, includes all schedules, supplements, annexes and confirmations attached thereto or incorporated therein, as such agreement may be amended, supplemented or replaced from time to time;

1.1.72 “ Issuing Lender ” means Royal Bank of Canada as the issuer of Letters of Credit (in that capacity), or any successor issuer of Letters of Credit. For greater certainty, where the context requires, references to “Lenders” herein include the Issuing Lender;

1.1.73 “ Joinder Agreement ” means an agreement substantially in the form of Schedule “O”.

1.1.74 “ Laws ” or “ Law ” means all applicable provisions of all laws, ordinances, decrees, orders, rules, regulations and directives of governmental bodies, and all applicable provisions of treaties, as well as all rulings, orders and other decrees of tribunals and arbitrators;

1.1.75 “ LC Fees ” has the meaning ascribed to such term in subsection 4.3.2;

1.1.76 “ Lender ” or “ Lenders ” means the Revolving Facility Lenders listed in Schedule “A”, together with any Assignee(s), or, as the context permits, any of them alone. When used in connection with “Derivative Instruments”, the term “Lender” shall include any Affiliate of a Lender. When used in connection with the Security, the term “Lender” shall include any counterparty to a Derivative Instrument, provided that the counterparty was a Lender or an Affiliate of a Lender at the time any such Derivative Instrument was entered into;

1.1.77 “ Letter of Credit ” means any stand-by letter of credit or letter of guarantee issued by the Issuing Lender in connection with the Spectrum Auction and Purchase in accordance with the provisions hereof;

1.1.78 “ Leverage Ratio ” means, as of any date of determination, the ratio of Debt (excluding the QMI Subordinated Debt) as of such date to EBITDA for the preceding four quarters ending on such date;

1.1.79 “ LIBOR ” means, with respect to any Designated Period of 1, 2, 3 or 6 months relating to a Libor Advance, the average rate for deposits in Cdn. $ for Foreign Lenders under the Revolving Facility (except in the circumstances described in Section 4.11, in which case the applicable rate will be for US$ deposits) for a period comparable to the Designated Period which, if in US $, is quoted on Libor01 Page of Reuters, and if in Cdn. $, is quoted on Libor02 Page of Reuters or, in case of the unavailability of either such page, which is quoted on the British Bankers Association Libor Rates Telerate (page 3750 for US $ or 3740 for Cdn. $, or other applicable page), in either case at or about 11:00 a.m. (London, England time), determined two Banking Days prior to the date on which a Libor Advance is to be made in accordance with Section 5.6; if neither of such quotes is available, then LIBOR shall be determined by the Agent as the average of the rate at which deposits in US$ or Cdn. $, as the case may be, for a period similar to the Designated Period and in amounts comparable to the amount of such Libor Advance are offered by the Libor Reference Lenders to prime banks in the London inter-bank market at or about 11:00 a.m. London, England time on the date of such determination;

1.1.80 “ Libor Advance ” means, at any time, any Cdn. $ Advances made by Foreign Lenders, or, in the circumstances described in Section 4.11, US$ Advances made by Foreign Lenders;

1.1.81 “ Libor Basis ” means the basis of calculation of interest on Libor Advances, or any part thereof, made in accordance with the provisions of Sections 5.3 and 5.4;

1.1.82 “ Libor Reference Lenders ” means any two Lender(s) appointed by the Agent with the consent of such Lenders and the Borrower, acting reasonably;

1.1.83 “ Licences ” means all licences, permits and authorizations issued to the VL Group by the CRTC pursuant to the Broadcasting Act (Canada) and the orders, rules, regulations and directions promulgated pursuant to such Act;

1.1.84 “ Loan ” means, at any time, the aggregate of the Advances outstanding in accordance with the provisions hereof, including the face amount of any Bankers’ Acceptances and Letters of Credit issued in accordance with the provisions hereof, together with all unpaid interest thereon and any other amount in principal, interest and accessory costs payable to the Agent or the Lenders by the Borrower pursuant hereto, including, for greater certainty, amounts contemplated by Section 5.7;

1.1.85 “ Majority Lenders ” means Lenders having at least 51% of the Commitments;

1.1.86 “ Mandatory Repayment ” means the repayment of all or any part of the Loan which the Borrower is obliged to effect in accordance with Section 8.2;

1.1.87 “ Margin ” means, for Prime Rate Advances, Stamping Fees, LC Fees and Facility Fees, as well as Libor Advances by Foreign Lenders, under the Revolving Facility, the following annual percentages depending on the VL Group’s then-applicable Leverage Ratio, determined at the times and in the manner set out below the table:

1.1.88 “ Material Adverse Change ” means a material adverse change in (i) the business, assets, liabilities, financial position, operating results or business prospects of the VL Group, taken as a whole, or (ii) in the ability of the Borrower and the Guarantors to perform any of their obligations hereunder or under the Security Documents, or (iii) the validity or enforceability of this Agreement or the Security Documents or of the rights and remedies of the Agent or the Lenders hereunder or under the Security Documents;

1.1.89 “ Negative Value of Derivative Instruments ” means the aggregate amount that would be payable to all Persons by the Borrower on the date of determination pursuant to Section 6(e)(ii)(2)(A) of each ISDA Master Agreement between the Borrower and such Persons as if all Derivative Instruments under such ISDA Master Agreements were being terminated on that day; provided that, with respect to the Derivative Instruments between each Lender and the Borrower, each Lender will determine Market Quotation (as such term is defined in the ISDA Master Agreement) using its estimates at mid-market of the amounts that would be paid for Replacement Transactions (as such term is defined in the ISDA Master Agreement);

1.1.90 “ Net Proceeds ” means, for the purposes of Sections 8.2, 13.3, 13.4 and 13.11:

in each case, minus reasonable out-of-pocket costs, fees and expenses incurred in connection with such Asset Disposition or Offering, including commissions but excluding any amounts paid to Affiliates;

1.1.91 “ Ninth Amendment Closing Date ” means April 7, 2008;

1.1.92 “ Notice of Borrowing ” means a notice substantially in the form of Schedule “B” transmitted to the Agent by the Borrower in accordance with the provisions of Sections 4.1 or 4.2, or of subsection 6.1.1;

1.1.93 “ Offering ” has the meaning ascribed to it in the definition of “Net Proceeds”;

1.1.94 “ Permitted Charges ” means the Charges created by the Security Documents and, with respect to any Person:

1.1.95 “ Person ” means a legal person, a natural person, a joint venture, a partnership, a trust, an entity without juridical personality, a government or any ministry, organization or intermediary of such government;

1.1.96 “ Phase II Date ” means the date on which all of the conditions precedent to an Advance under the previously existing Term Facility A-2 and Term Facility B were met and the initial Advance under the said Term Facility A-2 was made, such that the Quebecor Media Guarantee may be released by the Agent on behalf of the Lenders three months and one day later, in accordance with the provisions of Section 10.5 hereof;

1.1.97 “ Prime Rate ” means, on any day, the reference rate of interest, expressed as an annual rate, publicly announced or posted from time to time by Royal Bank of Canada as being its reference rate then in effect for determining interest rates on demand commercial loans granted in Canada in Canadian Dollars to its clients (whether or not any such loans are actually made); provided that in the event that the Prime Rate is, at any time, less than the average one month Bankers’ Acceptance rate quoted on Reuters Service, page CDOR, as at approximately 10:00 a.m. on such day plus % (the “ BA Rate ”), “Prime Rate” shall be equal to the BA Rate;

1.1.98 “ Prime Rate Advance ” means, at any time, the portion of the Advances in Canadian Dollars with respect to which the Borrower has chosen, or, in accordance with the provisions hereof, is obliged, to pay interest on the Prime Rate Basis;

1.1.99 “ Prime Rate Basis ” means the basis of calculation of interest on the Prime Rate Advances, or any part thereof, made in accordance with the provisions of Sections 5.1 and 5.2;

1.1.100 “ QMI Subordinated Debt ” has the meaning ascribed to it in Section 13.8;

1.1.101 “ Quebecor Media Guarantee ” has the meaning ascribed to it in subsection 9.1.1;

1.1.102 “ Quebecor Media Credit Facility ” means the credit facility in the amount of $2,090,000,000 established pursuant to the credit agreement entered into on October 23, 2000 by Quebecor Media Inc. as borrower, Quebecor Communications Inc., GVL, Quebecor New Media Inc., Canoe: Canadian Online Explorer Inc., Quebecor New Media Limited Partnership, 9076-1883 Quebec Inc., 9076-1859 Quebec Inc. and 3588386 Canada Inc. as guarantors, the financial institutions named therein as lenders, RBC Dominion Securities Inc. as lead arranger and bookrunner, Bank of America Canada, BMO Nesbitt Burns Inc. and The Toronto-Dominion Bank as co-arrangers and Royal Bank of Canada as administrative agent, as amended, supplemented or restated from time to time, or as replaced from time to time by another credit facility in an amount not exceeding Cdn. $1,905,000,000 minus the proceeds of any high-yield debt securities issued by Quebecor Media Inc. on or before October 22, 2002;

1.1.103 “ Regulatory Approval ” means the obtention of all material approvals of all governmental bodies having jurisdiction which are required to be obtained in connection with the Transaction including, without limitation, the approval of the CRTC and all other approvals set forth in the New Offers to Purchase for Cash referred to in the definition “Transaction”;

1.1.104 “ Revolving Facility ” or “ Facility ” means the Credit available pursuant to Section 2.1;

1.1.105 “ Revolving Facility Lender ” means a Lender having a Commitment under the Revolving Facility;

1.1.106 “ Rollover Date ” means, with respect to a Libor Advance or a BA Advance, the date of any such Advance, or the first day of any Designated Period;

1.1.107 “ Second Currency ” has the meaning ascribed to it pursuant to Section 15.1;

1.1.108 “ Security Documents ” means all of the security documents described in Article 9, and “ Security ” means the security created thereby;

1.1.109 “ Selected Amount ” means

1.1.110 “ Senior Secured Debt Coverage Ratio ” means, for any period, the ratio of (a) the Consolidated Debt of the VL Group owing under (i) this Credit Agreement, plus (ii) the CF Cable Notes, plus (iii) the Negative Value of Derivative Instruments entered into with a Lender, plus (iv) any other Debt supported by a Charge to secure its repayment, to (b) EBITDA;

1.1.111 “ Seventh Amendment Closing Date ” means November 19, 2004;

1.1.112 “ Share Pledge ” has the meaning ascribed to it in subsection 9.2.3;

1.1.113 “ Sixth Amendment Closing Date ” means October 8, 2003;

1.1.114 “ Spectrum Auction and Purchase ” means the process described in Industry Canada’s “Notice No. DGRB-011-07 — Licensing Framework for the Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in the 2 GHz Range”;

1.1.115 “ Spectrum Co. ” means any Person in which the Borrower may have a voting and/or economic interest and which Person may be the bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase;

1.1.116 “ Stamping Fees ” means, with respect to BA Advances, the fee calculated by (a) multiplying the percentage referred to in the definition of “Margin” by the face amount of the Bankers’ Acceptances being issued and stamped in connection with the BA Advance being made, (b) dividing the product so obtained by 365 or, in a leap year, 366, and (c) multiplying the result so obtained by the number of days in the relevant Designated Period;

1.1.117 “ Subordinated Debt ” means, in respect of any Person, unsecured Debt of such Person that has no required redemption provisions and matures at least 6 months after the expiry of the Term hereof and that has been subordinated in right of payment to the obligations of the VL Group hereunder and under the Security Documents in form and substance acceptable to the Lenders and their counsel;

1.1.118 “ Subsidiary ” means any Person in respect of which the majority of the issued and outstanding capital stock (including securities convertible into voting shares and options to purchase voting shares) granting a right to vote in all circumstances is at the relevant time owned by a member of the VL Group or one or more of its Subsidiaries or by a member of the VL Group and one or more of its Subsidiaries, and includes a limited partnership that would be an Affiliate;

1.1.119 “ Synthetic Lease ” means any synthetic lease or similar off-balance sheet financing product where such transaction is considered borrowed money for tax purposes but is classified as an operating lease in accordance with GAAP;

1.1.120 “ Tax Benefit Transaction ” means, for so long as the Borrower is a direct or indirect Subsidiary of Quebecor Inc. (“ Quebecor ”), any transaction between a member of the VL Group and Quebecor or any of its Affiliates, the primary purpose of which is to create tax benefits for any member of the VL Group or for Quebecor or any of its Affiliates; provided, however, that (1) the member of the VL Group involved in the transaction obtains a favorable tax ruling from a competent tax authority or a favorable tax opinion from a nationally recognized Canadian law or accounting firm having a tax practice of national standing as to the tax efficiency of the transaction for such member of the VL Group; (2) the Borrower delivers to the Agent (a) a resolution of the board of directors of the Borrower to the effect the transaction will not prejudice the Lenders and certifying that such transaction has been approved by a majority of the disinterested members of such board of directors and (b) an opinion as to the fairness to such member of the VL Group of such transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada, except in respect of any Tax Benefit Transaction in an amount of less than $1,000,000 each, provided that the aggregate of all Tax Benefit Transactions for amounts of less than $1,000,000 does not exceed $10,000,000 in the aggregate in any 12 month period; (3) such transaction is set forth in writing; (4) such transaction either (a) causes all of the Security creating a Charge on any transferred assets to remain in full force and effect, or (b) provides for the replacement of such assets by different assets of a value, nature and kind acceptable to each of the Lenders, and which shall in any event be subject to the Security (and the assets so transferred that were previously Charged shall be released); and (5) the Consolidated EBITDA of the VL Group is not reduced after giving pro forma effect to the transaction as if the same had occurred at the beginning of the most recently ended four fiscal quarter period of the VL Group for which internal financial statements are available; provided, however , that if such transaction shall thereafter cease to satisfy the preceding requirements as a Tax Benefit Transaction, it shall thereafter cease to be a Tax Benefit Transaction for purposes of this Agreement and shall be deemed to have been effected as of such date and, if the transaction is not otherwise permitted by this Agreement as of such date, the Borrower will be in Default hereunder if such transaction does not comply with the preceding requirements or is not otherwise unwound within 30 days of that date;

1.1.121 “ Term ” means the period commencing on the Closing Date and terminating, with respect to the Revolving Facility, on April 6, 2012;

1.1.122 “ Term Facility A-1 ” means the portion of the Credit previously available under this Credit Agreement, which was repaid in full out of the HYD Offering and out of Advances made under Term Facility C;

1.1.123 “ Term Facility B ” means the portion of the Credit previously available under this Credit Agreement which was repaid in full by the Borrower concurrently with any Advances hereunder on and after the Sixth Amendment Closing Date;

1.1.124 “ Term Facility C ” means the portion of the Credit previously available under this Credit Agreement which was repaid in full by the Borrower concurrently with the initial Advance hereunder on or after the Seventh Amending Closing Date;

1.1.125 “ Transaction ” means the acquisition by Quebecor Media Inc. of all of the issued and outstanding multiple voting shares and subordinate voting shares (including subordinate voting shares issuable upon the exercise of options) of GVL as well as the investments in Quebecor Media Inc. to be made by Capital Communications CDPQ Inc. and Quebecor Inc. and the transfer of assets to Quebecor Media Inc. to be made by Quebecor Inc. as described in the document entitled “New Offers to Purchase for Cash” dated September 27, 2000 made by Quebecor Media Inc. with respect to the shares of GVL;

1.1.126 “ Transfer Agreement ” means a form of transfer agreement substantially in the form annexed hereto as Schedule “C”;

1.1.127 “ US Dollars ” or “ US $ ” means the lawful currency of the United States of America in same day immediately available funds or, if such funds are not available, the currency of the United States of America which is ordinarily used in the settlement of international banking operations on the day on which any payment or any calculation must be made pursuant to this Agreement;

1.1.128 “ VL Group ” means the Borrower, the Guarantors (other than Quebecor Media Inc. and GVL) and their respective Subsidiaries, and a reference to a “member of the VL Group” means any of them; provided, however, that for the purposes of all Back-to-Back Transactions alone, until the CF Cable Notes have been repaid in full, CF Cable TV Inc. and its Subsidiaries shall not be considered to be part of the VL Group in the context of any Back-to-Back Transaction with another member of the VL Group. However, CF Cable TV Inc. and its Subsidiaries shall be considered members of the VL Group in the context of a Back-to-Back Transaction with an Affiliate of the Borrower that is not a member of the VL Group. A list of the members of the VL Group as of the Seventh Amendment Closing Date is provided in Schedule “M” hereto.

Unless stipulated to the contrary, the words used herein which indicate the singular include the plural and vice versa and the words indicating masculine include the feminine and vice versa. In addition, the word “ includes ” (or “ including ”) shall be interpreted to mean “includes (or including) without limitation”. Finally, any reference to a time shall mean local time in the City of Montreal, Province of Quebec.

2.3.1 The Borrower may, on one or more occasions during the portion of the Term of the Revolving Facility commencing on the Ninth Amendment Closing Date and terminating April 6, 2009, by written notice to the Agent (an “ Increase Notice ”), elect to request an increase to the existing Commitments (any such increase, the “ New Lender Commitments ”), by adding one or more Lenders (each, a “ New Lender ”) or having an existing Lender increase its Commitment (an

“ Increased Commitment ”) in accordance with the provisions of this Section.

2.3.2 The aggregate amount of any such New Lender Commitments and Increased Commitments shall not exceed $75,000,000 and shall not be less than $25,000,000 per New Lender (or such lesser amount as may be approved by the Agent). Such Increase Notice shall specify (a) the date (the “ Increased Amount Date ”) on which the Borrower proposes that the New Lender Commitments and/or Increased Commitments shall be effective, which shall be a date not less than 10 Business Days after the date on which such notice is delivered to the Agent, (b) the amount of the increase in the Revolving Facility, (c) the identity of each New Lender, and/or of each existing Lender that is prepared to provide an Increased Commitment, and (d) the proposed allocation of such New Lender Commitments to each New Lender and/or the amount of each Increased Commitment. Such New Lender Commitments and/or Increased Commitments shall become effective as of the Increased Amount Date; provided that (1) no Default or Event of Default shall exist on the Increased Amount Date before or after giving effect to such New Lender Commitments and/or Increased Commitments; (2) the Borrower shall be in compliance with each of the covenants set forth in Section 12.11 as of the last day of the most recently ended fiscal quarter after taking into account such New Lender Commitments and/or Increased Commitments, on a pro forma basis; (3) the New Lender Commitments shall be effected pursuant to one or more Joinder Agreements executed and delivered by the Borrower, each New Lender and the Agent, and each of which shall be recorded in the register maintained by the Agent in respect of Assignments; (4) Increased Commitments shall be effected in accordance with the last sentence of subsection 2.3.5; and (5) the Borrower shall deliver or cause to be delivered any legal opinions or other documents reasonably requested by the Agent in connection with any such transaction.

2.3.3 On the Increased Amount Date, subject to the satisfaction of the foregoing terms and conditions, (a) each of the Revolving Facility Lenders shall assign to each of the New Lenders or applicable existing Lenders, who shall purchase same, at the principal amount thereof (together with accrued interest), such interests in the Loan outstanding on the Increased Amount Date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Loan under the Revolving Facility will be held by existing Revolving Facility Lenders and New Lenders ratably in accordance with their Commitments after giving effect to the addition of such New Lender Commitments and/or Increased Commitments to the Commitments, (b) each New Lender Commitment shall be deemed for all purposes a Commitment and each Advance made thereunder (a “ New Advance ”) shall be deemed, for all

purposes, an Advance under the Revolving Facility and (c) each New Lender shall become a Lender with respect to the New Lender Commitment and all matters relating thereto.

2.3.4 The Agent shall notify the Lenders, promptly upon receipt, of the Borrower’s Increase Notice, including the Increased Amount Date, any Increased Commitments, and the New Lender Commitments and New Lenders in respect thereof, as well as the effect of same as contemplated by the preceding paragraph.

2.3.5 The terms and provisions of the New Advances shall be identical to the Advances under the Revolving Facility. Each Joinder Agreement may, without the consent of any other Revolving Facility Lenders, effect such amendments to this Agreement and the Security Documents as may be necessary or appropriate, in the opinion of the Agent, to give effect to the provisions of this Section 2.3.

2.3.6 If on April 6, 2009, the Credit is less than $650,0000,000, from that date until the expiry of the Term, the Borrower may, on one additional occasion, again send an Increase Notice to the Agent. The Agent shall provide a copy of the Increase Notice to the Lenders, and the Lenders shall, within 10 Business Days following receipt thereof, advise the Agent of their decision whether or not to provide any Increased Commitments. Any Lender approached to provide all or a portion of the Increased Commitments may elect or decline, in its sole discretion, to provide an Increased Commitment. If any Lender does not respond to the Increase Notice, it will be deemed to have elected not to provide an Increased Commitment. Schedule “A” will be amended by the Agent to reflect any Increased Commitments made by Lenders, without requiring the signature of each Lender.

2.3.7 If, after the Borrower has availed itself of the procedures set out in subsection 2.3.6, the Credit remains less than $650,000,000, the Borrower may again, on one occasion, attempt to obtain New Lender Commitments for the remaining balance subject to complying with the provisions of subsections 2.3.1 to 2.3.5.

4.3.1 Issuance . Subject to the applicable provisions of this Agreement, on any Business Day during the Disbursement Period, as part of the Credit available under the Revolving Facility, upon one (1) Business Day’s prior written Notice of Borrowing delivered to the Agent prior to 10:00 a.m. the preceding Business Day, the Borrower may cause to be issued by the Issuing Lender on behalf of the Lenders one or more Letters of Credit in a maximum aggregate amount outstanding at any time not exceeding $350,000,000. Each Letter of Credit may be issued solely to support, directly or indirectly, the bid in the Spectrum Auction and Purchase, and shall be issued in Canadian Dollars. Concurrently with the delivery of a Notice of Borrowing requesting a Letter of Credit, the Borrower shall execute and deliver to the Issuing Lender the documents required by the Issuing Lender in respect of the requested type of Letter of Credit, including a Letter of Credit application and indemnity on the Issuing Lender’s standard forms. In the event of any conflict between the provisions of this Agreement and the provisions of any document relating to a Letter of Credit, the provisions of this Agreement shall govern and prevail. The term of each Letter of Credit shall expire prior to the end of the Term and shall not be more than 364 days and shall otherwise be in form and substance satisfactory to the Issuing Lender.

4.3.2 Fee . The Borrower shall pay fees in respect of any such Letters of Credit (“ LC Fees ”) issued or renewed equal to the aggregate of: (i) for the Lenders, an amount equal to (A) the face amount of the Letter of Credit on the date that the fee is payable multiplied by (B) a fraction (1) the numerator of which shall equal the product resulting from multiplying the applicable LC Fee percentage provided for in the table contained in the definition of “Margin” by the number of days in the term of the Letter of Credit selected by the Borrower, and (2) the denominator of which shall consist of 365 days or 366 days (as the case may be), which fees shall be payable quarterly in arrears on the last Business Day of each calendar quarter and (ii) for the Issuing Lender, % per annum of the face amount thereof and for the number of days in the term of the Letter of Credit selected by the Borrower, payable quarterly in arrears on the last Business Day of each calendar quarter, or on such other date as the Agent may determine from time to time.

4.3.3 Reimbursement Obligations . In the event of any drawing under a Letter of Credit, the Issuing Lender shall promptly notify the Borrower who shall immediately reimburse the amount to the Issuing Lender in same day funds. In the event that the Borrower fails to reimburse the Issuing Lender immediately upon a drawing and fails to provide a Notice of Borrowing with a different option, the Borrower shall be deemed to have requested from the Agent a Canadian Prime Rate Advance on the date and in the amount of the drawing, the proceeds of which will be used to satisfy the reimbursement obligations of the Borrower to the Lenders in respect of the drawing. The reimbursement obligations of the Borrower hereunder shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of:

4.3.4 Indemnification .

4.3.5 LC Escrowed Funds . Upon the occurrence and continuance of an Event of Default, or if a Mandatory Repayment to be made would require the repayment of outstanding Letters of Credit prior to their maturity, the Borrower will forthwith , upon request from the Issuing Lender or the Agent, pay to the Agent for deposit into an escrow account maintained by and in the name of the Agent, (i) in the case of the occurrence and the continuance of an Event of Default, the amount equal to the Issuing Lender’s maximum potential exposure under the then outstanding Letters of Credit or (ii) in the case of a Mandatory Repayment requiring the repayment of outstanding Letters of Credit prior to their maturity, the amount equal to the proportion of such Mandatory Repayment that would require Letters of Credit to be repaid prior to their maturity (in each case, the “ LC Escrowed Funds ”). The LC Escrowed Funds will be held by the Agent for compensation

or set-off against future Indebtedness owing by the Borrower to the Issuing Lender in respect of such Letters of Credit and pending such application will bear interest at the rate declared by the Agent from time to time as that payable by it in respect of deposits for such amount and for the period from the date of deposit to the maturity date of the Letters of Credit. If such Event of Default is either waived or cured in compliance with the terms of this Agreement, then the remaining LC Escrowed Funds, if any, together with any accrued interest to the date of release, will be released to the Borrower. The deposit of the LC Escrowed Funds by the Borrower with the Agent as herein provided will not operate as a repayment on account of the Loan Obligations until such time as the LC Escrowed Funds are actually paid to the Issuing Lender as a repayment of principal hereunder. The Borrower shall sign and remit as Security with regard thereto all appropriate documents that the Agent or the Issuing Lender might judge necessary or desirable.

4.3.6 Resignation . The Issuing Lender may resign as such (a “ Resigning Issuing Lender ”) upon 15 days’ prior written notice to the Agent and the Borrower, in which event the Borrower shall designate another Lender as Issuing Lender. Upon acceptance by another Lender of the appointment as Issuing Lender (the “ Successor Issuing Lender ”), the Successor Issuing Lender shall succeed to the rights, powers and duties of the Resigning Issuing Lender and shall have all the rights and obligations of the Resigning Issuing Lender under this Agreement and the other Loan Documents. Upon request by any of the Resigning Issuing Lender, the Successor Issuing Lender, the Agent or the Borrower, each of the Resigning Issuing Lender, the Agent, the Borrower and the Successor Issuing Lender shall enter into an agreement evidencing the appointment of the Successor Issuing Lender and dealing with such other matters as the parties may agree including any reallocation of fees paid in relation to outstanding Letters of Credit which may be necessary. Following the resignation of the Resigning Issuing Lender, the Resigning Issuing Lender shall continue to have all the rights and obligations of an Issuing Lender under this Agreement and the other Loan Documents with respect to Letters of Credit issued by it prior to such resignation, but the Resigning Issuing Lender shall not be required to issue additional Letters of Credit. For avoidance of doubt, the provisions of this Agreement relating to the Issuing Lender shall inure to the benefit of the Resigning Issuing Lender as to any actions taken or omitted to be taken by it (a) while it was the Issuing Lender under this Agreement or (b) at any time with respect to Letters of Credit issued by the Issuing Lender.

4.12.1 The Incapable Lender shall make US$ Advances on the Libor Basis, and the parties will negotiate such amendments hereto as may be required to give full effect to such intention, it being understood that the Borrower alone will bear all foreign exchange risks; and

4.12.2 Sections 4.9 and 4.10 hereof shall apply without reference to this Section 4.12 and, upon the expiration of the Designated Period of any existing Libor Advance, the provisions of Section 5.8 hereof shall apply to such Libor Advances.

5.4.1 on the last day of the Designated Period when the Designated Period is 1 to 3 months,

5.4.2 when the Designated Period exceeds 3 months, on the last Business Day of each period of 3 months during such Designated Period and on the last day of the Designated Period.

5.6.1 the date on which the Libor Advance is to be made; or

5.6.2 the relevant Rollover Date.

5.11.1 for the Revolving Facility Lenders, a facility fee (the “ Facility Fee ”) calculated daily by multiplying the amount of the Credit under the Revolving Facility (including the Credit under the Cash Management Facilities) each day by the applicable rate set out in the definition of “Margin”, and dividing the result by 365 (or 366 in a leap year), and then multiplying that result by the number of days in the relevant quarter, payable quarterly in arrears two Business Days following the last day of each calendar quarter, commencing in respect of the quarter ending on December 31, 2003, or on such other date as the Lenders may determine, acting reasonably; and

5.11.2 for the Agent, an annual agency fee in the amount and payable in accordance with the provisions of a letter agreement dated as of August 9, 2000, entered into between inter alia , Quebecor Media Inc. and the Agent, and consented to by the Borrower.

5.12.1 For the purposes of the Interest Act (Canada), any amount of interest or fees calculated herein using 360, 365 or 366 days per year and expressed as an annual rate is equal to the said rate of interest or fees multiplied by the actual number of days comprised within the calendar year, divided by 360, 365 or 366, as the case may be.

5.12.2 The parties agree that all interest in this Agreement will be calculated using the nominal rate method and not the effective rate method, and that the deemed re-investment principle shall not apply to such calculations. In addition, the parties acknowledge that there is a material distinction between the nominal and effective rates of interest and that they are capable of making the calculations necessary to compare such rates.

6.1.1 Subject to the applicable provisions of this Agreement, including those of the second paragraph of Section 4.1 with regard to Notices of Borrowing for Libor Advances by Foreign Lenders, on any Business Day during the Disbursement Period, by written Notice of Borrowing to the Agent given at least two (2) Business Days prior to the date of the Advance or the Rollover Date (for the purposes of this Article 6 called the “ Acceptance Date ”) and before 10:00 A.M., the Borrower may request that a BA Advance be made, that one or more Advances (other than Cdn. $ Libor Advances by Foreign Lenders) not borrowed as BA Advances be converted into one or more BA Advances or that a BA Advance or any part thereof be extended, as the case may be (the “ BA Request ”). Bankers’ Acceptances shall be issued on each Acceptance Date or Rollover Date, in a minimum Selected Amount, with respect to each Designated Period, of $5,000,000 or such greater amount which is an integral multiple of $1,000,000, shall have a Designated Period of 10 to 180 days (or such other period as may be available and acceptable to the Agent), subject to availability, and shall, in no event, mature on a date after the expiry of the applicable Term.

6.1.2 Prior to making any BA Request, the Borrower shall deliver:

6.2.1 The Agent shall promptly notify in writing each Lender of the details of the proposed issue, specifying:

6.2.2 (a) For each BA Lender, (i) the principal amount of the Bankers’ Acceptances to be accepted by such Lender, and (ii) the Designated Period of such Bankers’ Acceptances; and

6.2.3 The Agent shall establish the Bankers’ Acceptance Discount Rate at or about 10:00 a.m. on the Acceptance Date, and the Agent shall promptly determine the amount of the BA Proceeds.

6.2.4 Forthwith, and in any event not later than 11:30 A.M. on the Acceptance Date, the Agent shall indicate to each Lender, in the manner set out in Section 18.5:

6.2.5 Not later than 1:00 P.M. on the Acceptance Date, each Lender shall make available to the Agent its Available Proceeds.

6.2.6 Not later than 4:00 P.M. on the Acceptance Date, the Agent shall transfer the Available Proceeds to the Borrower in accordance with Section 8.9 and shall notify the Borrower on such day either by telex, fax or telephone (if by telephone, to be confirmed subsequently in writing) of the details of the issue.

6.3.1 are BA Lenders shall, on the Acceptance Date, accept the Bankers’ Acceptances by inserting the appropriate principal amount, Acceptance Date and maturity date in accordance with the BA Request relating thereto and affixing their acceptance stamps thereto, and shall purchase or sell same; and

6.3.2 are Non-BA Lenders shall, on the Acceptance Date, complete the Discount Notes by inserting the appropriate principal amount, Acceptance Date and maturity date in accordance with the BA Request relating thereto.

6.4.1 give to the Agent a notice in the form of Schedule “B” requesting that the Lenders convert all or any part of the BA Advance then outstanding by way of Bankers’ Acceptances which are maturing into a Prime Rate Advance; or

6.4.2 give to the Agent a notice in the form of Schedule “B” requesting that the Lenders extend all or any part of the BA Advance outstanding by way of Bankers’ Acceptances which are maturing into another BA Advance by issuing new Bankers’ Acceptances, subject to compliance with the provisions of subsection 6.1.1 with respect to the minimum Selected Amount and Designated Period; or

6.4.3 at latest at 10:00 A.M., two (2) Business Days prior to the Rollover Date of each Bankers’ Acceptance then outstanding and reaching maturity, notify the Agent by way of a notice substantially in the form of Schedule “B-1” (but omitting paragraph 3 thereof) that it intends to deposit in its account for the account of the Lenders on the Rollover Date an amount equal to the principal amount of each such Bankers’ Acceptance.

6.6.1 of subsection 6.4.1 and of Section 6.5, the Borrower requests or is deemed to have requested, as the case may be, that the Agent convert the portion of the BA Advance which is maturing into a Prime Rate Advance, the Lenders shall pay the Bankers’ Acceptances which are outstanding and maturing. Such payments by the Lenders will constitute an Advance within the meaning of this Agreement and the interest thereon shall be calculated and payable as the Borrower may request or may be deemed to have requested;

6.6.2 of subsection 6.4.3, the Borrower makes a deposit in its account, without limiting in any way the generality of Section 17.5, the Borrower hereby expressly and irrevocably authorizes the Agent to make any debits necessary in its account in order to pay the Bankers’ Acceptances which are outstanding and maturing.

6.12.1 any lack of validity or enforceability of any draft accepted by any Lender as a Bankers’ Acceptance; or

6.12.2 the existence of any claim, set-off, defence or other right which the Borrower may have at any time against the holder of a Bankers’ Acceptance, the Lenders, or any other person or entity, whether in connection with this Agreement or otherwise.

7.1.1 has rendered or will render it illegal or contrary to any law, directive or guideline for any of the Lenders to maintain or to give effect to all or part of their obligations stipulated in this Agreement, including the obligation to make or maintain all or any part of a BA Advance or a Libor Advance pursuant to the terms hereof, then the obligation of such Lender(s) to maintain or to give effect to such part of its obligations will become null and, subject to the provisions of the particular law, directive or guideline and of Section 7.2 with respect to losses, costs and expenses, if the Loan affected is a BA Advance, the Borrower may convert the principal amount thereof into a Prime Rate Advance. If the Loan affected is a Libor Advance, the provisions of Section 4.12 shall apply. In either case, the Borrower shall pay the interest accrued thereon, or may reimburse the particular BA Advance or Libor Advance, as the case may be, in whole with interest accrued thereon.

7.1.2 Such conversion or reimbursement shall be made at the expiry of the relevant Designated Period of any then outstanding Libor Advances or BA Advances, as the case may be, or, if in the judgment of the Lender expressed to the Agent in the certificate referred to above, an immediate conversion or reimbursement is necessary, immediately upon demand by the Agent, subject to the payment by the Borrower of breakage costs, if any; or

7.1.3 (a) has imposed, modified or deemed applicable any loan ceiling with respect to the Lenders, or imposed, modified or deemed applicable any special tax, reserve, deposit, capital adequacy or similar requirement with respect to the assets held by, deposited at or used for the purchase of funds, or to the loans made by the Lenders, or (b) changes the basis of taxation on payments made to the Lenders under this Agreement (other than a change affecting the taxes based on net profits of the Lenders), or (c) imposes upon the Lenders any other monetary conditions or restrictions with respect to this Agreement, all or any part of a Loan, as the case may be, or any other document, effect or operation contemplated hereby, and if the result of any of the foregoing is to increase the cost to such Lender of making or maintaining its Commitment or any Advance, or to reduce any amount otherwise receivable by such Lender hereunder with respect thereto, then, in any such case, the Borrower shall promptly pay to such Lender, within 10 Business Days from demand, such additional amounts necessary to compensate such Lender for such additional cost or reduced amount receivable as is determined in good faith by such Lender. If a Lender becomes entitled to claim any additional amounts pursuant to this Section 7.1, it shall promptly notify the Borrower, through the Agent, of

the event by reason of which it has become so entitled and provide reasonable particulars of the calculation of such amount. A certificate of a Lender as to any such additional amounts payable to it shall be conclusive and binding in the absence of manifest error.

8.2.1 100% of the Net Proceeds of all Asset Dispositions (excluding the Net Proceeds of Asset Dispositions received by the Borrower up to an amount of $50,000,000 in the aggregate) of the VL Group (excluding

the non-material assets referred to in Section 13.3), unless same are reinvested within 12 months following any such Asset Disposition to acquire capital assets used in the Core Business, payable within 5 Business Days following the expiry of such 12 month period; plus

8.2.2 Any amounts payable to the Agent for the Lenders in accordance with the provisions of Section 12.6, provided that insurance proceeds received by the Borrower, up to an amount of $50,000,000 in the aggregate, will be exempt from the imputation rules set out in this Section 8.2 and may be retained by the Borrower.

8.5.1 of principal under the Loan, or any part thereof, shall be made in the same currency as that in which they are outstanding;

8.5.2 of interest, shall be made in the same currency as the principal amount outstanding to which they relate;

8.5.3 of Fees, shall be made in Canadian Dollars alone; and

8.5.4 of the amounts referred to in Section 7.2, shall be made in the same currency as the losses, costs and expenses suffered or incurred by the Lenders.

8.11.1 Except as otherwise indicated herein, all payments made to the Agent by the Borrower for the account of the Lenders shall be distributed the same day by the Agent, in accordance with its normal practice, in funds having same day value, among the Lenders to the accounts last designated in writing by each Lender to the Agent, pro rata in accordance with their respective Commitments, and notice thereof shall be given to the Borrower by the Agent within a reasonable delay.

8.11.2 Except as otherwise indicated herein or as otherwise determined by the Lenders, all payments made by the Borrower to the Agent on behalf of the Lenders shall be applied by the Lenders as follows:

8.14.1 All payments to be made hereunder by the Borrower shall be made free and clear of, and without deduction or withholding for or on account of, any present or future tax, levy, impost, duty, charge, assessment or fee (including interest, penalties and additions thereto) (herein “ Taxes ”), but excluding net income taxes and franchise taxes (imposed in lieu of income taxes) imposed on any Lender as a result of a present or former connection between such Lender and the jurisdiction imposing such tax (other than any such connection arising solely from such Lender having executed, delivered or performed its obligations under, or received a payment under, or enforced this Agreement or any Guarantee). If any Taxes are required to be withheld from any payment hereunder, the Borrower shall (a) increase the amount of such payment so that the Lenders will receive a net amount (after deduction and withholding of all Taxes) equal to the amount otherwise due hereunder; (b) pay such Taxes to the appropriate taxing authority for the account of the relevant Lenders and (c) as promptly as possible thereafter, send the Agent and the Lenders an original receipt showing payment thereof, together with such additional documentary evidence as the Lenders may from time to time reasonably require.

8.14.2 Each Lender other than a Foreign Lender agrees to use reasonable measures to avoid or to minimize any amounts which might otherwise be payable pursuant to this Section 8.14, but no Lender shall be required

to disclose any information about its taxes to the Borrower that is not publicly available.

8.14.3 If the Borrower fails to perform its obligations under subsection 8.14.1, the Borrower shall indemnify the Lenders for any incremental Taxes, interest or penalties that may become payable by the Lenders as a consequence of such failure. The obligations of the Borrower under this Section 8.14 shall survive the termination of this Agreement.

9.1.1 cause to be executed by Quebecor Media Inc. (the “ Quebecor Media Guarantee ”) and by each of the other Guarantors an unconditional solidary (joint and several) Guarantee, in favour of the Agent on behalf of the Lenders, of the obligations of the Borrower under this Agreement and the Security Documents, substantially in the form annexed as Schedule “D”; provided that the Quebecor Media Guarantee shall incorporate by reference the provisions of, inter alia , Sections 8.1 and 8.2 of the Quebecor Media Credit Facility, providing for certain restrictions as to the ability of Quebecor Media Inc. to incur Debt, sell assets and otherwise perform certain acts, as such provisions appear at the Closing Date and irrespective of any amendment subsequent thereto; and

9.1.2 cause to be executed by the owner of the shares of the Borrower and each of the Initial VL Group Guarantors an agreement creating a first-ranking (prior to the Phase II Date) pledge of the shares of each of the Borrower and the Initial VL Group Guarantors (other than Quebecor Media Inc. and GVL) to the Agent on behalf of the Lenders, which agreement shall be substantially in form of Schedule “E”.

9.2.1 cause to be executed by each of the Guarantors an unconditional solidary (joint and several) Guarantee (or, in the case of the Initial VL Group Guarantors, confirmations of their existing Guarantees), in favour of the Agent on behalf of the Lenders, of the obligations of the Borrower under this Agreement and the Security Documents, substantially in the form annexed as Schedule “D”, provided that the Guarantees provided by CF Cable TV Inc. and its Subsidiaries shall be limited to the extent contemplated by the terms of the CF Cable Notes. The existing Guarantee executed by GVL shall be amended to provide that the Agent shall not have any recourse to any of the shares owned by GVL which have not been pledged in accordance with the provisions of subsection 9.1.2. The Guarantees provided by CF Cable TV Inc. and its Subsidiaries shall provide that, to the extent permitted by the provisions of the CF Cable Notes, such Guarantees constitute “First Priority Debt”, as such expression is defined in the CF Cable Notes;

9.2.2 cause to be executed by Quebecor Media Inc. a limited-recourse Guarantee agreement with the Agent for the Lenders, which will be substantially in the form of Schedule “D” but will provide that (A) the recourse of the Lenders under such Guarantee shall be limited to the pledge, if any, of the shares referred to in subsection 9.1.2, which pledge shall remain in effect but shall rank second to the Permitted Charge referred to in subsection 1.1.94.7 until the Quebecor Media Credit Facility has been repaid in full and cancelled, and (B) the restrictions contained in the Quebecor Media Credit Facility and incorporated by reference in the Guarantee referred to in subsection 9.1.1 shall no longer be so incorporated;

9.2.3 execute and cause to be executed by the Guarantors other than Quebecor Media Inc. and GVL, whose pledges of shares pursuant to the provisions of subsection 9.1.2 shall remain in effect, an agreement pledging the shares of each of their respective Subsidiaries to the Agent on behalf of the Lenders, which agreement shall be substantially in form of Schedule “E” (the “ Share Pledge ”), provided that the Share Pledges by CF Cable TV Inc. and its Subsidiaries shall be limited to the extent contemplated by the provisions of the CF Cable Notes;

9.2.4 execute and cause to be executed by each of the Guarantors (other than Quebecor Media Inc.) first-ranking security (subject only to Permitted

Charges) in favour of the Agent on behalf of the Lenders, by way of a hypothec on the universality of all of its movable and immovable property located in the Province of Quebec (and/or, at the option of the Agent, by way of a hypothec securing Debentures granted in favour of the Agent or a collateral agent designated by the Agent as the power of attorney (“ fondé de pouvoir”) of the Lenders within the meaning of Article 2692 of the Civil Code of Quebec, as contemplated by Section 18.16), provided that (a) any Security created by CF Cable TV Inc. and its Subsidiaries shall be limited to the extent contemplated by the provisions of the CF Cable Notes, and (b) the Security created by GVL shall not extend to any shares owned by GVL which have not been pledged in accordance with the provisions of subsection 9.1.2;

9.2.5 execute first-ranking security (subject only to Permitted Charges) in favour of each Lender that is a bank, within the meaning of the Bank Act (Canada), under Sections 427 and following of the Bank Act (Canada);

9.2.6 execute and cause to be executed by each of the Guarantors (other than Quebecor Media Inc. and GVL) in favour of the Agent on behalf of the Lenders, a first-ranking (subject only to Permitted Charges) General Security Agreement and mortgage charging all of its property and assets, personal (movable) and real (immovable), if any, located elsewhere in Canada or in the USA (and/or, at the option of the Agent, by way of a debenture or other instrument containing the same Charges), provided that any Security created by CF Cable TV Inc. and its Subsidiaries shall be limited to the extent contemplated by the provisions of the CF Cable Notes;

9.2.7 execute and cause to be executed by each of the Guarantors (other than Quebecor Media Inc. and GVL), a first-ranking assignment, by way of collateral security, of the contracts governing or evidencing intellectual property rights (subject to Permitted Charges, and to the extent not prohibited by the terms of the agreements governing such rights) in favour of the Agent on behalf of the Lenders, provided that any Security created by CF Cable TV Inc. and its Subsidiaries shall be limited to the extent contemplated by the provisions of the CF Cable Notes;

9.2.8 cause the Agent on behalf of the Lenders to be named in all insurance policies protecting the members of the VL Group and their movable property, activities, business interruption and third party liability against any form of loss as a named insured as its interest may appear, and deliver to the Agent certificates of insurance in form and substance satisfactory to the Agent;

9.2.9 execute concurrently with (in respect of movable property), and within sixty days of (in respect of immovable property), the integration of Videotron Telecom Ltd. (“ VTL ”), by way of amalgamation or otherwise, with the Borrower (the “ Merger ”), any and all Security Documents or as the case may be, make any additional filings or registrations, reasonably requested by the Lenders, to ensure that the Lenders will hold valid and enforceable Security in, to and under the assets of VTL acquired by the Borrower as a result of the Merger;

9.2.10 if the Borrower elects to use Spectrum Co. as the bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase, execute and cause to be executed by the Borrower and any of its Subsidiaries holding shares or other equity interests in Spectrum Co., from the date on which any of same are acquired, an agreement pledging such shares and equity interests to the Agent on behalf of the Lenders by way of a first-ranking pledge (subject only to Permitted Charges), which agreement shall be substantially in the form of the Share Pledge.

9.3.1 on the Phase II Date, the liability of each Applicable Guarantor shall be limited to the amount of the book value or the realization value of its assets, whichever is greater, less the sum of its liabilities and its issued and paid-up share capital account on such date (the “ Initial Liability ”);

9.3.2 every day thereafter that its Guarantee remains in effect and until the date of determination on which it is then able to discharge its liabilities when due, each Applicable Guarantor shall be deemed to have granted a new Guarantee in an amount equal to the increase in the aggregate amount of the Guarantee that such Applicable Guarantor can provide on such day (calculated in accordance with the provisions of subsection 9.3.1);

9.3.3 the liability of each Applicable Guarantor may never be less than its Initial Liability; and

9.3.4 if ever the restriction provided by Law with respect to each Applicable Guarantor’s ability to execute a Guarantee is repealed, each of the Applicable Guarantors shall be deemed to have granted an unlimited Guarantee on the date such repeal came into force.

The relevant amounts on the Phase II Date, as determined by the directors of the Applicable Guarantor, will be set forth in a certificate in the form set out in Schedule “K”, to be delivered within 5 Business Days following the Phase II Date .

9.4.1 on the Phase II Date, the liability of each Relevant Guarantor under its Guarantee and the Security Documents shall constitute First Priority Debt within the meaning and to the extent permitted by the trust indenture dated as of July 11, 1995 among the Guarantors party thereto and The Chase Manhattan Bank, as Trustee, providing for the issue of notes, including the aggregate of US$100,000,000 of 12 year notes of CF Cable TV Inc. designated as 9 1/8% Senior Secured First Priority Notes due 2007 (the “ Trust Indenture ”) and thereafter shall constitute Second Priority Debt within the meaning and to the extent permitted by the Trust Indenture (the “ Initial Liability ”);

9.4.2 every day thereafter that its Guarantee remains in effect and until the provisions of subsection 9.4.4 apply, each Relevant Guarantor shall be deemed to have granted a new Guarantee by incurring additional First Priority Debt and additional Second Priority Debt to the extent permitted by the Trust Indenture in amounts equal to the increase in the aggregate amount of the Guarantee that such Relevant Guarantor can provide on such day (by way of First Priority Debt and Second Priority Debt under the Trust Indenture);

9.4.3 the liability of each Relevant Guarantor may never be less than its Initial Liability;

9.4.4 if ever the restriction provided by the Trust Indenture with respect to each Relevant Guarantor’s ability to execute a Guarantee is no longer applicable, each of the Relevant Guarantors shall be deemed to have granted an unlimited Guarantee on the date such restriction ceased to be applicable; and

9.4.5 the Security Documents shall oblige each Relevant Guarantor to provide additional security in the event that its liability is increased in accordance with the foregoing.

10.1.1 certified copies of all of the constating documents, borrowing by-laws and resolutions of the Borrower, of Quebecor Media Inc., of GVL and of each member of the VL Group shall have been provided to the Agent;

10.1.2 the Borrower shall have provided an irrevocable direction of payment to the Agent pursuant to which the Borrower instructs the Agent, contemporaneously with the first Advance hereunder and using the proceeds thereof, to repay all amounts due under the Existing Credit Agreement and the Existing Credit Agreement shall have been cancelled;

10.1.3 all Charges on the property of each member of the VL Group, other than Permitted Charges, shall have been discharged;

10.1.4 each of this Agreement and the Security Documents contemplated by Section 9.1 shall have been executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.1.5 the Agent shall have received copies of all existing title and search reports prepared by lawyers or notaries with respect to any immovable property owned by the VL Group and with respect to any network pertaining to the Core Business, together with an undertaking to update same prior to the Phase II Date;

10.1.6 evidence satisfactory to the Lenders shall have been provided to the Agent that Quebecor Media Inc. owns all or substantially all of the shares of every class of GVL (meaning for these purposes not less than 94% of all such shares), and the Lenders shall be satisfied that Quebecor Media Inc. is in a position to obtain 100% of all such shares within a delay not exceeding 60 days (or such additional period as may be approved by the Majority Lenders) from the Closing Date by way of the

compulsory acquisition of same in accordance with the provisions of the Quebec Companies Act;

10.1.7 evidence satisfactory to the Lenders shall have been provided to the Agent that GVL or another wholly-owned Subsidiary of Quebecor Media Inc. owns (a) all of the shares of every class of each of the Initial VL Group Guarantors, and (b) the percentages and classes of shares of each Subsidiary of GVL as set out in the diagram referred to in subsection 10.1.10(c);

10.1.8 all of the issued and outstanding shares of the Borrower and each of the Guarantors (other than Quebecor Media Inc. and GVL) shall have been pledged in accordance with the pledge described in subsection 9.1.2, and all of the pledged shares shall have been remitted to the Agent or to one or more agents of the Agent;

10.1.9 all necessary Regulatory Approvals (other than the approval of the CRTC) and all other required approvals shall have obtained, and all Laws, including environmental Laws, shall have been complied with;

10.1.10 the Borrower shall have delivered to the Agent a certificate in the form of Schedule “F” signed by an officer stipulating and certifying that:

10.1.11 nothing shall have occurred which would constitute a Material Adverse Change;

10.1.12 the Borrower shall have delivered to the Agent the favourable legal opinion of counsel to the Borrower and to the Guarantors, addressed to the Lenders, the Agent and its counsel, substantially in the form set forth in Schedule “G” and covering as well such other ancillary matters as

pertain to the transactions contemplated hereunder, as required by the Agent, acting reasonably.

10.2.1 certified copies of all of the constating documents, borrowing by-laws and resolutions of the Borrower, each other member of the VL Group and Spectrum Co. (if the Borrower elects to use Spectrum Co. to act as bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase) not previously provided to the Agent shall have been provided to the Agent;

10.2.2 each of the Security Documents required by Section 9.2 shall have been executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.2.3 all of the issued and outstanding shares of the Subsidiaries referred to in subsection 9.2.3, and the shares of Spectrum Co. referred to in subsection 9.2.10, owned, directly or indirectly by the Borrower and any of its Subsidiaries at the relevant time, shall have been pledged in accordance with the Share Pledge executed by the Borrower and the relevant Subsidiaries and all of the pledged shares shall have been remitted to the Agent;

10.2.4 the Borrower shall have delivered to the Agent a certificate in the form of Schedule “F” signed by an officer stipulating and certifying that:

10.2.5 each of the Security Documents shall have been amended (to the extent required), executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.2.6 the Borrower shall have delivered to the Agent the favourable legal opinion(s) of the counsel to the Borrower, addressed to the Lenders, the Agent and its counsel, in form and substance acceptable to the Agent and its counsel, acting reasonably, including with regard to the continuing validity of all relevant Guarantees and Security.

10.3.1 the representations and warranties contained in this Agreement shall continue to be true and correct (except where stated to be made as at a particular date);

10.3.2 the Borrower shall have delivered to the Agent a completed Notice of Borrowing;

10.3.3 nothing shall have occurred since the Sixth Amendment Closing Date which would constitute a Material Adverse Change; and

10.3.4 no Default shall have occurred and be continuing and no Event of Default shall have occurred.

11.20.1 There are no existing claims, demands, suits, proceedings or actions of any nature whatsoever, whether threatened or pending, arising out of the presence on any property owned or controlled by any member of the VL Group, either past or present, of any hazardous substance or hazardous waste, or out of any past or present activity conducted on any property now owned by any member of the VL Group, whether or not conducted by any member of the VL Group, involving hazardous substances or hazardous waste, which would reasonably be expected to result in a Material Adverse Change;

11.20.2 To the best of the knowledge of the Borrower, after due enquiry:

12.11.1 Leverage Ratio . A Leverage Ratio not exceeding the following:

12.11.2 Interest Coverage Ratio . An Interest Coverage Ratio of at least:

12.11.3 Senior Secured Debt Coverage Ratio . A Senior Secured Debt Coverage Ratio of not more than 2.5:1.

12.14.1 the reasonable legal fees and costs incurred by the Agent and the Lenders for the negotiation, drafting, signing, registration, publication and/or service of the commitment letter, this Agreement and the Security Documents, as well as any amendments, renunciations, consents or examinations pertaining to this Agreement and the Security Documents; and

12.14.2 the reasonable costs of syndicating and advertising, as well as all reasonable fees, including reasonable legal fees and costs, incurred by the Agent, any collateral agent designated by the Agent, and the Lenders to preserve, enforce or exercise their respective rights hereunder or under the Security Documents following an action, a Default or an omission of the Borrower or of any other member of the VL Group.

12.15.1 Quarterly Statements

12.15.2 Annual Statements

12.15.3 Other Information

The Borrower shall advise the Agent forthwith upon the occurrence of any of the following events:

12.16.1 The commencement of any proceeding or investigation by or before any governmental body and any action or proceeding before any court or arbitrator against any member of the VL Group, or any of its property, assets or activities which could reasonably be expected to result in a Material Adverse Change;

12.16.2 The occurrence of any Material Adverse Change which is known to the Borrower or any other member of the VL Group, acting reasonably;

12.16.3 Any Default or Event of Default, specifying in each case the relevant details and the action contemplated in this respect.

13.1.1 All of the representations and warranties and covenants contained herein shall apply to VTL as and from the date of the Merger;

13.1.2 VTL shall become a member of the VL Group as and from the date of the Merger;

13.1.3 each of the Security Documents with respect to movable (personal) property referred to in subsection 9.2.9 shall have been executed, delivered, issued or assigned and registered or published, as the case may be, wherever required, and provided that the Security Documents required with respect to immovable property are executed, delivered and registered or published, as the case may be, wherever required, within 60 days following the Merger as set out in subsection 9.2.9; and

13.1.4 The Borrower shall have delivered to the Agent a certificate in the form of Schedule “F” signed by an officer stipulating and certifying that:

14.1.1 If the Borrower fails to make any payment of interest or principal with respect to the Loan when due; or

14.1.2 If the VL Group fails to respect any of the financial tests set out in Section 12.11 hereof at any time;

14.1.3 If the Borrower or any Guarantor fails to respect any of its other obligations and undertakings hereunder or under the Security Documents or another undertaking of the Borrower or any other

Guarantor with respect to the Loan not otherwise contemplated by this Section 14.1 and has not remedied the Default within fifteen (15) days following the date on which the Agent has given written notice to the Borrower; or

14.1.4 If (a) the Borrower or any Guarantor commits an act of bankruptcy within the meaning of the Bankruptcy and Insolvency Act, makes an assignment in favour of its creditors, consents to the filing of a petition for a receiving order against it, files a proposal within the meaning of the Bankruptcy and Insolvency Act, or makes a motion to a tribunal to name, or consents to, approves or accepts the appointment of a trustee, receiver, liquidator or sequestrator with respect to itself or its property, commences any other proceeding with respect to itself or its property under the provisions of any law contemplating reorganizations, proposals, rectifications, compromises or liquidations in connection with insolvent Persons, in any jurisdiction whatsoever; or (b) a trustee, receiver, liquidator or sequestrator is named with respect to the Borrower, any Guarantor or its property, or the Borrower or any Guarantor is judged insolvent or bankrupt; or (c) a proceeding seeking to name a trustee, receiver, liquidator or sequestrator, or to force the Borrower or any Guarantor into bankruptcy, is commenced against the Borrower or any Guarantor and is not settled or withdrawn within a delay of 30 days; or

14.1.5 If the Borrower or any Guarantor is in default with respect to any Indebtedness (other than amounts due to the Lenders hereunder) which has resulted in Indebtedness in excess of an amount of $10,000,000 ($25,000,000 in the case of Quebecor Media Inc.) becoming payable prior to its stated maturity or scheduled repayment date; or

14.1.6 If one or more judgments is rendered by a competent tribunal against the Borrower or any Guarantor in an aggregate amount in excess of $10,000,000 ($25,000,000 in the case of Quebecor Media Inc.) (net of applicable insurance coverage pursuant to which liability is acknowledged in writing by the insurer, with a copy promptly provided to the Agent on behalf of the Lenders) and remains undischarged or unsatisfied for a period ending on the earlier of (a) 25 days from such judgment, or (b) the 5th day prior to the date on which such judgment becomes executory; or

14.1.7 If property of any of the Borrower or any Guarantor having a total value in excess of $10,000,000 ($25,000,000 in the case of Quebecor Media Inc.) is the object of one or more seizures or takings of possession or other legal proceedings by creditors, and is not released within 15 days in respect of movable property or 45 days in respect of immovable

property, and in any event, not less than 10 days prior to the date fixed for any sale of such property; or

14.1.8 If any statement, attestation, financial statement, report, data, representation or warranty which was given by, for the account of or in the name of the Borrower or any Guarantor to the Lenders, with respect to this Agreement or any Security Documents, is revealed at any time to be misleading or incorrect in any material respect when it was made, and if any event or circumstance which makes such statement, attestation, financial statement, report, data, representation or warranty misleading in any material respect is capable of being remedied, such action as may be required to remedy same shall not have been completed within 15 days of the earlier of (a) the Agent notifying the Borrower or, as the case may be, a Guarantor of such breach, or (b) the Borrower notifying the Agent of the Default in accordance with subsection 12.16.3; or

14.1.9 If in the opinion of the Lenders, acting in good faith, there occurs a Material Adverse Change and the situation has not been remedied within 15 days following the earlier of the date on which (a) the Agent gave notice thereof to the Borrower, or (b) the Borrower gave notice to the Agent in accordance with subsection 12.16.3; or

14.1.10 If a Change in Control occurs; or

14.1.11 If any Guarantee to be provided by any Guarantor hereunder is or purports to be terminated by notice given under article 2362 of the Quebec Civil Code.

14.2.1 the entire amount of the Loan, including the amount corresponding to the principal amount of the BA Advances then outstanding, in principal and interest, notwithstanding the fact that one or more of the holders of the Bankers’ Acceptances issued pursuant to the provisions hereof have not demanded payment in whole or in part or have demanded only partial payment from the Lenders, and the amount of the Negative Value of Derivative Instruments. The Borrower shall not have the right to

invoke against the Lenders any defence or right of action, indemnification or compensation of any nature or kind whatsoever that the Borrower may at any time have or have had with respect to any holder of one or more of the Derivative Instruments or Bankers’ Acceptances issued in accordance with the provisions hereof; and

14.2.2 an amount equal to the amount of losses, costs and expenses assumed by the Lenders and referred to in Section 7.2; and

15.2.1 on the date indicated in the Notice of Borrowing as the date of a request for an Advance; and

15.2.2 at any other time which in the opinion of the Lenders is desirable;

16.2.1 Each Lender may, at its own cost, assign or transfer to a Person entitled to lend money in Canada or any other Person consented to by the Borrower, the Agent and the Issuing Lender, or, to the extent permitted under Section 17.15, to a Foreign Lender (the “ Assignee ”) in accordance with this Article 16 up to 100% of its rights, benefits and obligations hereunder (provided that its aggregate retained Commitment, if any, under the Revolving Facility is not less than $5,000,000) with the prior consent of the Borrower, which shall not be unreasonably withheld or delayed. The Borrower may not refuse to consent to an assignment or transfer on the sole grounds that the Assignee is a Foreign Lender, provided the provisions of Section 17.15 are respected. After the occurrence of a Default, any Lender may transfer all or any part of its rights, benefits and obligations hereunder to any Person, without the

consent of the Borrower, but upon notice to the Agent and the Borrower and subject to the consent of the Issuing Lender.

16.2.2 Except for any assignments or transfers arranged by the Arrangers for their Affiliates in order to fulfill their sell-down requirements, for which no restrictions shall apply, any such assignment or transfer under the Revolving Facility shall be for a minimum amount of $5,000,000 in the aggregate and in multiples of $1,000,000 thereafter.

16.2.3 Notwithstanding subsection 16.2.1, each Lender shall be entitled to assign or transfer, at its own cost, in accordance with the other provisions of this Section 16 (including 16.5), its rights, benefits and obligations hereunder, in whole or in part, to a parent or subsidiary corporation or an Affiliate of such Lender.

16.3.1 such Lender shall be released from further obligations to the Borrower with respect to the portion of the obligations of such Lender assumed by the Assignee;

16.3.2 the Assignee shall assume the obligations of such Lender and acquire the rights of such Lender in respect of the Borrower, without novation of the Borrower’s obligations;

16.3.3 the Agent, such Lender and the Assignee shall acquire the same rights and assume the same obligations between themselves as they would have acquired and assumed had the Assignee been an original party hereto with the obligations assumed and the rights acquired by it as a result of such assignment or transfer; in furtherance of such principle, the Assignee shall be deemed to have agreed to be bound by the provisions of the Inter-Creditor Agreement, to the extent it remains in force at the relevant time, as if it had been an original party thereto; and

16.3.4 the Borrower, the Agent and such Lenders shall all execute such documents and perform such acts as may be required to give effect to the transfer or assignment.

16.6.1 the Agent shall act as agent for each Assignee and, in this connection, with respect to all decisions, notices and other matters relating to anything referred to in this Agreement, the Borrower shall only be obliged to give notice to or request consents from the Agent;

16.6.2 except as the result of an assignment and transfer permitted under Section 17.15, the amounts payable by the Borrower under this Agreement shall not increase, whether in respect of withholding on account of taxes or otherwise, as a result of any such assignment or transfer to an Assignee which is a non-resident of Canada as defined in the Income Tax Act (Canada); and

16.6.3 any Lender (a “ Granting Lender ”) may grant to a special purpose funding vehicle (an “ SPV ”), identified as such from time to time by the Granting Lender to the Agent and the Borrower, the option to provide to the Borrower all or any part of an Advance that such Granting Lender would otherwise be required to make hereunder; provided that (a) nothing herein shall constitute a commitment by any SPV to make any Advance, and (b) if an SPV does not make such Advance, the Granting Lender shall remain liable to do so. Any Advance by an SPV shall be made using the Commitment of the Granting Lender as if the Advance in question had been made by such Granting Lender. Each party hereto agrees that no SPV shall be liable for any indemnity or other payment hereunder, all of which liability shall remain with the Granting Lender. Accordingly, each party further agrees (which agreement will survive the termination hereof) that it shall not institute any insolvency or other proceeding against the SPV until a date that is not less than one year and one day following the repayment of all of such SPV’s commercial paper and other senior Indebtedness. In addition, any SPV may (a) assign all

or any portion of its interests in any Loans (i) with notice to, but without the consent of the Borrower or the Agent, and without paying any fees therefor, to the Granting Lender or (ii) to any financial institution, with the consent of the Borrower and the Agent providing liquidity and/or credit support to or for the account of such SPV to support the funding and maintenance of Advances; and (b) disclose on a confidential basis any non-public information relating to the Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPV.

17.13.1 the fees and disbursements of counsel;

17.13.2 the costs of defending, counterclaiming or claiming over against third parties in respect of any action or matter and any cost, liability or damage arising out of any settlement; and

17.13.3 other than losses, liabilities, claims, damages or expenses incurred by reason of the gross negligence or willful misconduct of the indemnified party, as determined by a final judgment of a court of competent jurisdiction.

17.15.1 the Arrangers (as hereinafter defined) may solicit and receive Commitments from any Person who is a non-resident of Canada (within the meaning of the Income Tax Act (Canada)) and who is authorized by law to lend money (“ Foreign Lenders ”) to the extent of $11,000,000 of the Revolving Facility;

17.15.2 in such case, the Affiliates of the Arrangers may make the required Assignments to such Foreign Lenders; and

17.15.3 upon compliance with the provisions of Article 16, such Foreign Lenders may further assign and transfer their Commitments to any other Foreign Lender.

18.1.1 Each Lender hereby irrevocably appoints and authorizes the Agent to act for all purposes as its agent hereunder and under the Security Documents with such powers as are expressly delegated to the Agent by the terms of this Agreement, together with such other powers as are reasonably incidental thereto and undertakes not to take any action on its own. Notwithstanding the provisions of the Civil Code of Quebec relating to contracts generally and to mandate, the Agent shall have no duties or responsibilities except those expressly set forth in this Agreement. As to any matters not expressly provided for by this Agreement, the Agent shall act hereunder or in connection herewith in accordance with the instructions of the Lenders in accordance with the provisions of this Article 18, but, in the absence of any such instructions, the Agent may (but shall not be obliged to) act as it shall deem fit in the best interests of the Lenders, and any such instructions and any action taken by the Agent in accordance herewith shall be binding upon each Lender. The Agent shall not, by reason of this Agreement, be deemed to be a trustee for the benefit of any Lender, the Borrower or any other Person. Neither the Agent nor any of its directors, officers, employees or agents shall be responsible to the Lenders for any recitals, statements, representations or warranties contained in this Agreement or in any certificate or other document referred to, or provided for in, or received by any of them under, this Agreement, for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement, or any other document referred to or provided for herein or any collateral provided for hereby or for any failure by the Borrower to perform its obligations hereunder. The Agent may employ agents and attorneys-in-fact and shall not be responsible for the negligence or misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. Neither the Agent nor any of its directors, officers, employees or agents shall be responsible for any

action taken or omitted to be taken by it or them under or in connection herewith, except for its or their own gross negligence or wilful misconduct.

18.1.2 For the purposes of creating a solidarité active between each Lender, taken individually, and the Agent in accordance with Article 1541 of the Civil Code of Québec , the Borrower and each Lender (on its own behalf) acknowledge and agree with the Agent that such Lender and the Agent are hereby conferred the legal status of solidary creditors of the Borrower and the Guarantors in respect of all amounts, liabilities and other obligations, present and future, owed by the Borrower to the Agent and such Lender hereunder and under Derivative Instruments (collectively, the “ Lender Solidary Claim ”). Accordingly, but subject (for the avoidance of doubt) to Article 1542 of the Civil Code of Québec , the Borrower and each of the Guarantors is irrevocably bound towards the Agent and each Lender in respect of the entire Lender Solidary Claim of the Agent and such Lender, such that the Agent and each Lender shall at all times have a valid and effective right of action for the entire Lender Solidary Claim of the Agent and such Lender and the right to give a full acquittance for it. Thus, without limiting the generality of the foregoing, the Agent, as solidary creditor for itself and each Lender, shall at all times have a valid and effective right of action in respect of all amounts, liabilities and other obligations owed by the Borrower and the Guarantors to the Agent and the Lenders or any of them hereunder and under Derivative Instruments and the right to give full acquittance for same. The parties further agree and acknowledge that the Security Documents described in subsections 9.1.1, 9.1.2, 9.2.1, 9.2.2, 9.2.3, 9.2.4, 9.2.7 and 9.2.9, as the case may be, shall be granted to the Agent, for its own benefit and for the benefit of the Lenders, as solidary creditor as hereinabove set forth.

18.2.1 The Agent shall be entitled to rely upon any certificate, notice or other document (including any cable, telegram, telex or telecopy) believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper person or persons, and upon advice and statements of legal advisers, independent accountants and other experts selected by the Agent. The Agent may deem and treat each Lender as the holder of the Commitment in the Loan made by such Lender for all purposes hereof unless and until an Assignment has been completed in accordance with Section 16.2.

18.2.2 The Agent shall not be deemed to have knowledge of the occurrence of a Default or Event of Default unless the Agent has received notice from a Lender or the Borrower describing such a Default or Event of Default

and stating that such notice is a “Notice of Default”. In the event that the Agent receives such a notice of the occurrence of a Default or Event of Default or otherwise becomes aware that a Default or Event of Default has occurred, the Agent shall promptly give notice thereof to the Lenders. The Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Lenders in accordance with the provisions of this Article 18 provided that, unless and until the Agent shall have received such directions, the Agent may (but shall not be obliged to) take such action, or refrain from taking such action, with respect to such a Default or Event of Default as it shall deem advisable in the best interest of the Lenders.

18.2.3 The Agent shall have no responsibility, (a) to the Borrower on account of the failure of any Lender to perform its obligations hereunder, or (b) to any Lender on account of the failure of the Borrower to perform its obligations hereunder.

18.2.4 Each Lender severally represents and warrants to the Agent that it has made its own independent investigation of the financial condition and affairs of the Borrower in connection with the making and continuation of its Commitment in the Loan hereunder and has not relied on any information provided to such Lender by the Agent in connection herewith, and each Lender represents and warrants to the Agent that it shall continue to make its own independent appraisal of the creditworthiness of the Borrower while the Loan is outstanding or the Lenders have any obligations hereunder.

18.6.1 The Agent shall not be required to keep itself informed as to the performance or observance by the Borrower of this Agreement or any other document referred to or provided for herein or therein or to inspect the properties or books of the Borrower. Except (in the case of the Agent) for notices, reports and other documents and information expressly required to be furnished to the Lenders by the Agent hereunder, the Agent shall have no duty or responsibility to provide any Lender with any credit or other information concerning the affairs or financial condition of the Borrower which may come to the attention of the Agent, except where provided to the Agent for the Lenders, provided that such information does not confer any advantage to the Agent as a Lender over the other Lenders. Nothing in this Agreement shall oblige the Agent to disclose any information relating to the Borrower if such disclosure would or might, in the opinion of the Agent, constitute a breach of any Laws or duty of secrecy or confidence.

18.6.2 Unless the Agent shall have been notified in writing or by telegraph, telex or telecopier by any Lender prior to the date of an Advance requested hereunder that such Lender does not intend to make available to the Agent such Lender’s proportionate share of such Advance, based on its Commitment, the Agent may assume that such Lender has made such Lender’s Commitment in such Advance available to the Agent on the date of such Advance and the Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount. If such corresponding amount is not in fact made available to the Agent by such Lender, the Agent shall be entitled to recover such amount (together with interest thereon at the rate determined by the Agent as being its cost of funds in the circumstances) on demand from such Lender or, if such Lender fails to reimburse the Agent for such amount on demand, from the Borrower.

18.6.3 Unless the Agent shall have been notified in writing or by telegraph, telex or telecopier by the Borrower prior to the date on which any payment is due hereunder that the Borrower does not intend to make such payment, the Agent may assume that the Borrower has made such payment when due and the Agent may, in reliance upon such assumption, make available to each Lender on such payment date an amount equal to such Lender’s pro rata share of such assumed payment. If it is established that the Borrower has not in fact made such payment to the Agent, each Lender shall forthwith on demand repay to the Agent the amount made available to such Lender (together with interest at the rate determined by the Agent as being its cost of funds in the circumstances).

18.9.1 The Derivative Obligations shall be secured by the Security provided that the related Derivative Instruments:

18.9.2 Each Lender shall confirm to the Agent and to the Borrower, upon request, quarterly on or about the last day of each financial quarter of each financial year of the Borrower, the Negative Value of the Derivative Instruments issued by it or contracted through it, calculated on a net as well as on a gross basis where several Derivative Instruments are governed by the same Master Agreement, as well as the Credit Facility in respect of which such Derivative Instruments apply.

18.18.1 Notwithstanding the irrevocable appointment of the Agent, a majority of Lenders holding not less than 66.67% of the Commitments may (with the consent of the Borrower), upon giving the Agent thirty (30) days prior written notice to such effect, terminate the Agent’s appointment hereunder provided that a successor Agent has been appointed at or prior to the expiry of such notice.

18.18.2 The Agent may resign its appointment hereunder at any time without giving any reason therefor by giving written notice to such effect to each of the other parties hereto. Such resignation shall not be effective until a successor Agent has been appointed.

18.18.3 In the event of any such termination or resignation, the Lenders shall appoint a successor Agent that is willing to accept such role and is acceptable to the Borrower within thirty (30) days therefrom, deliver copies of all accounts to such successor and the retiring Agent shall be discharged from any further obligations hereunder but shall remain entitled to the benefit of the provisions of this Article 18 and the Agent’s successor and each of the other parties hereto shall have the same rights and obligations among themselves as they would have had if such successor originally had been a party hereto as Agent.

“1.1.2 “ Additional Offering ” means an Offering of unsecured Debt incurred or issued by the Borrower having a term expiring after the expiry of the Term, the terms and conditions of which Offering (excluding, for greater certainty, pricing) are no more favourable to the Persons providing such Debt than the provisions hereof;”.

“1.1.50 “ EBITDA ” means, during a financial period, earnings of the VL Group before non-controlling interests, earnings from equity-accounted investments, extraordinary items, non-recurring gains or losses on debt extinguishment, asset sales and restructuring, Interest Expense, taxes, depreciation and amortization, foreign exchange translation gains or losses not involving the payment of cash and other non-cash financial charges, without taking into account any goodwill adjustments, calculated on a Consolidated basis, and otherwise in accordance with GAAP; for greater certainty, there shall be excluded from the calculation of EBITDA, to the extent included in such calculation, the amount of any income or expense relating to Back-to-Back Securities and the costs arising out of the termination of the Derivative Instruments associated with Term Facility B upon its repayment, in an approximate amount of $8,000,000;”.

“1.1.51 “ Eighth Amendment Closing Date ” means March 6, 2008;”.

“1.1.72 “ Issuing Lender ” means Royal Bank of Canada as the issuer of Letters of Credit (in that capacity), or any successor issuer of Letters of Credit. For greater certainty, where the context requires, references to “Lenders” herein include the Issuing Lender;

1.1.74 “ LC Fees ” has the meaning ascribed to such term in subsection 4.3.2;

1.1.76 “ Letter of Credit ” means any stand-by letter of credit or letter of guarantee issued by the Issuing Lender in connection with the Spectrum Auction and Purchase in accordance with the provisions hereof;”.

“1.1.83 “ Loan ” means, at any time, the aggregate of the Advances outstanding in accordance with the provisions hereof, including the face amount of any Bankers’ Acceptances and Letters of Credit issued in accordance with the provisions hereof, together with all unpaid interest thereon and any other amount in principal, interest and accessory costs payable to the Agent or the Lenders by the Borrower pursuant hereto, including, for greater certainty, amounts contemplated by Section 5.7;”.

“1.1.86 “ Margin ” means, for Prime Rate Advances, Stamping Fees, LC Fees and Facility Fees, as well as Libor Advances by Foreign Lenders, under the Revolving Facility, the following annual percentages depending on the VL Group’s then-applicable Leverage Ratio, determined at the times and in the manner set out below the table:

“1.1.112 Spectrum Auction and Purchase ” means the process described in Industry Canada’s “Notice No. DGRB-011-07 — Licensing Framework for the Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in the 2 GHz Range;

1.1.113 “ Spectrum Co. ” means any Person in which the Borrower may have a voting and/or economic interest and which Person may be the bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase;”.

“1.1.122 “ Term Facility C ” means the portion of the Credit previously available under this Credit Agreement which was repaid in full by the Borrower concurrently with the initial Advance hereunder on or after the Seventh Amending Closing Date;”.

“4.3 Letters of Credit for Spectrum Auction and Purchase

4.3.1 Issuance . Subject to the applicable provisions of this Agreement, on any Business Day during the Disbursement Period, as part of the Credit available under the Revolving Facility, upon one (1) Business Day’s prior written Notice of Borrowing delivered to the Agent prior to 10:00 a.m. the preceding Business Day, the Borrower may cause to be issued by the Issuing Lender on behalf of the Lenders one or more Letters of Credit in a maximum aggregate amount outstanding at any time not exceeding $350,000,000. Each Letter of

Credit may be issued solely to support, directly or indirectly, the bid in the Spectrum Auction and Purchase, and shall be issued in Canadian Dollars. Concurrently with the delivery of a Notice of Borrowing requesting a Letter of Credit, the Borrower shall execute and deliver to the Issuing Lender the documents required by the Issuing Lender in respect of the requested type of Letter of Credit, including a Letter of Credit application and indemnity on the Issuing Lender’s standard forms. In the event of any conflict between the provisions of this Agreement and the provisions of any document relating to a Letter of Credit, the provisions of this Agreement shall govern and prevail. The term of each Letter of Credit shall expire prior to the end of the Term and shall not be more than 364 days and shall otherwise be in form and substance satisfactory to the Issuing Lender.

4.3.2 Fee . The Borrower shall pay fees in respect of any such Letters of Credit (“ LC Fees ”) issued or renewed equal to the aggregate of: (i) for the Lenders, an amount equal to (A) the face amount of the Letter of Credit on the date that the fee is payable multiplied by (B) a fraction (1) the numerator of which shall equal the product resulting from multiplying the applicable LC Fee percentage provided for in the table contained in the definition of “Margin” by the number of days in the term of the Letter of Credit selected by the Borrower, and (2) the denominator of which shall consist of 365 days or 366 days (as the case may be), which fees shall be payable quarterly in arrears on the last Business Day of each calendar quarter and (ii) for the Issuing Lender, % per annum of the face amount thereof and for the number of days in the term of the Letter of Credit selected by the Borrower, payable quarterly in arrears on the last Business Day of each calendar quarter, or on such other date as the Agent may determine from time to time.

4.3.3 Reimbursement Obligations . In the event of any drawing under a Letter of Credit, the Issuing Lender shall promptly notify the Borrower who shall immediately reimburse the amount to the Issuing Lender in same day funds. In the event that the Borrower fails to reimburse the Issuing Lender immediately upon a drawing and fails to provide a Notice of Borrowing with a different option, the Borrower shall be deemed to have requested from the Agent a Canadian Prime Rate Advance on the date and in the amount of the drawing, the proceeds of which will be used to satisfy the reimbursement obligations of the Borrower to the Lenders in respect of the drawing. The reimbursement obligations of the Borrower hereunder shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of:

4.3.4 Indemnification .

4.3.5 LC Escrowed Funds . Upon the occurrence and continuance of an Event of Default, or if a Mandatory Repayment to be made would require the repayment of outstanding Letters of Credit prior to their maturity, the Borrower will forthwith , upon request from the Issuing Lender or the Agent, pay to the Agent for deposit into an escrow account maintained by and in the name of the Agent, (i) in the case of the occurrence and the continuance of an Event of Default, the amount equal to the Issuing Lender’s maximum potential exposure under the then outstanding Letters of Credit or (ii) in the case of a Mandatory Repayment requiring the repayment of outstanding Letters of Credit prior to their maturity, the amount equal to the proportion of such Mandatory Repayment that would require Letters of Credit to be repaid prior to their maturity (in each case, the “ LC Escrowed Funds ”). The LC Escrowed Funds will be held by the Agent for compensation or set-off against future Indebtedness owing by the Borrower to the Issuing Lender in respect of such Letters of Credit and pending such application will bear interest at the rate

declared by the Agent from time to time as that payable by it in respect of deposits for such amount and for the period from the date of deposit to the maturity date of the Letters of Credit. If such Event of Default is either waived or cured in compliance with the terms of this Agreement, then the remaining LC Escrowed Funds, if any, together with any accrued interest to the date of release, will be released to the Borrower. The deposit of the LC Escrowed Funds by the Borrower with the Agent as herein provided will not operate as a repayment on account of the Loan Obligations until such time as the LC Escrowed Funds are actually paid to the Issuing Lender as a repayment of principal hereunder. The Borrower shall sign and remit as Security with regard thereto all appropriate documents that the Agent or the Issuing Lender might judge necessary or desirable.

4.3.6 Resignation . The Issuing Lender may resign as such (a “ Resigning Issuing Lender ”) upon 15 days’ prior written notice to the Agent and the Borrower, in which event the Borrower shall designate another Lender as Issuing Lender. Upon acceptance by another Lender of the appointment as Issuing Lender (the “ Successor Issuing Lender ”), the Successor Issuing Lender shall succeed to the rights, powers and duties of the Resigning Issuing Lender and shall have all the rights and obligations of the Resigning Issuing Lender under this Agreement and the other Loan Documents. Upon request by any of the Resigning Issuing Lender, the Successor Issuing Lender, the Agent or the Borrower, each of the Resigning Issuing Lender, the Agent, the Borrower and the Successor Issuing Lender shall enter into an agreement evidencing the appointment of the Successor Issuing Lender and dealing with such other matters as the parties may agree including any reallocation of fees paid in relation to outstanding Letters of Credit which may be necessary. Following the resignation of the Resigning Issuing Lender, the Resigning Issuing Lender shall continue to have all the rights and obligations of an Issuing Lender under this Agreement and the other Loan Documents with respect to Letters of Credit issued by it prior to such resignation, but the Resigning Issuing Lender shall not be required to issue additional Letters of Credit. For avoidance of doubt, the provisions of this Agreement relating to the Issuing Lender shall inure to the benefit of the Resigning Issuing Lender as to any actions taken or omitted to be taken by it (a) while it was the Issuing Lender under this Agreement or (b) at any time with respect to Letters of Credit issued by the Issuing Lender.”.

“The relevant amounts on the Phase II Date, as determined by the directors of the Applicable Guarantor, will be set forth in a certificate in the form set out in Schedule “K”, to be delivered within 5 Business Days following the Phase II Date . ”.

1.1.28.1 obligations of or unconditionally guaranteed by the governments of Canada or the United States of America (“ USA ”), or any agency of any of them backed by the full faith and credit of the governments of Canada or the USA, respectively, maturing within 364 days of acquisition;

1.1.28.2 marketable direct obligations of the governments of one of the provinces of Canada, one of the states of the USA, or any agency thereof, or of any county, department, municipality or other political subdivision of Canada or the USA, the payment or guarantee of which constitutes a full faith and credit obligation of such province, state, municipality or other political subdivision, which matures within 364 days of acquisition and which is currently accorded a short-term credit rating of at least A-1 by Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc. (“ S & P ”) or at least Prime-1 by Moody’s Investors Service, Inc. (“ Moody’s ”) or the equivalent thereof from Dominion Bond Rating Service Inc. (“ DBRS ”);

1.1.28.3 commercial paper, bonds, notes, debentures and bankers’ acceptances issued by a Person residing in Canada or the

USA and not referred to in subsections 1.1.28.1, 1.1.28.2 or 1.1.28.4, and maturing within 364 days from the date of issuance which, at the time of acquisition, is accorded a short-term credit rating of at least A-1 by S & P or at least Prime-1 by Moody’s or the equivalent thereof from DBRS;

1.1.28.4 (a) certificates of deposit maturing within 364 days from the date of issuance thereof, issued by a bank or trust company organized under the laws of the USA, any state thereof, or Canada or any province thereof, or (b) US Dollar certificates of deposit maturing within 364 days of acquisition and issued by a bank in western Europe or the United Kingdom, in all cases having capital, surplus and undivided profits aggregating at least US $500,000,000 (or its equivalent in Canadian Dollars) and whose short-term credit rating is, at the time of acquisition thereof, rated A-1 or better by S & P or Prime-1 or better by Moody’s (or the equivalent thereof from DBRS);

1.1.43.1 obligations in respect of borrowed money, whether or not evidenced by notes, bonds, debentures or similar evidences of indebtedness of such Person;

1.1.43.2 obligations in respect of borrowed money and the Negative Value of Derivative Instruments, but without duplication of any underlying Debt that may be hedged by same, and, in particular, without taking into account the currency hedging in respect of the US$ denominated Debt referred to in the final paragraph of this definition;

1.1.43.3 obligations representing the deferred purchase price of goods and services, other than such obligations incurred in the ordinary course of business of the VL Group and payable within a period not exceeding 120 days from the date of their incurrence,

1.1.43.4 the obligations, whether or not assumed, which are secured by Charges on the property belonging to such Person or payable out of the proceeds flowing therefrom,

1.1.43.5 Contingent Obligations;

1.1.43.6 obligations under Capital Leases and Synthetic Leases, and

1.1.43.7 obligations under letters of credit, letters of guarantee, bankers’ acceptances or Guarantees,

1.1.52.1 the amount of taxes paid or otherwise due during the period in question;

1.1.52.2 the amount of any Interest Expense paid in cash (and not accrued); however, for the purposes of this definition alone, “Interest Expense” shall include all fees and expenses relating to the HYD Offering, any Additional Offering and all other future Debt Offerings, except to the extent that the fees and expenses in question are paid for out of the proceeds of such Debt Offerings and not out of the VL Group’s cash flow;

1.1.52.3 the amount of all voluntary prepayments of Debt, other than (a) payments under the Revolving Facility or under the unsecured cash management facility not exceeding $10,000,000 permitted hereunder, (b) voluntary prepayments using the proceeds of Asset Dispositions and Offerings, and (c) voluntary prepayments of the QMI Subordinated Debt made in accordance with Section 13.10 hereof;

1.1.52.4 the amount of extraordinary items not included in earnings but which required the payment of cash;

1.1.52.5 the amount of any mandatory principal repayment (other than Mandatory Repayments under subsections 8.2.1 and 8.2.2) of Debt that is permitted hereunder; and

1.1.52.6 the sum of (1) the amount of Capital Expenditures made during such period that have not been financed separately out of (i) the proceeds of Debt permitted hereunder; (ii) equity obtained after the date hereof; or (iii) the Net Proceeds arising out of Asset Dispositions made during the period which are not used to make Mandatory Repayments under subsection 8.2.1 and (2) the amount, if any, by which $18,750,000 exceeds the actual Capital Expenditures made during such period;

1.1.90.1 the gross amount of proceeds payable to any member of the VL Group in cash or Cash Equivalents arising from the sale, lease, transfer, assignment or other disposition or alienation of any of the property (including shares, capital stock and ownership interests) of any member of the VL Group (an “ Asset Disposition ”), less amounts payable to discharge or radiate Permitted Charges on the assets being disposed of, and less the amount of taxes arising from each such Asset Disposition and which cannot be offset against losses, depreciation or otherwise such that same must actually be paid in cash; and

1.1.90.2 the gross amount of proceeds payable to any member of the VL Group in cash or Cash Equivalents from any public or private offering of equity securities or Debt permitted hereunder of any member of the VL Group (herein called an “ Offering ”);

1.1.94.1 any Charge created by law that is assumed in the ordinary course of business and in order to exercise same, which, in the case of construction Charges in favour of contractors, sub-contractors, workmen, suppliers of materials, engineers and architects, has not at such date been registered in accordance with applicable Laws against such Person, which relates to obligations which are not yet due or delinquent, which is not related to any loan of money or obtention of credit and which, in the aggregate, do not affect in a material way the use, the income or the benefits flowing from the property so charged in the conduct of the business of such Person; any Charge resulting from judgments or decisions which such Person has, at such date, appealed or in respect of which it has sought revision and obtained a suspension of execution pending the appeal or the revision; any Charge for taxes, assessments or governmental claims or other impositions not yet due or matured or in respect of which the validity at such date has been contested in good faith by such Person before a competent tribunal or other governmental body in accordance with the provisions of Section 12.7; or which relates to a deposit of monies or securities in the ordinary course of business with respect to any Charge referred to in this paragraph, or to secure workmen’s compensation, surety or appeal bonds or security for costs of litigation; or any Charge in favour of a landlord on movable or personal property to secure the payment of rent and other amounts owing under leases for immovable or real property, provided the Charge is limited to property situated on the leased premises;

1.1.94.2 any right of a municipality, governmental body or other public authority pursuant to any lease, license, franchise, grant or permit obtained by such Person, or any right resulting from a legislative provision, to terminate such lease, license, franchise, grant or permit, or requiring an annual or periodic payment as a condition of its extension;

1.1.94.3 Charges in favour of a public body, or to a municipal or governmental authority or public utility, or which may be imposed by one or the other, when required by such body or authority with respect to the operations of such Person or in the ordinary course of its business;

1.1.94.4 Charges granted in favour of municipal authorities or public utilities on immovables acquired from time to time by such Person which do not adversely affect the value or marketability of such Person ‘s immovable property in any material respect;

1.1.94.5 title defects, homologated lines, zoning and building by-laws, ordinances, regulations and other governmental restrictions on the use of property, or servitudes, easements or other similar encumbrances, provided that none of the foregoing adversely affect the value or marketability of such Person’s immovable property in any material respect;

1.1.94.6 Charges to secure the payment of the purchase price incurred in connection with the acquisition after the Closing Date of assets to be used in carrying on the Core Business, including Charges existing on such assets at the time of the acquisition thereof or at the time of the acquisition by a member of the VL Group of any business entity then owning such assets, whether or not such existing Charges were given to secure the payment of the purchase price of the assets to which they attach, provided that such Charges are limited to the assets purchased and that the amount guaranteed by such Charges does not exceed 100% of the acquisition price of the assets so acquired, and, in the aggregate, $10,000,000 outstanding at any time;

1.1.94.7 Charges on the shares of the Borrower and the Initial VL Group Guarantors in favour of the lenders under the Quebecor Media Credit Facility, which shall be a second-

ranking Charge until the Phase II Date, and which thereafter will rank ahead of the Charges on such shares in favour of the Lenders until all amounts owed under the Quebecor Media Credit Facility have been paid in full and the said credit facility cancelled;

1.1.94.8 Charges disclosed in Schedule “H”, including any extension, renewal or refinancing thereof provided the amount secured by such Charge does not exceed the amount so secured immediately prior to such extension, renewal or refinancing thereof, and provided that the property subject to such Charge is not extended;

1.1.109.1 with respect to a BA Advance, the amount of the Advances in Canadian Dollars which the Borrower has asked to obtain by the issuance of Bankers’ Acceptances in accordance with Section 6.1, and

1.1.109.2 with respect to a Libor Advance, the amount in respect of which the Borrower is deemed to have asked, in accordance with Section 4.2, that the interest payable thereon be calculated on the Libor Basis;

4.3.3.1 any lack of validity or enforceability of any Letter of Credit or this Agreement or any term or provision therein or herein;

4.3.3.2 the existence of any claim, set-off, compensation, defence or other right that the Borrower, any Guarantor or other member of the VL Group or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuing Lender, the Agent, any Lender or any other Person, whether in connection with this Agreement or any other related or unrelated agreement or transaction;

4.3.3.3 any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect;

4.3.3.4 any dispute between or among the members of the VL Group and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the members of the VL Group against any beneficiary of such Letter of Credit or any such transferee; and

4.3.3.5 the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit or any of the rights or benefits thereunder or proceeds thereof in whole or in part, which may prove to be invalid or ineffective for any reason.

4.3.4.1 The Borrower agrees to indemnify and hold harmless the Issuing Lender and each of its officers, directors, affiliates, employees, advisors and agents (the “ Indemnitees ”) from and against any and all losses, claims, damages and liabilities which the Indemnitees may incur (or which may be claimed against any Indemnitee) by any Person by reason of or in connection with the issuance or transfer of or payment or failure to pay under any Letter of Credit, provided that the foregoing indemnity will not, as to an Indemnitee, apply to losses, claims, damages, liabilities or related expenses to the extent they are found by a final, non-appealable judgment of a court to arise from the gross or intentional fault of such Indemnitee.

4.3.4.2 The Borrower agrees, as between the Borrower and the Issuing Lender, that the Borrower shall assume all risks of the acts, omissions or misuse by the beneficiary of any Letter of Credit.

4.3.4.3 Neither the Issuing Lender nor the Agent or any other Lender shall, in any way, be liable for any failure by the Issuing Lender or anyone else to pay any drawing under any Letter of Credit as a result of any action by any governmental authority or any other cause beyond the control of the Issuing Lender.

4.3.4.4 The obligations of the Borrower under this Section 4.3 shall survive the termination of this Agreement. No acts or omissions of any current or prior beneficiary of a Letter of Credit shall in any way affect or impair the rights of the Issuing Lender to enforce any right, power or benefit under this Agreement.

4.3.3.1 any lack of validity or enforceability of any Letter of Credit or this Agreement or any term or provision therein or herein;

4.3.3.2 the existence of any claim, set-off, compensation, defence or other right that the Borrower, any Guarantor or other member of the VL

Group or any other Person may at any time have against the beneficiary under any Letter of Credit, the Issuing Lender, the Agent, any Lender or any other Person, whether in connection with this Agreement or any other related or unrelated agreement or transaction;

4.3.3.3 any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect;

4.3.3.4 any dispute between or among the members of the VL Group and any beneficiary of any Letter of Credit or any other party to which such Letter of Credit may be transferred or any claims whatsoever of the members of the VL Group against any beneficiary of such Letter of Credit or any such transferee; and

4.3.3.5 the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit or any of the rights or benefits thereunder or proceeds thereof in whole or in part, which may prove to be invalid or ineffective for any reason.

4.3.4.1 The Borrower agrees to indemnify and hold harmless the Issuing Lender and each of its officers, directors, affiliates, employees, advisors and agents (the “ Indemnitees ”) from and against any and all losses, claims, damages and liabilities which the Indemnitees may incur (or which may be claimed against any Indemnitee) by any Person by reason of or in connection with the issuance or transfer of or payment or failure to pay under any Letter of Credit, provided that the foregoing indemnity will not, as to an Indemnitee, apply to losses, claims, damages, liabilities or related expenses to the extent they are found by a final, non-appealable judgment of a court to arise from the gross or intentional fault of such Indemnitee.

4.3.4.2 The Borrower agrees, as between the Borrower and the Issuing Lender, that the Borrower shall assume all risks of the acts, omissions or misuse by the beneficiary of any Letter of Credit.

4.3.4.3 Neither the Issuing Lender nor the Agent or any other Lender shall, in any way, be liable for any failure by the Issuing Lender or anyone else to pay any drawing under any Letter of Credit as a result of any action by any governmental authority or any other cause beyond the control of the Issuing Lender.

4.3.4.4 The obligations of the Borrower under this Section 4.3 shall survive the termination of this Agreement. No acts or omissions of any current or prior beneficiary of a Letter of Credit shall in any way affect or impair the rights of the Issuing Lender to enforce any right, power or benefit under this Agreement.

SCOPE

PURPOSE

RESPONSIBILITY

WORK ENVIRONMENT

RELATIONS WITH CUSTOMERS AND SUPPLIERS

CONFLICT OF INTEREST

COMPANY PROPERTY

COMPANY FUNDS

CONFIDENTIAL INFORMATION

INSIDER TRADING

BUSINESS RECORDS

RELATIONS WITH THE PUBLIC

RESPECT OF THE ENVIRONMENT

The Company is worried about the health and the well-being of its employees, and also of the communities surrounding its installations. Therefore, it is committed to respect the laws and regulations in force in matters of environment and will favour any procedure or initiative from its employees aiming at reducing any negative impact on the quality of air, ground or water that could result from its activities.

COMPETITION BEHAVIOUR

LEGAL COMPLIANCE

QUESTIONS AND REPORTING VIOLATIONS

(a) to the Lenders, in the name of each Lender which is a bank that accepts bankers’ acceptances (a “ BA Lender ”), drafts in form and substance acceptable to the Agent and the Lenders; and

(b) to the Lenders in the name of each Lender which is not a bank or does not accept bankers’ acceptances (a “ Non-BA Lender ”), Discount Notes;

(a) to the fees, costs, expenses and accessories contemplated by Article 7, Section 14.5 and Section 17.5 or by the Security Documents;

(b) to all amounts due under Article 5 hereunder;

(c) to the repayment of the principal amount of the Loan subject, in the case of Mandatory Repayments, to the imputation rules set out in Section 8.2;

(d) to any other amounts due pursuant to this Agreement.

(a) such officer has taken cognizance of all the terms and conditions of this Agreement and of all contracts, agreements and deeds pertaining hereto;

(b) no Default or Event of Default has occurred or exists hereunder;

(c) the corporate structure of Quebecor Media Inc. and the VL Group is as set out in the diagram attached to the certificate; and

(d) subject to obtaining the approval of the CRTC to the Transaction, each member of the VL Group holds the permits, Licences, licences and authorizations required in order to permit it to possess its property and its real estate and to carry on its business in the manner in which it is being carried on at present;

(a) such officer has taken cognizance of all the terms and conditions of this Agreement and of all contracts, agreements and deeds pertaining hereto;

(b) no Default or Event of Default has occurred or exists hereunder;

(c) the corporate structure of the VL Group is as set out in the diagram attached to the certificate;

(d) each member of the VL Group holds the permits, Licences, licences and authorizations required in order to permit it to possess its property and its real estate and to carry on its business in the manner in which it is being carried on at present; and

(e) all property to be charged by the Security Documents is located in the jurisdictions described in a schedule thereto;

(a) there is no hazardous substance or hazardous waste existing on or under any property of any member of the VL Group which constitutes a material violation of any ordinance, statute or law for which an owner, operator or person in control of a property may be held liable;

(b) the business of each member of the VL Group is being carried on so as to respect in all material ways the Laws applicable to environmental and health and safety matters; and

(c) no contaminant, pollutant, toxic substance or material or dangerous waste has been spilled or emitted into the environment from any property owned, operated or controlled by any member of the VL Group for which such member of the VL Group could have any material liability.

(a) the unaudited Consolidated balance sheet of the VL Group as at the end of such quarter and the related Consolidated statements of earnings and cash flows, for the period then ended, in each case with comparative figures for the same period for the immediately preceding financial year and in respect of the preceding financial year end; and

(b) the unaudited consolidated balance sheet of the Borrower as at the end of such quarter and the related consolidated statements of earnings and cash flows of the Borrower, determined in accordance with GAAP, for the period then ended, in each case with comparative figures for the same period for the immediately preceding financial year and in respect of the preceding financial year end; and

(c) a Compliance Certificate of the chief financial officer of the Borrower in the form of Schedule “J” and setting forth the information necessary to determine whether the Borrower has complied with the covenants contained in Section 12.11, as well as a reconciliation of the financial statements prepared in accordance with GAAP to the information used in determining compliance with the financial covenants using GAAP as at the Sixth Amendment Closing Date, certifying that the Borrower is in compliance with all of its covenants hereunder and that no Default or Event of Default has come to the attention of the officer of the Borrower signing the certificate, after due inquiry, or if a Default or an Event of Default has occurred, setting out the relevant particulars thereof, the period of existence thereof and what action the Borrower has taken or proposes to take with respect thereto (a “ Compliance Certificate ”).

(a) Within 120 days following the end of each financial year of the Borrower, the audited Consolidated balance sheet of the VL Group as at the end of such year and the related Consolidated statements of earnings and cash flows for such financial year, together with comparative figures for the immediately preceding

year, the whole as certified without qualification by the current auditors of the Borrower or otherwise by another reputable firm of independent chartered accountants acceptable to the Agent, together with the unaudited consolidated balance sheet of the Borrower as at the end of such year and the related consolidated statements of earnings and changes in financial position for such financial year, determined in accordance with GAAP, together with comparative figures for the immediately preceding year, and any audited statements of any other member of the VL Group that may be prepared; and

(b) Within 75 days following the end of each financial year of the Borrower, a Compliance Certificate, based on unaudited financial information, to be updated and replaced by a second Compliance Certificate to be provided along with the audited financial statements referred to in paragraph (a) above.

(a) Within 75 days following the end of each financial year of the Borrower commencing with the financial year ending August 31, 2001, the Annual Business Plan, which shall promptly be submitted to the Agent for the Lenders; and

(b) Within 75 days following the end of each financial quarter of the Borrower, a certificate of its Chief Financial Officer certifying a detailed calculation of Excess Cash Flow (in such form and providing such detail as the Agent may reasonably require) during such quarter (the “ Excess Cash Flow Certificate ”); and

(c) from time to time and forthwith upon demand by the Agent, such data, reports, statements, documents or other additional information pertaining to the business, assets, liabilities, financial position, operating results or business prospects of the VL Group as the Agent may request, acting reasonably.

(a) such officer has taken cognizance of all the terms and conditions of this Agreement and of all contracts, agreements and deeds pertaining hereto;

(b) no Default or Event of Default has occurred or exists hereunder;

(c) the corporate structure of the VL Group is as set out in the diagram attached to the certificate;

(d) Videotron Telecom Ltd. has no Debt as of the date of the Merger, and has no material liabilities other than those that have been disclosed to the Lenders in the financial statements provided to the Lenders immediately prior to the Seventh Amendment Closing Date and liabilities incurred in the ordinary course of business since that date;

(e) each member of the VL Group holds the permits, Licences, licences and authorizations required in order to permit it to possess its property and its real estate and to carry on its business in the manner in which it is being carried on at present, including all Regulatory Approvals; and

(f) all property to be charged by the Security Documents is located in the jurisdictions described in a schedule thereto;

10.2.2 each of the Security Documents required by Section 9.2 shall have been executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.2.3 all of the issued and outstanding shares of the Subsidiaries referred to in subsection 9.2.3, and the shares of Spectrum Co. referred to in subsection 9.2.10, owned, directly or indirectly by the Borrower and any of its Subsidiaries at the relevant time, shall have been pledged in accordance with the Share Pledge executed by the Borrower and the relevant Subsidiaries and all of the pledged shares shall have been remitted to the Agent;

10.2.4 the Borrower shall have delivered to the Agent a certificate in the form of Schedule “F” signed by an officer stipulating and certifying that:

a) such officer has taken cognizance of all the terms and conditions of this Agreement and of all contracts, agreements and deeds pertaining hereto;

b) no Default or Event of Default has occurred or exists hereunder;

c) the corporate structure of the VL Group is as set out in the diagram attached to the certificate;

d) each member of the VL Group holds the permits, Licences, licences and authorizations required in order to permit it to possess its property and its real estate and to carry on its business in the manner in which it is being carried on at present; and

e) all property to be charged by the Security Documents is located in the jurisdictions described in a schedule thereto;

10.2.6 each of the Security Documents shall have been amended (to the extent required), executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.2.7 the Borrower shall have delivered to the Agent the favourable legal opinion(s) of the counsel to the Borrower, addressed to the Lenders, the Agent and its counsel, in form and substance acceptable to the Agent and its counsel, acting reasonably, including with regard to the continuing validity of all relevant Guarantees and Security.”.

10.2.1 certified copies of all of the constating documents, borrowing by-laws and resolutions of the Borrower, each other member of the VL Group and Spectrum Co. (if the Borrower elects to use Spectrum Co. to act as bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase) not previously provided to the Agent shall have been provided to the Agent;

10.2.2 each of the Security Documents required by Section 9.2 shall have been executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.2.3 all of the issued and outstanding shares of the Subsidiaries referred to in subsection 9.2.3, and the shares of Spectrum Co. referred to in subsection 9.2.10, owned, directly or indirectly by the Borrower and any of its Subsidiaries at the relevant time, shall have been pledged in accordance with the Share Pledge executed by the Borrower and the relevant Subsidiaries and all of the pledged shares shall have been remitted to the Agent;

10.2.4 the Borrower shall have delivered to the Agent a certificate in the form of Schedule “F” signed by an officer stipulating and certifying that:

a) such officer has taken cognizance of all the terms and conditions of this Agreement and of all contracts, agreements and deeds pertaining hereto;

b) no Default or Event of Default has occurred or exists hereunder;

c) the corporate structure of the VL Group is as set out in the diagram attached to the certificate;

d) each member of the VL Group holds the permits, Licences, licences and authorizations required in order to permit it to possess its property and its real estate and to carry on its business in the manner in which it is being carried on at present; and

e) all property to be charged by the Security Documents is located in the jurisdictions described in a schedule thereto;

10.2.5 the Borrower shall have delivered to the Agent in a sufficient number of copies for each of the Lenders its Annual Business Plan in respect of its financial years ending December 31, 2008, 2009 and 2010, showing pro forma compliance with all financial covenants hereunder;

10.2.6 each of the Security Documents shall have been amended (to the extent required), executed, delivered, issued or assigned and registered or published, as the case may be, wherever required;

10.2.7 the Borrower shall have delivered to the Agent the favourable legal opinion(s) of the counsel to the Borrower, addressed to the Lenders, the Agent and its counsel, in form and substance acceptable to the Agent and its counsel, acting reasonably, including with regard to the continuing validity of all relevant Guarantees and Security.”.

SUBORDINATED LOAN AGREEMENT

Dated as of January 3, 2007

Exhibit 4.11

SUBORDINATED LOAN AGREEMENT

Dated as of May 31, 2007

Exhibit 4.12

SUBORDINATED LOAN AGREEMENT

Dated as of May 31, 2007

Exhibit 4.13

SUBORDINATED LOAN AGREEMENT

Dated as of January 4, 2008

SUBORDINATED LOAN AGREEMENT

Dated as of January 4, 2008

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

o	REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
OR

x	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the fiscal year ended December 31, 2008
OR

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period from to
OR

o	SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	Date of event requiring this shell company report

	For the transition period from to

Commission file number 033-51000

VIDEOTRON LTD. / VIDÉOTRON LTÉE

(Exact name of Registrant as specified in its charter)

Province of Québec, Canada

(Jurisdiction of incorporation or organization)

612 St. Jacques Street

Montréal, Québec, Canada H3C 4M8

(Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act.

Title of each class		Name of each exchange on which registered
None		None

Securities registered or to be registered pursuant to Section 12(g) of the Act.

None

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.

6 7 / 8 % Senior Notes due January 15, 2014

6 3 / 8 % Senior Notes due December 15, 2015

(Title of Class)

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

2,515,277 Class “A” Common Shares

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Yes

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

Accelerated filer

Non-accelerated filer

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP

International Financial Reporting Standards as issued
by the International Accounting Standards Board

Other

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17

Item 18

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes

Table of Contents

TABLE OF CONTENTS

	Page

Explanatory Notes	1
presentation of financial information	1
Industry And Market Data	2
Exchange Rate Information	2
Cautionary statement regarding Forward-Looking Statements	3

PART I

Item 1 - Identity Of Directors, Senior Management And Advisers	4
Item 2 - Offer Statistics And Expected Timetable	4
Item 3 - Key Information	4
Item 4 - Information On The Company	26
Item 4A - Unresolved Staff Comments	54
Item 5 - Operating and Financial Review and Prospects	55
Item 6 - Directors, Senior Management And Employees	77
Item 7 - Major Shareholders And Related Party Transactions	86
Item 8 - Financial Information	89
Item 9 - The Offer And Listing	90
Item 10 - Additional Information	91
Item 11 - Quantitative And Qualitative Disclosures About Market Risk	110
Item 12 - Description Of Securities Other Than Equity Securities	112

PART II

Item 13 - Defaults, Dividend Arrearages And Delinquencies	113
Item 14 - Material Modifications To The Rights Of Security Holders And Use Of Proceeds	113
Item 15 - Controls And Procedures	113
Item 16 - [Reserved]	114
Item 16A - Audit Committee Financial Expert	114
Item 16B - Code of Ethics	114
Item 16C - Principal Accountant Fees and Services	114
Item 16D - Exemptions from the Listing Standards for Audit Committees	115
Item 16E - Purchases of Equity Securities by the Issuer and Affiliated Purchasers	115
Item 16F - Changes in registrant’s certifying accountant	115
Item 16G - corporate governance	116

PART III

Item 17 - Financial Statements	116
Item 18 - Financial Statements	117
Item 19 - Exhibits	117
Signature	121
Index to Consolidated Financial Statements	F1

Table of Contents

EXPLANATORY NOTES

All references in this annual report to “Videotron” or “our company”, as well as use of the terms “we”, “us”, “our” or similar terms, are references to Videotron Ltd. and, unless the context otherwise requires, its consolidated subsidiaries. All references in this annual report to “Quebecor Media” are to our parent company Quebecor Media Inc., and all references to “TVA Group” are to TVA Group Inc. In this annual report, all references to the “CRTC” are references to The Canadian Radio-television and Telecommunications Commission.

All references in this annual report to our “Senior Notes” are to, collectively, our issued and outstanding 6 7 / 8 % Senior Notes due January 15, 2014, our 6 3 / 8 % Senior Notes due December 15, 2015 and our 9% Senior Notes due 2018.

PRESENTATION OF FINANCIAL INFORMATION

Our consolidated financial statements included in this annual report have been prepared in accordance with accounting principles generally accepted in Canada, or Canadian GAAP. For a discussion of the principal differences between Canadian GAAP and accounting principles generally accepted in the United States, or U.S. GAAP, as they relate to our financial statements, see Note 24 to our audited consolidated financial statements which are included under “Item 17. Financial Statements” in this annual report. We state our financial statements in Canadian dollars. In this annual report, references to Canadian dollars, Cdn$ or $ are to the currency of Canada and references to U.S. dollars or US$ are to the currency of the United States.

We use the supplemental financial measure operating income to assess our operating results and financial performance. Operating income and ratios based on this measure are not required by or recognized under Canadian GAAP or U.S. GAAP. We define operating income, reconciled to net income under Canadian GAAP, as net income before amortization, financial expenses, (gain) loss on valuation and translation of derivative instruments, impairment of goodwill and other items, income taxes and non-controlling interest in a subsidiary. Operating income margin is operating income as a percentage of operating revenues. Operating income, and ratios using this measure, are not intended to be regarded as an alternative to other financial operating performance measures, or to the statement of cash flows as a measure of liquidity. Operating income is not intended to represent funds available for debt service, reinvestment, distributions of dividends, or other discretionary uses, and should not be considered in isolation from, or as a substitute for, our financial information reported under Canadian GAAP and U.S. GAAP. We believe that operating income is a meaningful measure of performance because operating income excludes, among other things, certain non-cash items and items that are not readily comparable from year to year. Operating income is also commonly used in the sector in which we operate, as well as by the investment community to analyze and compare companies in our field of activities. Operating income has limitations as an analytical tool, including:

· although amortization is a non-cash charge, the assets being amortized will often have to be replaced in the future, and operating income does not reflect cash requirements for such capital expenditures;

· it does not reflect income tax expense or the cash necessary to pay income taxes; and

· it does not reflect financial expenses or the cash necessary to pay financial expenses.

You should note our definition of operating income may not be identical to similarly titled measures reported by other companies, limiting its usefulness as a comparative measure. We provide a reconciliation of operating income to net income (loss) under Canadian GAAP and U.S. GAAP in footnote 9 under “Item 3. Key Information — Selected Financial Data”.

In this annual report, we also use the measure long-term debt, excluding QMI subordinated loans, as a supplemental measure of our indebtedness. Long-term debt, excluding QMI subordinated loans, is not a measure that is required by or recognized under Canadian GAAP or U.S. GAAP. We define long-term debt, excluding QMI subordinated loans, as our long-term debt excluding subordinated loans that we enter into with our parent, Quebecor Media. We believe that long-term debt, excluding QMI subordinated loans, is, from the perspective of a holder of our Senior Notes, a meaningful measure of our long-term debt because the QMI subordinated loans are subordinated in right of payment to the prior payment in full of our senior indebtedness, including the Senior Notes, and because the proceeds

Table of Contents

of our QMI subordinated loans were invested in retractable preferred shares of Quebecor Media as part of back-to-back transactions to reduce our income tax obligations. Long-term debt, excluding QMI subordinated loans, is not intended to be, and should not be, regarded as an alternative to other financial reporting measures, and it should not be considered in isolation as a substitute for measures of liabilities prepared in accordance with Canadian GAAP or U.S. GAAP. We provide a reconciliation of long-term debt, excluding QMI subordinated loans, to long-term debt under Canadian GAAP and U.S. GAAP in footnote 8 under “Item 3. Key Information — Selected Financial Data”.

Unless otherwise indicated, information provided in this annual report, including all operating data, is as of December 31, 2008.

INDUSTRY AND MARKET DATA

Industry statistics and market data used throughout this annual report were obtained from internal surveys, market research, publicly available information and industry publications, including the CRTC, as a source of Canadian data, and NCTA, A.C. Nielsen Media Research and Kagan Research LLC, as sources of U.S. data. Industry publications generally state that the information they contain has been obtained from sources believed to be reliable, but that the accuracy and completeness of this information is not guaranteed. Penetration and market share data contained in this annual report is generally based on sources published in the fourth quarter of 2008.

EXCHANGE RATE INFORMATION

The following table sets forth, for the periods indicated, the average, high, low and end of period noon rates published by the Bank of Canada. Such rates are set forth as U.S. dollars per Cdn$1.00 and are the rates published by the Bank of Canada for Canadian dollars per US$1.00. On March 3, 2009, the noon rate was Cdn$1.00 equals US$0.7729. We do not make any representation that Canadian dollars could have been converted into U.S. dollars at the rates shown or at any other rate.

Year Ended:	Average(1)	High	Low	Period End

December 31, 2008	0.9381	1.0289	0.7711	0.8166
December 31, 2007	0.9304	1.0905	0.8437	1.0120
December 31, 2006	0.8817	0.9099	0.8528	0.8581
December 31, 2005	0.8254	0.8690	0.7872	0.8577
December 31, 2004	0.7683	0.8493	0.7159	0.8308

Month Ended:	Average(2)	High	Low	Period End

March 2009 (through March 3, 2009)	0.7744	0.7758	0.7729	0.7729
February 28, 2009	0.8021	0.8 202	0.7758	0.7870
January 31, 2009	0.8150	0.8458	0.7849	0.8088
December 31, 2008	0.8100	0.8358	0.7711	0.8166
November 30, 2008	0.8203	0.8696	0.7779	0.8083
October 31, 2008	0.8441	0.9426	0.7726	0.8220
September 30, 2008	0.9449	0.9673	0.9263	0.9435

(1) The average of the exchange rates for all days during the applicable year.

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

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

T his annual report contains forward-looking statements with respect to our financial condition, results of operations, business and certain of our plans and objectives. These forward-looking statements are made pursuant to the “Safe Harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industries in which we operate as well as beliefs and assumptions made by our management. Such statements include, in particular, statements about our plans, prospects, financial position and business strategies. Words such as “may”, “will”, “expect”, “continue”, “intend”, “estimate”, “anticipate”, “plan”, “foresee”, “believe” or “seek” or the negatives of these terms or variations of them or similar terminology are intended to identify such forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these statements, by their nature, involve risks and uncertainties and are not guarantees of future performance. Such statements are also subject to assumptions concerning, among other things: our anticipated business strategies; anticipated trends in our business; and our ability to continue to control costs. We can give no assurance that these estimates and expectations will prove to have been correct. Actual outcomes and results may, and often do, differ from what is expressed, implied or projected in such forward-looking statements, and such differences may be material. Some important factors that could cause actual results to differ materially from those expressed in these forward-looking statements include, but are not limited to:

· our ability to successfully build and deploy our new wireless services network on the timeline we are targeting and to implement successfully our strategy of becoming a facilities-based wireless provider;

· general economic, financial or market conditions;

· the intensity of competitive activity in the industries in which we operate, including competition from alternative means of programs and content transmission;

· unanticipated higher capital spending required to address continued development of competitive alternative technologies or the inability to obtain additional capital to continue the development of our business;

· our ability to implement successfully our business and operating strategies and manage our growth and expansion;

· disruptions to the network through which we provide our digital television, Internet access and telephony services, and our ability to protect such services from piracy;

· labour disputes or strikes;

· changes in our ability to obtain services and equipment critical to our operations;

· changes in laws and regulations, or in their interpretations, which could result, among other things, in the loss (or reduction in value) of our licenses or markets or in an increase in competition, compliance costs or capital expenditures;

· our substantial indebtedness, the tightening of credit markets, and the restrictions on our business imposed by the terms of our debt;

· exchange rate fluctuations that affect our ability to repay our U.S. dollar-denominated debt; and

· interest rate fluctuations that affect a portion of our interest payment requirements on long-term debt.

We caution you that the above list of cautionary statements is not exhaustive. These and other factors are discussed in further detail elsewhere in this annual report, including under the “Item 3. Key Information — Risk Factors” of this annual report. Each of these forward-looking statements speaks only as of the date of this annual report. We will not update these statements unless the securities laws require us to do so. We advise you to consult any documents we may file or furnish with the U.S. Securities and Exchange Commission, or the SEC, as described under “Item 10. Additional Information — Documents on Display”.

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Not applicable.

Not applicable.

A- Selected Financial Data

The following table presents selected consolidated financial information for our business for each of the years 2004 through 2008. We derived this selected financial information from our consolidated financial statements. O ur consolidated balance sheets as at December 31, 2008 and 2007 and consolidated statements of income, comprehensive income, shareholder’s equity and cash flows for each of the years in the three-year period ended December 31, 2008 are included in this annual report. The consolidated financial statements as at December 31, 2007 and for the years ended December 31, 2007 and December 31, 2006 have been audited by KPMG LLP, an independent registered public accounting firm. KPMG LLP’s report on these consolidated financial statements is included in this annual report. The consolidated financial statements as at and for the year ended December 31, 2008 have been audited by Ernst & Young LLP, an independent registered public accounting firm. Ernst & Young LLP’s report on these consolidated financial statements is included in this annual report. The selected consolidated statement of income data for the years ended December 31, 2005 and 2004 and the consolidated balance sheet data as at December 31, 2006, 2005 and 2004 which are presented below are derived from our audited consolidated financial statements audited by KPMG not included in this annual report. The information presented below the caption “Operating Data” is not derived from our consolidated financial statements and is unaudited. The information presented below the caption “Other Financial Data” is unaudited except for cash flows and capital expenditures for the years ended December 31, 2008, 2007, 2006, 2005 and 2004, which have been derived from our consolidated financial statements. All information contained in the following tables should be read in conjunction with our consolidated financial statements, the notes related to those financial statements and the section entitled “Item 5. Operating and Financial Review and Prospects”. Our historical results are not necessarily indicative of our future financial condition or results of operations.

Our consolidated financial statements have been prepared in accordance with Canadian GAAP. For a discussion of the principal differences between Canadian GAAP and U.S. GAAP, see Note 24 to our audited consolidated financial statements for the years ended December 31, 2008, 2007 and 2006 included under “Item 17. Financial Statements” in this annual report.

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	Year Ended December 31,
	2008			2007 (1)			2006			2005 (2)		2004 (2)
										(restated)		(restated)
	(dollars in thousands )
AMOUNTS UNDER CANADIAN GAAP
Consolidated Statement of Income Data:
Operating revenues:
Cable television	$	809,891		$	735,832		$	677,273		$	618,346	$	576,825
Internet	499,627			422,448			345,075			270,791		222,458
Cable telephony	286,063			195,477			107,357			21,088		—
Wireless telephony	31,630			17,717			1,208			—		—
Business solutions	63,592			70,189			74,352			78,409		66,117
Video stores	57,015			59,956			55,585			55,146		48,058
Other	56,388			50,987			48,745			36,626		24,274
Total operating revenues	1,804,206			1,552,606			1,309,595			1,080,406		937,732

Direct cost and operating expenses	1,007,050			909,923			796,887			666,793		573,943
Amortization	214,281			206,083			185,115			166,292		163,862
Financial expenses(3)(4)(5)	90,924			76,147			81,779			65,796		60,989
Loss (gain) on valuation and translation of derivative instruments	24,673			(9,095		)	(2,193		)	8,941		31,872
Impairment of goodwill and other items	(1,414		)	5,425			—			—		1,930
Income taxes expense (recovery)	73,102			38,258			64,230			69,791		(6,661		)
Non-controlling interest in a subsidiary	148			173			86			102		100
Net income	$	395,442		$	325,692		$	183,691		$	102,691	$	111,697

Consolidated Balance Sheet Data (at year end):
Cash and cash equivalents	—			—			—			$	26,699	$	32,411
Total assets	$	5,105,932		$	4,152,775		$	1,988,032		1,977,610		1,895,433
Long-term debt, excluding QMI subordinated loans(6)(7)(8)	1,807,997			950,988			1,021,170			971,697		990,008
QMI subordinated loans(6)(7)(8)	2,055,000			1,995,000			—			150,000		150,000
Share capital	1			46,177			345,727			342,940		388,593
Shareholder’s equity	403,654			259,110			249,581			76,363		229,302
Cash dividends declared and reductions of paid-up capital	230,000			299,550			118,749			255,653		205,233

	Year Ended December 31,
	2008			2007 (1)			2006			2005 (2)			2004 (2)
										(restated)			(restated)
	(dollars in thousands, except ARPU and ratio)
Other Financial Data
Operating income (unaudited)(9)	$	797,156		$	642,683		$	512,708		$	413,613		$	363,789
Operating income margin (unaudited)(9)	44.2		%	41.4		%	39.2		%	38.3		%	38.8		%
Cash flows from operating activities	711,534			552,923			440,619			387,205			329,433
Cash flows used in investing activities	(1,043,220		)	(2,338,164		)	(265,101		)	(274,977		)	(111,093		)
Cash flows from (used in) financing activities	331,686			1,785,241			(202,217		)	(117,940		)	(215,652		)
Capital expenditures(10)	404,759			330,075			302,629			219,865			144,453

Operating Data (unaudited):
Homes passed(11)	2,542,859			2,497,403			2,457,213			2,419,335			2,383,443
Basic cable customers(12)	1,715,616			1,638,097			1,572,411			1,506,113			1,452,554
Basic cable penetration(13)	67.5		%	65.6		%	64.0		%	62.3		%	60.9		%
Digital customers	927,322			768,211			623,646			474,629			333,664
Digital penetration(14)	54.1		%	46.9		%	39.7		%	31.5		%	23.0		%
Cable Internet customers	1,063,847			932,989			791,966			637,971			502,630
Cable Internet penetration(13)	41.8		%	37.4		%	32.2		%	26.4		%	21.1		%
Cable telephony customers	851,987			636,352			397,830			162,979			2,135
Cable telephony penetration(13)	33.5		%	25.5		%	16.2		%	6.7		%	0.1		%
ARPU(15)	$	81.17		$	71.52		$	61.43		$	51.86		$	46.50
Ratio of earnings to fixed charges(16)	4.6		x	5.2		x	3.9		x	3.8		x	2.6		x

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	Year Ended December 31,
	2008		2007 (1)			2006		2005 (2)			2004 (2)
								(restated)			(restated)
	(dollars in thousands )
AMOUNTS UNDER U.S. GAAP
Consolidated Statement of Income Data:
Operating revenues:
Cable television	$	810,131	$	736,179		$	677,970	$	621,493		$	584,187
Internet	499,712		422,585			345,112		272,926			224,450
Cable telephony	286,195		195,587			109,293		21,983			—
Wireless telephony	31,630		17,717			1,208		—			—
Business solutions	63,592		70,189			74,352		78,409			66,117
Video stores	57,015		59,956			55,585		55,146			48,058
Other	56,388		50,987			48,745		36,626			24,274
Total operating revenues	1,804,663		1,553,200			1,312,265		1,086,583			947,086

Direct cost and operating expenses	1,004,982		912,811			803,235		674,798			584,876
Amortization	225,587		216,711			196,335		177,415			175,743
Financial expenses(3)(4)(5)	90,924		76,147			81,779		65,796			60,989
Loss (gain) on valuation and translation of derivative instruments	30,105		(14,101		)	5,992		9,361			24,183
Impairment of goodwill and other items	586		5,425			—		—			1,930
Income taxes expenses (recovery)	77,293		32,317			56,073		60,408			(1,208			)
Non-controlling interest in a subsidiary	148		173			86		102			100
Net income	$	375,038	$	323,717		$	168,765	$	98,703		$	100,473

Consolidated Balance Sheet Data (at year end):
Cash and cash equivalents			—			—		$		26,699	$		32,411
Total assets	$	7,311,724	$	6,371,695		$	4,222,810	4,225,866			4,162,179
Long-term debt, excluding QMI subordinated loans (6)(7)(8)	1,804,003		946,236			1,007,557		958,433			991,280
QMI subordinated loans(6)(7)(8)	2,055,000		1,995,000			—		150,000			150,000
Share capital	1		46,177			345,727		342,940			388,593
Shareholder’s equity	2,626,594		2,475,853			2,429,137		2,273,593			2,437,970
Cash dividends declared and reductions of paid-up capital	230,000		$	299,550		$	118,749	$	255,653		$	205,233

	Year Ended December 31,
	2008			2007 (1)			2006			2005 (2)			2004 (2)
										(restated)			(restated)
	(dollars in thousands, except ratio)
Other Financial Data:
Operating income (unaudited)(9)	$	799,681		$	640,389		$	509,030		$	411,785		$	362,210
Operating income margin (unaudited)(9)	44.3		%	41.2		%	38.8		%	37.9		%	38.2		%
Cash flows from operating activities	712,259			552,529			437,841			385,377			327,854
Cash flows used in investing activities	(1,043,945		)	(2,337,770		)	(262,323		)	(273,149		)	(109,514		)
Cash flows from (used in) financing activities	331,686			1,785,241			(202,217		)	(117,940		)	(215,652		)
Capital expenditures(10)	404,759			330,075			302,629			219,865			144,453
Ratio of earnings to fixed charges(16)	4.4		x	5.1		x	3.6		x	3.6		x	2.5		x

(1) Effective January 1, 2007, Videotron adopted new financial instruments, hedges and comprehensive income standards pursuant to Canadian GAAP. See Note 1 to our consolidated financial statements included under Item 17 of this annual report.

(2) On January 1, 2006, a company under common control, Videotron Telecom Ltd., merged with the Company. On July 1, 2006, the Company also merged with its parent, 9101-0827 Québec inc. Those transactions have been accounted for using the continuity of interest method, and the results of operations and financial position of Videotron Telecom Ltd. and 9101-0827 Québec inc. have been included in these consolidated financial statements as if the three companies had always been combined. Comparative figures have been restated from statements previously presented. In respect of U.S. GAAP financial data, see also Note 24 “Significant differences between generally accepted accounting principles (GAAP) in Canada and the United States” to our consolidated financial statements included under Item 17 of this annual report.

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(3) In the first quarter of 2004, our wholly-owned subsidiary, Vidéotron (1998) ltée, entered into a back-to-back transaction with Quebecor Media. With respect to this back-to-back transaction, we made cash interest payments of $108.5 million to Quebecor Media in the year ended December 31, 2004, but we received $111.1 million in dividends from Quebecor Media in that same year. See “Item 5. Operating and Financial Review and Prospects — Liquidity and Capital Resources — Purchase of Shares of Quebecor Media and Service of Subsidiary Subordinated Loan”.

(4) On January 3, 2007, May 31, 2007 and January 4, 2008, we entered into back-to-back transactions with Quebecor Media and 9101-0835 Québec Inc., a subsidiary of Quebecor Media Inc. With respect to these back-to-back transactions, we recorded an interest expense of $238.9 million in the year ended December 31, 2008 and $157.7 million in the year ended December 31, 2007, but we recorded $246.9 million and $162.9 million in dividends from Quebecor Media in 2008 and 2007, respectively. See “Item 5. Operating and Financial Review and Prospects — Liquidity and Capital Resources — Purchase of Shares of Quebecor Media and Service of Subsidiary Subordinated Loan”.

(5) On May 31 2007 and January 4, 2008, CF Cable TV inc., a wholly-owned subsidiary of Videotron, entered into back-to-back transactions with Quebecor Media and 9101-0835 Québec Inc. With respect to these back-to-back transactions, we recorded interest expense of $30.9 million in the year ended December 31, 2008 and $7.7 million in the year ended December 31, 2007, but we recorded $31.9 million and $8.0 million in dividends from Quebecor Media in 2008 and 2007 respectively. See “Item 5. Operating and Financial Review and Prospects — Liquidity and Capital Resources — Purchase of Shares of Quebecor Media and Service of Subsidiary Subordinated Loan”.

(6) For the years ended December 31, 2007 and 2008, the term “QMI subordinated loans” refers to the $1.0 billion and $870.0 million subordinated loans due in 2022 we entered into in 2007 in favor of Quebecor Media (partly redeemed for $525.0 million in 2008), the $415.0 million subordinated loan due in 2023, entered into in 2008, also in favor of Quebecor Media, the $125.0 million subordinated loan due in 2022 our subsidiary CF Cable TV Inc., entered into in 2007 in favor of Quebecor Media and the $170.0 million subordinated loan due in 2023 our subsidiary CF Cable TV Inc., entered into in 2008 in favor of Quebecor Media . Interest on the subordinated loan throughout its term is payable in cash at our option. The QMI subordinated loans are reflected as long-term debt on our consolidated balance sheet. See Item 5. Operating and Financial Review and Prospects — Operating Results — Liquidity and Capital Resources — Purchase of Shares of Quebecor Media and Service of Subsidiary Subordinated Loan”.

(7) For the years ended December 31, 2004 and 2005, the term “QMI subordinated loans” refers to the $150.0 million subordinated loan due 2015 we entered into in favor of Quebecor Media and the $1.1 billion subordinated loan due 2019 by our subsidiary Vidéotron (1998) ltée, which is a guarantor of our Senior Notes, entered into on January 16, 2004 in favor of Quebecor Media. Interest on the $150.0 million subordinated loan throughout its term is payable in cash at our option. The QMI subordinated loans have been excluded from long-term debt because under the terms of our Senior Notes, all payments on the $150.0 million subordinated loan are restricted payments treated in the same manner as dividends on our common shares (excluding QMI subordinated loans entered into as part of a back-to-back transaction), and the proceeds of our $1.1 billion subordinated loan has been invested in retractable preferred shares of Quebecor Media as part of a back-to-back transaction to reduce our income tax obligations. On December 16, 2004, Quebecor Media redeemed its $1.1 billion of retractable preferred shares, and we used the proceeds to repay our $1.1 billion subordinated loan. On January 17, 2006, we reimbursed the $150.0 million subordinated loan due 2015 and all interest owed at that date for a total consideration of $168.0 million.

(8) We believe that long-term debt, excluding QMI subordinated loans, is, from the perspective of a holder of our issued and outstanding Senior Notes, a meaningful measure of our long-term debt because the QMI subordinated loans are subordinated in right of payment to the prior payment in full of our senior indebtedness, including our Senior Notes, and because the proceeds of our QMI subordinated loans due 2022 and 2023 were invested in retractable preferred shares of Quebecor Media as part of back-to-back transactions to reduce our income tax obligations. Consequently, we disclose long-term debt, excluding QMI subordinated loans, as a supplemental measure of our indebtedness in this annual report. Long-term debt, excluding QMI subordinated loans, is not intended to be, and should not be, regarded as an alternative to other financial reporting measures, and it should not be considered in isolation as a substitute for measures of liabilities prepared in accordance with Canadian GAAP or U.S. GAAP. Long-term debt, excluding QMI subordinated loans, is calculated from and reconciled to long-term debt as follows:

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	At December 31,
	2008			2007 (1)			2006		2005 (2)			2004 (2)
									(restated)			(restated)
	(Canadian dollars in millions) (unaudited)
AMOUNTS UNDER CANADIAN GAAP
Long-term debt	$	3,863.0		$	2,946.0		$	1,021.2	$	1,121.7		$	1,140.0
QMI subordinated loans	(2,055.0		)	(1,995.0		)	—		(150.0		)	(150.0		)
Long-term debt, excluding QMI subordinated loans, as defined	$	1,808.0		$	951.0		$	1,021.2	$	971.7		$	990.0

AMOUNTS UNDER U.S. GAAP
Long-term debt	$	3,859.0		$	2,941.2		$	1,007.6	$	1,108.4		$	1141.3
QMI subordinated loans	(2,055.0		)	(1,995.0		)	—		(150.0		)	(150.0		)
Long-term debt, excluding QMI subordinated loans, as defined	$	1,804.0		$	946.2		$	1,007.6	$	958.4		$	991.3

(9) We use the supplemental financial measure operating income to assess our operating results and financial performance. Operating income and ratios based on this measure are not required by or recognized under Canadian GAAP or U.S. GAAP. We define operating income, reconciled to net income under Canadian GAAP, as net income before amortization, financial expenses, loss (gain) on valuation and translation of derivative instruments, impairment of goodwill and other items, income taxes and non-controlling interest in a subsidiary. Operating income margin is operating income as a percentage of operating revenues. Operating income, and ratios using this measure, are not intended to be regarded as an alternative to other financial operating performance measures, or to the statement of cash flows as a measure of liquidity. Operating income is not intended to represent funds available for debt service, reinvestment, distributions of dividends, or other discretionary uses, and should not be considered in isolation from, or as a substitute for, our financial information reported under Canadian GAAP and U.S. GAAP. We believe that operating income is a meaningful measure of performance because operating income excludes, among other things, certain non-cash items and items that are not readily comparable from year to year. Operating income is also commonly used in the sector in which we operate, as well as by the investment community to analyze and compare companies. You should note our definition of operating income may not be identical to similarly titled measures reported by other companies, limiting its usefulness as a comparative measure. Our operating income is calculated from and reconciled to net income (loss) as follows:

	Year Ended December 31,
	2008			2007 (1)			2006			2005 (2)		2004 (2)
										(restated)		(restated)
	(Canadian dollars in millions) (unaudited)
AMOUNTS UNDER CANADIAN GAAP
Net income	$	395.4		$	325.7		$	183.7		$	102.7	$	111.7
Amortization	214.3			206.1			185.1			166.3		163.9
Financial expenses	90.9			76.1			81.8			65.8		61.0
Loss (gain) on valuation and translation of derivative instruments	24.7			(9.1		)	(2.2		)	8.9		31.9
Impairment of goodwill and other items	(1.4		)	5.4			—			—		1.9
Income taxes expense (recovery)	73.1			38.3			64.2			69.8		(6.7		)
Non-controlling interest	0.2			0.2			0.1			0.1		0.1
Operating income as defined	$	797.2		$	642.7		$	512.7		$	413.6	$	363.8

AMOUNTS UNDER U.S. GAAP
Net income	$	375.0		$	323.7		$	168.8		$	98.7	$	100.5
Amortization	225.6			216.7			196.3			177.4		175.7
Financial expenses	90.9			76.1			81.8			65.8		61.0
Loss (gain) on valuation and translation of derivative instruments	30.1			(14.1		)	6.0			9.4		24.2
Impairment of goodwill and other items	0.6			5.4			—			—		1.9
Income taxes expense (recovery)	77.3			32.3			56.1			60.4		(1.2		)
Non-controlling interest	0.2			0.2			0.1			0.1		0.1
Operating income as defined	$	799.7		$	640.4		$	509.0		$	411.8	$	362.2

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(10) Capital expenditures are comprised of acquisitions of fixed assets.

(11) “Homes passed” means the number of residential premises, such as single dwelling units or multiple dwelling units, and commercial premises passed by the cable television distribution network in a given cable system service area in which the programming services are offered.

(12) “Basic cable customers” are customers who receive basic cable television service in either analog or digital mode.

(13) Represents customers as a percentage of total homes passed.

(14) Represents customers as a percentage of basic customers.

(15) Average monthly revenue per user, or ARPU, is an industry metric that we use to measure our average cable, Internet, and cable and wireless telephony revenues per month per basic cable customer. ARPU is not a measurement that is required by or recognized under Canadian GAAP or U.S. GAAP, and our definition and calculation of ARPU may not be the same as similarly titled measurements reported by other companies. We calculate ARPU by dividing our combined cable television, Internet-access, and cable and wireless telephony revenues by the average number of our basic cable customers during the applicable period, and then dividing that result by the number of months in the applicable period.

(16) For the purpose of calculating the ratio of earnings to fixed charges, (i) earnings consist of net (loss) income plus non-controlling interest in a subsidiary, income taxes, fixed charges, amortized capitalized interest, less interest capitalized, and (ii) fixed charges consist of interest expensed and capitalized, excluding interest on QMI subordinated loans, plus amortized premiums, discounts and capitalized expenses relating to indebtedness and an estimate of the interest within rental expense.

B- Capitalization and Indebtedness

Not applicable.

C- Reasons for the Offer and Use of Proceeds

Not applicable.

D- Risk Factors

This section describes some of the risks that could materially affect our business, revenues, results of operations and financial condition, as well as the market value of our Senior Notes. The factors below should be considered in connection with any forward-looking statements in this document and with the cautionary statements contained in the section “Cautionary Statement Regarding Forward-Looking Statements” at the forepart of this annual report. The risks below are not the only ones that we face. Some risks may not yet be known to us and some that we do not currently believe to be material could later turn out to be material.

Risks Relating to Our Business

We operate in highly competitive industries with emerging technological developments, and our inability to compete successfully could have a material adverse effect on our business, prospects, revenues, financial condition and results of operations.

We operate in highly competitive industries. In our cable operations, we compete against direct broadcast satellite providers, or DBS (which is also called DTH in Canada, for “direct-to-home” satellite), multi-channel multipoint distribution systems, or MDS, satellite master antenna television systems and over-the-air television broadcasters. In addition, we compete against incumbent local exchange carriers (or “ILECs”) which have secured licenses to launch video distribution services using video digital subscriber line, or VDSL, technology. The CRTC has approved a regional license for the main ILEC in our market to provide terrestrial broadcasting distribution in Montréal and several other communities in the Province of Québec. The same ILEC has also acquired a cable network in our main service area. We also face competition from illegal providers of cable television services and illegal access to non-Canadian DBS (also called grey market piracy) as well as from signal theft of DBS that enables customers to access programming services

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from U.S. and Canadian DBS without paying any fees (also called black market piracy). Competitors in the video business also include the video stores industry (rental & sale) and other alternative entertainment media. In addition, the Internet, as well as distribution over mobile devices, may become competitive broadcast distribution platforms in the future.

In our Internet access business, we compete against other Internet service providers, or ISPs, offering residential and commercial Internet access services as well as open Wi-Fi networks in some cities. The CRTC also requires us to offer access to our high speed Internet system to our ISP competitors and several third party ISPs have access or have requested access to our network. CRTC rules also require that we allow third party ISPs to provide voice or telephony applications in addition to retail Internet access services.

Our Voice-over-IP (or “VoIP”) telephony service has numerous competitors, including ILECs, competitive local exchange carriers, or CLECs, wireless telephone service operators and other providers of telephony services, and competitors that are not facilities-based and therefore have a much lower infrastructure cost. Competition from ILECs is expected to increase, particularly as a result of the Canadian federal government’s decision in 2007 to lift winback restrictions on ILECs and to change the criteria for forbearance from regulation of local exchange services. Since this decision, the CRTC has approved numerous applications for local forbearance submitted by Bell Aliant, Bell Canada, Télébec and TELUS-Québec, in both the residential and business local exchange markets. As a result, Videotron’s incumbent local service competitors are now free from regulation of local exchange services in the vast majority of residential markets in which Videotron competes, as well as in a large number of business markets, including all of the largest metropolitan markets in Quebec. These rulings granting the ILECs’ forbearance applications enable ILECs to adjust their local exchange service prices for the approved exchanges without approval from the CRTC. Such price flexibility for local exchange services could have an adverse effect on our ability to compete successfully with ILECs in the local telephony market.

With our current Mobile Virtual Network Operator (or “MVNO”)-based wireless telephony service, we compete against a mix of corporations, some of them being active in some or all the products we offer, while others only offer mobile wireless telephony services in our market. In addition, users of wireless voice and data systems may find their communications needs satisfied by other current or developing technologies, such as Wi-Fi, WiMax, “hotspots” or trunk radio systems, which have the technical capability to handle wireless data communication and mobile telephone calls. There can be no assurance that current or future competitors will not provide services comparable or superior to those we provide or may in the future provide, or at lower prices, adapt more quickly to evolving industry trends or changing market requirements, or introduce competing services. The cost of implementing or competing against future technological innovations may be prohibitive to us, and we may lose customers if we fail to keep pace with these changes. Any of these factors could adversely affect our ability to operate our MVNO-based wireless business successfully and profitably.

We may not be able to compete successfully in the future against existing or potential competitors, and increased competition could have a material adverse effect on our business, prospects, revenues, financial condition and results of operations.

Delays in the launch of our facilities-based wireless services, including due to issues relating to infrastructure buildout and tower-sharing requirements, could impair our ability to gain market share and could adversely affect our ability to deploy and operate our wireless operations successfully and profitably.

In July 2008, under Canada’s spectrum auction for third generation AWS, our parent company, Quebecor Media, acquired spectrum licenses for AWS covering all regions of the province of Québec and certain areas of Ontario. Quebecor Media was the successful bidder for 40 MHz spectrum licenses in all parts of the Province of Québec, except the Outaouais region where it obtained 20 MHz spectrum licenses and certain regions of Québec where it obtained 50 MHz spectrum licenses. Quebecor Media also acquired 20 MHz spectrum licenses in Eastern Ontario and 10 MHz spectrum licenses in the city of Toronto. These licenses, the control of which was transferred from Quebecor Media to Videotron subsequent to the completion of the auction, were issued by Industry Canada on December 23, 2008. The spectrum enables us to pursue the

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buildout of a network infrastructure and to become a facilities-based provider offering advanced wireless telephony services, including high-speed Internet, mobile television and a variety of other advanced functions that can be accessed through mobile devices referred to as smartphones.

We are a new entrant in the wireless business in Canada, and, recently, most of the incumbent carriers have launched lower cost services in order to acquire additional market share and increase the wireless telephony penetration rate in our territory. Any delay in the launch of our wireless services could result in a more challenging market to penetrate. Any such delays could therefore also require us to deploy additional efforts and marketing expenses to meet our customer acquisition objectives, and there is a risk that we will be unable to meet our customer acquisition objectives on the timeline that we are targeting or at all.

Under Industry Canada’s new policy concerning mandatory roaming and antenna site and tower sharing, parties are required to consider tower-sharing arrangements in respect of existing towers prior to proposing the construction of new antenna tower structures. We are therefore dependent on the participation of incumbent operators to satisfy this requirement. Although incumbent carriers are required to respond to tower-sharing requests, there can be no assurance that they will accede to such requests or otherwise negotiate tower-sharing rates and terms that are economically or technologically acceptable to new entrants, such as Videotron. Industry Canada has established an arbitration process to encourage commercially reasonable outcomes, but such a process may prove lengthy and burdensome, and could delay the launch of our wireless services network, which could adversely affect our ability to operate our wireless business successfully and profitably.

In addition, Industry Canada’s new policy concerning antenna site and tower sharing includes requirements with respect to land-use authority and public consultation regarding proposed tower installations or modifications. We must therefore undertake public notification and address local and neighborhood concerns before building a new tower structure. These procedures could lead to delays in acquiring and developing new sites for cellular towers and could make it more costly to pursue our strategy of building an AWS network, which could adversely affect our ability to deploy and operate our wireless operations successfully and profitably.

In order to build our wireless network infrastructure in a timely manner Videotron has entered into commercial relationships with certain key suppliers. The inability of our key suppliers to meet our procurement and timing requirements could result in delays in the launch of our wireless network and in additional expenses, which could adversely affect our ability to deploy and operate our wireless business successfully and profitably.

We may encounter difficulties in reaching out-of-territory and in-territory roaming agreements with incumbent wireless operators.

Under Industry Canada’s new policy concerning mandatory roaming and antenna site and tower sharing, incumbent wireless operators are required, for a period of up to 10 years from the effective date of new entrants’ wireless licenses (December 23, 2008, in the case of Videotron), to permit new wireless entrants’ customers to roam on their networks outside the regions where such entrants won licenses in the 2008 AWS auction. Incumbents are also required to permit new entrants’ customers to roam on their networks within the regions where such new entrants have won licenses for a period of 5 years (a period that could be extended to 10 years in certain circumstances). However, the rates and terms for such roaming are not prescribed and will be determined by negotiation between new entrants, such as Videotron, and the incumbents. There can be no assurance that incumbents will advance these negotiations rapidly or that they will propose rates and other terms which are economically or technologically acceptable to new entrants. Industry Canada has established an arbitration process to encourage commercially reasonable outcomes, but such a process is lengthy and burdensome, and could further delay the launch of our wireless services, which could adversely affect our ability to operate our wireless business successfully and profitably.

In addition, various aspects of wireless communications operations, including the ability of wireless providers to enter into interconnection agreements with traditional wireline telephone companies, are subject to regulation by the CRTC. The government agencies having jurisdiction over any wireless business that we may develop could adopt

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regulations or take other actions that could adversely affect our wireless business and operations, including actions that could increase competition or that could increase our costs.

We are using a new technology for which only a limited number of handsets might be available at the time of commercial launch.

AWS in the 2GHz range is a spectrum that has not been broadly used until recently for mobile telephony. While certain wireless device suppliers in the United States have recently begun to offer their products on the AWS technology, there are still a limited number of handsets available. As a result, the handset portfolio for AWS we will offer at the time of the commercial launch of our wireless services may not be as broad as that of certain other providers and we could potentially incur higher costs of customer acquisition due to a smaller market for this type of technology, which could adversely affect our ability to operate our wireless business profitably .

We are regularly required to make capital expenditures to remain technologically and economically competitive. We may not be able to obtain additional capital to implement our business strategies and make certain capital expenditures.

Our strategy of maintaining a leadership position in the suite of products and services we offer and launching new products and services requires capital investments in our network and infrastructure to support growth in our customer base and demands for increased bandwidth capacity and other services. In this regard, we have in the past required substantial capital for the upgrade, expansion and maintenance of our network and the launch and expansion of new or additional services, and we expect additional capital expenditures in the short and medium term to expand and maintain our systems and services, including our expenditures relating to advancements in Internet access and high definition television, or HDTV, as well as the cost of our wireless services infrastructure buildout. In October 2008, we and Quebecor Media announced our intention to invest between $800 million and $1.0 billion over the next four years to roll out our own AWS network. This amount includes the cost of the acquired spectrum and operating licenses (which has already been paid), the cost of network buildout and initial operating costs (but excludes any capitalized interest). There can be no assurance that we will be able to obtain the funds necessary to finance our capital improvement programs, new strategies and services or other capital expenditure requirements, whether through internally generated funds, additional borrowings or other sources. If we are unable to obtain financing on acceptable terms, we may not be able to implement our business strategies and effect capital expenditures required to maintain our leadership position, and our business, financial condition, results of operations, reputation and prospects could be materially adversely affected. Even if we are able to obtain adequate funding, the period of time required to upgrade our network could have a material adverse effect on our ability to successfully compete in the future.

See also the following risk factors in this section: “— We operate in highly competitive industries with emerging technological developments, and our inability to compete successfully could have a material adverse effect on our business, prospects, revenues, financial condition and results of operations”, “—Delays in the launch of our wireless services, including due to issues relating to infrastructure buildout and tower-sharing requirements, could impair our ability to gain market share and could adversely affect our ability to deploy and operate our wireless operations successfully and profitably”, “— We compete, and will continue to compete, with alternative technologies, and we may be required to invest a significant amount of capital to address continuing technological evolution and development” and “— We may need to refinance certain of our indebtedness. Our inability to do so on favourable terms, or at all, could have a material adverse effect on us”.

If the world-wide financial crisis continues, the volatility and disruptions in the capital and credit markets could adversely affect our business, including affecting the cost of new capital, our ability to refinance our scheduled debt maturities and meet our other obligations as they come due.

The capital and credit markets have been experiencing extreme volatility and disruption. In the fourth quarter of 2008, the volatility and disruption reached unprecedented levels. The markets have exerted extreme downward pressure

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on stock prices and upward pressure on the cost of new debt capital and have severely restricted credit availability for most issuers.

The disruptions in the capital and credit markets have also resulted in higher interest rates on issuance of debt securities and increased costs under credit facilities. Continuation of these disruptions could increase our interest expense, adversely affecting our results of operations and financial position.

Our access to funds under our senior secured credit facilities is dependent on the ability of the financial institutions that are parties to those facilities to meet their funding commitments. Those financial institutions may not be able to meet their funding commitments if they experience shortages of capital and liquidity or if they experience excessive volumes of borrowing requests within a short period of time. Moreover, the obligations of the financial institutions under our senior secured credit facilities are several and not joint and, as a result, a funding default by one or more institutions does not need to be made up by the others.

Longer term volatility and continued disruptions in the capital and credit markets as a result of uncertainty, changing or increased regulation of financial institutions, reduced alternatives or failures of significant financial institutions could adversely affect our access to the liquidity needed for our businesses in the longer term. Such disruptions could require us to take measures to conserve cash until the markets stabilize or until alternative credit arrangements or other funding for our business needs can be arranged.

Continued market disruptions could cause broader economic downturns, which may lead to lower demand for certain of our products and increased incidence of customers’ inability to pay or timely pay for the services we provide. Events such as these adversely impact our results of operations, cash flows and financial position.

We compete, and will continue to compete, with alternative technologies, and we may be required to invest a significant amount of capital to address continuing technological evolution and development.

T he media industry is experiencing rapid and significant technological changes, which has resulted in alternative means of program and content transmission. The continued growth of the Internet has presented alternative content distribution options that compete with traditional media. Furthermore, in each of our broadcasting markets, industry regulators have authorized DTH, microwave services and VDSL services and may authorize other alternative methods of transmitting television and other content with improved speed and quality. We may not be able to successfully compete with existing or newly developed alternative technologies, such as digital television over Internet Protocol connections (IPTV), or we may be required to acquire, develop or integrate new technologies ourselves. The cost of the acquisition, development or implementation of new technologies could be significant and our ability to fund such implementation may be limited and could have a material adverse effect on our ability to successfully compete in the future. Any such difficulty or inability to compete could have a material adverse effect on our business, reputation, prospects, financial condition or results of operations.

We may not successfully implement our business and operating strategies.

Our business strategies are based on leveraging an integrated platform of media assets. Our strategies include launching and deploying additional value-added products and services such as AWS, pursuing cross-promotional opportunities, maintaining our advanced broadband network, leveraging geographic clustering, further integrating our operations within the Quebecor Media group of companies and maximizing customer satisfaction. We may not be able to implement these strategies fully or realize their anticipated results without incurring significant costs or at all. In addition, our ability to successfully implement these strategies could be adversely affected by a number of factors beyond our control, including operating difficulties, regulatory developments, general or local economic conditions, increased competition, technological change and the other factors described in this “Risk Factors” section. We may also be required to make capital expenditures in addition to those originally planned for the buildout of our AWS operations which may affect our ability to implement our business strategy should we not be able to secure additional financing on acceptable terms or generate sufficient internally generated funds to cover these requirements. Any material failure to

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implement our strategies could have a material adverse effect on our reputation, business, financial condition, prospects and results of operations and on our ability to meet our obligations, including our ability to service our indebtedness.

We have grown rapidly and are seeking to continue our growth. This rapid growth presents significant strains on our management. If we do not effectively manage our growth, our business, results of operations and financial condition could be adversely affected.

We have experienced substantial growth in our business and have significantly expanded our operations in recent years. We have in the past and may in the future seek to make opportunistic or strategic acquisitions and further expand the types of businesses in which we participate, such as our expansion into facilities-based wireless telephony operations, under appropriate conditions. This growth has placed, and will continue to place, a significant demand on our management. We can provide no assurance that we will be successful in either developing or fulfilling the objectives of any such acquisition or business expansion. In addition, our expansion and acquisitions may require us to incur significant costs or divert significant resources, and may limit our ability to pursue other strategic and business initiatives, which could have an adverse effect on our business, financial condition, prospects or results of operations. Furthermore, if we are not successful in managing and integrating any acquired businesses, or if we are required to incur significant or unforeseen costs, our business, results of operations and financial condition could be adversely affected.

We depend on key personnel.

Our success depends to a large extent upon the continued services of our senior management and our ability to retain skilled employees. There is intense competition for qualified management and skilled employees, and our failure to recruit, train and retain such employees could have a material adverse effect on our business, financial condition or operating results. In addition, to implement and manage our businesses and operating strategies effectively, we must maintain a high level of efficiency and performance, continue to enhance our operational and management systems, and continue to effectively attract, train, motivate and manage our employees. In connection with our current expansion as a facilities-based wireless services provider, we currently anticipate a near-term need to attract and train a substantial number of new employees, including many skilled employees, to staff this operation. If we are not successful in these efforts, it may have a material adverse effect on our business, prospects, results of operations and financial condition.

Our financial performance could be materially adversely affected if we cannot continue to distribute a wide range of television programming on reasonable terms.

The financial performance of our cable service business depends in large part on our ability to distribute a wide range of appealing, conveniently-scheduled television programming at reasonable rates. We obtain television programming from suppliers pursuant to programming contracts. The quality and amount of television programming offered by us affect the attractiveness of our services to customers and, accordingly, the rates we can charge. We may be unable to maintain key programming contracts at commercially reasonable rates for television programming. Loss of programming contracts, or our inability to obtain programming at reasonable rates, or our inability to pass on rate increases to our customers could have a material adverse effect on our business, financial condition and results of operations.

Our ability to distribute television programming at a reasonable cost is also linked to the risk of being imposed a carriage fee for over-the-air television. In November 2007, the CRTC agreed, pursuant to a request made by over-the-air television stations (OTAs), to revisit the concept of a subscriber fee that would be payable for the carriage of the signals of OTAs. In October 2008, the CRTC once again denied this request, although it is possible that the CRTC may re-examine the issue in the future.

In addition, our ability to attract and retain cable customers depends, to a certain extent, upon our capacity to offer quality content and a variety of programming choices and packages. If the number of specialty channels being offered decreases significantly or if the content offered on such channels does not receive audience acceptance, it may have a significant negative impact on revenues from our cable operations.

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We provide our digital television, Internet access and cable telephony services through a single clustered network, which may be more vulnerable to widespread disruption.

W e provide our digital television, Internet access and telephony services through a primary headend and our analog television services through twelve additional regional headends in our single clustered network. This characteristic means that a failure in our primary headend could prevent us from delivering some of our products and services throughout our network until we have resolved the failure, which may result in significant customer dissatisfaction.

We are dependent upon our information technology systems and those of certain third-parties and the inability to enhance our systems, or to protect them from a security breach or disaster, could have an adverse impact on our financial results and operations.

The day-to-day operation of our business is highly dependent on information technology systems, including those of certain third-party suppliers. An inability to maintain and enhance our existing information technology systems or obtain new systems to accommodate additional customer growth or to support new products and services could have an adverse impact on our ability to acquire new subscribers, retain existing customers, produce accurate and timely billing, generate revenue growth and manage operating expenses, all of which could adversely impact our financial results and position. In addition, although we use industry standard network and information technology security and survivability/disaster recovery practices, a security breach or disaster could have a material adverse effect on our reputation, business, prospects, financial condition and results of operations.

We may not be able to protect our services from piracy, which may have an adverse effect on our customer base and lead to a possible decline in revenues.

In our cable, Internet access and telephony operations, we may not be able to protect our services from piracy. We may be unable to prevent unauthorized access to our analog and digital programming, as well as our Internet access services. We use encryption technology to protect our cable signals from unauthorized access and to control programming access based on subscription packages. We may not be able to develop or acquire adequate technology to prevent unauthorized access to our services, which may have an adverse effect on our customer base and lead to a possible decline in our revenues.

Malicious and abusive Internet practices could impair our cable data services.

Our cable data customers utilize our network to access the Internet and, as a consequence, we or they may become victim of common malicious and abusive Internet activities, such as unsolicited mass advertising (or spam) and dissemination of viruses, worms and other destructive or disruptive software. These activities could have adverse consequences on our network and our customers, including degradation of service, excessive call volume to call centers and damage to our customers’ equipment and data or ours. Significant incidents could lead to customer dissatisfaction and, ultimately, loss of customers or revenue, in addition to increased costs to us to service our customers and protect our network. Any significant loss of cable data customers or revenue or significant increase in costs of serving those customers could adversely affect our growth, financial condition and results of operations.

We depend on third-party suppliers and providers for services and other items critical to our operations.

We depend on third-party suppliers and providers for certain services and other items that are critical to our operations, particularly our cable, telephony and wireless operations. These materials and services include set-top boxes, cable and telephony modems, servers and routers, fiber-optic cable, telephony switches, inter-city links, support structures, software, the “backbone” telecommunications network for our Internet access and telephony service, and construction services for expansion and upgrades of our network. These services and equipment are available from a limited number of suppliers. If no supplier can provide us with the equipment or services that we require or that comply with evolving Internet and telecommunications standards or that are compatible with our other equipment and software, our business, financial condition and results of operations could be materially adversely affected. In addition, if we are

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unable to obtain critical equipment, software, services or other items on a timely basis and at an acceptable cost, our ability to offer our products and services and roll out our advanced services may be delayed, and our business, financial condition and results of operations could be materially adversely affected. See also the risk factor “— Delays in the launch of our wireless services, including due to issues relating to infrastructure buildout and tower-sharing requirements, could impair our ability to gain market share and could adversely affect our ability to deploy and operate our wireless operations successfully and profitably” above.

We may be adversely affected by litigation and other claims.

In the normal course, we are involved in various legal proceedings and other claims relating to the conduct of our business. Although, in the opinion of our management, the outcome of current pending claims and other litigation is not expected to have a material adverse effect on our reputation, results of operations, liquidity or financial position, a negative outcome in respect of any such claim or litigation could have such an adverse effect. Moreover, the cost of defending against lawsuits and diversion of management’s attention could be significant. See also “Item 8. Financial Information — Legal Proceedings” in this annual report.

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

As of December 31, 2008, approximately 60% of our employees are unionized, and the terms of their employment are governed by one of our five regional collective bargaining agreements. Our two most important collective bargaining agreements, covering our unionized employees in the Montréal and Québec City regions, have terms extending to December 31, 2009. We are also party to two collective bargaining agreements covering our unionized employees in the Chicoutimi and Hull regions, with terms running through January 31, 2010 and August 31, 2011, respectively, and one other collective bargaining agreement covering 39 employees of our SETTE inc. subsidiary, which expired on December 31, 2007. Negotiations regarding this collective bargaining agreement began in 2008 and are ongoing.

We have in the past experienced labour disputes, which have disrupted our operations, resulted in damage to our network or our equipment and impaired our growth and operating results. We cannot predict the outcome of any current or future negotiations relating to labour disputes, union representation or the renewal of our collective bargaining agreements, nor can we assure you that we will not experience work stoppages, strikes, property damage or other forms of labour protests pending the outcome of any current or future negotiations. If our unionized workers engage in a strike or if there is any other form of work stoppage, we could experience a significant disruption of our operations, damages to our property and/or service interruption, which could adversely affect our business, assets, financial position and results of operations. Even if we do not experience strikes or other forms of labour protests, the outcome of labour negotiations could adversely affect our business and operating results, including if current or future labour negotiations or contracts were to restrict our ability to maximize the efficiency of our operations. In addition, our ability to make short-term adjustments to control compensation and benefits costs is limited by the terms of our collective bargaining agreements.

Our auditors are not required to issue a report on our internal control over financial reporting in this annual report.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, our management is responsible for establishing and maintaining adequate internal control structures and procedures for financial reporting, and to prepare a report which contains an assessment of the effectiveness of our internal control over financial reporting. Management’s report on our internal controls over financial reporting is included in “Item 15. Controls and Procedures” of this annual report. Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 and related temporary SEC rules, this annual report does not include a report of the Company’s registered public accounting firm on our internal control over financial reporting.

While we have concluded that our internal control over financial reporting was effective as of December 31, 2008, we cannot be certain that, when our auditors are required to perform an audit of our internal control over financial reporting, they will deliver their report without identifying areas for further attention or improvement, including material weaknesses.

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We will adopt new accounting standards in 2011, and this adoption may have a material impact on our financial statements.

In February 2008, Canada’s Accounting Standards Board confirmed that Canadian GAAP, as used by publicly accountable enterprises, will be fully converged to International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board. For our 2011 interim and annual financial statements, we will be required to report under IFRS and to provide IFRS comparative information for the 2010 fiscal year.

IFRS uses a conceptual framework similar to Canadian GAAP, but there are significant differences in recognition, measurement and disclosures. In order to prepare for the transition to IFRS, we have established an IFRS implementation team which includes senior levels of management from all relevant departments and subsidiaries, and have engaged an external expert advisor.

We have completed a diagnostic impact assessment, including a high-level analysis of potential consequences to financial reporting, business processes, internal controls, and information systems. Initial training has been provided to key employees and further investment in training and resources will be made throughout the transition to facilitate a timely and efficient changeover to IFRS. We continue to monitor and assess the impact of evolving differences between Canadian GAAP and IFRS. At this time, the impact of this changeover on our future financial position and results of operations is not yet determinable.

Risks Relating to Our Industry

We are subject to extensive government regulation. Changes in government regulation could adversely affect our business, financial condition, prospects and results of operations.

Broadcasting operations in Canada are subject to extensive government regulation. Laws and regulations govern the issuance, amendment, renewal, transfer, suspension, revocation and ownership of broadcast programming and distribution licenses. With respect to distribution, regulations govern, among other things, the distribution of Canadian and non-Canadian programming services and the maximum fees to be charged to the public in certain circumstances. In addition, there are significant restrictions on the ability of non-Canadian entities to own or control broadcasting licenses in Canada. Changes to the laws, regulations and policies governing broadcast television and distribution through cable or alternate means, the introduction of new laws, regulations, policies or terms of license could have a material adverse effect on our business, financial condition, prospects and results of operations. We outline certain elements of this regulatory framework below. For a more complete description of the regulatory environment affecting our business, see “Item 4. Information on the Company —Regulation”.

Our broadcasting distribution and telecommunications operations (including Internet access service) are regulated respectively by the Broadcasting Act (Canada) and the Telecommunications Act (Canada) and regulations thereunder. The CRTC, which administers the Broadcasting Act and the Telecommunications Act , has the power to grant, amend, suspend, revoke and renew broadcasting licenses, approve certain changes in corporate ownership and control, and make regulations and policies in accordance with the Broadcasting Act and the Telecommunications Act , subject to certain directions from the Federal Cabinet. Our cable operations are also subject to technical requirements and performance standards under the Radiocommunication Act (Canada) administered by Industry Canada. Furthermore, the Federal Government introduced a bill in a previous session of Parliament which would permit the Competition Bureau, under the Competition Act (Canada), to impose fines of up to $15 million on telecommunications companies that do not

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comply with this law. We do not know whether this bill will be re-introduced in Parliament or whether it will become law.

The issuance of licenses for the use of radiofrequency spectrum in Canada is administered by Industry Canada under the Radiocommunication Act . Use of spectrum is governed by conditions of license which address such matters as license term, transferability and divisibility, technical compliance, lawful interception, research and development requirements, and requirements related to antenna site sharing and mandatory roaming.

At the present time, the CRTC, through an exemption order, does not regulate the content of the Internet or interactive television and does not regulate broadcast distribution via the Internet. However, the CRTC has a policy of reviewing any of its exemption orders periodically. Broadcasting of programs and distribution of programs on the Internet and on wireless devices had been exempted from regulation since exemption orders issued in 1999 and 2007 respectively. On October 15, 2008, the CRTC announced that it will hold a public hearing beginning on February 17, 2009 to consider issues relating to broadcasting in the new media and the following six main themes: (i) defining broadcasting in new media; (ii) the significance of broadcasting in new media and its impact on the Canadian broadcasting system; (iii) are incentives or regulatory measures necessary or desirable for the creation and promotion of Canadian broadcasting content in new media?; (iv) are there issues concerning access to broadcasting content in new media?; (v) other broadcasting or public policy objectives; and (vi) the appropriateness of the new media exemption order. Subject to the outcome of these hearings, it is possible that the CRTC may impose a tax on cable and telecommunications companies in order to create a national fund that would finance Canadian programming.

On November 20, 2008, the CRTC initiated a public proceeding to consider Internet traffic management practices for both wholesale and retail Internet services. Among the issues to be considered in this proceeding are trends in traffic growth and network congestion, technical and economic solutions to address network congestion, the end user impacts of these solutions, notification requirements, and the potential for unjust discrimination toward Internet content or application providers. A decision is expected in November 2009. Any restrictions the CRTC might impose on the traffic management practices of Internet service providers could limit our ability to recover the costs of our access network.

On January 15, 2008, the CRTC issued its determination in Broadcasting Public Notice CRTC 2008-4, entitled “ Diversity of Voices .” In this public notice, the CRTC introduced new policies with respect to cross-media ownership; the common ownership of television services, including pay and specialty services; and the common ownership of broadcasting distribution undertakings. See “Item 4. Information on the Company — Regulation — Ownership and Control of Canadian Broadcast Undertakings — Diversity of Voices”.

On July 5, 2007, the CRTC announced a review of the regulatory frameworks for broadcasting distribution undertakings and discretionary programming services (Broadcasting Notice of Public Hearing CRTC 2007-10). As part of this review, the CRTC was considering reducing the amount of regulation for broadcasting distribution undertakings and discretionary programming services to the minimum essential to achieve the objectives under the Broadcasting Act , relying instead on market forces wherever possible. As a result of this review, on October 30, 2008, the CRTC issued a new distribution regulatory framework entitled “ Regulatory frameworks for broadcasting distribution undertakings and discretionary programming services ”. Pursuant to this new regulatory framework, the CRTC announced various changes to the regulatory frameworks for broadcasting distribution undertakings and discretionary programming services, the majority of which will be implemented via amendments to the Broadcasting Distribution Regulations and will take effect on August 31, 2011. See “Item 4. Information on the Company — Regulation — Canadian Broadcasting Distribution (Cable Television) — Distribution of Canadian Content and Broadcasting Distribution Regulations”.

On December 18, 2006, the federal government issued a policy direction to the CRTC which requires the CRTC to now take a more market-based approach to implementing the Telecommunications Act . This policy direction applies prospectively to the wide-variety of telecommunications-related regulatory issues that the CRTC handles. Application of this policy could result in future material changes to telecommunications regulation.

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As described more fully under the “Item 4. Information on the Company — Regulation — Canadian Broadcasting Distribution (Cable Television) — Licensing of Canadian Broadcasting Distribution Undertakings”, the CRTC has approved, since August 2007, the applications of a number of ILECs for forbearance from regulation of residential and business local exchange services affecting a large portion of the market in which Videotron operates. These rulings allow ILECs the right to adjust their prices for local exchange services in the approved exchanges without the need for CRTC approval. Such price flexibility by our ILEC competitors for local exchange services could have an adverse impact on our ability to compete successfully with them in the local telephony market.

On December 20, 2007, the CRTC granted conditional approval to a new telecommunications consumer agency, to which we had previously adhered voluntarily. The major Canadian cable operators, including Videotron, challenged certain elements of this ruling, and the CRTC issued a revised decision on May 30, 2008. Among other things, the CRTC ruled that all telecommunications service providers with annual revenues in excess of $10 million must become members of the agency for a period of three years. Videotron remains a member in good standing of the agency.

The CRTC may not renew our existing distribution licenses or grant us new licenses on acceptable terms, or at all.

Our CRTC distribution licenses must be renewed from time to time, typically every seven years, and cannot be transferred without regulatory approval.

While CRTC regulations and policies do not require CRTC approval before a broadcaster purchases an unregulated media entity, such as a newspaper, the CRTC may consider the issue of our cross-media ownership at license renewal proceedings, and may also consider the issue in deciding whether to grant new licenses to us. The CRTC further has the power to prevent or address the emergence of undue competitive advantage on behalf of one licensee where it is found to exist.

The CRTC may require us to take measures which could have a material adverse effect on the integration of our assets, our employees and our ability to realize certain of the anticipated benefits of our acquisitions. Our inability to renew any of our licenses or acquire new interests or licenses on acceptable terms, or at all, could have a material adverse effect on our business, financial condition or results of operations.

Industry Canada may not renew our AWS licenses on acceptable terms, or at all.

Our AWS licenses were issued on December 23, 2008, for a term of ten years. At a minimum of two years before the end of this term, and any subsequent terms, we may apply for license renewal for an additional license term of up to ten years. AWS license renewal, including whether license fees should apply for a subsequent license term, will be subject to a public consultation process initiated in year eight.

We are required to provide third-party Internet service providers with access to our cable systems, which may result in increased competition.

The four largest cable operators in Canada, including Vidéotron, have been required by the CRTC to provide third-party Internet service providers with access to their cable systems at mandated cost-based rates. The CRTC has further directed us to file, at the same time we offer any new retail Internet service speed, proposed revisions to our third-party internet access (or “TPIA”) tariff to include this new speed offering. TPIA tariff items have been filed and approved for all Videotron Internet service speeds. Several third-party Internet service providers are now interconnected to our cable network and are thereby providing retail Internet access services.

The CRTC also requires large cable carriers, such as us, to allow third-party Internet service providers to provide voice or telephony applications in addition to retail Internet access services.

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As a result of these requirements, we may experience increased competition for retail cable Internet and residential telephony customers. In addition, because our third-party Internet access rates are regulated by the CRTC, we could be limited in our ability to recover our costs associated with providing this access.

On March 3, 2008, the CRTC released a decision affirming that cable TPIA services are not ‘essential services’, yet mandated that they continue to be provided at cost-based rates until such time as it has been demonstrated that a functionally equivalent, practical and feasible wholesale alternative exists.

We may need to support increasing costs in securing access to support structures needed for our cable network.

We require access to the support structures of hydro-electric and telephone utilities and to municipal rights of way to deploy our cable network. Where access to the structures of telephone utilities cannot be secured, we may apply to the CRTC to obtain a right of access under the Telecommunications Act (Canada).

We have entered into comprehensive support structure access agreements with all of the major hydro-electric companies and all of the major telecommunications companies in our service territory. Our agreement with Hydro-Québec, by far the largest of the hydro-electric companies, expires in December 2010.

On October 30, 2008, TELUS filed an application with the CRTC seeking an order to direct the ILECs to file new costs, terms and conditions for support structure service. TELUS further requested that current telecommunications support structure rates be declared interim, and that monthly rental rates be adjusted retroactively to the date of its application to reflect any revised rates once a new tariff receives final approval. The major Canadian cable operators, including Videotron, have opposed TELUS’ application, whereas Bell Canada and its affiliates have supported it. If a review of monthly rental rates does proceed and if it results in an increase in rates, it may have a significant impact on Videotron’s network cost structure.

Long-Distance Equal Access could adversely affect our revenues.

The CRTC’s current three-year “Work Plan” includes a review of the regulatory treatment of Wireless Service Providers (WSPs), which could encompass a review of the issue of long-distance equal access for WSPs. Equal access would permit wireless customers to choose their long distance provider rather than relying on the long distance services of their contracted wireless carrier. This could result in lower revenues for long-distance services, which could adversely affect the profitability of our wireless telephony business .

We are subject to a variety of environmental laws and regulations.

We are subject to a variety of environmental laws and regulations. Certain of our facilities are subject to federal, provincial, state and municipal laws and regulations concerning, among other things, emissions to the air, water and sewer discharge, the handling and disposal of hazardous materials and waste, recycling, the soil remediation of contaminated sites, or otherwise relating to the protection of the environment. In addition, laws and regulations relating to workplace safety and worker health, which, among other things, regulate employee exposure to hazardous substances in the workplace, also govern our operations. Failure to comply with present or future laws or regulations could result in substantial liability to us. Environmental laws and regulations and their interpretation have changed rapidly in recent years and may continue to do so in the future. Our properties, as well as areas surrounding those properties, particularly those in areas of long-term industrial use, may have had historic uses, or may have current uses, in the case of surrounding properties, which may affect our properties and require further study or remedial measures. We are not currently conducting or planning any material study or remedial measure, and none has been required by regulatory authorities. However, we cannot provide assurance that all environmental liabilities have been determined, that any prior owner of our properties did not create a material environmental condition not known to us, that a material environmental condition does not otherwise exist as to any such property, or that expenditure will not be required to deal with known or unknown contamination.

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Risks Relating to our Senior Notes and Capital Structure

Our indebtedness and significant interest payment requirements could adversely affect our financial condition and therefore make it more difficult for us to fulfill our obligations, including our obligations under our outstanding Senior Notes.

We currently have a substantial amount of debt and significant interest payment requirements. As of December 31, 2008, we had $1.8 billion of consolidated long-term debt (excluding Quebecor Media subordinated loans) and we had $ 367.3 million available for additional borrowings under our senior secured credit facilities. Our substantial indebtedness could have significant consequences, including the following:

· increase our vulnerability to general adverse economic and industry conditions;

· require us to dedicate a substantial portion of our cash flow from operations to making interest and principal payments on our indebtedness, reducing the availability of our cash flow to fund capital expenditures, working capital and other general corporate purposes;

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

· place us at a competitive disadvantage compared to our competitors that have less debt or greater financial resources; and

· limit, along with the financial and other restrictive covenants in our indebtedness, among other things, our ability to borrow additional funds on commercially reasonable terms, if at all.

Our senior secured credit facilities and the indentures governing our outstanding notes permit us to incur additional indebtedness in the future. If we incur additional debt, the risks we now face as a result of our leverage could intensify. For more information regarding our long-term debt, see Note 14 to our audited consolidated financial statements for the year ended December 31, 2008 included under “Item 17. Financial Statements” of this annual report.

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

The terms of our senior secured credit facilities and the respective indentures governing our Senior Notes contain a number of operating and financial covenants restricting our ability to, among other things:

· incur additional debt, including guarantees by our restricted subsidiaries;

· pay dividends and make other restricted payments;

· create or permit certain liens;

· use the proceeds from sales of assets and subsidiary stock;

· create or permit restrictions on the ability of our restricted subsidiaries, if any, to pay dividends or make other distributions;

· engage in certain transactions with affiliates;

· enter into sale and leaseback transactions; and

· enter into mergers, consolidations and transfers of all or substantially all of our assets.

Our failure to comply with these covenants could result in an event of default which could, if not cured or waived, result in an acceleration of our debt and cause cross-defaults under our other debt. If our indebtedness is accelerated, we may not be able to repay our indebtedness or borrow sufficient funds to refinance it, and any such prepayment or refinancing could adversely affect our financial condition. In addition, if we incur additional debt in the future, we may be subject to additional covenants, which may be more restrictive than those to which we are currently

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subject. Even if we are able to comply with all applicable covenants, the restrictions on our ability to manage our business in our sole discretion could adversely affect our business by, among other things, limiting our ability to take advantage of financings, mergers, acquisitions and other corporate opportunities that we believe would be beneficial to us.

We may not be able to finance an offer to purchase our Senior Notes following a change of control as required by each of the indentures governing our Senior Notes because we may not have sufficient funds at the time of the change of control or our senior secured credit facilities may not allow the repurchases.

If we experience a change of control, as that term is defined in each of the respective indentures governing our Senior Notes, or if we dispose of significant assets under specified circumstances, we may be required to make an offer to repurchase all of our Senior Notes prior to maturity. We cannot assure you that we will have sufficient funds or be able to arrange for additional financing at the time of the change of control to make the required repurchase of the Senior Notes. There is no sinking fund with respect to our outstanding Senior Notes.

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

We may need to refinance certain of our indebtedness. Our inability to do so on favourable terms, or at all, could have a material adverse effect on us.

We may need to refinance certain of our existing debt instruments at their term. Our ability to obtain additional financing to repay our existing debt at maturity will depend upon a number of factors, including prevailing market conditions and our operating performance. The tightening of credit availability and the well-publicized challenges affecting global capital markets could also limit our ability to refinance our existing maturities. There can be no assurance that any such financing will be available to us on favourable terms or at all. See also the risk factor “—Risks Relating to Our Business—If the world-wide financial crisis continues, the volatility and disruptions in the capital and credit markets could adversely affect our business, including affecting the cost of new capital, our ability to refinance our scheduled debt maturities and meet our other obligations as they come due” above.

We may be adversely affected by exchange rate fluctuations.

Most of our revenues and expenses are received or denominated in Canadian dollars. However, certain expenditures, such as the purchase of set-top boxes and cable modems and certain capital expenditures, including certain costs related to the buildout of our wireless network, are paid in U.S. dollars. Also, a substantial portion of our debt is denominated in U.S. dollars, and interest, principal and premium, if any, thereon is payable in U.S. dollars. For the purposes of financial reporting, any change in the value of the Canadian dollar against the U.S. dollar during a given financial reporting period would result in a foreign exchange gain or loss on the translation of any unhedged U.S. dollar-denominated debt into Canadian dollars. Consequently, our reported earnings and debt could fluctuate materially as a result of foreign exchange gains or losses. Although we have entered into transactions to hedge the exchange rate risk with respect to 100% of our U.S. dollar-denominated debt outstanding at December 31, 2008, and we intend in the future to enter into such transactions for new U.S. dollar-denominated debt, these hedging transactions could, in certain circumstances, prove economically ineffective and may not be successful in protecting us against exchange rate fluctuations, or we may in the future be required to provide cash and other collateral to secure our obligations with respect to such hedging transactions, or we may in the future be unable to enter into such transactions on favorable terms or at all. In addition, certain cross-currency interest rate swaps that we have entered into include an option that allows each party to unwind the transaction on a specific date at the then-fair value.

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The fair value of the derivative financial instruments we are party to is estimated using period-end market rates and reflect the amount Videotron would receive or pay if the instruments were terminated and settled at those dates, as adjusted for counterparties’ non-performance risk. At December 31, 2008, the net aggregate fair value of our cross-currency interest rate swaps and forward foreign exchange swap agreements was $78.5 million. See also “Item 11. Quantitative and Qualitative Disclosures About Market Risk” of this annual report.

Canadian bankruptcy and insolvency laws may impair the trustees’ ability to enforce remedies under our Senior Notes.

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

The powers of the court under the Bankruptcy and Insolvency Act (Canada), and particularly under the Companies’ Creditors Arrangement Act (Canada), have been interpreted and exercised broadly so as to protect a restructuring entity from actions taken by creditors and other parties. Accordingly, we cannot predict whether payments under our outstanding notes would be made during any proceedings in bankruptcy, insolvency or other restructuring, whether or when the trustees could exercise their respective rights under the respective indentures governing our Senior Notes or whether and to what extent holders of our Senior Notes would be compensated for any delays in payment, if any, of principal, interest and costs, including the fees and disbursements of the respective trustees.

Applicable statutes allow courts, under specific circumstances, to void the guarantees of our Senior Notes provided by certain of our subsidiaries.

Our creditors or the creditors of one or more guarantors of our Senior Notes could challenge the guarantees as fraudulent transfers, conveyances or preferences or on other grounds under applicable U.S. federal or state law or applicable Canadian federal or provincial law. While the relevant laws vary from one jurisdiction to another, the entering into of the guarantees by certain of our subsidiaries could be found to be a fraudulent transfer, conveyance or preference or otherwise void if a court was to determine that:

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

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

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

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

In addition, the corporate statutes governing the guarantors of our Senior Notes may also have provisions that serve to protect each guarantor’s creditors from impairment of its capital from financial assistance given to its corporate insiders where there are reasonable grounds to believe that, as a consequence of this financial assistance, the guarantor

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would be insolvent or the book value, or in some cases the realizable value, of its assets would be less than the sum of its liabilities and its issued and paid-up share capital. While the applicable corporate laws may not prohibit financial assistance transactions and a corporation is generally permitted flexibility in its financial dealings, the applicable corporate laws may place restrictions on each guarantor’s ability to give financial assistance in certain circumstances.

There is no public market for our Senior Notes.

There is currently no established trading market for our Senior Notes and we do not intend to apply for listing of any of our Senior Notes on any securities exchange or on any automated dealer quotation system. No assurance can be given as to the prices or liquidity of, or trading markets for, any series of our Senior Notes. The liquidity of any market for our Senior Notes will depend upon the number of holders of our Senior Notes, the interest of securities dealers in making a market in our Senior Notes, prevailing interest rates, the market for similar securities and other factors, including general economic conditions, our financial condition and performance, and our prospects. The absence of an active market for our Senior Notes could adversely affect the market price and liquidity of our Senior Notes.

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

Non-U.S. holders of our Senior Notes are subject to restrictions on the transfer or resale of our Senior Notes.

We did not, and we do not intend to, qualify our Senior Notes by prospectus in Canada, and, accordingly, the Senior Notes remain subject to restrictions on resale and transfer in Canada. In addition, non-U.S. holders remain subject to restrictions imposed by the jurisdiction in which the holder is resident.

U.S. investors in our Senior Notes may have difficulties enforcing civil liabilities.

We are incorporated under the laws of the Province of Québec. Substantially all of our directors, controlling persons and officers are residents of Canada or other jurisdictions outside the United States and all or a substantial portion of their assets and substantially all of our assets are located outside the United States. We have agreed, under the terms of the respective indentures governing our Senior Notes, to accept service of process in any suit, action or proceeding with respect to the indentures or the Senior Notes brought in any federal or state court located in New York City by an agent designated for such purpose, and to submit to the jurisdiction of such courts in connection with such suits, actions or proceedings. Nevertheless, it may be difficult for holders of our outstanding notes to effect service of process upon us or such persons within the United States or to enforce against us or them in the United States, judgments of courts of the United States predicated upon the civil liability provisions of the U.S. federal or state securities laws or other laws of the United States. In addition, there is doubt as to the enforceability in Canada of liabilities predicated solely upon U.S. federal or state securities law against us and our directors, controlling persons and officers who are not residents of the United States, in original actions or in actions for enforcement of judgments of U.S. courts.

We are controlled by Quebecor Media.

All of our issued and outstanding common shares are held by Quebecor Media. As a result, Quebecor Media controls our policies and operations. The interests of Quebecor Media, as our sole common shareholder, may conflict with the interests of the holders of our outstanding notes. In addition, actions taken by Quebecor Media, as well as its financial condition, matters over which we have no control, may affect us.

Also, Quebecor Media is a holding company with no significant assets other than its equity interests in its subsidiaries. Its principal source of cash needed to pay its own obligations is the cash that we and other subsidiaries generate from operations and borrowings. We have the ability to pay significant dividends under the terms of our indebtedness and applicable law and currently expect to make distributions to our shareholder in the future, subject to the

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terms of our indebtedness and applicable law. See “Item 8. Financial Information — Dividend Policy” elsewhere in this annual report.

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A- History and Development of the Company

We were founded on September 1, 1989 as part of the amalgamation of our two predecessor companies, namely Videotron Ltd. and Télé-Câble St-Damien inc., under Part IA of the Companies Act (Québec). In October 2000, our parent company, Le Groupe Vidéotron ltée, was acquired by Quebecor Media. At the time of this acquisition, the assets of Le Groupe Vidéotron ltée included all of our shares. In December 2002, Le Groupe Vidéotron ltée was liquidated into its sole shareholder, Quebecor Media.

Our registered office is located at 612 St. Jacques Street, Montréal, Québec, Canada H3C 4M8, and our telephone number is (514) 281-1232. Our corporate website may be accessed through the URL http://www.videotron.com . The information found on our corporate website does not, however, form part of this annual report and is not incorporated by reference herein. Our agent for service of process in the United States with respect to our Senior Notes is CT Corporation System, 111 Eighth Avenue, New York, New York 10011.

On January 1, 2005, our subsidiary Vidéotron TVN Inc., or Vidéotron TVN, was liquidated into us, and on December 31, 2004, our subsidiary Vidéotron (1998) ltée was liquidated into us. These transactions had no impact on our consolidated financial statements.

On January 1, 2006, Vidéotron (Régional) ltée was merged with and into CF Cable TV Inc. This transaction has no impact on our consolidated financial statements.

On January 1, 2006, Videotron Telecom, which was a wholly-owned indirect subsidiary of Quebecor Media, was merged with and into us, pursuant to an amalgamation under Part IA of the Companies Act (Québec). On July 1, 2006, we also merged with our parent, 9101-0827 Québec inc, pursuant to an amalgamation under Part IA of the Companies Act (Québec). Both transactions have been accounted for using the continuity of interest method and, accordingly, the previous periods have been restated to include the results of operations and the financial position of the companies as if they had always been combined.

On September 23, 2008, Videotron completed the acquisition of all of the issued and outstanding common shares of 9193-2962 Québec Inc. (“Spectrumco”) from Quebecor Media. Spectrumco currently holds the recently obtained spectrum licenses for AWS.

For a description, including the amount invested, of our principal capital expenditures since January 1, 2006, see “Item 5. Operating and Financial Review and Prospects — Liquidity and Capital Resources — Uses of Liquidity and Capital Resources— Capital Expenditures”.

B- Business Overview

Overview

We are the largest cable operator in the Province of Québec and the third largest in Canada, in each case based on the number of cable customers, a major Internet service provider and a provider of telephony services in the Province of Québec. We offer pay television, Internet access, cable telephony and mobile wireless telephony services. Our cable network covers approximately 80% of Québec’s approximately 3.1 million residential and commercial premises passed by cable. Our cable licenses include licenses for the greater Montréal area, the second largest urban area in Canada. The greater Montréal area represents one of the largest contiguous clusters in Canada and is among the largest in North America as measured by the number of cable customers. This concentration provides us with improved operating efficiencies and is a key element in the development and launch of our bundled service offerings.

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As of December 31, 2008, we had over 1.7 million basic cable customers (which we define as customers receiving basic cable service, including analog and digital customers), representing a basic penetration rate of 67.5%. Through our extensive broadband coverage, we also offer digital television and cable Internet access services to approximately 99% of our total homes passed. We have rapidly grown our digital customer base in recent years, and at December 31, 2008, we had 927,332 digital customers, representing 54.1% of our basic customers and 36.5% of our total homes passed. We have also rapidly grown our cable Internet access customer base, and as of December 31, 2008, we had 1,063,847 cable Internet access customers, representing 62.0% of our basic customers and 41.8% of our total homes passed. We believe that the continued increase in the penetration rate of our digital television, cable Internet access, telephony and wireless voice and data services will result in increased average revenue per customer (ARPU).

Our bi-directional hybrid fiber coaxial (HFC) network also allows us to offer a telephony service using VoIP technology to our residential and commercial customers. As of December 31, 2008, we had 851,987 cable telephony customers, representing 49.7% of our basic customers and 33.5% of our total homes passed. In addition, as of December 31, 2008, approximately 99% of all of our cable customers were in areas in which our cable telephony service was available.

We also currently offer MVNO-based mobile wireless telephony services utilizing the GSM/GPRS network of Rogers Wireless Inc. (“Rogers Wireless”), a subsidiary of Rogers Communications Inc. As of December 31, 2008, 63,402 lines had been activated. On March 31, 2008, our parent company, Quebecor Media, qualified as a new market entrant in the spectrum auction for third generation Advanced Wireless Services. In July 2008, our parent company, Quebecor Media, acquired spectrum licenses for AWS covering all regions of the province of Québec and certain areas of Ontario. Quebecor Media was the successful bidder for 40 MHz spectrum licenses in all parts of the Province of Québec, except the Outaouais region where it obtained 20 MHz spectrum licenses and certain regions of Québec where it obtained 50 MHz spectrum licenses. Quebecor Media also acquired 20 MHz spectrum licenses in Eastern Ontario and 10 MHz spectrum licenses in the city of Toronto. These licenses, the control of which was transferred from Quebecor Media to Videotron subsequent to the completion of the auction, were issued by Industry Canada on December 23, 2008. These spectrum licenses enable us to pursue the buildout of a network infrastructure and become a facilities-based provider offering advanced wireless telephony services, including high-speed Internet, mobile television and a variety of other advanced functions that can be accessed through mobile devices referred to as smartphones.

In October 2008, we and Quebecor Media announced our intention to invest between $800 million and $1.0 billion over the next four years to roll out our own AWS network. This amount includes the cost of the acquired spectrum and operating licenses (which has already been paid), the cost of network buildout and initial operating costs (but excludes any capitalized interest). We plan to fund future investments in AWS through cash flow generation and available credit facilities. We currently anticipate that our new High Speed Packet Access (HSPA) network will be operational in 9 to 15 months.

We offer our advanced products and services, which include video-on-demand and selected interactive television services, as a bundled package that is unique among the competitors in our market. We differentiate our services by offering a higher speed Internet access product, the widest range of French-language programming in Canada and exclusive content on our video-on-demand service. We believe that our bundled packages of products and services, together with our focus on customer service and the breadth of our French-language offerings, have resulted in improved customer satisfaction, increased use of our services and higher customer retention.

For the year ended December 31, 2008, Videotron generated revenues of $ 1.80 billion and operating income of $ 797.2 million. For the year ended December, 31, 2007, Videotron generated revenues of $1.55 billion and operating income of $642.7 million.

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Competitive Strengths

Leading Market Positions . We are the largest cable operator in Québec and the third largest in Canada. We believe that our strong market position has enabled us to more effectively launch and deploy new products and services. For example, since the introduction of our cable Internet access service, we estimate that we have become the largest provider of such service in the areas we serve. In addition, we operate the largest chain of video stores in Québec through our Le SuperClub Vidéotron subsidiary. We believe that our proprietary and third-party retail distribution network of 717 stores and points of sale, including the Le SuperClub Vidéotron stores, assists us in marketing and distributing our advanced services, such as cable Internet access and digital television, on a large scale basis.

Single, Highly-Contiguous Cluster. We serve our customer base through a single HFC clustered network that covers approximately 80% of Québec’s total addressable market and five of the province’s top six urban areas. This network represents one of the largest contiguous clusters in Canada and among the largest in North America as measured by the number of cable customers. We serve all of our cable customers through one primary headend and twelve regional headends. We believe that our single cluster network architecture provide us with several benefits, including:

· a higher quality and more reliable network;

· the ability to launch and deploy new products and services rapidly and efficiently; and

· a lower cost structure through reduced maintenance and technical support costs.

Differentiated, Bundled Service Offerings. Through our technologically advanced network, we offer a differentiated, bundled suite of entertainment, information and communication services and products, including digital television, cable Internet access, video-on-demand and other interactive television services, as well as residential and commercial cable telephony services using VoIP technology, and mobile wireless telephony services. In addition, we deliver high-quality services and products, including, for example, our standard cable Internet access service that enables our customers to download data at a higher speed than that currently offered by standard digital subscriber line, or DSL, technology, we offer the widest range of French-language programming in Canada, and we offer exclusive content on our video-on-demand service.

Advanced Broadband Network. We have an advanced network, 99% of which is bi-directional, which allows us to offer a wide range of advanced services on the same media, such as digital television, video-on-demand, cable Internet access and cable telephony services. We are committed to maintaining and upgrading our network capacity and, to that end, we currently anticipate that future capital expenditures over the next five years will be required to accommodate the evolution of our products and services and to meet the demand for increased capacity resulting from the growth of our telephony service and the offering of our other advanced products and services.

Strong, Market-Focused Management Team. We have a strong market-focused management team that has extensive experience and expertise in a range of areas, including marketing, finance, telecommunications and technology. Under the leadership of our senior management team, we have, despite intense competition, successfully increased sales of our digital television products, improved penetration of our high-speed Internet access and cable products and successfully launched our VoIP telephony services.

Cable Television Industry Overview

Cable television has been available in Canada for more than 50 years and is a well developed market. Competition in the cable industry was first introduced in Canada in 1997. As of August 31, 2007, the most recent date for which data is available, there were approximately 7.6 million cable television customers in Canada, representing a basic cable penetration rate of approximately 55.9% of homes passed. For the twelve months ended August 31, 2007 (the most recent data available), total industry revenue was estimated to be over $7.1 billion and is expected to grow in the future because Canadian cable operators have aggressively upgraded their networks and have begun launching and deploying

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new products and services, such as cable Internet access, digital television services and, more recently, telephony services. The following table summarizes the most recent available annual key statistics for the Canadian and U.S. cable television industries.

	Twelve Months Ended August 31,
	CAGR(1)		2007			2006			2005			2004			2003
	(Homes passed and basic cable customers in millions, dollars in billions)

Canada
Industry Revenue	12.7	%	$	7.1		$	6.1		$	5.0		$	4.7		$	4.4
Homes Passed(2)	5.7	%	13.6			13.0			11.2			10.5			10.9
Basic Cable Customers	1.7	%	7.6			7.5			6.9			6.9			7.1
Basic Penetration	(3.8	)%	55.9		%	57.7		%	61.6		%	65.7		%	65.1		%

	Twelve Months Ended December 31,
	CAGR(3)		2008			2007			2006			2005			2004
	(Homes passed and basic cable customers in millions, dollars in billions)

U.S.
Industry Revenue	7.1	%	US$	81.3		US$	74.7		US$	68.2		US$	62.3		US$	57.6
Homes Passed(2)	2.8	%	124.2			123.0			111.6			110.8			108.2
Basic Cable Customers	(0.2	)%	64.7			65.1			65.6			65.4			65.4
Basic Penetration	(2.9	)%	52.1		%	52.9		%	58.8		%	59.0		%	60.4		%

Source of Canadian data: CRTC.

Source of U.S. data: NCTA, A.C. Nielsen Media Research and SNL Kagan.

(1) Compounded annual growth rate from 2003 through 2007.

(2) “Homes passed” means the number of residential premises, such as single dwelling units or multiple dwelling units, and commercial premises passed by the cable television distribution network in a given cable system service area in which the programming services are offered.

(3) Compounded annual growth rate from 2004 through 2008.

The traditional cable business, which is the delivery of video via hybrid fiber coaxial network, is fundamentally similar in the U.S. and Canada. Different economic and regulatory conditions, however, have given rise to important differences between the two markets. Canadian operators have more limited revenue sources than U.S. operators due to Canadian regulations which prevent cable operators from generating revenue from local advertising. However, the lack of local advertising revenues allows Canadian cable operators to benefit from lower programming costs as compared to U.S. cable operators.

A significant portion of Canada’s cable television customers are based in Québec. As of August 31, 2008, Québec is home to approximately 23.3% of Canada’s population and approximately 23.9% of its basic cable customers. Based on the CRTC statistics, basic cable penetration in Québec, which was approximately 53.9% as of August 31, 2008, has traditionally been lower than in other provinces in Canada, principally due to the higher concentration of French-speaking Canadians in Québec. It is estimated that over 80% of Québec’s population is French-speaking. Contrary to the English-speaking provinces of Canada, where programming in English comes from all over North America, programming in French is available over-the-air in most of Québec’s French-speaking communities. The arrival of a variety of French-language specialty channels not available over-the-air and, more recently, the introduction of HD content, contributed to a penetration increase.

Expansion of Digital Distribution and Programming

In order to compete with the direct broadcast satellite offerings, the cable industry began deploying digital technology, which allows for a large number of programming channels and advanced services to be offered.

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In addition, in recent years, the choice and range of television programming has expanded substantially in Canada. In November 2000, the CRTC released its decisions on the applications for new digital pay and specialty television channels. In total, the CRTC approved 21 Category One licenses (16 English-language and five French-language) and 262 Category Two licenses, as well as two pay-per-view and four video-on-demand licenses. Cable service providers using digital technology are required to carry all of the approved Category One services appropriate to their markets while Category Two licensees who do not have guaranteed distribution rights must negotiate with cable service providers for access. Since then, the CRTC has licensed dozens of Category Two additional programming licenses. The increase in programming content as a result of the launch of approximately 50 of these programming services is believed to be a key factor in driving increases in digital cable penetration in Canada.

Many programming services have announced their intention to convert to high-definition format. We believe that the availability of HDTV programming will increase significantly in the coming years and will result in a higher penetration level of digital distribution.

In recent years, digital cable has significantly expanded the range of services that may be offered to our customers. We are now offering to our digital cable customers more than 340 channels, including 161 English-language channels, 55 French-language channels, 35 HDTV channels, 10 time-shifting channels and 63 radio/music channels.

Our strategy, in the coming years, will be to try to continue the expansion in our offering and maintain the quality of our programming. Our cable television service depends in large part on our ability to distribute a wide range of appealing, conveniently-scheduled television programming at reasonable rates and will be an important factor in our success to maintain the attractiveness of our services to customers.

Products and Services

We currently offer our customers analog cable television services and programming as well as new and advanced high-bandwidth products and services such as cable Internet access, digital television, premium programming and selected interactive television services. We continue to focus on our cable Internet access, digital television and telephony services, which are increasingly desired by customers. With our advanced broadband network, our objective is to increase penetration of value-added services such as video-on-demand, high-definition television, personal video recorders, as well as interactive programming and advertising.

We offer cable telephony service in Québec, a product that leverages our customer base with what was at the time Videotron Telecom’s telecommunications network and expertise. We integrated Videotron Telecom’s operations within our own operations pursuant to the merger of Videotron Telecom with and into Videotron on January 1, 2006.

Traditional Cable Television Services

Customers subscribing to our traditional analog “basic” and analog “extended basic” services generally receive a line-up of 44 channels of television programming, depending on the bandwidth capacity of their local cable system. Customers who pay additional amounts can also subscribe to additional channels, either individually or in packages. We aim to tailor our channel packages to satisfy the specific needs of the different customer segments we serve.

Our analog cable television service offerings include the following:

· Basic Service. All of our customers receive a package of basic programming, consisting of local broadcast television stations, the four U.S. commercial networks and PBS, selected Canadian specialty programming services, and local and regional community programming. Our basic service customers generally receive 26 channels on basic cable.

· Extended Basic Service. This expanded programming level of services, which is generally comprised of approximately 18 channels, includes a package of French- and English-language specialty television programming and U.S. cable channels in addition to the basic service channel line-up described above.

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Branded as “Telemax”, this service was introduced in almost all of our markets largely to satisfy customer demand for greater flexibility and choice.

Advanced Cable-Based Products and Services

Cable’s large bandwidth is a key factor in the successful delivery of advanced products and services. Several emerging technologies and increasing Internet usage by our customer base have presented us with significant opportunities to expand our sources of revenue. We currently offer a variety of advanced products and services, including cable Internet access, digital television, cable telephony and selected interactive services. We intend to continue to develop and deploy additional services to further broaden our service offering.

· Cable Internet Access. Leveraging our advanced cable infrastructure, we offer cable Internet access to our residential customers primarily via cable modems attached to personal computers. We provide this service at speeds of up to 360 times the speed of a conventional telephone modem. In 2008, we also launched and effected a gradual roll-out of our Wideband services, which offer speeds of up to 900 times the speed of a conventional telephone modem. We currently plan to continue extending the coverage of this service in 2009. As of December 31, 2008, we had 1,063,847 cable Internet access customers, representing 62.0% of our basic customers and 41.8% of our total homes passed. Based on internal estimates, we are the largest provider of Internet access services in the areas we serve with an estimated market share of 53.9% as of September 30, 2008.

· Digital Television. We have installed headend equipment capable of delivering digitally encoded transmissions to a two-way digital-capable set-top box in the customer’s home. This digital connection provides significant advantages. In particular, it increases channel capacity, which allows us to increase both programming and service offerings while providing increased flexibility in packaging our services. Our basic digital package includes 25 television channels, 45 audio services providing CD-quality music, 16 AM/FM radio channels, an interactive programming guide as well as television-based e-mail capability. Our extended digital basic television offering, branded as “ à la carte ” ( i.e. , individual channel selections), offers customers the ability to select more than 200 additional channels of their choice, including U.S. super-stations and other special entertainment programs, allowing them to customize their choices. This also offers customers significant programming flexibility including the option of French-language only, English-language only or a combination of French- and English-language programming, as well as many foreign-language channels. We also offer pre-packaged themed service tiers in the areas of news, sports and discovery. Customers who purchase basic service and one customized package can also purchase channels on an à la carte basis at a specified cost per channel per month. As part of our digital service offering, customers can also purchase near-video-on-demand services on a per-event basis. As of December 31, 2008, we had 927,322 customers for our digital television service, representing 54.1% of our basic customers and 36.5% of our total homes passed. Our customers currently have the option to purchase or lease the digital set-top boxes required for digital service. We believe that the sale of equipment to customers improves customer retention, and, as of December 31, 2008, we had 1,209,595 set-top boxes deployed, of which approximately 97% were owned by customers and 3% were leased.

· Cable Telephony . In January 2005, we launched our cable telephony service using VoIP technology in selected areas of the Province of Québec, and since then we have been progressively rolling-out this offering among our other residential and commercial customers in the Province of Québec. As of December 31, 2008, our cable telephony service is available to 99% of our homes passed. Our cable telephony service includes both local and long-distance calling, and permits all of our telephony customers, both residential and commercial, to access all service features mandated by CRTC Decision 97-8 and other regulatory decisions and orders, including: enhanced 911 Emergency service; number portability from and to any local exchange carrier; a message relay service allowing subscribers to communicate with the hearing impaired; and a variety of personal privacy features including universal call tracing. We also offer free basic listings in local telephone directories, as well as full operator assistance, including: operator-assisted calls; collect and third-party calls; local, national and

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international directory assistance; person-to-person calls; and busy-line verification. Finally, we offer as part of our telephony service a host of convenient, optional features, including: name and number caller ID; call waiting with long-distance distinctive ring and audible indicator tone; name and number caller ID on call waiting; visual indicator of a full voice mail box and audible message waiting indicators; automatic call forwarding; three-way conference calling; automatic recalling; and last incoming call identification and recall. VoIP allows us to deliver new cutting-edge features, such as voice-mail to e-mail functionality, which allows customers to access their voice-mail via e-mail in the form of audio-file attachments. In keeping with our competitive strength of providing differentiated, bundled service offerings, we offer free installation of our telephony service to existing cable television and/or Internet customers and to new bundled customers. We also offer discounts to our bundled customers, when compared to the sum of the prices of the individual services provided to these customers. In addition, we offer discounts for a second telephone line subscription. On October 24, 2007, we launched our Softphone service, our new computer-based service providing users with more flexibility when traveling, the ability to make local calls anywhere in the world, and new communications management capabilities. As of December 31, 2008, we had 851,987 subscribers to our cable telephony service, representing a penetration rate of 49.7% of our basic cable subscribers and 33.5% of our homes passed.

· Video-On-Demand. Video-on-demand service enables digital cable customers to rent from a library of movies, documentaries and other programming through their digital set-top box. Our digital cable customers are able to rent their video-on-demand selections for a period of 24 hours, which they are then able to watch at their convenience with full stop, rewind, fast forward, pause and replay functionality during that period. Our video-on-demand service is available to 99% of the homes passed by us. We sometimes group movies, events or TV programs available on video-on-demand and offer them on a weekly basis. Regulations prevent us from offering such blocks of programs for a longer period. We also offer pay television channels on a subscription basis that permits our customers to access and watch most of the movies available on the linear Pay TV channels these clients subscribe to.

· Other Products and Services. To maintain and enhance our market position, we are focused on increasing penetration of high-definition television and personal video recorders, as well as other high-value products and services.

Wireless Telephony

On August 10, 2006, we launched our MVNO-based mobile wireless telephony services in the Québec City area, utilizing the Rogers Wireless GSM/GPRS network. Since then, the service has been completely rolled out throughout the Province of Québec. Through our strategic relationship with Rogers Wireless, we offer Québec consumers a quadruple play of television, broadband Internet, cable telephony and Videotron branded mobile wireless telephony services. Our services include international roaming and popular options such as voicemail, call waiting, call display, call forwarding, text messaging and conference calling. We are responsible for acquiring and billing customers, as well as for providing customer support under our own brand. As of December 31, 2008, 63,402 lines had been activated.

Following our participation in Canada’s spectrum auction for third generation AWS, we are currently pursuing the buildout of a network infrastructure to become a facilities-based provider offering advanced wireless telephony services. Videotron’s objective is to bring consumers and small businesses an offering of advanced wireless telecommunications services that is based on effective, reliable technology, diverse and convergent content and unambiguous business policies. See “— Business Overview — Overview.”

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Customer Statistics Summary

The following table summarizes our customer statistics for our analog and digital cable and advanced products and services:

	As of December 31,
	2008		2007		2006		2005		2004

Homes passed(1)	2,542,859		2,497,403		2,457,213		2,419,335		2,383,443
*Cable*
Basic customers(2)	1,715,616		1,638,097		1,572,411		1,506,113		1,452,554
Penetration(3)	67.5	%	65.6	%	64.0	%	62.3	%	60.9	%
Digital customers	927,322		768,211		623,646		474,629		333,664
Penetration(4)	54.1	%	46.9	%	39.7	%	31.5	%	23.0	%
Number of digital set-top boxes	1,209,595		953,393		738,530		537,364		362,053
*Dial-up Internet Access*
Dial-up customers	6,533		9,052		13,426		18,034		23,973
*Cable Internet Access*
Cable modem customers	1,063,847		932,989		791,966		637,971		502,630
Penetration(3)	41.8	%	37.4	%	32.2	%	26.4	%	21.1	%
*Telephony Services*
Cable telephony customers	851,987		636,352		397,860		162,979		2,135
Penetration(3)	33.5	%	25.5	%	16.2	%	6.7	%	0.1	%
Wireless telephony lines	63,402		45,077		11,826		—		—

(1) “Homes passed” means the number of residential premises, such as single dwelling units or multiple dwelling units, and commercial premises passed by the cable television distribution network in a given cable system service area in which the programming services are offered.

(2) Basic customers are customers who receive basic cable service in either the analog or digital mode.

(3) Represents customers as a percentage of total homes passed.

(4) Represents customers for the digital service as a percentage of basic customers.

In the year ended December 31, 2008, we recorded a net increase of 77,519 basic cable customers. During the same period, we also recorded net additions of: 130,858 subscribers to our cable Internet access service; 159,111 customers to our digital television service, the latter of which includes customers who have upgraded from our analog cable service; and 215,635 customers to our cable telephony services. In 2008, we activated 18,325 lines for our mobile wireless telephony services.

Business Telecommunications Ser vices

We integrated Videotron Telecom’s operations within our own operations pursuant to the merger of Videotron Telecom with and into us on January 1, 2006. Our Business Telecommunications segment provides a wide range of network solutions, Internet services, application/server hosting, local and long-distance telephone service, and studio-quality audio-video services to large and medium-sized businesses, ISPs, application service providers (“ASP”), broadcasters and carriers in both Québec and Ontario.

Video Stores

Through Le SuperClub Vidéotron, we also operate the largest chain of video and video game rental stores in Québec and among the largest of such chains in Canada, with a total of 246 retail locations (of which 208 are franchised). With 140 retail locations offering our suite of services and products, Le SuperClub Vidéotron is both a showcase and a valuable and cost-effective distribution network for Videotron’s growing array of advanced products and services, such

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as cable Internet access, digital television and mobile wireless telephony. Le SuperClub Vidéotron announced in 2008 its intention to franchise most of its remaining corporate locations and is currently in the process of doing so.

Pricing of our Products and Services

Our revenues are derived principally from the monthly fees our customers pay for cable services. The rates we charge vary based on the market served and the level of service selected. Rates are usually adjusted annually. We also offer discounts to our bundled customers, when compared to the sum of the prices of the individual services provided to these customers. As of December 31, 2008, the average monthly fees for basic and extended basic service were $24.57 and $38.49, respectively, and the average monthly fees for basic and extended basic digital service were $14.00 and $42.75, respectively. A one-time installation fee, which may be waived in part during certain promotional periods, is charged to new customers. Monthly fees for rented equipment, such as set-top boxes and cable modems, are also charged to customers.

The CRTC only regulates rates for basic cable service. Fees for extended cable service (over and above basic cable service rates), pay-television and pay-per-view services, and rentals for set-top boxes are priced by us on a commercial, free-market basis and are not regulated by the CRTC.

Although our service offerings vary by market, because of differences in the bandwidth capacity of the cable systems in each of our markets and competitive and other factors, our services are typically offered at monthly price ranges, which reflect discounts for bundled service offerings, as follows:

Service		Price Range

Basic analog cable		$15.07 – $29.88
Extended basic analog cable		$28.50 – $42.19
Basic digital cable		$13.98 – $15.98
Extended basic digital cable		$27.98 – $76.98
Pay-television		$ 3.99 – $29.99
Pay-per-view (per movie or event)		$ 3.99 – $54.99
Video-on-demand (per movie or event)		$ 4.49 – $64.99
Dial-up Internet access		$ 9.95 – $19.95
Cable Internet access		$27.95 – $89.95
Cable telephony		$16.95 – $22.95
Mobile wireless telephony		$22.65 – $78.35

Our Network Technology

As of December 31, 2008, our cable systems consisted of 19,331 km of fiber optic cable and 36,740 km of coaxial cable, passing approximately 2.5 million homes and serving approximately 1.9 million customers. Our network is the largest broadband network in Québec covering approximately 80% of cable homes passed and, according to our estimates, more t han 80% of the businesses located in the major metropolitan areas of each of Québec and Ontario. Our extensive network supports direct connectivity with networks in Ontario, Eastern Québec, the Maritimes and the United States.

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The following table summarizes the current technological state of our systems, based on the percentage of our customers who have access to the bandwidths listed below and two-way (or “bi-directional”) capability:

	450 MHz and Under		480 to 625 MHz		750 to 860 MHz		Two-Way Capability

December 31, 2004	3	%	23	%	74	%	97	%
December 31, 2005	2	%	23	%	75	%	98	%
December 31, 2006	2	%	23	%	75	%	98	%
December 31, 2007	1	%	2	%	97	%	99	%
December 31, 2008	1	%	0	%	99	%	99	%

Our cable television networks are comprised of four distinct parts including signal acquisition networks, main headends, distribution networks and subscriber drops. The signal acquisition network picks up a wide variety of television, radio and multimedia signals. These signals and services originate from either a local source or content provider or are picked up from distant sites chosen for satellite or over-the-air reception quality and transmitted to the main headends by way of over-the-air links, coaxial links or fiber optic relay systems. Each main headend processes, modulates, scrambles and combines the signals in order to distribute them throughout the network. Each main headend is connected to the primary headend in order to receive the digital MPEG2 signals and the IP Backbone for the Internet services. The first stage of this distribution consists of a fiber optic link which distributes the signals to distribution or secondary headends. After that, the signal uses the hybrid fiber coaxial cable network made of wide-band optical nodes, amplifiers and coaxial cables capable of serving up to 30 km in radius from the distribution or secondary headends to the subscriber drops. The subscriber drop brings the signal into the customer’s television set directly or, depending on the area or the services selected, through various types of customer equipment including set top boxes and cable modems.

We have adopted the hybrid fiber coaxial (HFC) network architecture as the standard for our ongoing system upgrades. Hybrid fiber coaxial network architecture combines the use of fiber optic cable with coaxial cable. Fiber optic cable has excellent broadband frequency characteristics, noise immunity and physical durability and can carry hundreds of video and data channels over extended distances. Coaxial cable is less expensive and requires greater signal amplification in order to obtain the desired transmission levels for delivering channels. In most systems, we deliver our signals via fiber optic cable from the headend to a group of nodes to the homes passed served by that node. Our system design provides for cells of approximately 570 homes each to be served by fiber optic cable. To allow for this configuration, secondary headends were put into operation in the greater Montréal area and in the greater Québec City area. Remote secondary headends must also be connected with fiber optic links. The loop structure of the two-way networks brings reliability through redundancy, the cell size improves flexibility and capacity, while the reduced number of amplifiers separating the home from the headend improves signal quality and reliability. Our network design provides us with significant flexibility to offer customized programming to individual cells of approximately 570 homes, which is critical to our advanced services, such as video-on-demand, Switched Digital Video Broadcast and the continued expansion of our interactive services. Our network design also allows for further segmentation from 500 to 250 or 125 homes where cable, Internet and telephony service penetration requires higher network capacity. We also believe that our network design provides high capacity and superior signal quality that will enable us to provide to our current and future customers new advanced products and services in addition to those currently offered by us.

Our strategy of maintaining a leadership position in respect of the suite of products and services that we offer and launching new products and services requires investments in our network to support growth in our customer base and increases in bandwidth requirements. Approximately 99% of our network in Québec has been upgraded to a bandwidth of 750 MHz or greater. Also, in light of the greater availability of HDTV programming, the ever increasing speed of Internet access and increasing demand for our cable telephony service, further investment in the network will be required.

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(but excludes any capitalized interest). We plan to fund future investments in AWS through cash flow generation and available credit facilities. We currently anticipate that our new High Speed Packet Access (HSPA) network will be operational in 9 to 15 months.

Marketing and Customer Care

Our long term marketing objective is to increase our cash flow through deeper market penetration of our services and continued growth in revenue per customer. We believe that customers will come to view their cable connection as the best distribution channel to the home for a multitude of services. To achieve this objective, we are pursuing the following strategies:

· continue to rapidly deploy advanced products and services such as cable Internet access, digital television, cable telephony and mobile wireless telephony services;

· design product offerings that provide greater opportunity for customer entertainment and information choices;

· target marketing opportunities based on demographic data and past purchasing behavior;

· develop targeted marketing programs to attract former customers, households that have never subscribed to our services and customers of alternative or competitive services;

· enhance the relationship between customer service representatives and our customers by training and motivating customer service representatives to promote advanced products and services;

· leverage the retail presence of Le SuperClub Vidéotron and third-party commercial retailers;

· cross-promote the wide variety of content and services offered within the Quebecor Media group (including, for example, the content of TVA Group productions and the 1-900 service for audience voting during reality television shows popular in Québec) in order to distribute our cable, data transmission, cable telephony and mobile wireless telephony services to our existing and future customers;

· introduce new value-added packages of products and services, which we believe increases average revenue per user, or ARPU, and improves customer retention; and

· leverage our business market, using the Videotron Telecom network and expertise with our commercial customer base, which should enable us to offer additional bundled services to our customers and may result in new business opportunities.

We continue to invest time, effort and financial resources in marketing new and existing services. To increase both customer penetration and the number of services used by our customers, we use coordinated marketing techniques, including door-to-door solicitation, telemarketing, media advertising, e-marketing and direct mail solicitation.

Maximizing customer satisfaction is a key element of our business strategy. In support of our commitment to customer satisfaction, we provide a 24-hour customer service hotline seven days a week for nearly all of our systems, in addition to our web-based customer service capabilities. All of our customer service representatives and technical support staff are trained to assist our customers with respect to all products and services offered by us, which in turn allows our customers to be served more efficiently and seamlessly. Our customer care representatives continue to receive extensive training to develop customer contact skills and product knowledge, which are key contributors to high rates of customer retention as well as to selling additional products and services and higher levels of service to our customers. To assist us in our marketing efforts, we utilize surveys, focus groups and other research tools as part of our efforts to determine and proactively respond to customer needs.

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Programming

We believe that offering a wide variety of conveniently scheduled programming is an important factor in influencing a customer’s decision to subscribe to and retain our cable services. We devote resources to obtaining access to a wide range of programming that we believe will appeal to both existing and potential customers. We rely on extensive market research, customer demographics and local programming preferences to determine our channel and package offerings. The CRTC currently regulates the distribution of foreign content in Canada and, as a result, we are limited in our ability to provide such programming to our customers. We obtain basic and premium programming from a number of suppliers, including TVA Group.

Our programming contracts generally provide for a fixed term of up to seven years, and are subject to negotiated renewal. Programming tends to be made available to us for a flat fee per customer. Our overall programming costs have increased in recent years and may continue to increase due to factors including, but not limited to, additional programming being provided to customers as a result of system rebuilds that increase channel capacity, increased costs to produce or purchase specialty programming and inflationary or negotiated annual increases.

Competition

We operate in a competitive business environment in the areas of price, product and service offerings and service reliability. We compete with other providers of television signals and other sources of home entertainment. In addition, as we expand into additional services such as Internet, cable telephony and mobile wireless telephony services, we may face additional competition. Our principal competitors include over-the-air television and providers of other entertainment, direct broadcast satellite, digital subscriber line (DSL), private cable, other cable distribution, ILECs and wireless distribution. We also face competition from illegal providers of cable television services and illegal access to both foreign DBS (also called grey market piracy) as well as from signal theft of DBS that enables customers to access programming services from U.S. and Canadian direct broadcast satellite services without paying any fee (also called black market piracy).

· Over-the-air Television and Providers of Other Entertainment. Cable television has long competed with broadcast television, which consists of television signals that the viewer is able to receive without charge using an over-the-air antenna. The extent of such competition is dependent upon the quality and quantity of broadcast signals available through over-the-air reception compared to the services provided by the local cable system. Cable systems also face competition from alternative methods of distributing and receiving television signals and from other sources of entertainment such as live sporting events, movie theatres and home video products, including videotape recorders, DVD players and video games. The extent to which a cable television service is competitive depends in significant part upon the cable system’s ability to provide a greater variety of programming, superior technical performance and superior customer service than are available over the-air or through competitive alternative delivery sources.

· Direct Broadcast Satellite. Direct broadcast satellite, or DBS, is a significant competitor to cable systems. DBS delivers programming via signals sent directly to receiving dishes from medium- and high-powered satellites, as opposed to cable delivery transmissions. This form of distribution generally provides more channels than some of our television systems and is fully digital. DBS service can be received virtually anywhere in Canada through the installation of a small rooftop or side-mounted antenna. Like digital cable distribution, DBS systems use video compression technology to increase channel capacity and digital technology to improve the quality of the signals transmitted to their customers.

· DSL. The deployment of digital subscriber line technology, known as DSL, provides customers with Internet access at data transmission speeds greater than that available over conventional telephone lines. DSL service is comparable to cable-modem Internet access over cable systems. We also face competition from other providers of DSL service.

· VDSL. The CRTC and Industry Canada have authorized video digital subscriber line, or VDSL, services. VDSL technology increases the capacity of DSL lines available, which permits the distribution of digital

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video. We expect that we will soon face competition from incumbent local exchange carriers, which have been granted licenses to launch video distribution services using this technology. ILECs are currently installing this new technology, which operates over the copper lines in phone lines, in our markets. This technology can achieve speeds as high as 52 Mbps upstream, but VDSL can only operate over a short distance of about 4,000 feet (1,200 metres). As a result, telephone companies are replacing many of their main feeds with fibre-optic cable. By placing a VDSL transceiver, a VDSL gateway, in larger multiple dwelling units, the distance limitation is overcome. Further, as a result of such improvements in broadband speeds over DSL and the evolution of compression technology, incumbent telephone carriers in our service areas may be in a position to enable delivery of digital television over their cable Internet connections (IPTV) in the coming years. Advanced trials are underway in Canada and in other countries. Tests in our service markets are still being performed. If successful, IPTV may provide telecommunications carriers with a way to offer services similar to those offered by cable operators in the consumer market.

· Private Cable. Additional competition is posed by satellite master antenna television systems known as “SMATV systems” serving multi-dwelling units, such as condominiums, apartment complexes, and private residential communities.

· Other Cable Distribution. Currently, a cable operator offering television distribution and providing cable-modem Internet access service is serving the greater Montréal area. This cable operator is owned by the regional ILEC.

· Wireless Distribution. Cable television systems also compete with wireless program distribution services such as multi-channel multipoint distribution systems, or MDS. This technology uses microwave links to transmit signals from multiple transmission sites to line-of-sight antennas located within the customer’s premises.

· Grey and Black Market DBS Providers. Cable and other distributors of television signals continue to face competition from the use of access codes and equipment that enable the unauthorized decoding of encrypted satellite signals, from unauthorized access to our analog and digital cable signals (black market) and from the reception of foreign signals through subscriptions to foreign satellite television providers that are not lawful distributors in Canada (grey market).

· Telephony Service. Our cable telephony service competes against other telephone companies, including both the incumbent telephone service provider in Québec, which controls a significant portion of the telephony market in Québec, as well as other VoIP telephony service providers and mobile wireless telephone service providers.

· Mobile wireless telephony services. Our mobile wireless telephony service competes against a mix of competitors, some of them being active in all the products we offer, while others only offer mobile wireless telephony services in our market. As a facilities-based wireless provider, we will compete primarily with established incumbent wireless service providers and MVNOs, and could in the future compete with other new entrant companies, including other MVNOs. In addition, users of wireless voice and data systems may find their communications needs satisfied by other current or developing technologies, such as Wi-Fi, WiMax, “hotspots” or trunk radio systems, which have the technical capability to handle wireless data communication and mobile telephone calls. Our wireless business will also compete with rivals for dealers and retail distribution outlets.

· Other Internet Service Providers. In the Internet access business, cable operators compete against other Internet service providers offering residential and commercial Internet access services. The CRTC requires the large Canadian incumbent cable operators to offer access to their high speed Internet system to competitive Internet service providers at mandated rates.

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C- Regulation

Foreign Ownership Restrictions Applicable under the Telecommunications Act (Canada) and the Broadcasting Act (Canada)

In November 2002, the Canadian federal Minister of Industry initiated a review of the existing foreign ownership restrictions applicable to telecommunications carriers. The House of Commons Standing Committee on Industry, Science and Technology issued a report on April 28, 2003 recommending the removal of foreign ownership restrictions in the telecommunications industry and that any changes made to the Canadian ownership and control requirements applicable to telecommunications common carriers be applied equally to broadcasting distribution undertakings. However, in June 2003, the House of Commons Standing Committee on Canadian Heritage instead recommended the status quo regarding foreign ownership levels for broadcasting and telecommunications companies. On April 4, 2005, the Canadian government released a response to the report of the latter committee wherein it stated, among other things, that “the Government wishes to indicate that it is not prepared to modify foreign ownership limits on broadcasting or content more generally.” However, it acknowledged the appointment by Industry Canada of an independent panel of experts, the Telecommunications Policy Review Panel, to review Canada’s telecommunications policy and regulation of telecommunications, including consideration of Canada’s foreign investment restrictions in telecommunications and whether those restrictions should be removed.

In March of 2006, the Telecommunications Policy Review Panel filed with Canada’s Industry Minister its report regarding its review of the existing foreign ownership restrictions applicable to telecommunications carriers. In the Afterword of the Report, the Panel proposed that the government adopt a phased and flexible approach to liberalization of restrictions on foreign investment in telecommunications service providers to the extent that they are not subject to the Broadcasting Act. Ownership and control of Canadian telecommunications common carriers should be liberalized in two phases:

· In the first phase, the Telecommunications Act should be amended to give the federal Cabinet authority to waive the foreign ownership and control restrictions on Canadian telecommunications common carriers when it deems a foreign investment or class of investments to be in the public interest. During the first phase, there should be a presumption that investments in any new start-up telecommunications investment or in any telecommunications common carrier with less than 10% of the revenues in any telecommunications service market are in the public interest. This presumption could be rebutted by evidence related to a particular investor or investment. The presumption should apply to all investments in fixed or mobile wireless telephony markets as well as to investments in new entrants and smaller players ( i.e ., those below the 10% limit). To encourage longer-term investment, foreign investors should remain exempt from the foreign investment restrictions if they are successful in growing the market share of their businesses beyond 10%.

· The second phase of liberalization should be undertaken after completion of the review of broadcasting policy proposed by the Panel. At that time, there should be a broader liberalization of the foreign investment rules in a manner that treats all telecommunications common carriers including the cable telecommunications industry in a fair and competitively neutral manner. The proposed liberalization should apply to the “carriage” business of BDUs, and new broadcasting policies should focus any necessary Canadian ownership restrictions on broadcasting “content” businesses. The Cabinet should retain the authority to screen significant investments in the Canadian telecommunications carriage business to ensure that they are consistent with the public interest.

On July 12, 2007, the Canadian Minister of Industry announced the creation of a Competition Policy Review Panel. This Panel has been mandated to review key elements of Canada’s competition and investment policies to ensure that they function effectively. The fundamental task of the Panel’s review is to provide recommendations to the Government on how to enhance Canadian productivity and competitiveness. Foreign ownership restrictions on broadcasting and telecommunications undertakings have been identified as an important issue. Quebecor Media, on behalf of itself and Videotron, like several other interested parties, has filed a submission. In June 2008, the Panel filed

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its report. This report recommends that the federal government adopt a two-phased approach to foreign participation in the telecommunications and broadcast industry. In the first phase, it is suggested that the Minister of Industry seek an amendment to the Telecommunications Act to allow foreign companies to establish a new telecommunications business in Canada or to acquire an existing telecommunications company with a market share of up to 10% of the telecommunications market in Canada. In the second phase, it is recommended that, following a review of broadcasting and cultural policies (including foreign investment), telecommunications and broadcasting foreign investment restrictions be liberalized in a manner that is competitively neutral for telecommunications and broadcasting companies. The Prime Minister has indicated that the current government does not intend to change the existing ownership rules.

Ownership and Control of Canadian Broadcast Undertakings

Subject to any directions issued by the Governor in Council (effectively the Federal Cabinet), the CRTC regulates and supervises all aspects of the Canadian broadcasting system.

The Governor in Council, through an Order-in-Council referred to as the Direction to the CRTC ( Ineligibility of Non-Canadians ), has directed the CRTC not to issue, amend or renew a broadcasting license to an applicant that is a non-Canadian. Canadian, a defined term in the Direction, means, among other things, a citizen or a permanent resident of Canada, a qualified corporation, a Canadian government, a non-share capital corporation of which a majority of the directors are appointed or designated by statute, regulation or specified governmental authorities, or a qualified mutual insurance company, qualified pension fund society or qualified cooperative of which not less than 80% of the directors or members are Canadian. A qualified corporation is one incorporated or continued in Canada, of which the chief executive officer (or if there is no chief executive officer, the person performing functions similar to those performed by a chief executive officer) and not less than 80% of the directors are Canadian, and not less than 80% of the issued and outstanding voting shares and not less than 80% of the votes are beneficially owned and controlled, directly or indirectly, by Canadians. In addition to the above requirements, Canadians must beneficially own and control, directly or indirectly, not less than 66.6% of the issued and outstanding voting shares and not less than 66.6% of the votes of the parent company that controls the subsidiary, and neither the parent company nor its directors may exercise control or influence over any programming decisions of the subsidiary if Canadians beneficially own and control less than 80% of the issued and outstanding shares and votes of the parent corporation, if the chief executive officer of the parent corporation is a non-Canadian or if less than 80% of the parent corporation’s directors are Canadian. There are no specific restrictions on the number of non-voting shares which may be owned by non-Canadians. Finally, an applicant seeking to acquire, amend or renew a broadcasting license must not otherwise be controlled in fact by non-Canadians, a question of fact which may be determined by the CRTC in its discretion. Control is defined broadly in the Direction to mean control in any manner that results in control in fact, whether directly through the ownership of securities or indirectly through a trust, agreement or arrangement, the ownership of a corporation or otherwise. Videotron is a qualified Canadian corporation.

Regulations made under the Broadcasting Act (Canada) require the prior approval of the CRTC for any transaction that directly or indirectly results in (i) a change in effective control of the licensee of a broadcasting distribution undertaking or a television programming undertaking (such as a conventional television station, network or pay or specialty undertaking service), (ii) a person or a person and its associates acquiring control of 30% or more of the voting interests of a licensee or of a person who has, directly or indirectly, effective control of a licensee, or (iii) a person or a person and its associates acquiring 50% or more of the issued common shares of the licensee or of a person who has direct or indirect effective control of a licensee. In addition, if any act, agreement or transaction results in a person or a person and its associates acquiring control of at least 20% but less than 30% of the voting interests of a licensee, or of a person who has, directly or indirectly, effective control of the licensee, the CRTC must be notified of the transaction. Similarly, if any act, agreement or transaction results in a person or a person and its associates acquiring control of 40% or more but less than 50% of the voting interests of a licensee, or a person who has directly or indirectly effective control of the licensee, the CRTC must be notified.

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“Diversity of Voices”

On April 13, 2007, in response to consolidation in the Canadian broadcasting industry, the CRTC launched a public proceeding (Broadcasting Notice of Public Hearing CRTC 2007-5) to review various issues relating to the ownership of Canadian broadcasting companies and other issues related to the diversity of voices in Canada. As part of the review, the CRTC was examining issues relating to, among other things, concentration of ownership, common ownership of broadcasting distribution undertakings, cross-media ownership, vertical integration and the CRTC’s relationship with the Competition Bureau. A public hearing on this matter was held in mid-September 2007. On January 15, 2008, the CRTC issued its determination in Broadcasting Public Notice CRTC 2008-4, entitled “ Diversity of Voices. ” In this public notice, the CRTC introduced new policies with respect to cross-media ownership; the common ownership of television services, including pay and specialty services; and the common ownership of broadcasting distribution undertakings. The CRTC’s existing policies with respect to the common ownership of over-the-air television and radio undertakings remain in effect. The CRTC will generally permit ownership by one person of no more than one conventional television station in one language in a given market. The CRTC, as a general rule, will not approve applications for a change in the effective control of broadcasting undertakings that would result in the ownership or control, by one person, of a local radio station, a local television station and a local newspaper serving the same market. Where a person that controls a local radio station and a local television station acquires a local newspaper serving the same market, the CRTC will, at the earliest opportunity, require the licensee to explain why, in light of this policy, its radio or television license(s) should be renewed. The CRTC, as a general rule, will not approve applications for a change in effective control that would result in the control, by one person, of a dominant position in the delivery of television services to Canadians that would impact on the diversity of programming available to television audiences. Specifically, as a general rule, the CRTC will not approve transactions that would result in the control by one person of more than 45% of the total television audience share — including audiences to both discretionary and OTA services. The CRTC will carefully examine transactions that would result in the control by one person of between 35% and 45% of the total television audience share — including audiences to both discretionary and OTA services. Barring other policy concerns, the CRTC will process expeditiously transactions that would result in the control by one person of less than 35% of the total television audience share — including audiences to both discretionary and OTA services. In terms of broadcasting distribution undertakings (BDUs), the CRTC, as a general rule, will not approve applications for a change in the effective control of BDUs in a market that would result in one person being in a position to effectively control the delivery of programming services in that market. The CRTC is not prepared to allow one person to control all BDUs in any given market.

Jurisdiction Over Canadian Broadcast Undertakings

Our cable distribution undertakings are subject to the Broadcasting Act (Canada) and regulations made under the Broadcasting Act (Canada) that empower the CRTC, subject to directions from the Governor in Council, to regulate and supervise all aspects of the Canadian broadcasting system in order to implement the policy set out in that Act. Certain of our undertakings are also subject to the Radiocommunication Act (Canada), which empowers Industry Canada to establish and administer the technical standards that networks and transmission must respect, namely, maintaining the technical quality of signals.

The CRTC has, among other things, the power under the Broadcasting Act (Canada) and regulations to issue, subject to appropriate conditions, amend, renew, suspend and revoke broadcasting licenses, approve certain changes in corporate ownership and control, and establish and oversee compliance with regulations and policies concerning broadcasting, including various programming and distribution requirements, subject to certain directions from the Federal Cabinet.

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Canadian Broadcasting Distribution (Cable Television)

Licensing of Canadian Broadcasting Distribution Undertakings

A cable distribution undertaking distributes broadcasting services to customers predominantly over closed transmission paths. A license to operate a cable distribution undertaking gives the cable television operator the right to distribute television programming services in its licensed service area. Broadcasting licenses may be issued for periods not exceeding seven years and are usually renewed, except in particular circumstances or in cases of a serious breach of the conditions attached to the license or the regulations of the CRTC. The CRTC is required to hold a public hearing in connection with the issuance, suspension or revocation of a license. We operate 52 cable systems pursuant either to the issuance of a license or of an order that exempts certain network operations from the obligation to hold a license.

Cable systems with 2,000 customers or fewer and operating their own local headend are exempted from the obligation to hold a license pursuant to exemption orders issued by the CRTC. These cable systems are required to comply with a number of programming carriage requirements set out in the exemption order and comply with the Canadian ownership and control requirements in the Direction to the CRTC. We operate 17 of these exempted cable systems. On October 30, 2008, the CRTC issued a new distribution regulatory framework in which it announced that it determines to exempt, under a single exemption order, all terrestrial distribution systems with fewer than 20,000 subscribers and to introduce a single class of license for those BDUs that not eligible for exemption. By April 2009, the CRTC will issue for comment a proposed revised exemption order that will contain what it considers to be the minimum necessary terms and conditions for BDUs with fewer than 20,000 subscribers. We and our affiliate cable companies will apply to have our respective relevant cable systems exempted during 2009.

In November 2003, the CRTC finalized the regulatory framework that will govern the distribution of digital signals by over-the-air television stations (Broadcasting Public Notice CRTC 2003-61). The CRTC requires broadcasting distribution undertakings to distribute the primary digital signal of a licensed over-the-air television service in accordance with the priorities that currently apply to the distribution of the analog version of the services. The CRTC expects all broadcasting distribution undertakings to implement the necessary upgrades. Analog carriage can be phased-out only once 85% of a particular broadcasting distribution undertaking’s customers have digital receivers or set-top boxes that can convert digital signals to analog. Exempt undertakings will not be required to duplicate mandatory services in digital format.

In Broadcasting Public Notice CRTC 2007-53, the CRTC has established August 31, 2011, as the deadline for over-the-air television services to transition from analog to digital and HD broadcasting, with the possibility of limited exceptions in northern and remote regions.

The Digital Migration Framework for programming services that do not use airwaves was published in February 2006 (Broadcasting Public Notice CRTC 2006-23). A cable BDU must continue to mirror any given analog tier until 85% of subscribers have a digital set-top box or until January 1, 2013, whichever occurs first. Some distribution priority status (dual and modified dual) is abandoned in the digital environment but the CRTC considered the possibility that certain specialty services may still warrant carriage on basic in a digital environment. In decision CRTC 2007-246, the CRTC approved an application by the National Broadcast Reading Service Inc. for a broadcasting license to operate a national, English-language digital specialty described video programming undertaking to be known as The Accessible Channel. The CRTC also approved the applicant’s request for this service to be designated for mandatory distribution on digital basic by direct-to-home (DTH) satellite distribution undertakings and by Class 1 and Class 2 broadcasting distribution undertakings (BDUs), excluding multipoint distribution system (MDS) undertakings. The CRTC approved in part applications for the services CBC Newsworld and Le Réseau de l’information to be designated for mandatory distribution on digital basic by DTH satellite distribution undertakings and by Class 1 and Class 2 BDUs, excluding MDS undertakings that do not currently carry the services. The CRTC approved in part an application for Avis de Recherche to be designated for mandatory distribution on digital basic by DTH satellite distribution undertakings and by Class 1 and Class 2 BDUs, excluding MDS undertakings. The Commission also approved amendments to the broadcasting license for Avis de

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Recherche , as requested by the applicant. To this effect, the CRTC issued, for the above-mentioned services, mandatory distribution orders under section 9(1)(h) of the Broadcasting Act .

A further framework governing the licensing and distribution of pay and specialty services to high definition, or HD, signals was made public in June 2006 (Broadcasting Public Notice CRTC 2006-74). The CRTC expects that, over time, all or most pay and specialty services will upgrade their programming to the new digital HD standard in order to meet the expectations of the marketplace. Under this framework, BDUs will be obliged to distribute those HD pay and specialty services that offer certain minimum amounts of HD programming (subject to available channel capacity until distribution of analog signals ceases by that BDU entirely). Carriage of programming services in the analog mode, in the standard definition digital mode and in the HD digital mode creates stress on a cable distributor’s capacity to serve the public with as much choice as competitors that generally do not have to distribute in the analog mode.

In order to conduct our business, we must maintain our broadcasting distribution undertaking licenses in good standing. Failure to meet the terms of our licenses may result in their short-term renewal, suspension, revocation or non-renewal. We have never failed to obtain a license renewal for any cable systems.

Distribution of Canadian Content

The Broadcasting Distribution Regulations issued by the CRTC pursuant to the Broadcasting Act (Canada) mandate the types of Canadian and non-Canadian programming services that may be distributed by broadcasting distribution undertakings, or BDUs, including cable television systems. For example, Canadian television broadcasters are subject to “must carry” rules which require terrestrial distributors, like cable and MDS systems, to carry the signals of local television stations and, in some instances, regional television stations as part of their basic service. The guaranteed carriage enjoyed by local television broadcasters under the “must carry” rules is designed to ensure that the signals of local broadcasters reach cable households and enjoy advantageous channel placement. Furthermore, cable operators, DBS operators and MDS operators must offer their customers more Canadian programming than non-Canadian programming services. In summary, each cable television system is required to distribute all of the Canadian programming services that the CRTC has determined are appropriate for the market it serves, which includes local and regional television stations, certain specialty channels and pay television channels, and a pay-per-view service, but does not include Category Two digital services and video-on-demand services.

The CRTC currently permits the linkage of up to one non-Canadian service for one Canadian specialty service and up to five non-Canadian services for every one Canadian pay-television service. On October 30, 2008, the CRTC announced that, as of August 31, 2011, the CRTC will eliminate these 1:1 and 5:1 packaging rules and BDUs will be permitted to offer a package consisting only of non-Canadian services. Most of these tiering and linkage rules will be replaced by rules providing that the number of Canadian services received by a cable television customer must exceed the total number of non-Canadian services received. The CRTC has issued a list of non-Canadian programming services eligible for distribution in Canada on a discretionary user-pay basis to be linked along with Canadian pay-television services or with Canadian specialty services. This list will be revised from time to time. The CRTC decided that it would not be in the interest of the Canadian broadcasting system to permit the distribution of certain non-Canadian pay-television movie channels and specialty programming services that could be considered competitive with licensed Canadian pay-television and specialty services. Therefore, pay-television movie channels and certain specialty programming services available in the United States and other countries are not approved for distribution in Canada. However, on October 30, 2008, the CRTC also announced that, with respect to non-Canadian news services, a more open-entry approach should be adopted. Accordingly, absent clear evidence that non-Canadian news service will violate Canadian regulations (such as those regarding abusive comment), the CRTC will be predisposed to authorize such service for distribution in Canada. Following recent CRTC policy statements, most foreign third language (other than English and French) programming services can be eligible for distribution in Canada if approved by the CRTC and if legacy Canadian services of the same language are distributed as well.

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Also important to broadcasting operations in Canada are the specialty (or thematic) programming service access rules. Cable systems in a French-language market, such as Videotron’s, with more than 6,000 customers are required to offer each analog French-language Canadian specialty and pay television programming service licensed, other than religious specialty services, to the extent of available channels. Similarly, DBS satellite operators must, by regulation, distribute all Canadian specialty services other than Category Two digital specialty services and religious specialty services. Moreover, all licensed specialty services, other than Category Two digital specialty services and religious specialty services, as well as at least one pay television service in each official language, must be carried by larger cable operators, such as Videotron, when digital distribution is offered. These rules seek to ensure wider carriage for certain Canadian specialty services than might otherwise be secured through negotiation. However, Category Two digital specialty services do not benefit from any regulatory assistance guaranteeing distribution other than a requirement that a cable operator distribute at least five (to be reduced to three as of August 31, 2011) unrelated Category Two digital specialty services for each Category Two digital specialty service distributed by such cable operator in which such cable operator or its affiliates control more than 10% of the total shares. In French-language markets like the markets we serve, two of each Category Two services must be French-language services. Cable systems (not otherwise exempt) and DBS satellite operators are also subject to distribution and linkage requirements for programming services set by the CRTC and amended from time to time which include requirements that link the distribution of eligible non-Canadian satellite programming services with Canadian specialty and pay television services.

On October 30, 2008, as part of its new regulatory framework for BDUs to take effect on August 31, 2011, the CRTC has determined to retain access rights for Canadian analog and Category One pay and specialty services (“Category A Services”) for digital distribution only. The requirement for BDUs to distribute Category A services on a digital basis will apply to either a standard definition (SD) or high definition (HD) version of the service. BDUs will no longer be required to distribute Category A services on an analog basis after that date. To the extent that BDUs wish to continue to providing their subscribers with an analog offering, the CRTC will propose rules to cover such offerings when it issues proposed amendments to the regulations governing BDUs.

Broadcasting Distribution Regulations

The Broadcasting Distribution Regulations enacted in 1998, also called the 1998 Regulations, apply to distributors of broadcasting services or broadcasting distribution undertakings in Canada. The 1998 Regulations promote competition between broadcasting distribution undertakings and the development of new technologies for the distribution of such services while ensuring that quality Canadian programs are exhibited. The 1998 Regulations introduced important new rules, including the following:

· Competition and Carriage Rules. The 1998 Regulations provide equitable opportunities for all distributors of broadcasting services. Similar to the signal carriage and substitution requirements that are imposed on existing cable television systems, under the 1998 Regulations, new broadcasting distribution undertakings are also subject to carriage and substitution requirements. The 1998 Regulations prohibit a distributor from giving an undue preference to any person, including itself, or subjecting any person to an undue disadvantage. This gives the CRTC the ability to address complaints of anti-competitive behavior on the part of certain distributors.

· Signal Substitution. A significant aspect of television broadcasting in Canada is simultaneous program substitution, or simulcasting, a regulatory requirement under which Canadian distribution undertakings, such as cable television systems with over 6,000 customers, are required to substitute the foreign programming service, with local Canadian signal, including Canadian commercials, for broadcasts of identical programs by a U.S. station when both programs are exhibited at the same time. These requirements are designed to protect the program rights that Canadian broadcasters acquire for their respective local markets. The CRTC, however, has suspended the application of these requirements to DTH satellite operators for a period of time, so long as they undertake certain alternative measures, including monetary compensation to a fund designed to help finance regional television productions.

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· Canadian Programming and Community Expression Financing Rules . All distributors, except systems with fewer than 2,000 customers, are required to contribute at least 5% of their gross annual broadcast revenues to the creation and presentation of Canadian programming including community programming. However, the allocation of these contributions between broadcast and community programming can vary depending on the type and size of the distribution system involved. On October 30, 2008, the CRTC issued a new distribution regulatory framework in which it announced that a further 1% will be added to the 5% contribution in order to finance a new national programming fund. Depending on the final terms of this regulatory framework, Videotron may institute proceedings challenging its validity.

· Inside Wiring Rules. The CRTC determined that the inside wiring portion of cable networks creates a bottleneck facility that could affect competition if open access is not provided to other distributors. Incumbent cable companies may retain the ownership of the inside wiring but must allow usage by competitive undertakings to which the cable company may charge a just and reasonable fee for the use of the inside wire. On September 3, 2002, the CRTC established a fee of $0.52 per customer per month for the use of cable inside wire in MDUs.

On July 5, 2007, the CRTC announced a review of the regulatory framework for broadcasting distribution undertakings, as well as the regulatory framework for discretionary programming services (Broadcasting Notice of Public Hearing CRTC 2007-10). As part of this review, the CRTC is considering reducing the amount of regulation for broadcasting distribution undertakings and discretionary programming services to the minimum essential to achieve the objectives under the Broadcasting Act , relying instead on market forces wherever possible.

As a result of this review, on October 30, 2008, the CRTC issued a new distribution regulatory framework entitled “Regulatory frameworks for broadcasting distribution undertakings and discretionary programming services. ” Pursuant to this new regulatory framework, the CRTC has decided to implement various changes to the regulatory frameworks for broadcasting distribution undertakings and discretionary programming services. As described above under “Distribution of Canadian Content”, as of August 31, 2011, this new regulatory framework provides for the CRTC eliminating some of the existing distribution and linkage rules for discretionary programming services carried by broadcasting distribution undertakings while continuing the existing preponderance requirement (i.e., that each subscriber receives more than 50% Canadian programming services). The CRTC has also decided to introduce competition for those genres of Category A Services (which have generally licensed on a one-per-genre basis and to be complementary and not compete with one another) where it is convinced that a competitive environment will not significantly reduce either the diversity of services available to viewers or their contribution to the creation of Canadian programming. At this time, the CRTC has decided to eliminate the current one per-genre policy for mainstream national news and mainstream sports specialty services. Amendments to the BDU regulations to be introduced to take effect August 31, 2011, will require all licensed BDUs to first obtain the consent of over-the-air Canadian television stations (OTAs) prior to distributing their local stations located in a distant market (Canadian distant signals). BDUs operating under an exemption order will not require consent from the broadcaster. These OTAs will be permitted to negotiate payment from BDUs for the retransmission of their local stations as distant signals. The distribution by BDUs of a second set of U.S. 4+1 signals to subscribers will be subject to subscribers also receiving at least one signal, originating from the same time zone as the U.S. signals, of each large multi-station Canadian broadcasting group. Finally, all BDUs contribution to Canadian programming will be raised from 5% to 6% as soon as possible, which may mean in the fourth quarter of 2009 or the first quarter of 2010.

On October 30, 2008, the CRTC also issued two requests for comments, one regarding the sales of advertising in local availabilities (generally two minutes per hour of air time on non-Canadian cable channels) and the other regarding the video-on-demand regulatory framework. We expect, in both cases, relaxation of the current rules.

Rates

Our revenue related to cable television is derived mainly from (a) monthly subscription fees for basic cable service; (b) fees for premium services such as specialty services, pay-television, pay-per-view television and video-on-demand; and (c) installation and additional outlets charges.

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The CRTC does not regulate the fees charged by non-cable broadcast distribution undertakings and does not regulate the fees charged by cable providers for non-basic services. The basic service fees charged by Class 1 (6,000 customers or more) cable providers are regulated by the CRTC until true competition exists in a particular service area, which occurs when:

(1) 30% or more of the households in the licensed service area have access to the services of another broadcasting distribution undertaking. The CRTC has advised that as of August 31, 1997, the 30% availability criterion was satisfied for all licensed cable areas; and

(2) the number of customers for basic cable service has decreased by at least 5% since the date on which a competitor started offering its basic cable service in the particular area.

For all but two service areas, accounting for less than 6% of our subscribers, our basic service fees for our customers have been deregulated.

The CRTC further restricts installation fees to an amount that does not exceed the average actual cost incurred to install and connect the outlet to a household situated in a residential area.

Subject to certain notice and other procedural requirements, for Class 1 cable systems still regulated, we may increase our basic service rates so as to pass through to customers increases, if the CRTC has authorized fees to be paid to specialty programming services distributed on our basic service. However, the CRTC has the authority to suspend or disallow such an increase.

In the event that distribution services may be compromised as a result of economic difficulties encountered by a Class 1 cable distributor, a request for a rate increase may be submitted to the CRTC. The CRTC may approve an increase if the distributor satisfies the criteria then in effect for establishing economic need. In accordance with the new regulatory framework announced on October 30, 2008 and discussed above in the section “— Canadian Broadcasting Distribution (Cable Television) — Broadcasting Distribution Regulations”, all rates regulation will be eliminated on August 31, 2011.

Other recent changes to regulations which have been announced

On October 21, 2008, the CRTC published a new policy regarding disclosure of industry group financial results. Prior to these changes, cable and telecommunications operators such as Videotron had their financial results aggregated with those of other similar companies in Canada for the purposes of certain CRTC disclosures. On and after November 30, 2008, aggregated financial data for each of the following industry sub-groups will be disclosed by the CRTC: the large broadcasting distribution undertakings, multi-system operators and over-the-air television and radio ownership groups. This financial data for each broadcasting year (September 1 to August 31) will be publicly available at: http://www.crtc.gc.ca/dcs/eng/current/dcs4_7.htm. Subject companies are required to post the same information on their respective websites. However, the large broadcasting distribution undertakings, multi-system operators and over-the-air television and radio ownership groups received the CRTC form for reporting aggregated results on October 21, 2008 and are refusing to disclose figures that would not be prepared according to GAAP and data that is not disclosed under Canadian and U.S. securities laws and regulations. On February 6 th , 2009, most of the large broadcasting distribution undertakings, multi-system operators and over-the-air television and radio ownership groups requested that the CRTC initiate a new public consultation in order to allow the broadcasting industry to express its point of view on the specific financial data the CRTC would like to see disclosed.

On October 15, 2008, the CRTC announced that it will hold a public hearing beginning on February 17, 2009 to consider issues relating to broadcasting in the new media environment and the following six main themes: (i) defining broadcasting in new media; (ii) the significance of broadcasting in new media and its impact on the Canadian

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broadcasting system; (iii) are incentives or regulatory measures necessary or desirable for the creation and promotion of Canadian broadcasting content in new media?; (iv) are there issues concerning access to broadcasting content in new media?; (v) other broadcasting or public policy objectives; and (vi) the appropriateness of the new media exemption order. Broadcasting of programs and distribution of programs on the Internet and on wireless devices had been exempted from regulation since exemption orders issued in 1999 and 2007, respectively. Subject to the outcome of these hearings, it is possible that the CRTC may impose a tax on cable and telecommunications companies in order to create a national fund that would finance Canadian programming.

On March 25, 2008, the CRTC authorized the transfer of the license for the video-on-demand service “Illico sur demand” from Groupe Archambault Inc., which is a subsidiary of Quebecor Media, to Videotron. Videotron is now the operator of our video-on-demand service.

Copyright Board Proceedings

Certain copyrights in radio, television, internet and pay audio content are administered collectively and tariff rates are established by the Copyright Board of Canada. Tariffs set by the Copyright Board are generally applicable until a public process is held and a decision of the Copyright Board is rendered for a renewed tariff. Renewed tariffs are often applicable retroactively.

Royalties for the Retransmission of Distant Signals

Following the implementation in 1989 of the Canada-U.S. Free Trade Agreement, the Copyright Act (Canada) was amended to require retransmitters, including Canadian cable television operators, to pay royalties in respect of the retransmission of distant television and radio signals.

Since this legislative amendment, the Copyright Act (Canada) empowers the Copyright Board to quantify the amount of royalties payable to retransmit these signals and to allocate them among collective societies representing the holders of copyright in the works thus retransmitted. Regulated cable television operators cannot automatically recover such paid retransmission royalties from their customers, although such charges might be a component of an application for a basic cable service rate increase based on economic need.

In 2008, distant television signal retransmission royalties varied from $0.35 to $0.85 per customer per month depending on the number of customers receiving the signal and whether the signal was transmitted by a small retransmission system, except in Francophone markets. In Francophone markets, there is a 50% rebate. The same pricing structure, with lower rates, still applies for distant radio signal transmission. Most of Videotron’s undertakings operate in Francophone markets.

Royalties for the Transmission of Pay and Specialty Services

In 1989, the Copyright Act (Canada) was amended, in particular, to define copyright as including the exclusive right to “communicate protected works to the public by telecommunication.” Prior to the amendment, it was generally believed that copyright holders did not have an exclusive right to authorize the transmission of works carried on radio and television station signals when these signals were not broadcast but rather transmitted originally by cable television operators to their customers. In 1996, at the request of the Society of Composers, Authors and Music Publishers of Canada (SOCAN), the Copyright Board approved Tariff 17A, which required the payment of royalties by broadcasting distribution undertakings, including cable television operators, that transmit musical works to their customers in the course of transmitting television services on a subscription basis. Through a series of industry agreements, this liability was shared with the pay and specialty programming services.

In March 2004, the Copyright Board changed the name of this tariff from Tariff 17A to Tariff 17 and rendered its decision setting Tariff 17 royalty rates for 2001 through 2004. The Copyright Board changed the structure of Tariff 17 to calculate the royalties based on the revenues of the pay and specialty programming services (affiliation payments only in the case of foreign and pay services, and all revenues in the case of Canadian specialty services) and set a basic royalty

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rate of 1.78% for 2001 and 1.9% for 2002 through 2004. The basic royalty rate is subject to reductions in certain cases, although there is no Francophone market discount. SOCAN has agreed, by filing proposed tariffs, that the 2005 to 2008 tariffs will continue on the same basis as in 2004, the royalty rate remaining at 1.9%.

Royalties for Pay Audio Services

The Copyright Board rendered a decision in March 2002 regarding two new tariffs for the years 1997-1998 to 2002, which provide for the payment of royalties by programming and distribution undertakings that broadcast pay audio services. The tariffs fix the royalties payable to SOCAN and to the Neighbouring Rights Collective of Canada, or NRCC, respectively, during this period at 11.1% and 5.3% of the affiliation payments payable during a month by a distribution undertaking for the transmission for private or domestic use of a pay audio signal. The royalties payable to SOCAN and

NRCC by a small cable transmission system, an unscrambled low or very low power television station or by equivalent small transmission systems during this period were fixed by the Copyright Board at 5.6% and 2.6%, respectively, of the affiliation payments payable during a year by the distribution undertaking for the transmission for private or domestic use of a pay audio signal. Royalties payable by a system located in a Francophone market during this period are calculated at a rate equal to 85.0% of the rate otherwise payable.

In February 2005, the Copyright Board rendered its decision setting pay audio services royalties for 2003 through 2006. The Copyright Board fixed the rate of royalties payable to SOCAN and NRCC during this period to 12.3% and 5.9%, respectively, of the affiliation payments payable during a month by a distribution undertaking for the transmission for private or domestic use of a pay audio signal. In addition, the Copyright Board established the rate of royalties payable to SOCAN and NRCC during this period at 6.2% and 3.0%, respectively, for a small cable transmission system, an unscrambled low or very low power television station or an equivalent small transmission system. The Copyright Board also eliminated the previously effective 15.0% discount to royalties payable by a system located in a Francophone market. We have made interim royalty payments for 2003 and 2004 based on the lower royalty rate of the 2002 tariffs. The retroactive royalty obligations to SOCAN and NRCC owed since 2003 were paid in 2005.

Currently, the royalties payable by distribution undertakings for the communication to the public by telecommunication of musical works in SOCAN’s repertoire in connection with the transmission of a pay audio signal other than retransmitted signals are as follows: a monthly fee of 12.35% of the affiliation payments payable by a distribution undertaking for the transmission for private or domestic use of a pay audio signal, or an annual fee of 6.175% of the affiliation payments payable where the distribution undertaking is a small cable transmission system, an unscrambled low power or very low power television station or an equivalent small transmission system. SOCAN has filed a proposed Pay Audio Tariff in March 2007 for the year 2008 that proposes to maintain those rates.

For its part, NRCC filed a proposed Pay Audio Tariff for the period 2007-2011 asking for a monthly fee of 15% of the affiliation payments payable by a distribution undertaking for the transmission for private or domestic use of a pay audio signal, or an annual fee of 7.5% of the affiliation payments payable where the distribution undertaking is a small cable transmission system, an unscrambled low power or very low power television station or an equivalent small transmission system.

No dates have yet been announced for the Copyright Board’s hearings regarding these proposed tariffs.

Royalties for Ringtones

In 2003, SOCAN filed a new proposed tariff, Tariff 24, for the communication of musical works incorporated into telephone or other ringtones. Since 2006, Videotron sells ringtones directly to cellular phone users. In June 2006, the Copyright Board rendered its decision setting a ringtone royalty for 2003 through 2005. The Copyright Board fixed the rate of royalty payable to SOCAN to 6% of the price paid for a ringtone by a cellular phone user, subject to a minimum royalty of 6.0¢ per ringtone. The minimum royalty only applies to the years 2004-2005. Following a judicial review, the Federal Court of Appeal upheld the decision of the Copyright Board.

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Internet Service Provider Liability

In 1996, SOCAN proposed a tariff to be applied against Internet service providers, in respect of composers’/publishers’ rights in musical works communicated over the Internet to Internet service providers’ customers. SOCAN’s proposed tariff was challenged by a number of industry groups and companies. In 1999, the Copyright Board decided that Internet service providers should not be liable for the communication of musical works by their customers, although they might be liable if they themselves operated a musical website. In June 2004, the Supreme Court of Canada upheld this portion of the decision of the Copyright Board and determined that Internet service providers do not incur liability for copyright content when they engage in normal intermediary activities, including web hosting for third parties and caching. As a consequence, internet service providers may, however, be found liable if their conduct leads to the inference that they have authorized a copyright violation. A proposed amendment to the Copyright Act (Canada) was introduced in June 2005 in Parliament to exempt ISPs for copyright liability for merely providing customers with access to the Internet and not operating the website itself. Following the November 2005 election call, the June 2005 Bill to amend the Copyright Act (Canada) was not enacted. Although there were discussions in 2008 to reintroduce such a Bill, it is premature to predict whether the amendment will be reintroduced in Parliament and enacted into law.

Canadian Telecommunications Services

Jurisdiction

The provision of telecommunications services in Canada is regulated by the CRTC pursuant to the Telecommunications Act (Canada). With certain exceptions, companies that own or operate transmission facilities in Canada that are used to offer telecommunications services to the public for compensation are deemed “telecommunications common carriers” under the Telecommunications Act (Canada) administered by the CRTC and are subject to regulation. Cable operators offering telecommunications services are deemed “Broadcast Carriers.”

The Telecommunications Act (Canada), which came into force on October 25, 1993, as amended, provides for the regulation of facilities-based telecommunications common carriers under federal jurisdiction. Under the Telecommunications Act (Canada), the CRTC may exempt any class of Canadian telecommunications carriers from the application of the Telecommunications Act (Canada) if the CRTC is satisfied that such an exemption is consistent with implementation of the Canada telecommunications policy objectives. The CRTC must refrain from regulating certain telecommunications services or classes of services provided by Canadian carriers, if it finds that such service or class is or will be subject to competition sufficient to protect the interests of users. The CRTC is prohibited from making a determination to refrain if refraining from regulation could likely impair unduly the establishment or continuance of a competitive market for a particular service or class of services.

In the Canadian telecommunications market, Videotron operates as a CLEC and a Canadian broadcast carrier. Videotron is also constructing its own 3G mobile wireless network and intends to offer services over this network as a Wireless Service Provider (WSP).

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Overview of the Telecommunications Competition Framework

Competition in the Canadian long-distance and local telephony markets is guided to a large extent by the principles set out in Telecom Decision CRTC 92-12, which removed the telephone companies’ monopoly in the provision of public long-distance voice telecommunications services, Review of Regulatory Framework , Telecom Decision CRTC 94-19, which sets out the principles for a new, pro-competitive regulatory framework, and Local Competition Telecom Decision CRTC 97-8, which establishes the policy framework for local exchange competition. The CRTC has issued numerous follow-up rulings on matters of policy and inter-carrier dispute. The CRTC Interconnection Steering Committee, or CISC, also provides an ongoing forum for consensus-based resolution of inter-carrier technical and operational issues.

Application of Canadian Telecommunications Regulation

In a series of decisions, the CRTC has determined that the carriage of “non-programming” services by cable companies results in that company being regulated as a carrier under the Telecommunications Act (Canada). This applies to a company serving its own customers, or allowing a third party to use its distribution network to provide non-programming services to customers, such as providing access to cable Internet services.

In addition, the CRTC regulates the provision of telephony services in Canada. On May 1, 1997, the CRTC established the regulatory framework for the provision of competitive local telephony services in Canada. Among the key elements of this framework are: a technical form of interconnection based on a co-carrier ( i.e. , peer-to-peer) relationship between the ILEC and CLECs; mutual compensation for traffic termination (including Bill & Keep compensation at low levels of traffic imbalance); effective deregulation of CLEC retail service offerings with the exception of certain social obligations such as the provision of enhanced 911 service; and the imposition of a series of regulatory safeguards on the ILECs to protect against anti-competitive conduct on their part, including retail tariffing requirements, service bundling restrictions and winback restrictions. Most of the latter restrictions have since been removed or rendered moot as the ILECs have secured widespread regulatory forbearance for their local exchange services.

Elements of the CRTC’s telecommunications regulatory framework to which Videotron is subject include: interconnection standards and inter-carrier compensation arrangements; the mandatory provision of equal access (i.e. customer choice of long distance provider); standards for the provision of 911 service, message relay service and certain privacy features; and the obligation not to prevent other local exchange carriers from accessing end-users on a timely basis under reasonable terms and conditions in multi-dwelling units where Videotron provides service and the payment of contribution on VoIP revenues for the purposes of the revenue-based contribution regime established by the CRTC to subsidize residential telephone services in rural and remote parts of Canada.

Generally speaking, the CRTC has pursued a policy of favoring facilities-based competition in telecommunications. Key to the CRTC’s framework are decisions issued on January 25, 2001 and June 30, 2003, respectively, regarding access to municipal rights of way and access to multi-dwelling units. In both cases, the CRTC adopted a policy of open access, with fees generally limited to recovering costs reasonably incurred. Application of the framework principles to individual access cases, however, has encountered resistance from certain municipalities and building owners. It remains to be determined whether any of these access cases will need to be brought before the CRTC for resolution.

On February 3, 2005, the CRTC issued a decision re-affirming and expanding a tariff regime initially established in June 2002 whereby competitive carriers may purchase certain digital network services from the ILECs at reduced cost-based rates. This regime had undermined Videotron’s position in the wholesale market for business telecommunications services. To remain competitive with the ILECs in the wholesale market, Videotron has substantially reduced the rates it charges other competitive carriers for certain digital network services that would be eligible under the new tariff regime were they purchased from the ILEC.

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On March 3, 2008, the CRTC released a decision in which it ruled that most mandated wholesale digital network services will be phased out over a period of three to five years. This decision is expected to have the effect of improving Videotron’s position in the wholesale market.

On April 6, 2006, the CRTC issued its framework for the forbearance from regulation of local telephone services offered by the ILECs. On April 4, 2007, in response to a petition filed by Bell Canada and the other ILECs, the Governor in Council issued an order varying this framework. The order eliminated forthwith all restrictions on local telephone winback and promotional activities in all geographic markets, and further established a local forbearance framework whereby: (i) residential local exchange services and business local exchange services are in different relevant markets; (ii) the relevant geographic market for local forbearance analysis is the telephone exchange; and (iii) the incumbent carrier must demonstrate that a competitor presence test has been satisfied, in addition to satisfying certain criteria related to the availability and quality of provision of services to competitors, before forbearance can be sought in any given market. For residential services, the competitor presence test requires the existence of two independent facilities-based service providers, other than the incumbent, each of which is capable of serving 75% of the lines in the exchange, and one of which is a fixed-line provider. In business markets, the competitor presence test requires the existence of one independent facilities- based fixed-line service provider, other than the incumbent, capable of serving 75% of the lines in the exchange.

The CRTC has since approved numerous applications for local forbearance submitted by Bell Aliant, Bell Canada, Télébec and TELUS-Québec, in both the residential and business local exchange markets. As a result, Videotron’s incumbent local service competitors are now free from regulation of local exchange services in the vast majority of residential markets in which Videotron competes, as well as in a large number of business markets, including all of the largest metropolitan markets in the Province of Quebec. These rulings granting the ILECs’ forbearance applications enable the ILECs to adjust their local exchange service prices for the approved exchanges without approval from the CRTC. Such price flexibility by our ILECs competitors for local exchange services could have an adverse impact on our ability to compete successfully with them in the local telephony market.

On December 20, 2007, the CRTC granted conditional approval to a new telecommunications consumer agency, to which Videotron had previously adhered voluntarily. The major Canadian cable operators, including Videotron, challenged certain elements of this ruling, and the CRTC issued a revised decision on May 30, 2008. Among other things, the CRTC ruled that all telecommunications service providers with annual revenues in excess of $10 million must become members of the agency for a period of three years. Videotron remains a member in good standing of the agency.

Right to Access to Telecommunications and Support Structures

The CRTC has concluded that some provisions of the Telecommunications Act (Canada) may be characterized as encouraging joint use of existing support structures of telephone utilities to facilitate efficient deployment of cable distribution undertakings by Canadian carriers. We access these support structures in exchange for a tariff that is regulated by the CRTC. If it were not possible to agree on the use or conditions of access with a support structure owner, we could apply to the CRTC for a right of access to a supporting structure of a telephone utility. The Supreme Court of Canada, however, held on May 16, 2003 that the CRTC does not have jurisdiction under the Telecommunications Act (Canada) to establish the terms and conditions of access to the support structure of hydro-electricity utilities. Terms of access to the support structures of hydro-electricity utilities must therefore be negotiated with those utilities.

On October 30, 2008, TELUS filed an application with the CRTC seeking an order to direct the ILECs to file new costs, terms and conditions for support structure service. TELUS further requested that current telco support structure rates be declared interim, and that monthly rental rates be adjusted retroactively to the date of its application to reflect any revised rates once a new tariff receives final approval. The major Canadian cable operators, including Videotron, have opposed TELUS’ application, whereas Bell Canada and its affiliates have supported it. If a review of

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monthly rental rates does proceed and if it results in an increase in rates, it may have a significant impact on our network cost structure.

Access by Third-Parties to Cable Networks

In Canada, access to the Internet is a telecommunications service. While Internet access services are not regulated on a retail (price and terms of service) basis, Internet access for third-party Internet service providers is mandated and tariffed according to conditions approved by the CRTC for cable operators.

On July 6, 1999, the CRTC required certain of the largest cable operators in Canada, including us, to submit cost-based tariffs for cable Internet access services, known as open access or third party access, in order to allow competing retail Internet service providers, to offer such services over a cable infrastructure. The CRTC has further directed us to file, at the same time we offer any new retail Internet service speed in the future, proposed revisions to our TPIA tariff to include this new speed offering. TPIA tariff items have been filed and approved for all Videotron Internet service speeds. Several third-party Internet service providers are now interconnected to our cable network and so providing retail Internet access services to the general public.

The CRTC also requires the large cable carriers, such as us, to allow third-party Internet service providers to provide voice or telephony applications services in addition to retail Internet access services.

Telemarketing

On September 30, 2008, a comprehensive reform of the CRTC’s telemarketing rules came into force, including the establishment of a new National Do Not Call List (DNCL). In accordance with new legislative powers granted under Bill C-37, which came into force on June 30, 2006, the CRTC has the authority to fine violators of its telemarketing rules up to $1,500 per violation in the case of an individual and $15,000 per violation in the case of a corporation. We have established internal controls to minimize the risk of breaching these rules and to provide any required investigative assistance in relation to alleged third-party violations.

Internet Traffic Management Practices

Regulatory Framework for Mobile Wireless Services

On July 21, 2008, Quebecor Media was declared the provisional winner of 17 AWS spectrum and operating licenses allocated at auction by Industry Canada. These licenses cover the entirety of the Province of Quebec, as well as Eastern and Southern Ontario. These licenses, the control of which was transferred from Quebecor Media to Videotron subsequent to the completion of the auction, were issued by Industry Canada on December 23, 2008.

Industry Canada’s policy framework for the AWS auction contained several measures intended to promote new facilities-based entry into the wireless industry. Among these measures were proposed rules to mandate inter-carrier roaming and the sharing of wireless antenna sites. On November 29, 2008, Industry Canada published the final rules for

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mandated roaming and site sharing, as well as the final arbitration procedure for resolving commercial disputes related to roaming and site sharing. These rules and procedures are now in effect.

The CRTC also regulates mobile wireless services under the Telecommunications Act . On August 12, 1994, the CRTC released a decision forbearing from the exercise of most of its powers under the Telecommunications Act as they relate to mobile wireless service. However, the CRTC did maintain its ability to require conditions governing customer confidential information and to place other general conditions on the provision of mobile wireless service. Since 1994, the CRTC has since exercised this power, for example, to mandate wireless number portability.

On February 2, 2009, the CRTC issued a decision requiring all WSPs to upgrade their networks by February 1, 2010, to more precisely determine the location of a person using a mobil phone to call 911. New entrants that launch services, after February 1, 2010, are to have the required functionality in place at the time of launch. This decision will add to Videotron’s initial costs of network deployment.

D- Organizational Structure

Videotron is a wholly-owned subsidiary of Quebecor Media. Quebecor Media is a 54.72% owned subsidiary of Quebecor Inc., which we refer to as Quebecor. The remaining 45.28% of Quebecor Media is owned by CDP Capital d’Amérique Investissements Inc., a subsidiary of the Caisse de dépôt et placement du Québec , one of Canada’s largest pension fund managers. The following chart illustrates the corporate structure of Videotron as of December 31, 2008, including Videotron’s significant subsidiaries, together with the jurisdiction of incorporation or organization of each entity.

E- Property, Plants and Equipment

Our corporate offices are located in leased space at 612 St-Jacques Street West, Montréal, Québec, Canada, H3C 4M8, in the same building than Quebecor’s head office. We also own several buildings in Montréal, the largest of which is located at 2155 Pie IX Street (approximately 112,000 square feet). We also own a building of approximately 73,000 square feet located at 150 Beaubien Street in Montréal. In Québec City, we own a building of approximately 40,000 square feet where our regional headend for the Québec City region is located. Furthermore, we own or lease a significant number of smaller locations for signal reception sites and customer service and business offices. We generally lease space for the business offices and retail locations for the operation of our video stores.

Our senior secured credit facilities are secured by charges over all of our assets and those of most of our subsidiaries.

F- Intellectual Property

We use a number of trademarks for our products and services. Many of these trademarks are registered by us in the appropriate jurisdictions. In addition, we have legal rights in the unregistered marks arising from their use. We have taken affirmative legal steps to protect our trademarks, and we believe our trademarks are adequately protected.

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G- Environment

Our operations are subject to federal, provincial and municipal laws and regulations concerning, among other things, emissions to the air, water and sewer discharge, the handling and disposal of hazardous materials and waste, recycling, the soil remediation of contaminated sites, or otherwise relating to the protection of the environment. Laws and regulations relating to workplace safety and worker health, which among other things, regulate employee exposure to hazardous substances in the workplace, also govern our operations.

Compliance with these laws has not had, and management does not expect it to have, a material effect upon our capital expenditures, net income or competitive position. Environmental laws and regulations and the interpretation of such laws and regulations, however, have changed rapidly in recent years and may continue to do so in the future. We have monitored the changes closely and have modified our practices where necessary or appropriate. Our properties, as well as areas surrounding our properties, may have had historic uses or may have current uses that may affect these properties and require further study or remedial measures. No material studies or remedial measures are currently anticipated or planned by us or required by regulatory authorities with respect to our properties. However, we cannot provide assurance that all environmental liabilities have been determined, that any prior owner of our properties did not create a material environmental condition not known to us, that a material environmental condition does not otherwise exist as to any such property, or that expenditure will not be required to deal with known or unknown contamination.

None.

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The following operating and financial review provides information concerning our operating results and financial condition. This discussion should be read in conjunction with our consolidated financial statements and accompanying notes included under “Item 17. Financial Statements” in this annual report. It also contains forward-looking statements, which are subject to a variety of factors that could cause actual results to differ materially from those contemplated by these statements. See “Forward-Looking Statements”.

General

We, Videotron Ltd, are a wholly-owned subsidiary of Quebecor Media Inc. (parent company), incorporated under Part IA of the Companies Act (Québec). We are the largest cable operator in the Province of Québec and the third largest in Canada, in each case based on the number of cable customers, a major Internet service provider and a provider of telephony services in the Province of Québec. We offer pay television, Internet access, cable telephony and mobile wireless telephony services.

This Management’s Discussion and Analysis contains an analysis of our consolidated financial position as of December 31, 2008 and the results of our operations and cash flows for the years ended December 31, 2008, 2007 and 2006. Our consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles (GAAP), which differ in certain respects from U.S. GAAP. Note 24 to our audited consolidated financial statements which are included under “Item 17. Financial Statements” in this annual report contains discussions of the principal differences between Canadian GAAP and U.S. GAAP and the extent to which those differences affect our consolidated financial statements. All amounts are in Canadian dollars unless otherwise specified.

Highlights Since December 31, 2007

· In May 2008, Videotron subscribed to 200,000,000 preferred shares, Series B, of 9193-2962 Québec Inc., a subsidiary of Quebecor Media, for cash consideration of $200.0 million. In September 2008, Videotron subscribed to an additional 336,601,953 preferred shares, Series B, of 9193-2962 Québec Inc. for cash consideration of $336.6 million. These transactions were effected in order to fund payments by 9193-2962 Québec Inc. in an amount of $554.5 million in connection with the successful bids for 17 new spectrum licences for Advanced Wireless Services (“AWS”), covering all of the Province of Québec and certain areas of Ontario, obtained as part of the Canadian spectrum auction for AWS. On September 23, 2008, Videotron acquired all the common shares of 9193-2962 Québec Inc. from Quebecor Media for a cash consideration of $17.9 million and issuance to Quebecor Media of one common share of Videotron. As of December 31, 2008, other intangible assets comprise the spectrum licences for AWS in the amount of $567.0 million (including capitalized interest). Industry Canada has informed 9193-2962 Québec Inc. that it met the Canadian ownership and control requirements of Section 10(2) of the Radiocommunication Regulations . The ownership transfer of these spectrum licences occurred in December 2008.

Non-GAAP Financial Measures

We use certain supplemental financial measures that are not calculated in accordance with or recognized by accounting principles generally accepted in Canada (“Canadian GAAP”) or accounting principles generally accepted in the United States (“U.S. GAAP”) to assess our financial performance. We use these non-GAAP financial measures, such as operating income and average monthly revenue per user, which we refer to as ARPU, because we believe that they are meaningful measures of our performance. Our method of calculating these non-GAAP financial measures may differ from the methods used by other companies and, as a result, the non-GAAP financial measures presented in this annual report may not be comparable to other similarly titled measures disclosed by other companies.

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Operating Income

We define operating income, reconciled to net income under Canadian GAAP, as net income before amortization, financial expenses, (gain) loss on valuation and translation of financial instruments, impairment of goodwill and other items, income taxes and non-controlling interest. Operating income margin is operating income as a percentage of operating revenues. Operating income, and ratios using this measure, are not intended to be regarded as an alternative to other financial operating performance measures, or to the statement of cash flows as a measure of liquidity. Operating income is not intended to represent funds available for debt service, reinvestment, distributions of dividends, or other discretionary uses, and should not be considered in isolation from, or as a substitute for, our financial information reported under Canadian GAAP and U.S. GAAP. We believe that operating income is a meaningful measure of performance because operating income excludes, among other things, certain non-cash items and items that are not readily comparable from year to year. Operating income is also commonly used in the sector in which we operate, as well as by the investment community, to analyze and compare companies in our field of activities. Operating income has limitations as an analytical tool, including:

· it does not reflect income tax expense or the cash necessary to pay income taxes; and

· it does not reflect financial expenses or the cash necessary to pay financial expenses.

It should be noted that our definition of operating income may not be identical to similarly titled measures reported by other companies, limiting its usefulness as a comparative measure. We provide a reconciliation of operating income to net income as disclosed in our financial statements in Table 1 below.

Table 1

Reconciliation between the operating income measure used in this report and the net income measure used in the consolidated financial statements
(in millions of Canadian dollars)

	Year Ended December 31,
	2008			2007			2006			2005		2004
										(restated)(1)		(restated)(1)
AMOUNTS UNDER CANADIAN GAAP
Net income	$	395.4		$	325.7		$	183.7		$	102.7	$	111.7
Amortization	214.3			206.1			185.1			166.3		163.9
Financial expenses	90.9			76.1			81.8			65.8		61.0
Loss (gain) on valuation and translation of financial instruments	24.7			(9.1		)	(2.2		)	8.9		31.9
Impairment of goodwill and other items	(1.4		)	5.4			—			—		1.9
Income taxes (recovery) expense	73.1			38.3			64.2			69.8		(6.7		)
Non-controlling interest in a subsidiary	0.2			0.2			0.1			0.1		0.1
Operating income as defined	$	797.2		$	642.7		$	512.7		$	413.6	$	363.8

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	Year Ended December 31,
	2008		2007			2006		2005		2004
								(restated)(1)		(restated)(1)
	(dollars in millions)
AMOUNTS UNDER U.S. GAAP
Net income	$	375.0	$	323.7		$	168.8	$	98.7	$	100.5
Amortization	225.6		216.7			196.3		177.4		175.7
Financial expenses	90.9		76.1			81.8		65.8		61.0
Loss (gain) on valuation and translation of financial instruments	30.1		(14.1		)	6.0		9.4		24.2
Impairment of goodwill and other items	0.6		5.4			—		—		1.9
Income taxes (recovery) expense	77.3		32.3			56.1		60.4		(1.2		)
Non-controlling interest in a subsidiary	0.2		0.2			0.1		0.1		0.1
Operating income as defined	$	799.7	$	640.4		$	509.0	$	411.8	$	362.2

(1) On January 1, 2006, a company under common control, Videotron Telecom Ltd., merged with Videotron. On July 1, 2006, Videotron also merged with its parent, 9101-0827 Québec inc. Those transactions have been accounted for using the continuity of interest method, and the results of operations and financial position of Videotron Telecom Ltd. and 9101-0827 Québec inc. have been included in these consolidated financial statements as if the three companies had always been combined. Comparative figures have been restated from statements previously presented. In respect of U.S. GAAP financial data, see also Note 24 “Significant differences between generally accepted accounting principles (GAAP) in Canada and the United States” to our audited consolidated financial statements which are included under “Item 17. Financial Statements” in this annual report.

Average Monthly Revenue per User

Average monthly revenue per user (“ARPU”) is an industry metric that we use to measure our average cable, Internet, and cable and wireless telephony revenues per month per basic cable customer. ARPU is not a measurement consistent with Canadian GAAP or U.S. GAAP. We calculate ARPU by dividing our combined cable television, Internet-access, and cable and wireless telephony revenues by the average number of basic cable customers during the applicable period, and then dividing the resulting amount by the number of months in the applicable period.

2008/2007 Year Comparison

Customer statistics

Cable television – The combined customer base for cable television services increased by 77,519 (4.7%) in 2008 (compared with 65,686 in 2007 and 66,298 in 2006) (see Table 2). As of December 31, 2008, our cable network had a household penetration rate (number of subscribers as a proportion of 2,542,859 total homes passed as of the end of December 2008) of 67.5% versus 65.6% a year earlier and 64.0% in 2006.

· The number of subscribers to illico Digital TV stood at 927,332 at the end of 2008, an increase of 159,111 or 20.7% during the year (compared with an increase of 144,565 in 2007 and an increase of 149,017 in 2006). At December 31, 2008, 54.1% of our cable television customers were subscribers to our illico Digital TV services compared to 46.9% in 2007 and 39.7% in 2006. At December 31, 2008, illico Digital TV had a household penetration rate of 36.5%, compared with 30.8% a year earlier and 25.4% in 2006.

· The customer base for analog cable television services decreased by 81,602 (-9.4%) in 2008 (compared with a decrease of 78,879 customers in 2007 and a decrease of 82,719 customers in 2006), primarily as a result of customer migration to illico Digital TV.

Internet access – The number of subscribers to cable Internet access services stood at 1,063,847 at the end of 2008, an increase of 130,858 (14.0%) from the previous year (compared with an increase of 141,023 in 2007 and an

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increase of 153,995 in 2006). At December 31, 2008, cable Internet access services had a household penetration rate of 41.8%, compared with 37.4% at December 31, 2007 and 32.2% at December 31, 2006.

Cable telephony service – The number of subscribers to cable telephony service stood at 851,987 at the end of 2008, an increase of 215,635 (33.9%) from the previous year (compared with an increase of 238,522 in 2007 and an increase of 234,851 in 2006). At December 31, 2008, the IP telephone service had a household penetration rate of 33.5%, compared with 25.5% at December 31, 2007 and 16.2% at December 31, 2006.

Wireless telephony service – At December 31, 2008, there were 63,402 lines activated on our wireless telephony service, an increase of 18,325 (40.6%) from the previous year (compared with an increase of 33,251 in 2007).

Table 2

End-of-year customer numbers

(in thousands of customers)

	2008	2007	2006	2005	2004
Cable television
Analog	788.3	869.9	948.8	1,031.5	1,118.9
Digital	927.3	768.2	623.6	474.6	333.7
Total cable television	1,715.6	1,638.1	1,572.4	1,506.1	1,452.6
Cable Internet	1,063.8	933.0	792.0	638.0	502.6
Cable telephony	852.0	636.4	397.8	163.0	—
Wireless telephony (in thousands of lines)	63.4	45.1	11.8	—	—

Results Analysis

Revenues : $1,804.2 million, an increase of $251.6 million (16.2%).

· Combined revenues from all cable television services increased by $74.1 million (10.1%) to $809.9 million. This growth was primarily due to an increase in the average number of basic cable customers, the migration of our customers from our analog to our digital services, higher buying rates for our video-on-demand and pay-TV products, an increase in the number of subscribers to our High Definition packages, as well as price increases, partially offset by higher bundling discounts due to the increase in Internet and cable telephony customers.

· Revenues from Internet access services increased by $77.2 million (18.3%) to $499.6 million. The improvement was mainly due to an increase in the average number of cable-modem Internet customers, along with increased revenues from usage of bandwidth over the limits stipulated in the contracts with our customers and a decrease in promotional discounts.

· Revenues from cable telephony services increased by $90.6 million (46.3%) to $286.1 million, primarily due to customer growth, partly offset by lower long distance revenues per user in 2008.

· Revenues from wireless telephony services increased by $13.9 million (78.5%) to $31.6 million, primarily due to customer growth.

· Revenues from business solutions decreased by $6.6 million (-9.4%) to $63.6 million, due to the end of a major contract.

· Revenues of Le SuperClub Vidéotron ltée decreased by $2.9 million (-4.9%) to $57.0 million, primarily because of the impact of the sale of the StarStruck Entertainment chain (operating in Ontario), the franchising of some of our corporate locations and some store closings, partly offset by higher retail sales, rental revenues and royalties.

· Other revenues, which represent principally sales of equipment to customers, increased by $5.4 million (10.6%) to $56.4 million, due to an increase in the sale of set-top boxes and a higher proportion of High Definition set-boxes.

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Monthly combined ARPU : $81.17, compared with $71.52 for 2007, an increase of $9.65 (13.5%).

Operating income : $797.2 million in 2008, an increase of $154.5 million (24.0%). This increase was due primarily due to:

· customer growth for all services;

· price increases, mostly on our cable television services and cable Internet access services;

· a higher proportion of digital customers for our television services resulting in increased ARPU; and

· a $34.3 million decrease in expenses related to the parent company’s management fees and stock option plan;

partially offset by:

· unfavourable variance of $29.0 million related to recognition in 2008 of a charge for CRTC Part II licence fees covering the period from September 1, 2006 to December 31, 2008 following the Federal Court of Appeal decision of April 29, 2008. Videotron recorded Part II licence fees for 2008 and will continue to record the fees going forward;

· higher bundling discounts;

· increase in our sales and marketing expenses;

· higher regulatory contributions due to the increase of our revenues;

· increase in our call center, technical services and network maintenance costs in order to support our growth; and

· decrease in our business solutions revenues.

Operating costs, expressed as a percentage of revenues: 55.8% in 2008 compared with 58.6% in 2007. Operating costs as a proportion of revenues decreased slightly for the following reasons:

· the fixed component of costs, which does not fluctuate in proportion to revenue growth;

· the marginal impact on costs of the higher consumption revenues, price increases and long-distance telephone volume; and

· the decrease in the parent company’s management fees and stock option plan expenses which was largely offset by the increase in Part II licence fees.

Amortization charge : $214.3 million, an increase of $8.2 million (4.0%) compared with 2007.

· The increase was mainly due to an increase in the acquisition of fixed assets, mostly related to telephony and Internet access services and the modernization of our network.

Financial expenses: $90.9 million, an increase of $14.8 million (19.4%). The increase was mainly due to:

· $30.4 million impact of increased indebtedness;

partially offset by:

· $12.8 million of interest mainly capitalized to the cost of intangible assets for 3G licences acquisition; and

· $3.5 million increase of the dividend income (net of the interest expense) resulting from tax consolidation transactions.

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The increase in indebtedness was due to the issuance, on April 15, 2008, of US$455.0 million aggregate principal amount of our 9 1 / 8 Senior Notes due 2018.

Valuation and translation of financial instruments : a loss of $24.7 million in 2008, compared to a gain of $9.1 million in 2007. The loss in 2008 was mainly due to:

· $10.8 million unfavourable impact related to a change in accounting estimates of the fair value of derivative instruments, reflecting market developments and recent accounting guidelines (see “Changes in accounting policies and accounting estimates” below); and

· $12.8 million unfavourable impact related to the ineffective portion of fair value hedges and the valuation of other financial instruments.

The gain in 2007 was mainly due to:

· $12.5 million favourable impact related to the ineffective portion of fair value hedges (first time adoption in 2007 of a new accounting policy on derivative financial instruments and hedge accounting); and

· $3.4 million unfavourable impact related to the valuation of other financial instruments.

Income tax expense : $73.1 million (effective tax rate of 15.6%), compared with $38.3 million in 2007 (effective tax rate of 10.5%). The variation in rate as compared to the statutory tax rate in 2008 was mainly due to:

· $86.1 million in non-taxable dividends from related parties; and

· $5.7 million due to the recognition of a deferred credits related to the acquisition of tax losses in prior years.

The variation in rate as compared to the statutory tax rate in 2007 was mainly due to:

· $54.7 million in non-taxable dividends from related parties; and

· $23.6 million due to non-deductible charges, non-taxable income and differences between current and future tax rates.

Net income : $395.4 million, an increase of $69.8 million (21.4%). The increase was mainly due to:

· $154.5 million increase in operating income (taxable at an average rate of 15.6% due to tax consolidation transactions);

partially offset by:

· $14.8 million increase in financial expenses;

· $8.2 million increase in amortization; and

· $33.8 million increase in the loss on valuation and translation of financial instruments.

2007/2006 Year Comparison

Results Analysis

Revenues : $1,552.6 million, an increase of $243.0 million (18.6%).

· Combined revenues from all cable television services increased by $58.6 million (8.6%) to $735.8 million. This growth was primarily due to an increase in the average number of basic cable customers, higher buying rates for our video-on-demand and pay-TV products, as well as the price increases implemented at the beginning of March 2006 and March 2007, partially offset by higher bundling discounts due to the increase in cable telephony customers.

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· Revenues from Internet access services increased by $77.4 million (22.4%) to $422.4 million. The improvement was mainly due to an increase in the average number of cable-modem Internet customers, along with increased revenues from usage of bandwidth over the limits stipulated in the contracts with our customers, price increases and a favourable product mix.

· Revenues from cable telephony services increased by $88.1 million (82.1%) to $195.5 million, mainly due to an increase in the average number of cable telephony customers, along with a slight increase in long distance and installation revenues.

· Revenues from wireless telephony services increased by $16.5 million to $17.7 million. The commercial launch occurred August 2006.

· Revenues from business solutions decreased by $4.2 million (-5.6%) to $70.2 million, due to the restructuring of a major contract.

· Revenues of Le SuperClub Vidéotron ltée increased by $4.4 million (7.9%) to $60.0 million, mainly due to increased sales of equipment and video games as well as the acquisition of new stores in 2006 and 2007.

· Other revenues, which represent principally sales of equipment to customers, increased by $2.2 million (4.6%) to $51.0 million, due to an increase in the sale of higher value set-top boxes as well as wireless equipment, partly offset by a lower volume of sales of basic set-top boxes.

Monthly combined ARPU : $71.52 in 2007, compared with $61.43 in the same period of 2006, an increase of $10.09 (16.4%).

Operating income : $642.7 million in 2007, an increase of $130.0 million (25.4%). The increase was due primarily to:

· customer growth for all services;

· price increases, mostly on our cable television services and cable Internet access services;

· our wireless telephony services (we launched our services in August 2006);

· a higher proportion of digital customers for our television services resulting in increased ARPU; and

· $12.9 million favourable variance related to non-recognition in 2007 of current Canadian Radio-television and Telecommunications Commission (“CRTC”) Part II licence fee accruals following the notice issued on October 1, 2007;

partially offset by:

· $30.1 million increase in management fees charged by our parent company including additional charges for the parent company stock option plan;

· additional resources required to support the growth in our customer base; and

· decrease in business solutions revenues.

Operating costs, expressed as a percentage of revenues : 58.6% in 2007 compared with 60.9% in 2006. Operating costs as a proportion of revenues decreased slightly for the following reasons:

· the fixed component of costs, which does not fluctuate in proportion to revenue growth; and

· the favourable variation related to the non-recognition of the Part II fees.

Amortization charge : $206.1 million, an increase of $21.0 million (11.3%).

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The increase was mainly due to an increase in the acquisition of fixed assets, mostly related to telephony and Internet access services and the modernization of our network.

Financial expenses : $76.1 million, a decrease of $5.6 million (-6.9%). The decrease was mainly due to:

· $5.9 million increase of the dividend income (net of the interest expense) resulting from tax consolidation transactions.

Valuation and translation of financial instruments : a gain of $9.1 million in 2007, compared to a gain of $2.2 million in 2006. The gain in 2007 was mainly due to:

· $3.4 million unfavourable impact related to the valuation of other financial instruments.

The gain in 2006 was mainly due to:

· $3.3 million gain on the termination of a long term debt; and

· $1.1 million unfavourable impact related to the valuation of other financial instruments.

Income tax expense : $38.3 million (effective tax rate of 10.5%), compared with $64.2 million in 2006 (effective tax rate of 25.9%). The variation in rate as compared to the statutory tax rate in 2007 was mainly due to:

· $54.7 million in non-taxable dividend from related parties (due to tax consolidation transactions); and

· $23.6 million due to non-deductible charges, non-taxable income and differences between current and future tax rates.

The variation in rate as compared to the statutory tax rate in 2006 was mainly due to:

· $14.9 million due to a change in substantively enacted tax rates affecting our future income tax balances.

Net income : $325.7 million, an increase of $142.0 million (77.3%). The increase was mainly due to:

· $130.0 million increase in operating income (taxable at an average rate of 10.5% due to tax consolidation transactions);

· $55.0 million impact of the lower income taxes rate in 2007;

Partially offset by:

· $21.0 million increase in amortization; and

· $5.4 million impairment in 2007 of the goodwill of our subsidiary, Le Superclub Vidéotron Ltée, related to the DVDs and games rental operations in Ontario.

Other Developments Since December 31, 2007

In 2003 and 2004, a number of companies, including Videotron, brought a suit against the Crown in Federal Court, alleging that the Part II licence fees annually paid by broadcasters constitute, in fact and in law, unlawful taxes under the Broadcasting Act (Canada). On December 14, 2006, the Federal Court found that these fees did indeed constitute taxes and that the CRTC should cease collection of such fees, but concluded that the plaintiff companies would not be entitled to a reimbursement of the amounts already paid. The plaintiffs and the defendant both filed an appeal before the Federal Court of Appeal. On October 1, 2007, the CRTC issued a document stating that it would adhere to the decision rendered and that it would not collect, in 2007 or any subsequent years, the Part II licence fees payable on November 30 of each year unless a Superior Court reverses the decision of the Federal Court of Appeal. In light of these facts, and as a result of the decision of the Superior Court, Videotron reversed its liability of $11.1 million related to

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these Part II licence fees covering the period from September 1, 2006 to December 30, 2007 in the third quarter of 2007. Videotron also ceased to record the Part II licence fees.

On April 29, 2008, the Federal Court of Appeal handed down its decision and overturned the December 14, 2006 decision of the Federal Court. The plaintiff companies disagree with this decision and the request for leave to appeal to the Supreme Court of Canada was accepted on December 18, 2008. The CRTC publicly stated that it will make no attempt to collect outstanding Part II licence fees until the earlier of (a) the judgment of the Federal Court of Appeal is affirmed by the Supreme Court or (b) the matter is settled between the parties. However, by virtue of the Federal Court of Appeal decision that confirms the right of the CRTC to collect Part II licence fees to which Videotron is subject, Videotron recorded in 2008 a total liability of $25.6 million related to the Part II licence fees. This liability is for the period covering from September 1, 2006 to December 31, 2008. Videotron continues to accrue for the Part II licence fees.

Liquidity and Capital Resources

Uses of Liquidity and Capital Resources

Our principal liquidity and capital resource requirements consist of:

· capital expenditures to maintain and upgrade our network in order to support the growth of our customer base and the launch and expansion of new or additional services;

· the servicing and repayment of our debt; and

· distributions to our shareholder.

Capital Expenditures : $404.8 million in 2008, an increase of $74.7 million (22.6%) compared with 2007. The increase was mainly due to:

· initial investments of $17.5 million in our AWS network, higher investments in our Internet network and the modernization of certain parts of our network.

We continue to focus on success-driven capital spending.

Fixed Assets Additions (in millions)	2008		2007		Variance

Customer premises equipment	$	113.1	$	122.9	$	(9.8	)
Scaleable infrastructure (1)	121.0		76.8		44.2
Line extensions	41.2		27.3		13.9
Upgrade/Rebuild	57.7		53.0		4.7
Support Capital	71.8		50.1		21.7
Total fixed assets additions	$	404.8	$	330.1	$	74.7

(1) Includes our $17.5 million initial investments in our AWS network.

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Service and Repayment of Our Debt : Cash interest payments of $109.3 million in 2008, an increase of $29.2 million compared with 2007. The increase was mainly due to:

· the issuance, in April 2008, of $455.0 million in aggregate principal amount of our 9 1 / 8 % Senior Notes ($447.6 million net of financing costs).

Purchase of Shares of Quebecor Media and Service of Subsidiary Subordinated Loan : Unlike corporations in the United States, corporations in Canada are not permitted to file consolidated tax returns. As a result, we have entered into certain transactions described below that have the effect of using tax losses within the Quebecor Media group.

On January 3, 2007, Videotron entered into a subordinated loan of $1.0 billion with Quebecor Media, as lender, bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and which incremental amount matures on January 3, 2022. On May 31, 2007, Videotron increased the principal amount of the subordinated loan by $870.0 million, maturing on May 31, 2022. Videotron invested the total proceeds of $1.0 billion and $870.0 million into 1,000,000 and 870,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On May 31, 2007, CF Cable TV Inc., a wholly-owned subsidiary of Videotron, entered into a subordinated loan of $125.0 million with Quebecor Media, as lender, bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on May 31, 2022. On the same day, CF Cable TV Inc. invested the total proceeds of $125.0 million into 125,000 preferred shares, Series B, of 9101-0835 Québec Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On January 4, 2008, Videotron entered into a subordinated loan of $415.0 million from Quebecor Media, as lender, bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 4, 2023. On the same day, Videotron invested the total proceeds of $415.0 million into 415,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On January 4, 2008, CF Cable TV Inc., a wholly-owned subsidiary of Videotron, entered into a subordinated loan of $170.0 million with Quebecor Media, as lender, bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 4, 2023. On the same day, CF Cable TV Inc. invested the total proceeds of $170.0 million into 170,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On December 23, 2008, 9101-0835 Québec Inc., a subsidiary of Quebecor Media, redeemed 525,000 preferred shares, Series B, for a total cash consideration of $525.5 million, including cumulative dividends of $0.5 million. On the same day, Videotron used the total proceeds of $525.0 million to repay part of its subordinated loan contracted from Quebecor Media on January 3, 2007.

On January 9, 2009, CF Cable TV Inc., a wholly-owned subsidiary of Videotron, increased the principal amount of its subordinated loan with Quebecor Media, as lender, by $190.0 million, which incremental amount bears interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 9, 2024. On the same day, CF Cable TV Inc. invested the total proceeds of $190.0 million into 190,000 preferred shares, Series B, of 9101-0835 Québec Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

Income tax transactions : On December 18, 2008, Videotron’s ultimate parent company, Quebecor Inc., transferred to Videotron a total of $104.9 of non-capital tax losses in exchange for net cash consideration of $18.4

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million. This transaction was recorded at the exchange amount. As a result, Videotron recorded an income tax asset of $32.4 million, and the difference of $14.0 million, between the net cash consideration and the income tax asset, was recorded as a deferred credit, included in accounts payable and accrued charges, which will reduce the income tax expense in the future as these tax deductions are used.

On December 18 and 21, 2007, Videotron’s ultimate parent company, Quebecor Inc., transferred to Videotron a total of $57.1 million of non-capital tax losses in exchange for net cash consideration of $12.8 million. This transaction was recorded at the exchange amount. As a result, Videotron recorded an income tax asset of $17.7 million, and the difference of $4.9 million between the net cash consideration and the income tax asset was recorded as a deferred credit, included in accounts payable and accrued liabilities, which reduced income tax expense in 2008 as these tax deductions were used.

On December 21, 2007, Videotron’s ultimate parent company, Quebecor Inc., transferred to CF Cable TV Inc., a wholly-owned subsidiary of Videotron, $9.4 million of non-capital tax losses in exchange for a net cash consideration of $2.1 million. This transaction was recorded at the exchange amount. As a result, CF Cable TV Inc. recorded an income tax asset of $2.9 million, and the difference of $0.8 million between the net cash consideration and the income tax asset, was recorded as a deferred credit, included in accounts payable and accrued liabilities, which reduced income tax expense in 2008 as these tax deductions were used.

Distributions to our Shareholder : During the year ended December 31, 2008, we paid $230.0 million to our sole shareholder, Quebecor Media, in respect of reductions in paid-up capital and dividends, compared to total cash distributions of $299.6 million in 2007. See Note 16 to our audited consolidated financial statements for the years ended December 31, 2008, 2007 and 2006 for more information. We expect to make cash distributions to our shareholder in the future, within the limits set by the terms of our indebtedness and applicable laws.

Contractual Obligations and Other Commercial Commitments : Our material contractual obligations included capital repayment and interest on long-term debt, operating lease arrangements, capital asset purchases and other commitments, and obligations related to derivative instruments. Videotron entered in the following material contractual obligations in 2008:

· On April 15, 2008, Videotron issued US$455.0 million in aggregate principal amount of 9 1 / 8 % Senior Notes due 2018.

· On April 7, 2008, Videotron amended its Senior Secured Credit Facility to increase commitments under the facility from $450.0 million to $575.0 million and extend the maturity date to April 2012. Pursuant to these amendments, Videotron may, subject to certain conditions, increase the commitments under the Senior Secured Credit Facility by an additional $75.0 million (for aggregate commitments of $650.0 million).

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Details of our contractual obligations and other commercial commitments are disclosed in notes 14, 15, 19, 20 and 21 to our annual consolidated financial statements for the year ended December 31, 2008.

				Payments Due by Period as of December 31, 2008
	Total			< 1 year		Less than 1-3 years		3-5 years		> 5 years
	(in million of dollars)
*Contractual obligations (1):*
Bank indebtedness	$	3.6		$	3.6	$	—	$	—	$	—
Bank credit facility	207.7			—		—		207.7		—
Accounts payable and accrued charges	322.6			322.6		—		—		—
Amounts payable to affiliated company	19.3			19.3		—		—		—
6 7 / 8 % Senior Notes due January 15, 2014	800.4			—		—		—		800.4
6 3 / 8 % Senior Notes due December 15, 2015	212.4			—		—		—		212.4
9 1 / 8 % Senior Notes due April 15, 2018	546.2			—		—		—		546.2
Cash Interest Expense(2)	829.7			120.7		241.3		228.7		239.0
Derivative financial instruments(3)	(60.3		)	—		—		—		(60.3		)

Total contractual cash obligations	$	2,881.6		$	466.2	$	241.3	$	436.4	$	1,737.7

(1) This table excludes obligations under subordinated loans due to Quebecor Media, our parent company, the proceeds of which are used to invest in preferred shares of an affiliated company for tax consolidation purposes of the Quebecor Media group. See note 9 to our audited consolidated financial statements which are included under “Item 17. Financial Statements” in this annual report.

(2) Estimate of interest to be paid on long-term debt and bank indebtedness is based on the hedged and unhedged interest rates and hedged foreign exchange rate as at December 31, 2008.

(3) Estimated net future reimbursements on derivative financial instruments related to foreign exchange hedging.

We rent equipment and premises under various operating leases or purchasing agreements. As of December 31, 2008, we estimate that the minimum aggregate payments under these leases and purchasing agreements over the next 20 years will be approximately $147.0 million. During the year ended December 31, 2008, we renewed or extended several leases and entered into new operating leases.

We entered into a management agreement with Quebecor Media for services it provides to us, including internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations, and other services. This agreement provides for an annual management fee payable to Quebecor Media of which we paid $25.4 million for the year ended December 31, 2008, compared to $46.9 million in 2007 and $23.4 million in 2006. See “Major Shareholders and Related Party Transactions — Related Party Transactions — Management Services and Other.”

Pension plan and post-retirement benefits : Videotron regularly monitors the funded status of its pension plans. The total cash amount paid or payable for employee future benefits for all plans, consisting of cash contributed by Videotron to its funded pension plans, cash payments directly to beneficiaries for its unfunded other benefit plans, and cash contributed to its defined contribution plans, totalled $9.7 million for the year ended December 31, 2008 ($9.8 million in 2007 and $7.5 million in 2006).

Sources of Liquidity and Capital Ressources

Operating activities (2008/2007)

Cash flows provided by operating activities : $711.5 million in 2008, compared with $552.9 million in 2007, an increase of $158.6 million (28.7%), mainly due to the increase in operating income.

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Operating activities (2007/2006)

Cash flows provided by operating activities : $552.9 million in 2007, compared with $440.6 million in 2006, an increase of $112.3 million (25.5%), mainly due to the increase in operating income.

Investing activities (2008/2007)

Cash flows used by investing activities: $1,043.2 million in 2008, compared with $2,338.2 million in 2007, a decrease of $1,294.9 million (-55.4%). The decrease was mainly due to the acquisition in 2007 of $1,995.0 million of shares of a company under common control for tax consolidation purposes.

Partially offset by:

· acquisition of $554.5 million of shares of a company under common control in 2008 in order to pay for the successful bids of 17 new spectrum licences for AWS;

· acquisition of $60.0 million of shares of a company under common control in 2008 for tax consolidation purposes; and

· increase of $74.7 million in the acquisition of fixed assets.

Investing activities (2007/2006)

Cash flows used by investing activities: $2,338.2 million in 2007, compared with $265.1 million in 2006, an increase of $2,073.1 million. The increase was mainly due to:

· acquisition in 2007 of $1,995.0 million of shares of a company under common control in 2007 for tax consolidation purposes;

· decrease of $39.5 million in temporary investments in 2006 compared to $1.0 million in 2007; and

· increase of $27.4 million in the acquisition of fixed assets.

Financing activities (2008/2007)

Cash flows provided by financing activities: $331.7 million provided in 2008, compared with $1,785.2 million provided in 2007, a decrease of 81.4%. The $1,453.5 million decrease was mainly due to:

· Videotron entering into a subordinated loan of $1,995.0 million from Quebecor Media Inc. in 2007 for fiscal consolidation purposes compared to $60.0 million in 2008; and

· a decrease in net borrowings under our bank credit facility of $38.8 million ($59.9 million in 2008 compared to $98.7 million in 2007).

Partially offset by:

· issuance, in 2008, of $455.0 million aggregate principal amount of our 9 1 / 8 % Senior Notes ($447.6 million net of financing costs); and

· a net decrease in cash distributions to our parent company, Quebecor Media, of $69.6 million ($230.0 million in 2008 compared to $299.6 million in 2007).

Financing activities (2007/2006)

Cash flows provided (used in) by financing activities: $1,785.2 million provided in 2007, compared with $202.2 million used in 2006. The $1,987.4 million increase was mainly due to:

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· Videotron entering into a subordinated loan of $1,995.0 million from Quebecor Media Inc., as lender, in 2007 for fiscal consolidation purposes; and

· repayment, in 2006, of $150.0 million relating to a subordinated loan to the parent company;

Partially offset by:

· a net increase of cash distributions to our parent company, Quebecor Media, of $180.9 million ($299.6 million in 2007 compared to $118.7 million in 2006).

Videotron believes that cashflow generated by operations and available sources of financing should be sufficient to meet all our obligations with respect to capital investments, working capital, interest payments and pension plans. Despite the crisis currently affecting the credit markets, Videotron believes that it will be able to meet its future long term debt repayments, which are relatively limited in the next five years.

Summary of Critical Accounting Estimates

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

Long-Lived Assets

Videotron reviews long-lived assets with definite useful lives for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. An impairment loss is recognized when the carrying amount of an asset or a group of assets held for use exceeds the sum of the undiscounted cash flows expected from its use and eventual disposition. Measurement of an impairment loss is based on the amount by which the carrying amount of a group of assets exceeds its fair value. Fair value is determined using quoted market prices, when available, or using accepted valuation techniques such as the discounted future cash flows method.

We also evaluate goodwill for impairment on at least an annual basis and whenever events or circumstances indicate that the carrying amount may not be recoverable from its estimated future cash flows. Impairment of goodwill is measured at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit, which is established based on the projected discounted future cash flows of the unit using a discount rate that reflects our average cost of funds. If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired, and a second test is performed to measure the amount of impairment loss.

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

Employee Future Benefits

Pensions: Pension costs of our defined benefit pension plans are determined using actuarial methods and could be impacted significantly by our assumptions and estimates regarding future events, including expected return on plan assets, rate of compensation increases, retirement ages of employees and other actuarial assumptions. The fluctuation of the discount rate at each measurement date also has an impact.

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In light of the actual return on plan assets realized in 2008, Videotron estimates that the cash contribution to its defined benefit plans, for which actuarial valuations are performed as of December, 31, 2008, will increase by $5.0 million per year for each of the next five years. A one-percentage point change in the discount rate would have the following effects:

	Pension					Postretirement
	benefits					benefits
	1%			1%		1%			1%
Sensitivity analysis (in millions)	increase			decrease		increase			decrease

Effect on benefit costs	$	(2.5	)	$	2.2	$	(0.2	)	$	0.2
Effect on benefit obligations	(10.3		)	12.1		(1.3		)	1.6

A one-percentage point change in the expected return on plan assets would have the following effects:

	Pension				Postretirement
	benefits				benefits
	1%			1%	1%		1%
Sensitivity analysis (in millions)	increase			decrease	increase		decrease

Effect on benefit costs	$	(0.9	)	0.9	$	—	$	—

A one-percentage point change in the rate of compensation increase would have the following effects:

	Pension					Postretirement
	benefits					benefits
	1%		1%			1%		1%
Sensitivity analysis (in millions)	increase		decrease			increase		decrease

Effect on benefit costs	$	0.6	$	(0.6	)	$	—	$	—
Effect on benefit obligations	1.4		(1.4		)	—		—

A one-percentage point change in the assumed health care cost trend would have the following effects:

	Postretirement
	benefits
	1%		1%
Sensitivity analysis (in millions)	increase		decrease

Effect on benefit costs	$	1	$	(1	)
Effect on benefit obligations	21		(18		)

Other Post-Retirement Benefits : We accrue the cost of post-retirement benefits, other than pensions, which are impacted significantly by a number of management assumptions, such as the discount rate, and an annual rate of increase in the per capita cost of covered benefits. These benefits, which are funded as they become due, principally include health and life insurance programs and cable services.

The employee future benefits accounting policy is explained in Note 1(o) to our audited consolidated financial statements which are included under “Item 17. Financial Statements” in this annual report, and assumptions on expected

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return on plan assets, rate of compensation increases and discount rates are disclosed in Note 23 to our audited consolidated financial statements which are included under “Item 17. Financial Statements” in this annual report.

Revenue Recognition

We recognize operating revenues when the following criteria are met:

· persuasive evidence of an arrangement exists;

· delivery has occurred or services have been rendered;

· the seller’s price to the buyer is fixed or determinable; and

· the collection of the sale is reasonably assured.

The portion of revenue that is unearned is recorded under “Deferred revenue” when customers are invoiced. Revenue recognition policies for each of Videotron’s main product lines are as follows:

Cable and wireless services are provided under arrangement with multiple deliverables, for which there are two separate accounting units: one for subscriber services (operating services and connecting fees) and the other, for equipment sales to subscribers, including activation fees related to wireless telephones. Components of multiple deliverable arrangements are separately accounted for provided the delivered elements have stand-alone value to the customers and the fair-value of any undelivered elements can be objectively and reliably determined.

Cable connection fee revenues are deferred and recognized as revenues over the estimated average 30-month period that subscribers are expected to remain connected to the network. The incremental and direct costs related to cable connection fees, in an amount not exceeding the revenue, are deferred and recognized as an operating expense over the same 30-month period. Operating revenues from cable and other services, such as Internet access, IP telephony and wireless telephone, are recognized when services are rendered. Revenue from equipment sales to subscribers and their costs are recognized in income when the equipment is delivered and in the case of wireless telephones, revenues from equipment sales are recognized in income when the telephone is delivered and activated. Revenues from video rentals are recorded as revenue when services are provided. Promotional offers related to subscriber services are accounted for as a reduction in the related service revenue over the period of performance of the service contract. Promotional offers related to equipment sales, including wireless telephones, are accounted for as a reduction in the related equipment sales when the equipment is delivered. Operating revenues related to service contracts are recognized in income over the life of the specific contracts on a straight-line basis over the period in which the services are provided.

Off-Balance Sheet Arrangements

Operating Leases

Videotron has guaranteed a portion of the residual values of certain assets under operating leases for the benefit of the lessor. Should Videotron terminate these leases prior to term (or at the end of the lease term) and should the fair value of the leased assets be less than the guaranteed residual value, Videotron must, under certain conditions, compensate the lessor for a portion of the shortfall. In addition, a subsidiary of Videotron has provided guarantees to certain lessors under premises leases for certain videostore franchisees, with expiry dates through 2017. Should the lessee default under such agreements, Videotron must, under certain conditions, compensate the lessor. As at December 31, 2008, the maximum exposure in respect of these guarantees was $16.3 million and no liability has been recorded in the consolidated balance sheet since Videotron does not expect to make any payments pertaining to these guarantees. In prior years, Videotron has not made any payments relating to these guarantees.

Guarantees Related to our Various Existing Notes

Under the terms of the indenture governing our 6 7 / 8 % Senior Notes due January 15, 2014, the indenture governing our 6 3 / 8 % Senior Notes due December 15, 2015 and the indenture governing our 9 1 / 8 % Senior Notes due April

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15, 2018, we are committed to pay any amount of withholding taxes that could eventually be levied by any Canadian taxing authority (as defined in the indenture that governs such Notes) on payments made to the lenders so that the amounts the lenders would receive are not less than amounts receivable where no taxes are levied. The amount of such guarantee is not limited and it is not possible for us to establish a maximum exposure of the guarantee because our exposure depends exclusively on the future actions, if any, by Canadian taxing authorities. Although no recourse exists for such liability, we have the right to redeem our 6 7 / 8 % Senior Notes due January 15, 2014, our 6 3 / 8 % Senior Notes due December 15, 2015 and our 9 1 / 8 % Senior Notes due April 15, 2018, at their face value were such taxes levied by any Canadian taxing authority, thereby terminating the guarantee.

Risks and Uncertainties

Videotron’s financial risk management policies have been established to identify and analyze the risks faced by Videotron, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies are reviewed regularly to reflect changes in market conditions and Videotron’s activities.

From its use of financial instruments, Videotron is exposed to credit risk, liquidity risk, and market risks relating to foreign exchange fluctuations, interest rate fluctuations and equity prices. In order to manage its foreign exchange and interest rate risks, Videotron and its subsidiaries use derivative financial instruments (i) to achieve a targeted balance of fixed and variable rate debts and (ii) to set in Canadian dollars all future payments on debts denominated in U.S. dollars (interest and principal) and certain purchases of inventory and other capital expenditures denominated in a foreign currency. Videotron does not intend to settle its financial derivative instruments prior to their maturity, as none of these instruments are held or issued for speculative purposes. Videotron designates its derivative financial instruments either as fair value hedges or cash flow hedges when they qualify for hedge accounting.

Description of derivative financial instruments:

Foreign exchange forward contracts:

Currencies (sold/bought)	Maturing	Weighted Average Exchange Rate	Notional Amount (in millions of dollars)

$ / US$	Less than 1 year	1.0865	$	75.5

Cross-currency interest rate swaps:

	Period covered	Notional amount (in millions of dollars)		Annual effective interest rateusing hedged rate	Annual nominal interest rate of debt		CDN dollar exchange rate on interest and capital payments per one U.S. dollar

Senior Notes	2004 to 2014	US$	190.0	Bankers’ acceptance 3 months plus 2.80%	6.875	%	1.2000
Senior Notes	2004 to 2014	US$	125.0	7.45%	6.875	%	1.1950
Senior Notes	2003 to 2014	US$	200.0	Bankers’ acceptance 3 months plus 2.73%	6.875	%	1.3425
Senior Notes	2003 to 2014	US$	135.0	7.66%	6.875	%	1.3425
Senior Notes	2005 to 2015	US$	175.0	5.98%	6.375	%	1.1781
Senior Notes	2008 to 2018	US$	455.0	9.65%	9.125	%	1.0210

Certain cross-currency interest rate swaps entered into by Videotron include an option that allows each party to unwind the transaction on a specific date at the then settlement amount.

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Fair value of financial instruments:

The carrying amount of accounts receivable from external or related parties (classified as loans and receivables), accounts payable and accrued charges to external or related parties (classified as other liabilities) approximates their fair value since these items will be realized or paid within one year or are due on demand.

The carrying values and fair value of long-term debt and derivative financial instruments as of December 31, 2008 and 2007 are as follows:

	December 31, 2008						December 31, 2007
	Carrying value			Fair value			Carrying value			Fair value

Long-term debt (1)	$	(1,766,668	)	$	(1,577,000	)	$	(973,355	)	$	(938,158	)
Cross-currency interest rate swaps	69,486			69,486			(241,320		)	(241,320		)
Foreign exchange forward contracts	9,013			9,013			(4,236		)	(4,236		)

(1) The carrying value of long-term debt excludes adjustments to record changes in the fair value of long-term debt related to hedges interest risk, the embedded derivatives or the financing fees.

The fair value of long-term debt is estimated based on discounted cash flows using year-end market yields or the market value of similar instruments with the same maturity, or quoted market prices when available. The majority of derivative financial instruments (e.g. cross currency interest rate swaps) are traded over the counter and, as such, there are no quoted prices. The fair value of derivative financial instruments is therefore estimated using valuation models that project future cash flows and discount the future amounts to a present value using the contractual terms of the derivative instrument and factors observable in external markets, such as period-end swap rates and foreign exchange rates. An adjustment is also included to reflect non-performance risk, impacted by the financial and economic environment prevailing at the date of the valuation, in the recognized measure of the fair value of the derivative instruments by applying a credit default premium to the net exposure of the counterparty or Videotron. The fair value of early settlement options recognized as embedded derivatives is determined by option pricing models using market inputs and assumptions, including volatility and discount factors.

Due to the judgment used in applying a wide range of acceptable techniques and estimates in calculating fair value amounts, fair values are not necessarily comparable among financial institutions or other market participants and may not be realized in an actual sale or the immediate settlement of the instrument.

Credit risk management:

Credit risk is the risk of financial loss to Videotron if a customer or counterparty to a financial asset fails to meet its contractual obligations.

In the normal course of business, Videotron continuously monitors the financial condition of its customers and reviews the credit history of each new customer. As of December 31, 2008, no customer balance represented a significant portion of Videotron’s consolidated trade receivables. Videotron establishes an allowance for doubtful accounts based on the specific credit risk of its customers and historical trends. The allowance for doubtful accounts amounted to $16.0 million as of December 31, 2008 ($11.7 million as of December 31, 2007). As of December 31, 2008, 8.9% of trade receivables were 90 days past their billing date (7.0% as of December 31, 2007).

Videotron believes that its product lines and the diversity of its customer base are instrumental in reducing its credit risk, as well as the impact of fluctuations in product-line demand. Videotron does not believe that it is exposed to an unusual level of customer credit risk.

From its use of derivative financial instruments, Videotron is exposed to the risk of non-performance by a third party. When Videotron enters into derivative contracts, the counterparties (either foreign or Canadian) must have credit ratings at least in accordance with Videotron’s credit risk management policy and are subject to concentration limits.

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Given the high minimum credit ratings required under Videotron’s policy, Videotron does not foresee any failure by counterparties to meet their obligations.

Liquidity risk management:

Liquidity risk is the risk that Videotron will not be able to meet its financial obligations as they fall due or the risk that those financial obligations have to be met at excessive cost. Videotron manages this exposure through staggered debt maturities. The weighted average term of Videotron’s consolidated debt was approximately 6.3 years as at December 31, 2008.

Videotron’s management believes that cash flows from continuing operations and available sources of financing should be sufficient to cover committed cash requirements for capital investments, working capital, interest payments, debt repayments, pension plan contributions, and dividends (or distributions) in the future. Videotron has access to cash flows generated by its subsidiaries through dividends (or distributions) and cash advances paid by its wholly-owned subsidiaries.

Market risk:

Market risk is the risk that changes in market prices due to foreign exchange rates, interest rates and/or equity prices will affect the value of Videotron’s financial instruments. The objective of market risk management is to mitigate and control exposures within acceptable parameters while optimizing the return on risk.

Foreign currency risk:

Most of Videotron’s consolidated revenues and expenses, other than interest expense on U.S. dollar-denominated debt, purchases of set-top boxes and cable modems and certain capital expenditures, are received or denominated in Canadian dollars. A large portion of the interest, principal and premium, if any, payable on Videotron’s debt is payable in U.S. dollars. Videotron has entered into transactions to hedge the foreign currency risk exposure on 100% of its U.S. dollar-denominated debt obligations outstanding as of December 31, 2008 and to hedge its exposure on certain purchases of set-top boxes, cable modems and capital expenditures. Accordingly, Videotron’s sensitivity to the variation of foreign exchange rates is economically limited.

The following table summarizes the estimated sensitivity on income and other comprehensive income, before income tax, of a $0.10 variance in the year-end exchange rate of the Canadian dollar per one U.S. dollar:

	Income			Other comprehensive income
	(in thousands of dollars)
Increase of $0.10
U.S. dollar accounts payable	$	(680.0	)	$	—
Gain (loss) on valuation and translation of financial instruments and of derivative financial instruments	(2,250		)	44,905

Decrease of $0.10
U.S. dollar accounts payable	680
Gain (loss) on valuation and translation of financial instruments and of derivative financial instruments	2,250			(44,905		)

Interest rate risk and non-performance risk:

Videotron’s bank credit facilities bear interest at floating rates based on the following reference rates: (i) bankers’ acceptance rate (BA) and (ii) bank prime rate (Prime). The Senior Notes issued by Videotron bear interest at fixed rates. Videotron has entered into various cross-currency interest rate swap agreements in order to manage cash flow and fair value risk exposure due to changes in interest rates. After taking into account the hedging instruments, the long-term debt is comprised of 58.7% of fixed rate debt and 41.3% of floating rate debt as of December 31, 2008.

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The estimated sensitivity on financial expense, before income tax, of a 100 basis point variance in the year-end Canadian Banker’s acceptance rate is $7.0 million.

The estimated sensitivity income and other comprehensive income, before income tax, of a 100 basis point variance in the discount rate used to calculate the fair value of financial instruments, as per Videotron’s valuation model, is as follows:

	Income			Other comprehensive income
	(in thousands of dollars)

Increase of 100 basis points	$	2,609		$	(3,908	)
Decrease of 100 basis points	(2,609		)	3,908

Capital management:

Videotron’s primary objective in managing capital is to maintain an optimal capital base in order to support the capital requirements of its various activities, including growth opportunities.

In managing its capital structure, Videotron takes into account the asset characteristics of its subsidiaries and planned requirements for funds, leveraging their individual borrowing capacities in the most efficient manner to achieve the lowest cost of financing. Management of the capital structure involves the issuance of new debt, the repayment of existing debt using cash generated by operations and the level of distributions to the parent company. Videotron has not significantly changed its strategy regarding management of its capital structure since the last financial year.

Videotron’s capital structure is composed of shareholder’s equity, bank indebtedness, long-term debt, assets and liabilities related to derivative financial instruments, and non-controlling interest, less cash and cash equivalents. The capital structure is as follows:

	2008			2007

Bank indebtedness	$	3,613		$	9,505
Long-term debt	1,807,997			950,988
Net (assets) liabilities related to derivative financial instruments	(78,499		)	245,556
Non-controlling interest	1,047			947
Net debt	$	1,734,158		$	1,206,996
Shareholder’s equity	$	403,654		$	259,110

Videotron is not subject to externally imposed capital requirements other than certain restrictions under the term of its borrowing agreements which relate to permitted investments, inter-company transactions or the declaration and payment of dividends and other distributions.

Changes in Accounting Policies and Accounting Estimates

Changes in accounting policies

On January 1, 2008, Videotron adopted the Canadian Institute of Chartered Accountants (“CICA”) Section 3031, Inventories, which provides more extensive guidance on the recognition and measurement of inventories, and related disclosures. Under this new accounting policy, inventories are now valued at the lower of cost, determined by the weighted-average cost method, and net realizable value. However, the net realizable value is now the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. The adoption of this new section had no impact on the consolidated financial statements.

On January 1, 2008, Videotron adopted the CICA Handbook Section 1535, Capital Disclosures , Section 3862, Financial Instruments - Disclosures , and Section 3863, Financial Instruments - Presentation . These sections relate to

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disclosures and presentation of information and did not affect the consolidated financial results. Disclosure requirements related to these new accounting standards are presented in Note 21 of our audited consolidated financial statements for the years ended December 31, 2008, 2007 and 2006.

Videotron estimates the fair value of its derivative financial instruments using a discounted cash flow valuation technique, since no quoted market prices exist for such instrument. In the second quarter of 2008, Videotron made some amendments to the technique used in measuring the fair value of its derivatives in a liability position and in an asset position. These amendments change the way Videotron factored counterparty and its own non-performance risk in its valuation technique, considering market developments and recent accounting guidelines. The cumulative impact of these changes as of December 31, 2008, is a decrease of the fair value of these derivatives by $10.8 million and an increase of the comprehensive loss by $10.8 million (before income taxes).

Recent Accounting Developments in Canada

In January 2008, the CICA issued Section 3064, Goodwill and Intangible Assets, which will replace Section 3062, Goodwill and Other Intangible Assets, and which results in the withdrawal of Section 3450, Research and Development Costs and Emerging Issues Committee (“EIC”) Abstract 27, Revenues and Expenditures During the Pre-operating Period , and amendments to Accounting Guideline (“AcG”) 11, Enterprises in the Development Stage . The new standard provides guidance on the recognition of intangible assets in accordance with the definition of an asset and the criteria for asset recognition, as well as clarifying the application of the concept of matching revenues and expenses, whether those assets are separately acquired or internally developed. This standard applies to interim and annual financial statements relating to fiscal years beginning on or after October 1, 2008. Videotron is currently evaluating the effects of adopting this standard, although it does not expect the adoption will have a material impact on its consolidated financial statements.

In February 2008, Canada’s Accounting Standards Board confirmed that Canadian GAAP, as used by publicity accountable enterprises, will be fully converged to International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). Videotron will be required to report under IFRS for its 2011 interim and annual financial statements and to provide in the 2011 financial statements IFRS comparative information for the 2010 fiscal year. Videotron is currently assessing the impact of the IFRS convergence initiative.

Videotron has completed a diagnostic impact assessment, including a high-level analysis of potential consequences to financial reporting, business processes, internal controls, and information systems. Initial training has been provided to key employees and further investment in training and resources will be made throughout the transition to facilitate a timely and efficient changeover to IFRS. Videotron continues to monitor and assess the impact of evolving differences between Canadian GAAP and IFRS. At this time, the impact of this changeover on our future financial position and results of operations is not yet determinable.

The adoption will result in changes to our reported financial position and results of operations, and these changes may be material. Moreover, the restatement of our 2010 financial statements for comparative purposes may be significant. In addition, IFRS could have an effect on the computation of our debt covenants and of certain other contractual obligations. In particular, although the adoption IFRS will not change our actual cash flows, our covenants linked to balance sheet ratios may be affected by the adoption of IFRS in ways that are difficult to predict at this time. At this time, the impact on Videotron’s future financial position and results of operations is not yet reasonably determinable while Videotron continues to monitor and assess the impact of evolving differences between Canadian GAAP and IFRS. Further updates on the progress to conversion and potential reporting impact from the adoption of IFRS will be provided during the implementation period to follow.

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Recent accounting developments in the United States

On January 1, 2008, Videotron adopted the provisions of SFAS 157, Fair Value Measurements , that enhance guidance for using fair value to measure assets and liabilities. In February 2008, the FASB issued FASB Staff Position (FSP) FAS 157-1, “ Application of SFAS 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13 ,” which removes certain leasing transactions from the scope of SFAS No. 157. The FASB also issued FSP FAS 157-2, “Effective Date of SFAS 157”, which defers the effective date of SFAS 157 for one year for certain non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis. Videotron is still in the process of evaluating this standard with respect to its effect on non-financial assets and liabilities and has not yet determined the impact that it will have on its financial statements upon full adoption in 2009.

In December 2007, the FASB issued SFAS 141 (Revised 2007), Business Combinations (SFAS 141R), and SFAS 160, Non-controlling Interests in Consolidated Financial Statements (SFAS 160), to improve and converge internationally the accounting for business combinations, the reporting of non-controlling interests in consolidated financial statements, accounting and reporting standards for the non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. The provisions of SFAS 141R apply prospectively to business combinations for which the acquisition date is on or after December 31, 2008 and SFAS 160 shall be effective as of the beginning of 2009. Videotron is currently evaluating the impact of adopting SFAS 141R and SFAS 160 on its consolidated financial statements.

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Directors and Executive Officers

The following table presents certain information concerning our directors and executive officers as of February 13, 2009:

Name and Municipality of Residence	Age	Position

SERGE GOUIN Outremont, Quebec	65	Director and Chairman of the Board

JEAN LA COUTURE, FCA(1) Montréal, Quebec	62	Director and Chairman of the Audit Committee

ANDRÉ DELISLE(1) Montréal, Quebec	62	Director

A. MICHEL LAVIGNE, FCA(1) Brossard, Quebec	58	Director

PIERRE KARL PÉLADEAU Montréal, Quebec	47	Director

ROBERT DÉPATIE Rosemère, Quebec	50	President and Chief Executive Officer

DONALD LIZOTTE Kirkland, Quebec	42	President, Le SuperClub Vidéotron and Vice President, Retail Sales

JEAN NOVAK Beaconsfield, Quebec	45	President, Videotron Business Service

MARIE-JOSEE MARSAN Montréal, Quebec	46	Vic e President, Finance and Chief Financial Officer

MANON BROUILLETTE Outremont, Quebec	40	Senior Vic e President, Strategic Development and Marketing

DANIEL PROULX Montréal, Quebec	51	Senior Vice President, Engineering

MYRIANNE COLLIN Laval, Québec	35	Vice President, Marketing, Consumer division

ANDRÉ GASCON Longueuil, Quebec	47	Vice President, Wireless Technologies

ROGER MARTEL Montréal, Québec	60	Vice President, Internal Audit

LOUIS MORIN Kirkland, Quebec	51	Vice President

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Name and Municipality of Residence	Age	Position

MARIE PIUZE Pierrefonds, Quebec	40	Vice President, Control

ÉDOUARD G. TRÉPANIER Boucherville, Quebec	58	Vice President, Regulatory Affairs

NORMAND VACHON Repentigny, Quebec	60	Vice President, Human Resources

JEAN-FRANÇOIS PRUNEAU Repentigny, Quebec	38	Treasurer

CLAUDINE TREMBLAY Nun’s Island, Quebec	55	Secretary

CHRISTIAN MARCOUX Laval, Quebec	34	Assistant Secretary

(1) Member of the Audit Committee

Serge Gouin , Director and Chairman of the Board of Directors. Mr. Gouin has been a Director and Chairman of our Board of Directors since July 2001. Mr. Gouin has also been a Director of Quebecor Media Inc. since May 2001, and he re-assumed the position of Chairman of its Board of Directors in May 2005, having also held that position from January 2003 to March 2004. Mr. Gouin served as President and Chief Executive Officer of Quebecor Media Inc. from March 2004 until May 2005. Mr. Gouin also has served as Director and Chairman of the Board of Directors of Sun Media Corporation since May 2004. Mr. Gouin was an Advisory Director of Citigroup Global Markets Canada Inc. from 1998 to 2003. From 1991 to 1996, Mr. Gouin served as President and Chief Operating Officer of Le Groupe Vidéotron. From 1987 to 1991, Mr. Gouin was President and Chief Executive Officer of TVA Group Inc. Mr. Gouin is also a member of the board of Directors of Biovail Corporation, Onex Corporation and of TVA Group Inc.

Jean La Couture , FCA, Director and Chairman of the Audit Committee. Mr. La Couture has served as a Director and as Chairman of our Audit Committee since October 2003. Mr. La Couture also serves as Director and Chairman of the Audit Committee of Quebecor Inc., Quebecor Media inc. and Sun Media Corporation. He was a Director of Quebecor World Inc. from December 2007 until December 2008. Mr. La Couture, a Fellow Chartered Accountant, is President of Huis Clos Ltée., a management and mediation firm. He is also President of the Regroupement des assureurs de personnes à charte du Québec (RACQ) , a position he has held since August 1995. From 1972 to 1994, he was President and Chief Executive Officer of three organizations, including The Guarantee Company of North America, a Canadian specialty line insurance company from 1990 to 1994. He is Chairman of the Boards of Innergex Power Trust, Groupe Pomerleau (a Québec-based construction company) and Maestro (a real estate capital fund), and serves as a Director of Immunotec Inc.

André Delisle, Director and member of the Audit Committee. Mr. Delisle has served as a Director of Videotron Ltd. and as a member of its Audit Committee since October 31, 2005. Since that date, Mr. Delisle has also served as a Director and a member of the Audit Committee of Quebecor Media Inc. and Sun Media Corporation. From August 2000 until July 2003, Mr. Delisle acted as Assistant General Manager and Treasurer of the City of Montréal. He previously acted as internal consultant for the Caisse de dép ôt et placement du Québec from February 1998 until August 2000. From 1982 through 1997, he worked for Hydro-Québec and the Québec Department of Finance, mainly in the capacity of Chief Financial Officer (Hydro-Québec) or Assistant Deputy Minister (Department of Finance). Mr. Delisle is a member of the Institute of Corporate Directors, a member of the Association of Québec Economists and a member of the Barreau du Québec .

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A. Michel Lavigne , FCA, Director and member of the Audit Committee. Mr. Lavigne has served as a Director of Videotron Ltd. and as a member of its Audit Committee since June 30, 2005. Since that date, Mr. Lavigne has also served as a Director and a member of the Audit Committee and the Compensation Committee of Quebecor Media Inc., and as a Director and a member of the Audit Committee of Sun Media Corporation and of TVA Group Inc. Mr. Lavigne is also a Director of the Caisse de dépôt et placement du Québec and NStein Technologies Inc . , as well as the Chairman of the Board of Primary Energy Recycling Corporation. Until May 2005, he served as President and Chief Executive Officer of Raymond Chabot Grant Thornton in Montréal, Québec, as Chairman of the Board of Grant Thornton Canada and as a member of the Board of Governors of Grant Thornton International. Mr. Lavigne is a Fellow Chartered Accountant of the Ordre des comptables agréés du Québec and a member of the Canadian Institute of Chartered Accountants since 1973.

Pierre Karl Péladeau , Director. Mr. Péladeau has served as a Director of Videotron Ltd. since June 2001. Mr. Péladeau is also currently President and Chief Executive Officer of Quebecor Media inc. (since August 2008), President and Chief Executive Officer of Sun Media Corporation (since November 2008) and President and Chief Executive Officer of Quebecor Inc., a position he has held since 1999. He was Vice Chairman of the board of Directors and Chief Executive Officer of Quebecor Media Inc. from May 2006 to November 2008 and President and Chief Executive Officer of Quebecor World Inc. from March 2004 to May 2006. Mr. Péladeau joined Quebecor Inc.’s communications division in 1985 as Assistant to the President. Since then, he has occupied various positions in the Quebecor group of companies. In 1998, Mr. Péladeau spearheaded the acquisition of Sun Media Corporation and, in 2000 he was responsible for the acquisition of Groupe Vidéotron. Mr. Péladeau was also the President and Chief Executive Officer of Videotron Ltd. from July 2001 until June 2003. Mr. Péladeau sits on the board of numerous Quebecor group companies and is active in many charitable and cultural organizations.

Robert Dépatie , President and Chief Executive Officer. Mr. Dépatie has been our President and Chief Executive Officer since June 2003 and served as a Director of our company from June 2003 until October 2005. He joined us in December 2001 as Senior Vice President, Sales, Marketing and Customer Service. Before joining us, Mr. Dépatie held numerous senior positions in the food distribution industry, such as President of Distributions Alimentaires Le Marquis/Planters from 1999 to 2001 and General Manager of Les Aliments Small-Fry (Humpty Dumpty) from 1998 to 1999. From 1988 to 1998, he held various senior positions with H.J. Heinz Canada Ltd., such as Executive Vice-President from 1993 to 1998.

Donald Lizotte , President, Le SuperClub Vidéotron and Vice President, Retail Sales Videotron. Mr Lizotte joined Videotron Ltd. in January 2005 as Vice-President, Sales, Vidéotron, and was promoted to his current responsibilities in September 2006. From 2000 to 2005, Mr Lizotte held various positions in sales and distribution for Molson Breweries, Canada’s largest brewing company, including General Manager Key Accounts as well as Regional Manager. Prior to Molson Breweries, Mr. Lizotte spent nine years in Toronto, Ontario where he held various Sales management positions, including National Sales Manager for the Perrier Group, a division of Nestlé, from 1998 to 2000. He started his career at Heinz Canada where he spent 8 years starting from a sales representative and moved to General Manager ECR. Mr. Lizotte has a bachelor’s degree in Management from the Université du Québec in Montréal.

Jean Novak , President, Videotron Business Service. Mr. Novak has served in his current position since January 2005. Mr. Novak joined Videotron Ltd. in May 2004 as Vice President, Sales. Between 1988 and May 2004, Mr. Novak held various management positions in sales and distribution for Molson Breweries, Canada’s largest brewing company including General Manager for all on premise accounts and the Montréal sales region as well as Manager, Customer Service and Telesales in Québec. Mr. Novak holds a bachelor’s degree in marketing from the HEC Montréal.

Marie -Josée Marsan , Vice President, Finance and Chief Financial Officer. Ms. Marsan has been appointed to her current position in June 2008. She joined Videotron Ltd. in July 2006 as Vice President, Control. Before joining us, Ms. Marsan held various senior positions mainly in the television & film industry, such as First Director of Finance and Administration at the Canadian Broadcast Company (CBC) from 1999 to 2006 and Vice-President, Finance and Business Development for Groupe Covitec inc, today known as Technicolor, from 1994 to 1999. Prior to that, she worked for TVA Group Inc. as Director of Production and held various financial positions at General Motors of Canada. Ms. Marsan

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holds a bachelor’s degree in Finance from the HEC Montréal, a master degree in Finance issued jointly by York University and HEC Montréal. She is also a member of the Certified General Accountants Association (CGA).

Manon Brouillette , Senior Vice President, Strategic Development and Marketing. Ms. Brouillette was promoted in her current position in June 2008. She joined Videotron Ltd in July 2004 and acted as Vice President, Marketing, from July 2004 to January 2005, as Vice President, New Product Development, from January 2005 to August 2006 and as Senior Vice President, Marketing, Content and New Product Development, from September 2006 to June 2008. Before joining our company, Ms. Brouillette was Vice President, Marketing and Communications of the San Francisco Group from April 2003 to February 2004. She was also responsible for the national and regional accounts of the Blitz division of Groupe Cossette Communication Marketing from April 2002 to April 2003. From September 1998 to April 2002, she worked at Publicité Martin inc. Ms. Brouillette holds a Bachelor’s degree in communications with a minor in marketing from Laval University.

Daniel Proulx , Senior Vice President, Engineering. Prior to his appointment as Vice President, Engineering in July 2003, Mr. Proulx had served as our Vice President, Information Technology since July 2002. Mr. Proulx has held various management positions within Videotron Ltd. since joining us in 1995.

Myrianne Collin , Vice President, Marketing, Consumer division. Ms. Collin has served as Vice President, Marketing, Consumer division since June 2008. She joined Videotron Ltd. In April 2005 as Senior Director Marketing, Cable Telephony and Bundling. In September 2006, Ms. Collin was appointed Senior Director, Broadcast Services & Relationship Marketing. From 1995 to 2005, Ms. Collin held various positions with Bell Canada and Alliance Data System (Air Miles). She holds a Bachelor’s degree in marketing from Sherbrooke University.

André Gascon , Vice President, Wireless Technologies. Mr. Gascon joined Videotron Ltd. in October 2003 as Vice President, Information Technologies and he was appointed to his current position in 2008. Prior to joining Videotron Ltd., Mr. Gascon served for more than two years as Team Manager of Service Conseil Mona inc., an information technology consulting firm based in Montréal. From 1998 to 2001, he was Director, Information Technology of Microcell Telecommunications Inc. Between 1986 and 1998, Mr. Gascon held various management positions relating to information technology with Larochelle Gratton Inc. and Société de Transport de Laval. Mr. Gascon holds a Master’s degree in business administration (MBA) from Université de Sherbrooke.

Roger Martel , Vice President, Internal Audit. Mr. Martel has served as Vice President, Internal Audit of Videotron Ltd. since February 2004. Mr. Martel also acts as Vice President, Internal Audit for Quebecor Inc., Quebecor Media Inc. and Sun Media Corporation. From February 2001 until February 2004, he was Principal Director, Internal Audit of Quebecor Media. Prior to that, he was an Internal Auditor of Le Groupe Vidéotron ltée.

Louis Morin , Vice President. Mr. Morin became Vice President of Videotron Ltd. on January 15, 2007. Mr. Morin also serves as Vice President and Chief Financial Officer of Quebecor Inc. and Quebecor Media Inc. From December 2003 until January 2006, he served as Chief Financial Officer of Bombardier Recreational Products Inc. Prior to that Mr. Morin was Senior Vice President and Chief Financial Officer of Bombardier Inc. from April 1999 until February 2003, where he had worked since 1982. Mr. Morin was appointed Vice President and Chief Financial Officer of Quebecor Inc. on January 14, 2008. Mr. Morin holds a Master’s degree as well as a Bachelor’s degree in Business Administration from the University of Montréal and is a Chartered Accountant.

Marie Piuze , Vice President, Control. Ms. Piuze joined Videotron Ltd in September 2008. Prior to joining Videotron Ltd., Ms. Piuze was Financial Controller of CGI from 2005 to 2008. Ms. Piuze held various financial positions in the telecommunication and software industry mainly at Microcell, Téléglobe and Softimage. She started her career at Coopérative Fédérée de Québec in 1994. Ms. Piuze holds a Bachelor’s degree in Finance from the HEC Montreal. She is also a member of the Certified Management Accountants Association (CMA).

Edouard G. Trépanier , Vice President, Regulatory Affairs. Mr. Trépanier was appointed as the Vice President, Regulatory Affairs of Videotron Ltd. in March 2002. He has also served as Vice President, Regulatory Affairs of

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Quebecor Media Inc. since the same date. Mr. Trépanier was Director, Regulatory Affairs of Videotron Ltd. from 1994 to 2001. Prior to joining us in 1994, Mr. Trépanier held several positions at the CRTC, including Director of Operations, Pay-television and Specialty Services. Prior to joining the CRTC, Mr. Trépanier worked as a television producer for TVA Group Inc., Rogers Communications Inc. and the Canadian Broadcasting Corporation in Ottawa. Mr. Trépanier is and has been a member of the boards of numerous broadcast industry organizations.

Normand Vachon , Vice President, Human Resources. Mr. Vachon joined Videotron Ltd. in January 2005 as Vice President, Human Resources. Prior to joining us, Mr. Vachon acted as senior executive officer and organizational development consultant for many private organizations in the Province of Québec between 2001 and 2004 and held the position of Vice President, Corporate and Vice President, Human Resources and Organizational Development at Nova Bus Corporation from 1995 to 2000. Prior to that, Mr. Vachon worked at Alcan Inc. from 1972 to 1994, holding the positions of Director of Operations at Alcan Smelters & Chemicals in Shawinigan, Manager of Alcan Wire and Cable’s Saint-Augustin plant in the Québec City region and General Manager of Alcan Extrusions’ Laval plant.

Jean-François Pruneau , Treasurer. Mr. Pruneau has served as Treasurer of Videotron Ltd. since October 2005. Mr. Pruneau also acts as Treasurer of Quebecor Inc., Quebecor Media Inc. and Sun Media Corporation. He also serves as Treasurer of various subsidiaries of Quebecor Media Inc. Before being appointed Treasurer of Quebecor Media Inc., Mr. Pruneau successively served as Director, Finance and Assistant Treasurer — Corporate Finance of Quebecor Media Inc. Before joining Quebecor Media Inc. in May 2001, Mr. Pruneau was Associate Director of BCE Media from 1999 to 2001. From 1997 to 1999, he served as Corporate Finance Officer at Canadian National Railway. He has been a member of the CFA Institute, formerly the Association for Investment Management and Research, since 2000.

Claudine Tremblay , Secretary. Ms. Tremblay was appointed Secretary of Videotron Ltd in November 2006. Ms. Tremblay is also Vice President and Secretary of Quebecor Inc. and Quebecor Media Inc. since January 2008 and Secretary of Sun Media Corporation since September 2001. She also serves as either Secretary or Assistant Secretary of various subsidiaries of Quebecor Inc. and, since December 2004, Ms. Tremblay serves as Corporate Secretary of TVA Group Inc. Ms. Tremblay was Senior Director, Corporate Secretariat for Quebecor Media Inc., Quebecor World Inc. and Quebecor Inc. from 2003 to December 2007. Prior to joining the Quebecor group of companies in 1987, Ms. Tremblay was Assistant Secretary and Administrative Assistant at the National Bank of Canada from 1979 to 1987. She has also been a member of the Chambre des notaires du Québec since 1977.

Christian Marcoux , Assistant Secretary. Mr. Marcoux was appointed Assistant Secretary of Videotron Ltd. in December 2006. Mr. Marcoux joined Quebecor Media Inc. in 2006 as Senior Legal Counsel, Compliance. He is currently also Assistant Secretary of Quebecor Inc., Quebecor Media Inc., TVA Group Inc. and Sun Media Corporation. From January 2004 to December 2006, Mr. Marcoux was Manager, Listed Issuer Services at the Toronto Stock Exchange. Prior to January 2004, Mr. Marcoux was an attorney with BCF LLP, a law firm, for three years.

B- Board Practices

Reference is made to “— Directors and Executive Officers” above for the current term of office, if applicable, and the period during which our directors and senior management have served in that office.

There are no directors’ service contracts with us or any of our subsidiaries providing for benefits upon termination of employment.

Our Board of Directors is comprised of five directors. Each director is nominated and elected by Quebecor Media, our parent company, to serve until a successor director is elected or appointed. Our Board of Directors has an Audit Committee, but we do not have a compensation committee. The Compensation Committee of Quebecor Media decides certain matters relating to the compensation of officers and employees of Videotron, including certain matters relating to the Quebecor Media stock option plan, as discussed further below.

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Audit Committee

Videotron’s Audit Committee, is currently composed of three directors, namely Messrs. Jean La Couture, André Delisle and A. Michel Lavigne. Mr. La Couture is the Chairman of our Audit Committee and our Board of Directors has determined that Mr. La Couture is an “audit committee financial expert” as defined under SEC rules. See “Item 16A. Audit Committee Financial Expert”. Our Board of Directors adopted the mandate of our Audit Committee in light of the Sarbanes-Oxley Act of 2002. Our Audit Committee assists our Board of Directors in overseeing our financial controls and reporting. Our Audit Committee also oversees our compliance with financial covenants and legal and regulatory requirements governing financial disclosure matters and financial risk management.

The current mandate of our Audit Committee provides, among other things, that our Audit Committee reviews our annual and quarterly financial statements before they are submitted to our Board of Directors, as well as the financial information contained in our annual reports on Form 20-F, our management’s discussion and analysis of financial condition and results of operations, our quarterly reports furnished to the SEC under cover of Form 6-K and other documents containing similar information before their public disclosure or filing with regulatory authorities; reviews our accounting policies and practices; and discusses with our independent auditor the scope of their audit and reviews their recommendations and the responses of our management to their recommendations. Our Audit Committee is also responsible for ensuring that we have in place adequate and effective internal control and management information systems to monitor our financial information and to ensure that our transactions with related parties are made on terms that are fair for us. Our Audit Committee pre-approves all audit services and permitted non-audit services and pre-approves all the fees pertaining to those services that are payable to our independent auditor, and submits the appropriate recommendations to our Board of Directors in connection with these services and fees. Our Audit Committee also reviews the scope of the audit and the results of the examinations conducted by our internal audit department. In addition, our Audit Committee recommends the appointment of our independent auditors, subject to our shareholders’ approval. It also reviews and approves our Code of Ethics for our President and Chief Executive Officer and principal financial officers.

C- Compensation of Directors and Executive Officers

Our directors do not receive any remuneration for acting in their capacity as directors of Videotron. The members of our Audit Committee do, however, receive attendance fees of $2,500 per meeting and the Chairman of our Audit Committee (currently, Mr. La Couture) receives an annual fee of $4,500 to act in such capacity. Our directors are reimbursed for their reasonable out-of-pocket expenses incurred in connection with meetings of our Board of Directors and our Audit Committee. During the financial year ended December 31, 2008, the amount of compensation (including benefits in kind) paid to our five directors for services in all capacities to Videotron and its subsidiaries was $143,750. None of our directors have contracts with us or any of our subsidiaries that provide for benefits upon termination of employment.

The aggregate amount of compensation we paid for the year ended December 31, 2008 to our executive officers as a group, excluding those who are also executive officers of, and compensated by, Quebecor Media, was $19.3 million , including salaries, bonuses and profit-sharing payments.

Quebecor Media’s Stock Option Plan

Under a stock option plan established by Quebecor Media, 6,180,140 common shares of Quebecor Media (representing 5% of all outstanding common shares of Quebecor Media) have been set aside for directors, officers, senior employees and other key employees of Quebecor Media and its subsidiaries, including Videotron. Each option may be exercised within a maximum period of 10 years following the date of grant at an exercise price not lower than, as the case may be, the fair market value of Quebecor Media common shares at the date of grant, as determined by its Board of Directors (if Quebecor Media common shares are not listed on a stock exchange at the time of the grant) or the 5-day weighted average closing price ending on the day preceding the date of grant of the common shares of Quebecor Media on the stock exchange(s) where such shares are listed at the time of grant. For so long as the shares of Quebecor Media

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are not listed on a recognized stock exchange, optionees may exercise their vested options during one of the following annual periods: from March 1 to March 30, from June 1 to June 29, from September 1 to September 29 and from December 1 to December 30. Holders of options under the plan have the choice at the time of exercising their options to receive an amount in cash equal to the difference between the fair market value, as determined by Quebecor Media’s Board of Directors, and the exercise price of their vested options or, subject to certain stated conditions, purchase common shares of Quebecor Media at the exercise price. Except under specific circumstances, and unless Quebecor Media’s Compensation Committee decides otherwise, options vest over a five-year period in accordance with one of the following vesting schedules as determined by Quebecor Media’s Compensation Committee at the time of grant: (i) equally over five years with the first 20% vesting on the first anniversary of the date of the grant; (ii) equally over four years with the first 25% vesting on the second anniversary of the date of grant; and (iii) equally over three years with the first 33% vesting on the third anniversary of the date of grant. Pursuant to the terms of this plan, no optionee may hold options representing more than 5% of the outstanding common shares of Quebecor Media.

During the year ended December 31, 2008, an aggregate total of 70,000 options were granted under this plan to executive officers of Videotron (excluding directors, officers and employees who, at the date of grant, were directors, officers or employees at multiple Quebecor Media group companies), with a weighted average exercise price of $45.82 per share, as determined by Quebecor Media’s Compensation Committee. During the year ended December 31, 2008, a total of 610,962 options were exercised by officers and employees of Videotron, for aggregate gross value realized of $18,165,946. The Quebecor Media stock option plan did not allow the exercise of any option before 2008, at which time it covered a six year compensation value. The value realized on option exercises represents the difference between the option exercise price and the fair market value of Quebecor Media common shares (as determined as set forth above) at the date of exercise. As of December 31, 2008, an aggregate total of 1,382,035 options granted to directors, officers and employees of Videotron (excluding directors, officers and employees who, at the date of grant, were directors, officers or employees at multiple Quebecor Media group companies) remain outstanding, with a weighted average exercise price of $42.35 per share, as determined by Quebecor Media’s Compensation Committee. Of these outstanding options, 1,030,220 options have been granted (and remain outstanding) to executive officers of Videotron (excluding executive officers who, at the date of grant, were directors, officers or employees at multiple Quebecor Media group companies), with a weighted average exercise price of $42.29 per share. For more information on this stock option plan, see Note 17 to our audited consolidated financial statements included under “Item 17. Financial Statements” of this annual report.

Pension Benefits

Both Quebecor Media and Videotron maintain pension plans for our non-unionized employees and certain officers.

Videotron’s pension plan provides pension benefits to our executive officers equal to 2.0% of salary (excluding bonuses) for each year of membership in the plan. The pension benefits so calculated are payable at the normal retirement age of 65 years, or sooner at the election of the executive officer, subject to an early retirement reduction. In addition, the pension benefits may be deferred, but not beyond the age limit under the relevant provisions of the Income Tax Act (Canada), in which case the pension benefits are adjusted to take into account the delay in their payment in relation to the normal retirement age. The maximum pension benefits payable under our pension plan are as prescribed under the Income Tax Act (Canada). An executive officer contributes to this plan an amount equal to 5.0% of his or her salary up to a maximum of $4,700 per year.

Quebecor Media’s pension plan provides greater pension benefits to eligible executive officers than it does to other employees. The higher pension benefits under this plan equal 2.0% of average salary over the best five consecutive years of salary (including bonuses), multiplied by the number of years of membership in the plan as an executive officer. The pension benefits so calculated are payable at the normal retirement age of 65 years, or sooner at the election of the executive officer, and from the age of 61 years without early retirement reduction. In addition, the pension benefits may be deferred, but not beyond the age limit under the relevant provisions of the Income Tax Act (Canada), in which case the pension benefits are adjusted to take into account the delay in their payment in relation to the normal retirement age. The maximum pension benefits payable under Quebecor Media’s pension plan are as prescribed by the Income Tax Act

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(Canada). An executive officer contributes to this plan an amount equal to 5.0% of his or her salary up to a maximum of $6,111 in 2009. Videotron has no liability regarding Quebecor Media’s pension plan.

The table below indicates the annual pension benefits that would be payable at the normal retirement age of 65 years under both Quebecor Media’s and our pension plans:

	Years of Participation
Compensation	10		15		20		25		30

$122,222 or more	$	24,444	$	36,667	$	48,889	$	61,111	$	73,333

Supplemental Retirement Benefit Plan for Designated Executives

In addition, both Quebecor Media’s and our pension plans provide supplemental retirement benefits to certain designated executives. As of December 31, 2008, three of our senior executive officers were participants under Quebecor Media’s supplemental retirement benefit plan, and one of our senior executive officers was participant under our supplemental retirement benefit plan.

The benefits payable to the senior executive officers who participate in Quebecor Media’s supplemental retirement benefit plan are calculated as under the basic pension plan but without regard to the limitation of the Income Tax Act (Canada), less the pension payable under the basic pension plan. The pension is payable for life without reduction from the age of 61. In case of death after retirement and from the date of death, Quebecor Media’s supplemental retirement benefit plan provides for the payment of a survivor pension to the eligible surviving spouse, representing 50.0% of the retiree’s pension for a period of up to ten years.

As of December 31, 2008, our senior executive officers participating in Quebecor Media’s supplemental retirement benefit plan each had credited service of five years or less.

The benefits payable to our senior executive officer who participates in our supplemental retirement benefit plan are calculated as under the basic pension plan but without regard to the limitation of the Income Tax Act (Canada), less the pension payable under the basic pension plan. The benefits so calculated are payable at the normal retirement age of 65 years, or sooner at the election of the senior executive officer, subject to an early retirement reduction. In case of death after retirement and from the date of death, our supplemental retirement benefit plan provides for the payment of a survivor pension to the eligible surviving spouse representing 60.0% of the retiree’s pension.

As of December 31, 2008, our senior executive officers had a credited service of 6 years under our supplemental retirement benefit plan.

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

	Years of Credited Service
Compensation	10		15		20		25		30

$200,000	$	15,556	$	23,333	$	31,111	$	38,889	$	46,667
$300,000	$	35,556	$	53,333	$	71,111	$	88,889	$	106,667
$400,000	$	55,556	$	83,333	$	111,111	$	138,889	$	166,667
$500,000	$	75,556	$	113,333	$	151,111	$	188,889	$	226,667
$600,000	$	95,556	$	143,333	$	191,111	$	238,889	$	286,667
$800,000	$	135,556	$	203,333	$	271,111	$	338,889	$	406,667
$1,000,000	$	175,556	$	263,333	$	351,111	$	438,889	$	526,667
$1,200,000	$	215,556	$	323,333	$	431,111	$	538,889	$	646,667
$1,400,000	$	255,556	$	383,333	$	511,111	$	638,889	$	766,667

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Liability Insurance

Quebecor carries liability insurance for the benefit of its directors and officers, as well as for the directors and officers of its subsidiaries, including Videotron and our subsidiaries, against certain liabilities incurred by them in such capacity. These policies are subject to customary deductibles and exceptions. The premiums in respect of this insurance are entirely paid by Quebecor, which is then reimbursed by Quebecor Media and its subsidiaries, including Videotron, for their ratable portion thereof.

D- Employees

At December 31, 2008, we employed 4,769 employees. At December 31, 2007 and 2006, we employed approximately 4,350 and 4,057 employees, respectively. Substantially all of our employees are based and work in the Province of Québec. Approximately 2,849 of our employees are unionized, and the terms of their employment are governed by one of our five regional collective bargaining agreements. Our two most important collective bargaining agreements, covering our unionized employees in the Montréal and Québec City regions, have terms extending to December 31, 2009. We also have two collective bargaining agreements covering our unionized employees in the Chicoutimi and Hull regions, with terms running through January 31, 2010 and August 31, 2011, respectively, and one other collective bargaining agreement, covering 39 employees of our SETTE inc. subsidiary, which expired on December 31, 2007. Negotiations regarding this collective bargaining agreement began in 2008 and are ongoing.

E- Share Ownership

No Videotron equity securities are held by any of our directors or senior executive officers.

A- Major Shareholders

We are a wholly-owned subsidiary of Quebecor Media, a leading Canadian-based media company with interests in newspaper publishing operations, television broadcasting, business telecommunications, book and magazine publishing and new media services, as well as our cable operations. Through these interests, Quebecor Media holds leading positions in the creation, promotion and distribution of news, entertainment and Internet-related services that are designed to appeal to audiences in every demographic category.

Quebecor Media is 54.72% owned by Quebecor, a communications holding company, and 45.28% owned by CDP Capital d’Amérique Investissements Inc. Quebecor’s primary assets are its interests in Quebecor Media. CDP Capital d’Amérique Investissements Inc. is a wholly-owned subsidiary of Caisse de dépôt et placement du Québec , one of Canada’s largest pension fund managers.

B- Related Party Transactions

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

Video-on-Demand Services

The Company entered into an affiliation agreement with Groupe Archambault Inc. (“Archambault”), a subsidiary of Quebecor Media and, as such, a company under common control. This agreement provided that the Company pay Archambault 54% of all revenues generated from the fees paid by customers to use Archambault’s video-on-demand services. In connection with this affiliation agreement, the Company entered into a video-on-demand services agreement with Archambault. Under this agreement, various technical services were provided to Archambault. In consideration of these services, Archambault paid a fee of 8% of all revenues generated from fees paid by customers to use Archambault’s video-on-demand services. The acquisition of the video-on-demand license by the Company from Archambault for a total cash consideration of $0.8 million resulted in the termination of these agreements on May 1, 2008.

Under the affiliation agreement, the Company paid fees to Archambault of $5.5 million, $13.3 million and $9.0 million and received fees from Archambault of $0.8 million, $2.6 million and $1.9 million for the years 2008, 2007 and 2006, respectively.

Management Services and Other

We have earned revenue from TVA Group for providing it with access to a specialty advertising channel carried on our network and incurred expenses for purchases and services obtained from related companies at prices and conditions prevailing on the market, as summarized below. The majority of our related party purchases were related to the telecommunications and Internet services agreements described above and for programming purchases, advertising purchases, outsourcing of call center operations and information technology services.

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

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	Year Ended December 31,
	2008		2007
	(dollars in millions)

Revenues	$	10.3	$	22.3
Purchases	56.1		64.5
Accounts payable	19.4		75.2

In 2002, we began paying an annual management fee to Quebecor Media for services rendered to us pursuant to a five-year management services agreement. These services include internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations and other services. The agreement provides for an annual management fee of $ 25.4 million payable to Quebecor Media in respect of 2008 (2007 - $46.9 million; 2006 — 23.4 million). This agreement is now automatically renewed annually. In addition, Quebecor Media is entitled to the reimbursement of out-of-pocket expenses incurred in connection with the services provided under the agreement.

On January 21, 2008, Quebecor World Inc. and its U.S. subsidiaries were granted creditor protection under the Companies Creditors Arrangement Act in Canada. On the same date, its U.S. subsidiaries also filed a petition under Chapter 11 of the United States Bankruptcy Code. Quebecor World Inc. outsourced its corporate information technology services to Videotron, which generated $3.0 million in revenues for Videotron in 2008 ($9.8 million in 2007 and $13.0 million in 2006). This agreement was terminated in 2008.

Asset Acquisition

On December 15, 2008, Videotron acquired fixed assets from Les Editions CEC Inc., a wholly-owned subsidiary of Quebecor Media, for total consideration of $1.6 million. This transaction was recorded at the exchange amount. As a result, Videotron recorded a net book value of $0.4 million and the difference between the cash consideration and the net book value, a loss of $1.2 million, was charged to the deficit.

Income Tax Transactions

Unlike corporations in the United States, corporations in Canada are not permitted to file consolidated tax returns. As a result, we enter into certain tax consolidation transactions from time to time through which we are able to recognize certain income tax benefits.

On December 18, 2008, Videotron’s ultimate parent company, Quebecor Inc., transferred to the Company a total of $104.9 million of non-capital tax losses in exchange for net cash consideration of $18.4 million. This transaction was recorded at the exchange amount. As a result, the Company recorded an income tax asset of $32.4 million and the difference of $14.0 million, between the net cash consideration and the income tax asset, was recorded as a deferred credit, included in accounts payable and accrued liabilities, which reduced income tax expenses in 2008 as these tax deductions were used.

On December 21, 2007, Videotron’s ultimate parent company, Quebecor Inc., transferred to CF Cable TV Inc., a wholly-owned subsidiary of the Company, $9.4 million of non-capital tax losses in exchange for a net cash consideration of $2.1 million. This transaction was recorded at the exchange amount. As a result, CF Cable TV Inc. recorded an income tax asset of $2.9 million and the difference of $0.8 million between the net cash consideration and the income tax asset, was recorded as a deferred credit, included in accounts payable and accrued liabilities, which reduced income tax expenses in 2008 as these tax deductions were used.

On December 18 and 21, 2007, Videotron’s ultimate parent company, Quebecor Inc., transferred to the Company a total of $57.1 million of non-capital tax losses in exchange for net cash consideration of $12.8 million. This transaction was recorded at the exchange amount. As a result, the Company recorded an income tax asset of $17.7 million and the difference of $4.9 million, between the net cash consideration and the income tax asset, was recorded as a deferred credit,

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included in accounts payable and accrued liabilities, which reduced the income tax expenses in 2008 as these tax deductions were used.

During the year ended December 31, 2004, we acquired from Quebecor Media income tax assets of $62.0 million, of which $55.5 million was recorded as future income tax assets and $6.5 million as income taxes receivable. The consideration payable to Quebecor Media for these income tax assets was $35.2 million as at December 31, 2004. The difference of $26.8 million was credited to contributed surplus.

C- Interests of Experts and Counsel

Not applicable.

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A- Consolidated Statements and Other Financial Information

Our consolidated balance sheets as at December 31, 2007 and 2008 and our consolidated statements of income, comprehensive income, shareholder’s equity and cash flows for the years ended December 31, 2006, 2007 and 2008, including the notes thereto and together with the auditors’ report thereon, are presented at Item 17 of this annual report.

B- Legal Proceedings

We are involved from time to time in various claims and lawsuits incidental to the conduct of our business in the ordinary course.

In 2003 and 2004, a number of companies, including Videotron, brought a suit against the Crown in Federal Court, alleging that the Part II license fees annually paid by broadcasters constitute, in fact and in law, unlawful taxes under the Broadcasting Act (Canada). On December 14, 2006, the Federal Court decreed that these fees did indeed constitute taxes and that the CRTC was to cease collection of such fees but concluded that the plaintiff companies would not be entitled to a reimbursement of the amounts already paid. The plaintiffs and the defendant both filed an appeal before the Federal Court of Appeal. On October 1, 2007, the CRTC issued a document stating that it would adhere to the decision rendered and that it would not collect, in 2007 or any subsequent years, the Part II license fees payable on November 30 of each year unless a Superior Court reverses the Federal Court decision. In light of these facts, and as a result of the decision of the Superior Court, Videotron reversed its liability of $11.1 million related to these Part II license fees covering the period from September 1, 2006 to September 30, 2007 in the third quarter of 2007. Videotron also ceased to record the Part II license fees in subsequent periods.

On April 29, 2008, the Federal Court of Appeal handed down its decision and overturned the December 14, 2006 decision of the Federal Court. The plaintiff companies disagree with this decision and the request for leave to appeal to the Supreme Court of Canada was accepted on December 18, 2008. The CRTC publicly stated that it will make no attempt to collect outstanding Part II license fees until the earlier of (a) the judgment of the Federal Court of Appeal is affirmed by the Supreme Court or (b) the matter is settled between the parties. However, by virtue of the Federal Court of Appeal decision that confirms the right of the CRTC to collect Part II license fees to which Videotron is subject, Videotron recorded in 2008 a total liability of $25.6 million related to the Part II license fees. This liability is for the period covering from September 1, 2006 to December 31, 2008. Videotron continues to accrue for the Part II license fees.

On July 20, 2007, a motion to certify a class action lawsuit was filed in the Province of Québec against Videotron in connection with an interruption of Internet service on July 18, 2007 and other sporadic interruptions of Internet service. The plaintiff is claiming a credit for the portion of the fees paid for the Internet service for the duration of the interruptions. The plaintiff is also seeking punitive damages and damages for troubles and inconveniences. The class certification hearing has not been scheduled yet. Although it is not possible as of the date of this annual report to determine with a reasonable degree of certainty the outcome of this legal proceeding, our management believes that the suit is without merit and intends to vigorously defend its case.

In addition, a number of other legal proceedings against Videotron, or in which Videotron is in demand, are currently pending. In the opinion of our management, the outcome of these proceedings is not expected to have a material adverse effect on our business, results of operations, liquidity or financial position.

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C- Dividend Policy and Reductions of Paid-Up Capital

As of December 31, 2008, our issued and outstanding share capital consists of 2,515,277 Class “A” Common Shares, all of which are held by Quebecor Media. See Note 15 to our audited consolidated financial statements included under “Item 17. Financial Statements” in this annual report.

During the year ended December 31, 2008, we paid aggregate cash dividends of $110,000,000 on our common shares. In the year ended December 31, 2007, we paid no dividends on our common shares. We currently expect to pay dividends and other distributions on our common shares in the future. The declaration and payment of dividends and other distributions is in the sole discretion of our Board of Directors, and any decision regarding the declaration of dividends and other distributions will be made by our Board of Directors depending on, among other things, our financial resources, the cash flows generated by our business, our capital needs, and other factors considered relevant by our Board of Directors, including the terms of our indebtedness and applicable law.

On several occasions during the years ended December 31, 2008 and 2007, the Company reduced the paid-up capital of its common shares through aggregate cash distributions of $ 120.0 million in 2008 and $299.6 million in 2007.

D- Significant Changes

Except as otherwise disclosed in this annual report, there has been no other material adverse change in our financial position since December 31, 2008.

A- Offer and Listing Details

Not applicable.

B- Plan of Distribution

Not applicable.

C- Markets

On April 15, 2008, we issued and sold US$455,000,000 aggregate principal amount of our 9 1 / 8 % Senior Notes due April 15, 2018 in a private placement exempt from the registration requirements of the Securities Act. In connection with the issuance of these unregistered notes, we agreed to file an exchange offer registration statement with the SEC if these notes are not freely tradeable as of the 366 th day after the notes were issued. In the event that we are so required to register these notes and we fail to satisfy our registration obligations within specified time periods, we will be required to pay additional interest to the holders of the notes under certain circumstances.

On September 16, 2005, we issued and sold US$175.0 million aggregate principal amount of our 6 3 / 8 % Senior Notes due December 15, 2015 in a private placement exempt from the registration requirements of the Securities Act. In connection with the issuance of these unregistered notes, we agreed to file an exchange offer registration statement with the SEC with respect to a registered offer to exchange without novation the unregistered notes for our new 6 3 / 8 % Senior Notes due December 15, 2015, which would be registered under the Securities Act. We filed a registration statement on Form F-4 with the SEC on December 16, 2005 and completed the registered exchange offer on February 6, 2006. As a result, we have US$175.0 million in aggregate principal amount of our 6 3 / 8 % Senior Notes due December 15, 2015 outstanding and registered under the Securities Act.

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On October 8, 2003 and November 19, 2004, we issued and sold US$335.0 million and US$315.0 million aggregate principal amount, respectively, of our 6 7 / 8 % Senior Notes due January 15, 2014 in private placements exempt from the registration requirements of the Securities Act. In connection with the issuance of these unregistered notes, we agreed to file exchange offer registration statements with the SEC with respect to registered offers to exchange without novation the unregistered notes for our new 6 7 / 8 % Senior Notes due January 15, 2014, which would be registered under the Securities Act. We filed a registration statement on Form F-4 with the SEC on November 24, 2003 and completed this registered exchange offer on February 9, 2004, and we filed another registration statement on Form F-4 with the SEC on December 7, 2004 and completed this exchange offer on March 4, 2004. As a result, we have US$650.0 million in aggregate principal amount of our 6 7 / 8 % Senior Notes due January 15, 2014 outstanding and registered under the Securities Act.

There can be no assurance as to (1) the liquidity of the market, if any, for our Senior Notes, (2) the ability of the holders of our Senior Notes to sell them or (3) the prices at which any sales may be made. Our Senior Notes are not currently listed on any national securities exchange or quoted on a quotation system. We do not presently intend to apply to list any of our Senior Notes on any national securities exchange or to have them quoted on an automated quotation system.

The record holder of each series of our Senior Notes is Cede & Co., a nominee of The Depository Trust Company.

D- Selling Shareholders

Not applicable.

E- Dilution

Not applicable.

F- Expenses of the Issue

Not applicable.

A- Share Capital

Not applicable.

B- Memorandum and Articles of Association

The Articles of Amalgamation of Videotron, dated as of July 1, 2006, and the Articles of Amendment of Videotron, dated as of June 30, 2008, have been filed by us as exhibits to this annual report. Videotron’s Articles of Amalgamation, as amended by its Articles of Amendment are referred to as our “Articles”. The following is a summary of certain provisions of our Articles and by-laws:

1. On July 1, 2006, Vidéotron ltée and 9101-0827 Québec inc. amalgamated, under Part IA of the Companies Act (Québec), into a single company using the name “Videotron Ltd.” (or “Vidéotron ltée” in French) with the Designating Number 1163819882. The Articles provide no restrictions on the purposes or activities that may be undertaken by Videotron.

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2. (a) Our by-laws provide that we may transact business with one or more of our directors or with any company of which one or more of our directors are members or employees or with any corporation or association of which one or more of our directors are shareholders, directors, officers or employees. The director who has an interest in the transaction must disclose his or her interest to us and to the other directors before expressing a view of this transaction and shall refrain from deliberating or voting on the transaction, except if his or her vote is necessary to commit us in respect of the transaction.

(b) Neither the Articles nor our by-laws contain provisions with respect to directors’ power, in the absence of an independent quorum, to determine their remuneration.

(c) Subject to any restriction which may from time to time be included in the Articles or our by-laws, or the terms, rights or restrictions of any of our shares or securities outstanding, our directors may authorize us, by simple resolution, to borrow money and obtain advances upon the credit of our company when they consider it appropriate. Our directors also may, by simple resolution, when they consider it appropriate, (i) issue bonds or other securities of our company and give them in guarantee or sell them for prices and amounts deemed appropriate; (ii) mortgage, pledge or give as surety our present or future movable and immovable property to ensure the payment of these bonds or other securities or give a part only of these guarantees for the same purposes; and (iii) mortgage or pledge our real estate or give as security or otherwise encumber with any charge our movables or give these various kinds of securities to assure the payment of loans made other than by the issuance of bonds as well as the payment or the execution of other debts, contracts and commitments of our company.

Neither the Articles nor our by-laws contain any provision with respect to (a) the retirement or non-retirement of our directors under an age limit requirement or (b) the number of shares, if any, required for the qualification of our directors.

3. The rights, preferences and restrictions attaching to our common shares and our preferred shares (consisting of our Class “A” Common Shares and our authorized classes of preferred shares, comprised or our Class “B” Preferred Shares, Class “C” Preferred Shares, Class “D” Preferred Shares, Class “E” Preferred Shares, Class “F” Preferred Shares, Class “G” Preferred Shares and Class “H” Preferred Shares) are set forth below:

Common Shares

Class “A” Common Shares

(a) Dividend rights : Subject to the rights of the holders of our preferred shares (including their redemption rights) and subject to applicable law, each Class “A” Common Share is entitled to receive such dividends as our Board of Directors shall determine.

(b) Voting rights : The holders of Class “A” Common Shares are entitled to vote at each shareholders’ meeting with the exception of meetings at which only the holders of another class of shares are entitled to vote. Each Class “A” Common Share entitles the holder to one vote. The holders of the Class “A” Common Shares shall elect the directors of Videotron at an annual or special meting of shareholders called for that purpose, except that any vacancy occurring in the Board of Directors may be filled, for the remainder of the term, by our Directors. At any meeting of shareholders called for such purpose, directors are elected by a majority of the votes cast in respect of such election.

(c) Rights to share in our profits : Other than as described in paragraph (a) above (whereby the holders of our Class “A” Common Shares are entitled to receive dividends as determined by our Board of Directors subject to certain restrictions) and paragraph (d) below (whereby the holders of our Class “A” Common Shares are entitled to participation in the remaining property and assets of our company available for distribution in the event of liquidation or dissolution), None.

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(d) Rights upon liquidation : In the event of our liquidation or dissolution or any other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of our Class “A” Common Shares shall be entitled, subject to the rights of the holders of our preferred shares, to participate equally, share for share, in our residual property and assets available for distribution to our shareholders, without preference or distinction.

(e) Redemption provisions : None.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of common shares as a result of such holder owning a substantial number of common shares : None.

Preferred Shares

Class “B” Preferred Shares

(a) Dividend rights : When our Board of Directors declares a dividend, the holders of our Class “B” Preferred Shares have the right to receive, in priority over the holders of our Class “A” Common Shares, Class “C” Preferred Shares, Class “D” Preferred Shares, Class “E” Preferred Shares and Class “F” Preferred Shares, but subordinated to the holders of our Class “G” Preferred Shares, a preferential and non-cumulative dividend at the fixed rate of 1% per month, calculated on the basis of the applicable redemption value of our Class “B” Preferred Shares. A dividend may be declared and payable in cash, in kind or through the issuance of fully paid shares of any class of our company.

(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “B” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

(c) Rights to share in our profits : Other than as described in paragraph (a) above (whereby the holders of our Class “B” Preferred Shares are entitled to receive certain dividends, if and when declared by our Board of Directors), paragraph (d) below (whereby the holders of our Class “B” Preferred Shares are entitled to participate in the distribution of the residual property and assets of Videotron available for distribution in the event of our liquidation or winding-up) and paragraph (e) below (whereby the holders of our Class “B” Preferred Shares have certain redemption rights): None.

(d) Rights upon liquidation : In the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of the Class “B” Preferred Shares shall be entitled to repayment of the amount paid for the Class “B” Preferred Shares in the subdivision of the issued and paid-up share capital account relating to the Class “B” Preferred Shares.

In addition, in the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the rights of holders of Class “B” Preferred Shares as regards to payment of dividends and the right to participate in the distribution of residual assets, shall rank in priority to the rights of the holders of our Class “A” Common Shares, Class “C” Preferred Shares, Class “D” Preferred Shares, Class “E” Preferred Shares

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and Class “F” Preferred Shares, but subordinated to the rights of holders of our Class “G” Preferred Shares.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), the holders of our Class “B” Preferred Shares have, at any time, the right to require Videotron to redeem (referred to as a “retraction right”) any or all of their Class “B” Preferred Shares at a redemption price equal to the amount paid for such shares in the subdivision of the issued and paid-up share capital account relating to such shares, plus a specified premium, if applicable, plus the amount of any declared and unpaid dividends.

In addition, Videotron may, at its option, redeem any or all of the Class “B” Preferred Shares outstanding at any time at an aggregate redemption price equal to the consideration received by Videotron for these Class “B” Preferred Shares. Videotron may also, when it deems it appropriate and without giving notice or taking into account the other classes of shares, buy, pursuant to a private agreement, all or some of the Class “B” Preferred Shares outstanding at a purchase price for any such Class “B” Preferred Shares not exceeding the retraction right purchase price described above or the book value of Videotron’s net assets.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “B” Preferred Shares as a result of such holder owning a substantial number of our Class “B” Preferred Shares : None.

Class “C” Preferred Shares

(a) Dividend rights : When our Board of Directors declares a dividend, the holders of our Class “C” Preferred Shares have the right to receive, in priority over the holders of our Class “A” Common Shares, Class “D” Preferred Shares, Class “E” Preferred Shares and Class “F” Preferred Shares, but subordinated to the holders of our Class “B” Preferred Shares and Class “G” Preferred Shares, a preferential and non-cumulative dividend at the fixed rate of 1% per month, calculated on the basis of the applicable redemption value of our Class “C” Preferred Shares. A dividend may be declared and payable in cash, in kind or through the issuance of fully paid shares of any class of our company.

(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “C” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

(c) Rights to share in our profits : Other than as described in paragraph (a) above (whereby the holders of our Class “C” Preferred Shares are entitled to receive certain dividends, if and when declared by our Board of Directors), paragraph (d) below (whereby the holders of our Class “C” Preferred Shares are entitled to participate in the distribution of the residual property and assets of Videotron available for distribution in the event of our liquidation or winding-up) and paragraph (e) below (whereby the holders of our Class “C” Preferred Shares have certain redemption rights), None.

(d) Rights upon liquidation : In the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of the Class “C” Preferred Shares shall be shall be entitled to repayment of the amount paid for the Class “C” Preferred Shares in the subdivision of the issued and paid-up share capital account relating to the Class “C” Preferred Shares.

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In addition, in the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the rights of holders of Class “C” Preferred Shares as regards to payment of dividends and the right to participate in the distribution of residual assets, shall rank in priority to the rights of the holders of our Class “A” Common Shares, Class “D” Preferred Shares, Class “E” Preferred Shares and Class “F” Preferred Shares, but subordinated to the rights of holders of our Class “B” Preferred Shares and Class “G” Preferred Shares.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), the holders of our Class “C” Preferred Shares have, at any time, the right to require Videotron to redeem (referred to as a “retraction right”) any or all of their Class “C” Preferred Shares at a redemption price equal to the amount paid for such shares in the subdivision of the issued and paid-up share capital account relating to such shares, plus a specified premium, if applicable, plus the amount of any declared and unpaid dividends.

In addition, Videotron may, at its option, redeem any or all of the Class “C” Preferred Shares outstanding at any time at an aggregate redemption price equal to the consideration received by Videotron for these Class “C” Preferred Shares. Videotron may also, when it deems it appropriate and without giving notice or taking into account the other classes of shares, buy, pursuant to a private agreement, all or some of the Class “C” Preferred Shares outstanding at a purchase price for any such Class “C” Preferred Shares not exceeding the retraction right purchase price described above or the book value of Videotron’s net assets.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “C” Preferred Shares as a result of such holder owning a substantial number of our Class “C” Preferred Shares : None.

Class “D” Preferred Shares

(a) Dividend rights : When our Board of Directors declares a dividend, the holders of our Class “D” Preferred Shares have the right to receive, in priority over the holders of our Class “A” Common Shares, Class “E” Preferred Shares and Class “F” Preferred Shares, but subordinated to the holders of our Class “B” Preferred Shares, Class “C” Preferred Shares and Class “G” Preferred Shares, a preferential and non-cumulative dividend at the fixed rate of 1% per month, calculated on the basis of the applicable redemption value of our Class “D” Preferred Shares. A dividend may be declared and payable in cash, in kind or through the issuance of fully paid shares of any class of our company.

(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “D” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

(c) Rights to share in our profits : Other than as described in paragraph (a) above (whereby the holders of our Class “D” Preferred Shares are entitled to receive certain dividends, if and when declared by our Board of Directors), paragraph (d) below (whereby the holders of our Class “D” Preferred Shares are entitled to participate in the distribution of the residual property and assets of Videotron available for distribution in the event of our liquidation or winding-up) and paragraph (e) below (whereby the holders of our Class “D” Preferred Shares have certain redemption rights), None.

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(d) Rights upon liquidation : In the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of the Class “D” Preferred Shares shall be shall be entitled to repayment of the amount paid for the Class “D” Preferred Shares in the subdivision of the issued and paid-up share capital account relating to the Class “D” Preferred Shares.

In addition, in the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the rights of holders of Class “D” Preferred Shares as regards to payment of dividends and the right to participate in the distribution of residual assets, shall rank in priority to the rights of the holders of our Class “A” Common Shares, Class “E” Preferred Shares and Class “F” Preferred Shares, but subordinated to the rights of holders of our Class “B” Preferred Shares, Class “C” Preferred Shares and Class “G” Preferred Shares.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), the holders of our Class “D” Preferred Shares have, at any time, the right to require Videotron to redeem (referred to as a “retraction right”) any or all of their Class “D” Preferred Shares at a redemption price equal to the amount paid for such shares in the subdivision of the issued and paid-up share capital account relating to such shares, plus a specified premium, if applicable, plus the amount of any declared and unpaid dividends.

In addition, Videotron may, at its option, redeem any or all of the Class “D” Preferred Shares outstanding at any time at an aggregate redemption price equal to the consideration received by Videotron for these Class “D” Preferred Shares. Videotron may also, when it deems it appropriate and without giving notice or taking into account the other classes of shares, buy, pursuant to a private agreement, all or some of the Class “D” Preferred Shares outstanding at a purchase price for any such Class “D” Preferred Shares not exceeding the retraction right purchase price described above or the book value of Videotron’s net assets.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “D” Preferred Shares as a result of such holder owning a substantial number of our Class “D” Preferred Shares : None.

Class “E” Preferred Shares

(a) Dividend rights : When our Board of Directors declares a dividend, the holders of our Class “E” Preferred Shares have the right to receive, in priority over the holders of our Class “A” Common Shares and Class “F” Preferred Shares, but subordinated to the holders of our Class “G” Preferred Shares, Class “C” Preferred Share and Class “E” Preferred Shares, a preferential and non-cumulative dividend at the fixed rate of 1% per month, calculated on the basis of the applicable redemption value of our Class “E” Preferred Shares. A dividend may be declared and payable in cash, in kind or through the issuance of fully paid shares of any class of our company.

(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “E” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

(c) Rights to share in our profits : Other than as described in paragraph (a) above (whereby the holders of our Class “E” Preferred Shares are entitled to receive certain dividends, if and when declared by our Board

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of Directors), paragraph (d) below (whereby the holders of our Class “E” Preferred Shares are entitled to participate in the distribution of the residual property and assets of Videotron available for distribution in the event of our liquidation or winding-up) and paragraph (e) below (whereby the holders of our Class “E” Preferred Shares have certain redemption rights), None.

(d) Rights upon liquidation : In the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of the Class “E” Preferred Shares shall be shall be entitled to repayment of the amount paid for the Class “E” Preferred Shares in the subdivision of the issued and paid-up share capital account relating to the Class “E” Preferred Shares.

In addition, in the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the rights of holders of Class “E” Preferred Shares as regards to payment of dividends and the right to participate in the distribution of residual assets, shall rank in priority to the rights of the holders of our Class “A” Common Shares and Class “F” Preferred Shares, but subordinated to the rights of holders of our Class “B” Preferred Shares, Class “C” Preferred Shares, Class “D” Preferred Shares and Class “G” Preferred Shares.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), the holders of our Class “E” Preferred Shares have, at any time, the right to require Videotron to redeem (referred to as a “retraction right”) any or all of their Class “E” Preferred Shares at a redemption price equal to the amount paid for such shares in the subdivision of the issued and paid-up share capital account relating to such shares, plus a specified premium, if applicable, plus the amount of any declared and unpaid dividends.

In addition, Videotron may, at its option, redeem any or all of the Class “E” Preferred Shares outstanding at any time at an aggregate redemption price equal to the consideration received by Videotron for these Class “E” Preferred Shares. Videotron may also, when it deems it appropriate and without giving notice or taking into account the other classes of shares, buy, pursuant to a private agreement, all or some of the Class “E” Preferred Shares outstanding at a purchase price for any such Class “E” Preferred Shares not exceeding the retraction right purchase price described above or the book value of Videotron’s net assets.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “E” Preferred Shares as a result of such holder owning a substantial number of our Class “E” Preferred Shares : None.

Class “F” Preferred Shares

(a) Dividend rights : When our Board of Directors declares a dividend, the holders of our Class “F” Preferred Shares have the right to receive, in priority over the holders of our Class “A” Common Shares, but subordinated to the holders of our Class “B” Preferred Shares, Class “C” Preferred Shares, Class “D” Preferred Shares, Class “E” Preferred Shares and Class “G” Preferred Shares, a preferential and non-cumulative dividend at the fixed rate of 1% per month, calculated on the basis of the applicable redemption value of our Class “F” Preferred Shares. A dividend may be declared and payable in cash, in kind or through the issuance of fully paid shares of any class of our company.

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(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “F” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

(c) Rights to share in our profits : Other than as described in paragraph (a) above (whereby the holders of our Class “F” Preferred Shares are entitled to receive certain dividends, if and when declared by our Board of Directors), paragraph (d) below (whereby the holders of our Class “F” Preferred Shares are entitled to participate in the distribution of the residual property and assets of Videotron available for distribution in the event of our liquidation or winding-up) and paragraph (e) below (whereby the holders of our Class “F” Preferred Shares have certain redemption rights), None.

(d) Rights upon liquidation : In the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of the Class “F” Preferred Shares shall be shall be entitled to repayment of the amount paid for the Class “F” Preferred Shares in the subdivision of the issued and paid-up share capital account relating to the Class “F” Preferred Shares.

In addition, in the event of our liquidation, dissolution or other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the rights of holders of Class “F” Preferred Shares as regards to payment of dividends and the right to participate in the distribution of residual assets, shall rank in priority to the rights of the holders of our Class “A” Common Shares, but subordinated to the rights of holders of our Class “B” Preferred Shares, Class “C” Preferred Shares, Class “D” Preferred Shares, Class “E” Preferred Shares and Class “G” Preferred Shares.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), the holders of our Class “F” Preferred Shares have, at any time, the right to require Videotron to redeem (referred to as a “retraction right”) any or all of their Class “F” Preferred Shares at a redemption price equal to the amount paid for such shares in the subdivision of the issued and paid-up share capital account relating to such shares, plus a specified premium, if applicable, plus the amount of any declared and unpaid dividends.

In addition, Videotron may, at its option, redeem any or all of the Class “F” Preferred Shares outstanding at any time at an aggregate redemption price equal to the consideration received by Videotron for these Class “F” Preferred Shares. Videotron may also, when it deems it appropriate and without giving notice or taking into account the other classes of shares, buy, pursuant to a private agreement, all or some of the Class “F” Preferred Shares outstanding at a purchase price for any such Class “F” Preferred Shares not exceeding the retraction right purchase price described above or the book value of Videotron’s net assets.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “F” Preferred Shares as a result of such holder owning a substantial number of our Class “F” Preferred Shares : None.

Class “G” Preferred Shares

(a) Dividend rights : When our Board of Directors declares a dividend, the holders of our Class “G” Preferred Shares have the right to receive, in priority over the holders of our common shares and preferred shares of other series, a preferential and cumulative dividend, payable semi-annually, at the

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fixed rate of 11.25% per year, calculated daily on the basis of the applicable redemption value of our Class “G” Preferred Shares. No dividends may be paid on any common shares or preferred shares of other series unless all dividends which shall have become payable on the Class “G” Preferred Shares have been paid or set aside for payment.

(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “G” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

However, in the event that we shall have failed to pay eight (8) half-yearly dividends, whether or not consecutive, on the Class “G” Preferred Shares, and only for so long as the dividend remains in arrears, the holders of Class “G” Preferred Shares shall have the right to receive notice of meetings of shareholders and to attend and vote at any such meetings, except meetings at which only holders of another specified series or class of shares are entitled to vote. At each such meeting, each Class “G” Preferred Share shall entitle the holder thereof to one vote.

(c) Rights to share in our profits : Except as described in paragraph (a) above (whereby the holders of our Class “G” Preferred Shares are entitled to receive a 11.25% cumulative preferred dividend in preference to the holders of our common shares and other series of our preferred shares), paragraph (d) below (whereby the holders of our Class “G” Preferred Shares are entitled to receive, in preference to the holders of our common shares and other series of our preferred shares, an amount equal to $1,000 per Class “G” Preferred Share and any accumulated and unpaid dividends with respect thereto in the event of our liquidation, winding-up or reorganization) and paragraph (e) below (whereby the holders of our Class “G” Preferred Shares may require us to redeem the Class “G” Preferred Shares at a redemption price of $1,000 per share plus any accrued and unpaid dividends with respect thereto), None.

(d) Rights upon liquidation : In the event of our liquidation, dissolution or reorganization or any other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of our Class “G” Preferred Shares shall be entitled to receive in preference to the holders of our common shares and our preferred shares of other series an amount equal to $1,000 per Class “G” Preferred Share and any accrued and unpaid dividends with respect thereto.

Our Class “G” Preferred Shares have priority over our common shares and our preferred shares of other series as to the order of priority of the distribution of assets in case of the liquidation or dissolution of our company, voluntary or involuntary, or of any other distribution of our assets to our shareholders for the purpose of winding up our affairs.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), the holders our Class “G” Preferred Shares have, at any time, the right to require Videotron to redeem any and all of their shares at a redemption price equal to $1,000 per share plus any accrued and unpaid dividends with respect thereto. In addition, we may, at our option, redeem any and all Class “G” Preferred Shares at any time at a redemption price equal to $1,000 per share plus any accrued and unpaid dividends with respect thereto.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “G” Preferred Shares as a result of such holder owning a substantial number of our Class “G” Preferred Shares : None.

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Class “H” Preferred Shares

(a) Dividend rights : The holders of Class “H” Preferred Shares shall be entitled to receive, every year, in such manner and at such time as our Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “H” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

(b) Voting rights : Subject to applicable law and except as expressly otherwise provided, the holders of our Class “H” Preferred Shares do not have the right to receive notice of meetings of shareholders or to attend any such meeting or vote at any such meeting.

(c) Rights to share in our profits : Except as described in paragraph (a) above (whereby the holders of our Class “H” Preferred Shares are entitled to receive, every year, in such manner and at such time as our Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month), paragraph (d) below (whereby the holders of our Class “H” Preferred Shares are entitled to entitled to repayment of the amount paid for the Class “H” Preferred Shares in the event of our liquidation, winding-up or reorganization) and paragraph (e) below (whereby the holders of our Class “H” Preferred Shares may require us to redeem the Class “H” Preferred Shares at a specified redemption price), None.

(d) Rights upon liquidation : In the event of our liquidation, dissolution or reorganization or any other distribution of our assets among our shareholders for the purpose of winding-up our affairs, whether voluntarily or involuntarily, the holders of our Class “H” Preferred Shares shall be entitled to repayment of the amount paid for the Class “H” Preferred Shares into the subdivision of the issued and paid-up share capital account relating to the Class “H” Preferred Shares.

(e) Redemption provisions : Subject to the provisions of the Companies Act (Québec), we may elect to redeem the Class “H” Preferred Shares at any time at a price equal to the specified redemption price plus an amount equal to any dividends declared thereon but unpaid up to the date of redemption. The specified redemption price is, subject to certain conditions, equal to the aggregate consideration received for such share.

(f) Sinking fund provisions : None.

(g) Liability to further capital calls by us : None, provided that our directors may make calls upon the shareholders in respect of any moneys unpaid upon their shares.

(h) Provisions discriminating against existing or prospective holders of our Class “H” Preferred Shares as a result of such holder owning a substantial number of our Class “H” Preferred Shares : None.

4. Actions necessary to change the rights of shareholders. Under the Companies Act (Québec), (i) the Articles may only be amended by the affirmative vote of the holders of two-thirds ( 2 / 3 ) of the votes cast by the shareholders at a special meeting called for that purpose and (ii) our by-laws may be amended by our directors and ratified by a majority of the votes cast by the shareholders at a meeting called for such purpose In addition, pursuant to the Companies Act (Québec), we may not make any amendments to the Articles that affect the rights, conditions, privileges or restrictions attaching to issued shares of any series outstanding, other than an increase in the share capital or the number of our authorized shares, without obtaining the consent of all the shareholders concerned by the amendment, whether or not they are eligible to vote. The consent of the shareholders of any classes outstanding with respect to the matters described in the foregoing requires either (i) the formal authorization given by all the holders of the shares of such class outstanding, or (ii) a resolution adopted by at least three-quarters ( 3 / 4 ) of the votes cast holders of the shares of such class voting on this resolution at a special general meeting held by order and under the supervision of a judge of the Superior Court of Québec.

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5. Shareholder Meetings . Our by-laws provide that the annual meeting of our shareholders shall be held at such place, on such date and at such time as our Board of Directors may determine from time to time. Annual meetings of our shareholders may be called at any time by order of our Board of Directors, our Chairman of the Board or, provided they are members of our Board of Directors, the president or any vice-president of our company. Special general meetings of our shareholders shall be held at such place, on such date and at such time as our Board of Directors may determine from time to time or at any place where all our shareholders entitled to vote are present in person or represented by proxy or at such other place as all our shareholders shall approve in writing. Special general meetings of our shareholders may be called at any time by order of our Board of Directors, our Chairman of the Board or, provided they are members of our Board of Directors, the president or any vice-president of our company.

Our by-laws provide that notice specifying the place, date, time and purpose of any meeting of our shareholders shall be given to all the shareholders entitled to this notice at least 21 days but not more than 50 days prior to the date fixed for the meeting. The notice may be mailed, postage prepaid, to the shareholders at their respective addresses as they appear on our books or delivered by hand or transmitted by any means of telecommunication.

Our chairman of the board or, in his absence, our president, if he is a director or, in his absence, one of our vice-presidents who is a director shall preside at all meetings of our shareholders. If all of the aforesaid officers are absent or decline to act, the persons present and entitled to vote may choose one of their number to act as chairman of the meeting.

Our by-laws provide that the holders of not less than 30% of the outstanding shares of our share capital carrying the right to vote at a shareholders’ meeting, present in person or represented by proxy, shall constitute a quorum for any meeting of our shareholders.

6. Limitations on right to own securities . There is no limitation imposed by Canadian law or by the Articles or our other constituent documents on the right of nonresidents or foreign owners to hold or vote shares, other than as provided in the Investment Canada Act (Canada) and the Radiocommunication Act . The Investment Canada Act (Canada) requires “non-Canadian” (as defined in the Investment Canada Act (Canada)) individuals, governments, corporations and other entities who wish to acquire control of a “Canadian business” (as defined in the Investment Canada Act (Canada)) to file either an application for review (when certain asset value thresholds are met) or a post closing notification with the Director of Investments appointed under the Investment Canada Act (Canada), unless a specific exemption applies. The Investment Canada Act (Canada) requires that, when an acquisition of control of a Canadian business by a “non-Canadian” is subject to review, it must be approved by the Minister responsible for the Investment Canada Act (Canada) on the basis that the Minister is satisfied that the acquisition is “likely to be of net benefit to Canada”, having regard to criteria set forth in the Investment Canada Act (Canada). Radio licenses may be issued under the Radiocommunication Act to radiocommunication service providers (“Service Providers”) that meet the eligibility criteria of Canadian ownership and control set forth in the Canadian Telecommunications Common Carrier Ownership and Control Regulations (the “CTCCOCR”). Under the CTCCOCR, the Service Provider may refuse to accept any subscription for or register the transfer of any of its voting shares unless it receives a declaration that such subscription or transfer would not result in the percentage of the total voting shares of the Service Provider that are beneficially owned and controlled by non-Canadians exceeding 33 1 / 3 %.

7. Provisions that could have the effect of delaying, deferring or preventing a change of control : The Articles provide that our directors shall refuse to issue (including on the occasion or because of a conversion of shares or in shares), and to allow a transfer of, any share of our capital stock if this issuance or transfer would, in the opinion of our directors, affect our eligibility or of any other company or partnership in which we have or may have an interest, to obtain, preserve or renew a license or authorization required for the operation or continuation of its broadcasting company (as defined in the Broadcasting Act (Canada), as amended) (or any part thereof) or

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of any other activity necessary for the continuation of our company. See “Item 4. Information on the Company — Regulation — Ownership and Control of Canadian Broadcast Undertakings”.

8. Not applicable.

9. Not applicable.

10. Not applicable.

C- MATERIAL CONTRACTS

The following is a summary of each material contract, other than contracts entered into in the ordinary course of business, to which we or any of our subsidiaries is a party, for the two years preceding publication of this annual report.

(a) Indenture relating to US$650,000,000 of our 6 7 / 8 % Senior Notes due January 15, 2014, dated as of October 8, 2003, by and among Videotron, the guarantors party thereto and Wells Fargo Bank Minnesota, N.A. (now Wells Fargo Bank, National Association) as trustee, as supplemented.

On October 8, 2003, we issued US$335.0 million aggregate principal amount of our 6 7 / 8 % Senior Notes due January 15, 2014 and, on November 19, 2004, we issued an additional US$315.0 million aggregate principal amount of these notes, pursuant to an Indenture, dated as of October 8, 2003, by and among Videotron, the guarantors party thereto and Wells Fargo Bank Minnesota, N.A. (now Wells Fargo Bank, National Association), as trustee. These notes are unsecured and are due January 15, 2014. Interest on these notes is payable semi-annually in arrears on January 15 and July 15 of each year, beginning on July 15, 2004. These notes are guaranteed on a senior unsecured basis by most, but not all, of our subsidiaries. These notes are redeemable, at our option, under certain circumstances and at the redemption prices set forth in the indenture. The indenture contains customary restrictive covenants with respect to us and certain of our subsidiaries and customary events of default. If an event of default occurs and is continuing (other than our bankruptcy or insolvency) the trustee or the holders of at least 25% in principal amount at maturity of the then-outstanding notes may declare all the notes to be due and payable immediately.

(b) Indenture relating to US$175,000,000 of our 6 3 / 8 % Senior Notes due December 15, 2015, dated as of September 16, 2005, by and among Videotron, the guarantors party thereto, and Wells Fargo Bank, National Association, as trustee.

On September 16, 2005, we issued US$175,000,000 aggregate principal amount of our 6 3 / 8 % Senior Notes due December 15, 2015, pursuant to an Indenture, dated as of September 16, 2005, by and among Videotron, the guarantors party thereto, and Wells Fargo Bank, National Association, as trustee. These notes are unsecured and are due on December 15, 2015. Interest on these notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on December 15, 2005. These notes are guaranteed on a senior unsecured basis by most, but not all, of our subsidiaries. These notes are redeemable, at our option, under certain circumstances and at the redemption prices set forth in the indenture. The indenture contains customary restrictive covenants with respect to us and certain of our subsidiaries, and customary events of default. If an event of default occurs and is continuing, other than our bankruptcy or insolvency, the trustee or the holders of at least 25% in principal amount at maturity of the then-outstanding notes may declare all the notes to be due and payable immediately.

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(c) Indenture relating to US$455,000,000 of our 9 1 / 8 % Senior Notes due April 15, 2018, dated as of April 15, 2008, by and among Videotron, the guarantors party thereto, and Wells Fargo Bank, National Association, as trustee.

On April 15, 2008, we issued US$455,000,000 aggregate principal amount of our 9 1 / 8 % Senior Notes due April 15, 2018, pursuant to an Indenture, dated as of April 15, 2018, by and among Videotron, the guarantors party thereto, and Wells Fargo Bank, National Association, as trustee. These notes are unsecured and are due on April 15, 2018. Interest on these notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on June 15, 2008. These notes are guaranteed on a senior unsecured basis by most, but not all, of our subsidiaries. These notes are redeemable, at our option, under certain circumstances and at the redemption prices set forth in the indenture. The indenture contains customary restrictive covenants with respect to us and certain of our subsidiaries, and customary events of default. If an event of default occurs and is continuing, other than our bankruptcy or insolvency, the trustee or the holders of at least 25% in principal amount at maturity of the then-outstanding notes may declare all the notes to be due and payable immediately.

(d) Amended and Restated Credit Agreement, as amended as of April 7, 2008, by and among Videotron, as borrower, the financial institutions party thereto from time to time, as lenders, and Royal Bank of Canada, as administrative agent.

On April 7, 2008, Videotron amended its senior secured credit facilities to increase commitments under the facility from $450.0 million to $575.0 million and extend the maturity date to April 2012. Pursuant to these amendments, Videotron may, subject to certain conditions, increase the commitments under the senior secured credit facilities by an additional $75.0 million (for aggregate commitments of $650.0 million) subject to approval by existing lenders providing such commitments or by adding new lenders. The proceeds of our senior secured credit facilities are to be used for general corporate purposes, including, without limitation, for distributions to our shareholder in certain circumstances.

Borrowings under our senior secured credit facilities bear interest at the Canadian prime rate, the bankers’ acceptance rate or LIBOR, plus, in each case an applicable margin. Borrowings under our senior secured credit facilities are repayable in full in April 2012.

Borrowings under senior secured credit facilities and under eligible derivative instruments are secured by a first-ranking hypothec or security interest (subject to certain permitted encumbrances) on all of our current and future assets, as well as those of the guarantors party thereto, including most but not all of our subsidiaries (the “Vidéotron Group”), guarantees of all the members of the Videotron Group, pledges of the shares of Videotron and the members of the Vidéotron Group, and other security.

Our senior secured credit facilities contain customary covenants that restrict and limit the ability of Videotron and the members of the Vidéotron Group to, among other things, enter into merger or amalgamation transactions, grant encumbrances, sell assets, pay dividends or make other distributions, issue shares of capital stock, incur indebtedness and enter into related party transactions. In addition, our senior secured credit facilities contain customary financial covenants and customary events of default, including the non-payment of principal or interest, the breach of any financial covenant, the failure to perform or observe any other covenant, certain bankruptcy events relating to us and the members of the Videotron group, and the occurrence of a change of control.

(e) Back-to-back transaction agreement, effective as of January 3, 2007, by and between Quebecor Media and Videotron (partly redeemed on December 23, 2008).

On January 3, 2007, we entered in a back-to-back transaction by contracting a subordinated loan of $1.0 billion from Quebecor Media and used the entire proceeds of this borrowing to purchase 1,000,000

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Preferred Shares, Series B of 9101-0835 Québec inc., a subsidiary of Quebecor Media. The subordinated loan bears interest at a rate of 10.5%, payable semi-annually, and matures on January 3, 2022. The Preferred Shares, Series B carry the right to receive a cumulative annual dividend of 10.85% payable semi-annually. On December 23, 2008, 9101-0835 Québec Inc. redeemed 525,000 preferred shares, Series B, for a total cash consideration of $525.5 million, including cumulative dividends of $0.5 million. On the same day, the Company used the total proceeds of $525.0 million to repay a part of its subordinated loan contracted from Quebecor Media on January 3, 2007. See also Note 9 to our consolidated financial statements included under “Item 17. Financial Statements” of this annual report.

(f) Back-to-back transaction agreement, effective as of May 31, 2007, by and between Quebecor Media and Videotron.

On May 31, 2007, we entered in a back-to-back transaction by contracting a subordinated loan of $870.0 million from Quebecor Media and used the entire proceeds of this borrowing to purchase 870,000 Preferred Shares, Series B of 9101-0835 Québec inc., a subsidiary of Quebecor Media. The subordinated loan bears interest at a rate of 10.5%, payable semi-annually, and matures on May 31, 2022. The Preferred Shares, Series B carry the right to receive a cumulative annual dividend of 10.85% payable semi-annually. See also Note 6 to our consolidated financial statements included under “Item 17. Financial Statements” of this annual report.

(g) Back-to-back transaction agreement, effective as of May 31, 2007, by and between Quebecor Media and CF Cable TV Inc., a wholly-owned subsidiary of Vidéotron.

On May 31, 2007, CF Cable TV inc., a wholly-owned subsidiary of the Company, entered into back-to-back transaction by contracting a subordinated loan of $125.0 million from Quebecor Média Inc. and invested the $125 million into 125,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Média Inc. The subordinated loan bears interest at a rate of 10.5% payable every six months on June 20 and December 20, and matures on May 31, 2022. The preferred shares carry the right to receive a cumulative annual dividend of 10.85%, payable semi-annually. See also Note 6 to our consolidated financial statements included under “Item 17. Financial Statements” of this annual report.

(h) Back-to-back transaction agreement, effective as of January 4, 2008, by and between Quebecor Media and Vidéotron.

On January 4, 2008, the Company contracted a subordinated loan of $415.0 million from Quebecor Média Inc., bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 4, 2023. on the same day, the company invested the total proceeds of $415.0 million into 415,000 preferred shares, Series B, of 9101-0835 Québec inc., a subsidiary of Quebecor Media Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually. See also Note 6 to our consolidated financial statements included under “Item 17. Financial Statements” of this annual report.

(i) Back-to-back transaction agreement, effective as of January 4, 2008, by and between Quebecor Media and CF Cable TV Inc., a wholly-owned subsidiary of Videotron.

On January 4, 2008, CF Cable TV inc., a wholly-owned subsidiary of Videotron, contracted a subordinated loan of $170.0 million from Quebecor Media, bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 4, 2023. On the same day, CF Cable TV Inc. invested the total proceeds of $170.0 million into 170,000 preferred shares, Series B, of 9101-0835 Québec inc., a subsidiary of Quebecor Media. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually. See also Note 9 to our consolidated financial statements included under “Item 17. Financial Statements” of this annual report.

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D- Exchange Controls

There are currently no laws, decrees, regulations or other legislation in Canada that restricts the export or import of capital, or affects the remittance of dividends, interest or other payments to non-resident holders of our securities, other than withholding tax requirements. See “— Taxation — Canadian Material Federal Income Tax Considerations for Residents of the United States” below.

There is no limitation imposed by Canadian law or by the Articles or our other charter documents on the right of a non-resident to hold our voting shares, other than as provided by the Investment Canada Act , as amended (the “Act”), as amended by the North American Free Trade Agreement Implementation Act (Canada), and the World Trade Organization (WTO) Agreement Implementation Act . The Act requires notification and, in certain cases, advance review and approval by the Government of Canada of the acquisition by a “non-Canadian” of “control of a Canadian business”, all as defined in the Act. Generally, the threshold for review will be higher in monetary terms for a member of the WTO or NAFTA. In addition, there are regulations related to the ownership and control of Canadian broadcast undertakings. See “Item 4. Information on the Company — Regulation”.

E- Taxation

Certain U.S. Federal Income Tax Considerations

The following discussion is a summary of certain U.S. federal income tax consequences applicable to the purchase, ownership and disposition of (i) our 6 3 / 8 % Senior Notes due 2015 (our “6 3 / 8 % Senior Notes”) and (ii) our 6 7 / 8 % Senior Notes due 2014 (our “6 7 / 8 % Senior Notes” and, together with our 6 3 / 8 % Senior Notes, the “notes”) by a U.S. Holder (as defined below), but does not purport to be a complete analysis of all potential U.S. federal income tax effects. Our 6 7 / 8 % Senior Notes were issued in two issuances, on October 8, 2003 (the “first 6 7 / 8 % Senior Notes issuance”) and November 19, 2004 (the “second 6 7 / 8 % Senior Notes issuance”), under the same indenture. This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), U.S. Treasury regulations promulgated thereunder, Internal Revenue Service (“IRS”) rulings and judicial decisions now in effect. All of these are subject to change, possibly with retroactive effect, or different interpretations.

This summary does not address all aspects of U.S. federal income taxation that may be relevant to particular U.S. Holders in light of their specific circumstances (for example, U.S. Holders subject to the alternative minimum tax provisions of the Code) or to holders that may be subject to special rules under U.S. federal income tax law, including:

· dealers in stocks, securities or currencies;

· securities traders that use a mark-to-market accounting method;

· banks and financial institutions;

· insurance companies;

· regulated investment companies;

· real estate investment trusts;

· tax-exempt organizations;

· persons holding notes as part of a hedging or conversion transaction or a straddle;

· persons deemed to sell notes under the constructive sale provisions of the Code;

· persons who or that are, or may become, subject to the expatriation provisions of the Code;

· persons whose functional currency is not the U.S. dollar; and

· direct, indirect or constructive owners of 10% or more of our outstanding voting shares.

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The summary also does not discuss any aspect of state, local or foreign law, or U.S. federal estate and gift tax law as applicable to U.S. Holders. In addition, this discussion is limited to U.S. Holders that acquired notes pursuant to the respective exchange offers that we filed with the Securities and Exchange Commission on January 8, 2004 (in respect of the first 6 7 / 8 % Senior Notes issuance), on January 18, 2005 (in respect of the second 6 7 / 8 % Senior Notes issuance), and on December 16, 2005 (in respect of our 6 3 / 8 % Senior Notes). Moreover, the discussion is limited to U.S. Holders who acquire and hold the notes as “capit al assets” within the meaning of Section 1221 of the Code (generally, property held for investment). In addition, this summary assumes that the notes are properly characterized as debt that is not contingent debt for U.S. federal income tax purposes.

For purposes of this summary, “U.S. Holder” means the beneficial holder of a note who or that for U.S. federal income tax purposes is:

· an individual citizen or resident alien of the United States;

· a corporation or other entity treated as such formed in or under the laws of the United States, any state thereof or the District of Columbia;

· an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or

· a trust, if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more “U.S. persons” (within the meaning of the Code) have the authority to control all substantial decisions of the trust, or if a valid election is in effect to be treated as a U.S. person.

No ruling has been or will be sought from the IRS with respect to the matters discussed below. There can be no assurance that the IRS will not take a different position concerning the tax consequences of the purchase, ownership or disposition of the notes or that any such position will not be sustained.

If a partnership or other entity or arrangement treated as a partnership for U.S. federal income tax purposes holds the notes, the U.S. federal income tax treatment of a partner generally will depend on the status of the partner and the activities of the partnership. Such partner should consult its own tax advisor as to the tax consequences of the partnership purchasing, owning and disposing of the notes.

To ensure compliance with requirements imposed by the IRS, you are hereby informed that the United States tax advice contained herein: (i) is written in connection with the promotion or marketing by Videotron of the transactions or matters addressed herein, and (ii) is not intended or written to be used, and cannot be used by any taxpayer, for the purpose of avoiding United States tax penalties. Each taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

U.S. INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH REGARD TO THE APPLICATION OF THE TAX CONSEQUENCES DESCRIBED BELOW TO THEIR PARTICULAR SITUATIONS AS WELL AS THE APPLICATION OF ANY STATE, LOCAL, FOREIGN OR OTHER TAX LAWS, INCLUDING GIFT AND ESTATE TAX LAWS.

Interest on the Notes

Payments of stated interest on the notes generally will be taxable to a U.S. Holder as ordinary income at the time that such payments are received or accrued, in accordance with the U.S. Holder’s method of accounting for U.S. federal income tax purposes. Interest on the notes will constitute income from sources outside the United States and generally, with certain exceptions, for taxable years beginning after December 31, 2006, will be “passive category income” which is treated separately from other income for purposes of computing the foreign tax credit allowable to a U.S. Holder under the federal income tax laws. Due to the complexity of the foreign tax credit rules, U.S. Holders should consult their own tax advisors with respect to the amount of foreign taxes that may be claimed as a credit.

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In certain circumstances we may be obligated to pay amounts in excess of stated interest or principal on the notes or may make payments or redeem the notes in advance of the expected maturity of the notes. According to U.S. Treasury regulations, the possibility that any such payments or redemptions will be made will not affect the amount of interest income a U.S. Holder recognizes if there is only a remote chance as of the date the notes were issued that such payments will be made. We believe the likelihood that we will make any such payments is remote. Therefore, we do not intend to treat the potential payments or redemptions pursuant to the provisions related to changes in Canadian laws or regulations applicable to tax-related withholdings or deductions, the registration rights provisions, or the other redemption and repurchase provisions as part of the yield to maturity of the notes or as affecting the tax treatment of the notes. Our determination that these contingencies are remote is binding on a U.S. Holder unless such holder discloses its contrary position in the manner required by applicable U.S. Treasury regulations. Our determination is not, however, binding on the IRS, and if the IRS were to challenge this determination, a U.S. Holder may be required to accrue income on its notes in excess of stated interest and to treat as ordinary income rather than capital gain any income realized on the taxable disposition of a note before the resolution of the contingencies. In the event a contingency occurs, it would affect the amount and timing of the income recognized by a U.S. Holder. If we pay additional amounts on the notes, U.S. Holders will be required to recognize such amounts as income.

In the issuance of our 6 3 / 8 % Senior Notes and in the first 6 7 / 8 % Senior Notes issuance, the notes were issued with a de minimis amount of original issue discount (“OID”). OID is the excess, if any, of a note’s “stated redemption price at maturity” over its “issue price”. A note’s stated redemption price at maturity is the sum of all payments provided by the note other than payments of qualified stated interest (i.e., stated interest that is unconditionally payable in cash or other property (other than debt of the issuer)). The “issue price” is the first price at which a substantial amount of the notes in the issuance that includes the notes is sold (excluding sales to bond houses, brokers or similar persons or organizations acting in the capacity of underwriters, agents or wholesalers). The amount of original issue discount with respect to a note will be treated as zero if it is less than an amount equal to 0.0025 multiplied by the product of the stated redemption price at maturity and the number of complete years to maturity (or weighted average maturity, as applicable) (“ de minimis OID”). Generally, any de minimis OID must be included in income as principal payments are received on the securities in the proportion that each such payment bears to the original principal balance of the security. The treatment of the resulting gain is subject to the general rules discussed under “—Sale, Exchange or Retirement of a Note” below.

Market Discount and Bond Premium

If a U.S. Holder purchases notes for an amount less than their stated redemption price at maturity, the difference is treated as market discount. Subject to a de minimis exception, gain realized on the maturity, sale, exchange or retirement of a market discount note will be treated as ordinary income to the extent of any accrued market discount not previously recognized (including in the case of a note exchanged for a registered note pursuant to the registration offer, any market discount accrued on the related outstanding note). A U.S. Holder may elect to include market discount in income currently as it accrues, on either a ratable or constant yield method. In that case, a U.S. Holder’s tax basis in its notes will increase by such income inclusions. An election to include market discount in income currently, once made, will apply to all market discount obligations acquired by the U.S. Holder during the taxable year of the election and thereafter, and may not be revoked without the consent of the IRS. If a U.S. Holder does not make such an election, in general, all or a portion of such holder’s interest expense on any indebtedness incurred or continued in order to purchase or carry notes may be deferred until the maturity of the notes, or certain earlier dispositions. Unless a U.S. Holder elects to accrue market discount under a constant yield method, any market discount will accrue ratably during the period from the date of acquisition of the related outstanding note to its maturity date.

If a U.S. Holder purchases notes for an amount greater than the sum of all amounts (other than qualified stated interest) payable with respect to the notes after the date of acquisition, such holder will have purchased such notes with amortizable bond premium. A U.S. Holder generally may elect to amortize that premium from the purchase date to the maturity date of the notes under a constant yield method. Amortizable premium generally may be deducted against interest income on such notes and generally may not be deducted against other income. A U.S. Holder’s basis in a note will be reduced by any premium amortization deductions. An election to amortize premium on a constant yield method, once made, generally applies to all debt obligations held or subsequently acquired by a U.S. Holder during the taxable

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year of the election and thereafter, and may not be revoked without IRS consent. The notes in the second 6 7 / 8 % Senior Notes issuance were issued with amortizable bond premium.

The market discount and bond premium rules are complicated, and U.S. Holders are urged to consult their own tax advisors regarding the tax consequences of owning and disposing of notes with market discount or bond premium, including the availability of certain elections.

Sale, Exchange or Retirement of a Note

A U.S. Holder generally will recognize gain or loss upon the sale, exchange (other than in a tax-free transaction), redemption, retirement or other taxable disposition of a note, equal to the difference, if any, between:

· the amount of cash and the fair market value of any property received (less any portion allocable to the payment of accrued interest not previously included in income, which amount will be taxable as ordinary interest income); and

· the U.S. Holder’s adjusted tax basis in the note.

Any such gain or loss generally will be capital gain or loss (except as described under “—Market Discount and Bond Premium” above) and generally will be long-term capital gain or loss if the note has been held or deemed held for more than one year at the time of the disposition. Long-term capital gains of noncorporate U.S. Holders, including individuals, may be taxed at lower rates than items of ordinary income. The ability of a U.S. Holder to offset capital losses against ordinary income is limited. Any capital gain or loss recognized by a U.S. Holder on the sale or other disposition of a note generally will be treated as income from sources within the United States or loss allocable to income from sources within the United States. U.S. Holders should consult their own tax advisors regarding the source of gain attributable to market discount. Any loss attributable to accrued but unpaid interest will be allocated against income of the same category and source as the interest on the notes unless certain exceptions apply. A U.S. Holder’s adjusted tax basis in a note will generally equal the U.S. Holder’s cost therefor, increased by the amount of market discount, if any, previously included in income in respect of the note and decreased (but not below zero) by the amount of principal payments received by such U.S. Holder in respect of the note, any amounts treated as a return of pre-issuance accrued interest and the amount of amortized bond premium, if any, previously taken into account with respect to the note.

Information Reporting and Backup Withholding

A U.S. Holder of the notes may be subject to “backup withholding” with respect to certain “reportable payments”, including interest payments and, under certain circumstances, principal payments on the notes or upon the receipt of proceeds upon the sale or other disposition of such notes. These backup withholding rules apply if the U.S. Holder, among other things:

· fails to furnish a social security number or other taxpayer identification number (“TIN”) certified under penalty of perjury within a reasonable time after the request for the TIN;

· furnishes an incorrect TIN;

· is notified by the IRS that it has failed to report properly interest or dividends; or

· under certain circumstances, fails to provide a certified statement, signed under penalties of perjury, that the TIN furnished is the correct number and that such holder is not subject to backup withholding.

A U.S. Holder that does not provide us with its correct TIN also may be subject to penalties imposed by the IRS. Any amount withheld from a payment to a U.S. Holder under the backup withholding rules is creditable against the U.S. Holder’s federal income tax liability, provided that the required information is timely furnished to the IRS. Backup

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withholding will not apply, however, with respect to payments made to certain exempt U.S. Holders, including corporations and tax-exempt organizations, provided their exemptions from backup withholding are properly established.

We will report to U.S. Holders and to the IRS the amount of any “reportable payments” for each calendar year and the amount of tax withheld, if any, with respect to these payments.

Canadian Material Federal Income Tax Considerations for Residents of the United States

The following summary fairly describes the main Canadian federal income tax consequences applicable to you if you invested, as initial purchaser or through a subsequent investment, in any of our 6 7 / 8 % Senior Notes due January 15, 2014 or 6 3 / 8 % Senior Notes due December 15, 2015 (which we refer to, collectively, as the “notes”), and you hold such notes as capital property for purposes of the Income Tax Act (Canada), which we refer to as the Act. Generally, a note will be considered to be capital property to a holder provided the holder does not hold the note in the course of carrying on a business and has not acquired the note in one or more transactions considered to be an adventure or concerns in the nature of trade. This summary is based on the Canada-United States Income Tax Convention (1980), as amended, or the Convention, the relevant provisions of the Act and the Regulations thereunder, or the Regulations, as in force on the date hereof, and counsel’s understanding of the administrative practices of the Canada Revenue Agency. It assumes that the specific proposals to amend the Act and the Regulations publicly announced by the Minister of Finance of Canada prior to the date of this annual report are enacted in their present form, but the Act or the Regulations may not be amended as proposed or at all. This summary does not address provincial, territorial or foreign income tax considerations. Changes in the law or administrative practices or future court decisions may affect your tax treatment.

The following commentary is generally applicable to a holder who, at all times for purposes of the Act, deals at arm’s length with us and is neither an insurer who carries on an insurance business in Canada nor an authorized foreign bank and who, at all times for the purposes of the Convention and the Act, is a resident of the United States, is not and is not deemed to be a resident of Canada and does not use or hold, and is not deemed to use or hold the notes in the course of carrying on a business in Canada, who we refer to as a U.S. Holder.

Interest Payments

A U.S. Holder will not be subject to tax (including withholding tax) under the Act on interest, principal or premium on the notes.

Dispositions

Gains realized on the disposition or deemed disposition of notes by a U.S. Holder will not be subject to tax under the Act.

The preceding discussions of federal income tax consequences is for general information only and is not legal or tax advice. Accordingly, you should consult your own tax advisor as to particular tax consequences of purchasing, holding, and disposing of the notes, including the applicability and effect of any state, provincial, territorial, local or foreign tax laws, and of any proposed changes in applicable laws.

F- Dividends and Paying Agents

Not applicable.

G- Statement By Experts

Not applicable.

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H- Documents on Display

We file periodic reports and other information with the SEC. These reports include certain financial and statistical information about us and may be accompanied by exhibits. You may read and copy this information at the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549, or obtain copies of this information by mail from the public reference room at the prescribed rates. You may call the SEC at 1-800-SEC-0330 for further information on the SEC’s Public Reference Room. The SEC also maintains an Internet website that contains reports and other information about issuers like us who file electronically with the SEC. The URL of that website is http://www.sec.gov. Any documents referred to in this annual report may also be inspected at our offices at 612 St. Jacques Street, Montréal, Québec, Canada, H3C 4M8.

I- Subsidiary Information

Not applicable.

From its use of financial instruments, Videotron is exposed to credit risk, liquidity risk, and market risks relating to foreign exchange fluctuations, interest rate fluctuations and equity prices. In order to manage its foreign exchange and interest rate risks, Videotron and its subsidiaries use derivative financial instruments (i) to achieve a targeted balance of fixed and variable rate debts and (ii) to set in Canadian dollars all future payments on debts denominated in U.S. dollars (interest and principal) and certain purchases of inventory and other capital expenditures denominated in a foreign currency. Videotron does not intend to settle its financial derivative instruments prior to their maturity as none of these instruments are held or issued for speculative purposes. Videotron designates its derivative financial instruments either as fair value hedges or cash flow hedges when they quality for hedge accounting.

These instruments are used solely to manage the financial risks associated with our obligations and are not used for trading or speculation purposes.

Foreign Currency Risk

Most of our revenues and expenses, other than interest and principal payments on U.S. dollar-denominated debt, purchases of set-top boxes and cable modems and certain capital expenditures, including those related to the buildout of our wireless network, are received or denominated in Canadian dollars. A large portion of the interest, principal and premium, if any, payable on our debt must be paid in U.S. dollars. We have entered into transactions to hedge the foreign currency risk exposure on 100% of our U.S. dollar-denominated debt obligations outstanding as of December 31, 2008 and to hedge our exposure on certain purchases of set-top boxes, cable modems and capital expenditures.

Foreign exchange forward contracts:

Currencies (sold/bought)	Maturing	Weighted Average Exchange Rate	Notional Amount (in millions of dollars)

$ / US$	Less than 1 year	1.0865	$	75.5

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Interest Rate Risk

Our senior secured credit facilities bear interest at floating rates based on the following reference rates: (i) bankers’ acceptances rate (BA), (ii) London Interbank Offered Rate (LIBOR) and (iii) bank prime rate (Prime). Our 9 1 / 8 % Senior Notes due 2018, our 6 3 / 8 % Senior Notes due 2015 and our 6 7 / 8 % Senior Notes due 2014 bear interest at fixed rates. We have entered into various interest rate and cross-currency interest rate swap agreements in order to manage our cash flow and fair value risk exposure to changes in interest rates.

Cross-Currency Interest Rate Swaps

	Period covered	Notional amount (in millions of dollars)		Annual effective interest rateusing hedged rate	Annual nominal interest rate of debt		CDN dollar exchange rate on interest and capital payments per one U.S. dollar

Senior Notes	2004 to 2014	US$	190.0	Bankers’ acceptance 3 months plus 2.80%	6.875	%	1.2000

Senior Notes	2004 to 2014	US$	125.0	7.45%	6.875	%	1.1950
Senior Notes	2003 to 2014	US$	200.0	Bankers’ acceptance 3 months plus 2.73%	6.875	%	1.3425

Senior Notes	2003 to 2014	US$	135.0	7.66%	6.875	%	1.3425
Senior Notes	2005 to 2015	US$	175.0	5.98%	6.375	%	1.1781
Senior Notes	2008 to 2018	US$	455.0	9.65 %	9.125	%	1.0210

Credit Risk

Credit risk is the risk of financial loss to Videotron if a customer or counterparty to a financial asset fails to meet its contractual obligations.

From the use of derivative financial instruments, Videotron is exposed to the risk of non-performance by a third party. When Videotron enters into derivative contracts, the counterparties (either foreign or Canadian) must have credit ratings at least in accordance with Videotron’s credit risk management policy and are subject to concentration limits. Given the high minimum credit ratings required under Videotron’s policy, Videotron does not foresee any failure by counterparties to meet their obligations.

Fair Value of Financial Instruments

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The carrying values and fair value of long-term debt and derivative financial instruments as of December 31, 2008 and 2007 are as follows:

	December 31, 2008						December 31, 2007
	Carrying value			Fair value			Carrying value			Fair value

Long-term debt (1)	$	(1,766,668	)	$	(1,577,000	)	$	(973,355	)	$	(938,158	)
Cross-currency interest rate swaps	69,486			69,486			(241,320		)	(241,320		)
Foreign exchange forward contracts	9,013			9,013			(4,236		)	(4,236		)

(1) The carrying value of long-term debt excludes adjustments to record changes in fair value of long-term debt related to hedges interest risk, the embedded derivatives and the financing fees.

The fair value of long-term debt is estimated based on discounted cash flows using year-end market yields or market value of similar instruments with the same maturity, or quoted market prices when available. The majority of derivative financial instruments (e.g. cross currency interest rate swaps) are traded over the counter and, as such, there are no quoted prices. The fair value of derivative financial instruments is therefore estimated using valuation models that project future cash flows and discount the future amounts to a present value using the contractual terms of the derivative instrument and factors observable in external markets, such as period-end swap rates and foreign exchange rates. An adjustment is also included to reflect non-performance risk, impacted by the financial and economic environment prevailing at the date of the valuation, in the recognized measure of fair value of the derivative instruments by applying a credit default premium to a net exposure by the counterparty or by Videotron. The fair value of early settlement options recognized as embedded derivatives is determined by option pricing models using market inputs and assumptions, including volatility and discount factors.

Material Limitations

Fair value estimates are made at a specific point in time and are based on relevant market information about the financial instruments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Principal Repayments

As at December 31, 2008, the aggregate amount of minimum principal payments on long-term debt required in each of the next five years and thereafter based on borrowing levels as at that date, are as follows:

Year ending December 31,	(in thousands of dollars)
2009	$	—
2010	$	—
2011	$	—
2012	$	207.7
2013	$	—
2014 and thereafter	$	1,559.0

Not applicable.

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None.

Material Modifications to the Rights Of Security Holders

There have been no material modifications to the rights of security holders.

Use of Proceeds

Not applicable.

As at the end of the period covered by this report, Videotron’s President and Chief Executive Officer and Videotron’s Vice President, Finance and Chief Financial Officer, together with members of Videotron’s senior management, have carried out an evaluation of the effectiveness of Videotron’s disclosure controls and procedures. These are defined (in Rule 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934, as amended) as controls and procedures designed to ensure that information required to be disclosed in reports filed under the Exchange Act is recorded, processed, summarized and reported within specified time periods. As of the date of the evaluation, Videotron’s President and Chief Executive Officer and Videotron’s Vice President, Finance and Chief Financial Officer, concluded that Videotron’s disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that Videotron files or submits under the Exchange Act is accumulated and communicated to management, including the company’s principal executive and principal financial officer, to allow timely decisions regarding disclosure .

Videotron’s management is responsible for establishing and maintaining adequate internal control over financial reporting of the company (as defined by Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934). Videotron’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Videotron; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of Videotron are being made only in accordance with authorizations of Videotron’s management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of Videotron’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Videotron’s management conducted an evaluation of the effectiveness of internal control over financial reporting based on the framework in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that Videotron’s internal control over financial reporting was effective as of December 31, 2008.

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Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 and related temporary SEC rules, this annual report does not include an attestation report of Videotron’s registered public accounting firm regarding our internal control over financial reporting. Our management’s report regarding the effectiveness of our internal control over financial reporting was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this annual report.

There have been no changes in Videotron’s internal control over financial reporting (as defined in Rule 13a-15 or 15d-15 under the Exchange Act) that occurred during the period covered by this annual report that have materially affected, or are reasonably likely to materially affect, Videotron’s internal control over financial reporting.

Our Board of Directors has determined that Mr. La Couture is an “audit committee financial expert” (as defined in Item 16A of Form 20-F) serving on our Audit Committee. Our Board of Directors has determined that Mr. La Couture is an “independent” director, as defined under SEC rules.

We have a code of ethics (as defined in Item 16B of Form 20-F) that applies to all directors, officers and employees of Videotron, including our Chief Executive Officer, Chief Financial Officer, principal accounting officer, controller and persons performing similar functions. In 2008 we adopted a restated Code of Ethics which effects a general update of the Code of Ethics that we originally adopted in 2003, as well as a new section specifically setting forth our commitment to respect for the environment and compliance with environmental laws and regulations. We have filed a copy of our new Code of Ethics as an exhibit to this annual report on Form 20-F.

Ernst & Young LLP has served as our independent public accountant for the fiscal year ended December 31, 2008. Prior to this year, KPMG LLP served as our independent public accountant, including for the fiscal years ended December 31, 2007 and December 31, 2006. The audited financial statements for each of the fiscal years in the three-year period ended December 31, 2008 are included in this annual report on Form 20-F.

The Audit Committee establishes the independent auditors’ compensation. In November 2008, the Audit Committee reviewed its policy relating to the pre-approval of services to be rendered by its independent auditors. The Audit Committee pre-approved all audit services, determined which non-audit services the independent auditors are prohibited from providing, and authorized permitted non-audit services to be performed by the independent auditors to the extent those services are permitted by the Sarbanes-Oxley Act and Canadian law. For each of the years ended December 31, 2007 and 2008, none of the non-audit services described below were approved by the Audit Committee of our Board of Directors pursuant to the “ de minimis exception” to the pre-approval requirement for non-audit services. The following table presents the aggregate fees billed for professional services and other services rendered by our independent auditor, Ernst & Young LLP, for the year ended December 31, 2008, and the aggregate fees billed for professional services and other services rendered by our former independent auditor, KPMG LLP, for the year ended December 31, 2007 and for a portion of the year ended December 31, 2008.

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	2008(1)		2008(2)		2007

Audit Fees(3)	$	477,941	$	67,200	$	590,300
Audit-related Fees(4)	19,048		200,452		56,600
All Other Fees(5)	—		3,300		327,400
Total	$	496,989	$	270,952	$	974,300

(1) Fees of Ernst & Young LLP.

(2) Fees of KPMG LLP.

(3) Audit Fees consist of fees approved for the annual audit of the Company’s consolidated financial statements and quarterly reviews of interim financial statements of the Company with the SEC, including required assistance or services that only the external auditor reasonably can provide and accounting consultations on specific issues.

(4) Audit-Related Fees include fees for the audits of our employee pension plans, the review of one subsidiary’s financial statements and various reports to statutory authorities and fees related to the Offering Memorandum issued in April 2008.

(5) All Other Fees include fees billed for assistance with respect to internal controls over financial reporting and disclosure controls and procedures and US tax compliance.

Not applicable.

Not applicable.

On June 9, 2008, Videotron announced its decision to appoint Ernst & Young LLP as its auditors, and the dismissal of KPMG LLP, effective as of the 2008 financial year. Ernst & Young LLP has audited Videotron’s financial statements for the year ended December 31, 2008. The decision to change auditors was approved by the Audit Committee of the Board of Directors of Videotron on May 5, 2008. This change in auditors was effected simultaneously with a corresponding change in auditors at Quebecor Media and at Quebecor Inc.

KPMG LLP’s reports on the financial statements of Videotron for the fiscal years ended December 31, 2007 and 2006 did not contain any adverse opinion or disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope, or accounting principles, except that KPMG’s report for the fiscal year ended December 31, 2007 contained the following explanatory paragraphs:

“Also, as discussed in note 1 b) to the consolidated financial statements, effective January 1, 2007 the Company adopted the Canadian Institute of Chartered Accountants’ new accounting standards on (i) Comprehensive income; (ii) Financial instruments and (iii) Hedges.

Canadian generally accepted accounting principles vary in certain significant respects from US generally accepted accounting principles (“US GAAP”). Information relating to the nature and effect of such differences is presented in note 20 to the consolidated financial statements. Also, as discussed in note 20 to the consolidated financial statements, in 2007 the Company changed in its US GAAP reconciliation its method of accounting for uncertainty in income taxes.”

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and except that KPMG LLP’s report for the fiscal year ended December 31, 2006 contained the following explanatory paragraph:

“Canadian generally accepted accounting principles vary in certain significant respects from accounting principles generally accepted in the United States of America. Information relating to the nature and effect of such differences is presented in note 24 to the financial statements. Also, as discussed in note 24 to the consolidated financial statements, in 2006 the Company changed in its US GAAP reconciliation (i) its method of accounting for share-based payment; and (ii) its method of accounting for pensions and other postretirement benefits plans. As described in note 24, the Company has restated its US GAAP reconciliation from that previously issued.”

For Videotron’s fiscal years ended December 31, 2007 and 2006 and any subsequent interim period through June 9, 2008, there were no disagreements with KPMG LLP on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure which disagreements, if not resolved to the satisfaction of KPMG LLP, would have caused it to make reference to the subject matter of such disagreements in connection with their reports on the financial statements for such years.

During Videotron’s two most recent fiscal years ended December 31, 2007 and 2006 and any subsequent interim period prior to June 9, 2008, neither Videotron nor anyone acting on its behalf, consulted with Ernst & Young LLP regarding either (a) the application of accounting principles to a specified transaction, either completed or proposed; or the type of audit opinion that would have been rendered on Videotron’s consolidated financial statements and either a written report was provided to Videotron or oral advice was provided that Ernst & Young LLP concluded was an important factor considered by Videotron in reaching a decision as to the accounting, auditing or financial reporting issue, or (b) any matter that was either the subject of a disagreement (as that term is used in Item 16F (a)(1)(iv) of Form 20-F and the related instructions to Item 16F) with the former auditors or a reportable event (as described in Item 16F (a)(1)(v) of Form 20-F).

On February 23, 2009, Videotron provided KPMG LLP and Ernst & Young LLP with a copy of the foregoing disclosures. Videotron requested that KPMG LLP furnish it with a letter addressed to the Securities and Exchange Commission stating whether it agrees with the above statements, and if not, stating the respects in which it does not agree. Videotron has received the requested letter from KPMG LLP, and a copy of KPMG LLP’s letter is filed as Exhibit 99.1 to this annual report. Videotron requested that Ernst & Young LLP review the foregoing disclosures and offered Ernst & Young LLP the opportunity to furnish Videotron with a letter addressed to the Securities and Exchange Commission containing any new information, clarification of Videotron’s expression of its views or the respects in which it does not agree with the statements by Videotron in response to this Item 16F. Ernst & Young LLP had no disagreement with the disclosures and consequently declined the opportunity to furnish Videotron with such a letter.

Not applicable.

Our consolidated balance sheets as at December 31, 2008 and 2007 and our consolidated statements of income, shareholder’s equity, comprehensive income and cash flows for the years ended December 31, 2008, 2007 and 2006, including the notes thereto and together with the auditors’ reports thereon, are included beginning on page F-1 of this annual report.

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Not applicable.

A- EXHIBITS

The following documents are filed as exhibits to this Form 20-F:

1.1		Articles of Amalgamation of Videotron Ltd. as of July 1, 2006 (translation) (incorporated by reference to Exhibit 1.1 to Videotron Ltd.’s Annual Report on Form 20-F for the fiscal year ended December 31, 2006, filed on March 30, 2007).

1.2		Certificate and Articles of Amendment of Videotron as of June 30, 2008.

1.3		Certificate and Articles of Amendment of Videotron as of December 12, 2008.

1.4		By-laws of Videotron Ltd. as of July 1, 2006 (incorporated by reference to Exhibit 1.2 to Videotron Ltd.’s Annual Report on Form 20-F for the fiscal year ended December 31, 2006, filed on March 30, 2007).

1.5		Certificate and Articles of Amalgamation of Le SuperClub Vidéotron ltée as of December 28, 2008 (translation).

1.6		By-laws of Le SuperClub Vidéotron ltée (incorporated by reference to Exhibit 3.8 to Videotron Ltd.’s Amendment No. 1 to the Registration Statement on Form F-4 dated January 8, 2004, Registration Statement No. 333-110697).

1.7		Articles of Amalgamation of CF Cable TV Inc. (translation) (incorporated by reference to Exhibit 1.13 to Videotron Ltd.’s Annual Report on Form 20-F for the fiscal year ended December 31, 2005, dated March 21 , 2006).

1.8		By-laws of CF Cable TV Inc. (incorporated by reference to Exhibit 1.14 to Videotron Ltd.’s Annual Report on Form 20-F for the fiscal year ended December 31, 2005, dated March 21 , 2006).

1.9		Certificate of Incorporation of Videotron US Inc. as of September 20, 2007.

1.10		Amended and Restated Certificate of Incorporation of Videotron US Inc. as of October 1, 2008.

1.11		By-laws of Videotron US Inc.

1.12		Articles of Incorporation of 9193-2962 Québec inc. as of February 28, 2008 (translation).

1.13		By-laws of 9193-2962 Québec inc. (translation).

2.1		Form of 6 7 / 8 % Senior Notes due January 15, 2014 of Videotron Ltd. (included as Exhibit A to Exhibit 2.3 below).

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2.2		Form of Notation of Guarantee by the subsidiary guarantors of the 6 7 / 8 % Senior Notes due January 15, 2014 of Videotron Ltd. (included as Exhibit E to Exhibit 2.3 below).

2.3		Indenture, dated as of October 8, 2003, by and among Videotron Ltd., the subsidiary guarantors signatory thereto and Wells Fargo Bank Minnesota, N.A. (now named Wells Fargo Bank, National Association), as trustee (incorporated by reference to Exhibit 4.3 to Videotron Ltd.’s Registration Statement on Form F-4 dated November 24, 2003, Registration Statement No. 333-110697).

2.4		Supplemental Indenture, dated as of July 12, 2004, by and among Videotron Ltd., SuperClub Vidéotron Canada inc., Les Propriétés SuperClub inc. and Wells Fargo Bank, National Association, as trustee, to the Indenture dated as of October 8, 2003 (incorporated by reference to Exhibit 4.4 to Videotron Ltd.’s Registration Statement on Form F-4 dated December 6, 2004, Registration Statement No. 333-121032).

2.5		Supplemental Indenture, dated as of April 15, 2008, by and among Videotron Ltd., Videotron US Inc., as guarantor, and Wells Fargo Bank, National Association, as trustee, to the Indenture dated as of October 8, 2003.

2.6		Supplemental Indenture, dated as of September 23, 2008, by and among Videotron Ltd., 9193-2962 Québec inc., as guarantor, and Wells Fargo Bank, National Association, as trustee, to the Indenture dated as of October 8, 2003.

2.7		Form of 6 3 / 8 % Senior Notes due December 15, 2015 of Vidéotron Ltd. (included as Exhibit A to Exhibit 2.9 below).

2.8		Form of Notation of Guarantee by the subsidiary guarantors of the 6 3 / 8 % Senior Notes due December 15, 2015 of Vidéotron ltée (included as Exhibit E to Exhibit 2.9 below).

2.9		Indenture, dated as of September 16, 2005, by and among Videotron ltée, the subsidiary guarantors signatory thereto and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.3 to Videotron Ltd.’s Registration Statement on Form F-4 dated October 14, 2005, Registration Statement No. 333-128998).

2.10		Supplemental Indenture, dated as of April 15, 2008, by and among Videotron Ltd., Videotron US Inc., as guarantor, and Wells Fargo Bank, National Association, as trustee, to the Indenture dated as of September 16, 2005.

2.11		Supplemental Indenture, dated as of September 23, 2008, by and among Videotron Ltd., 9193-2962 Québec inc., as guarantor, and Wells Fargo Bank, National Association, as trustee, to the Indenture dated as of September 16, 2005.

2.12		Form of 9 1 / 8 % Senior Notes due April 15, 2018 of Vidéotron Ltd. (included as Exhibit A to Exhibit 2.14 below).

2.13		Form of Notation of Guarantee of the subsidiary guarantors of the 9 1 / 8 % Senior Notes due April 15, 2018 of Vidéotron ltée (included as Exhibit E to Exhibit 2.14 below).

2.14		Indenture, dated as of April 15, 2008, by and among Videotron Ltd., the subsidiary guarantors signatory thereto and Wells Fargo Bank, National Association, as trustee.

2.15		Supplemental Indenture, dated as of September 23, 2008, by and among Videotron Ltd., 9193-2962 Québec inc., as guarantor, and Wells Fargo Bank, National Association, as trustee, to the Indenture dated as of April 15, 2008.

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4.1		Form of Amended and Restated Credit Agreement (the “Credit Agreement”) entered into as of November 28, 2000, (as amended by a First Amending Agreement dated as of January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated December 12, 2001 and accepted by the Lenders as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004, an Eighth Amending Agreement dated as of March 6, 2008 and a Ninth Amending Agreement dated as of April 7, 2008) entered into as of November 28, 2000, as amended as of April 7, 2008, by and among Videotron Ltd., Royal Bank of Canada, as administrative agent, and the financial institutions signatory thereto.

4.2		Ninth Amending Agreement, dated as of April 7, 2008, to the Credit Agreement, dated as of November 28, 2000, as amended by the First Amending Agreement, dated as of January 5, 2001, a Second Amending Agreement, dated as of June 29, 2001, a Third Amending Agreement, dated as of December 12, 2001, a Fourth Amending Agreement, dated as of December 23, 2002, a Fifth Amending Agreement, dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004 and an Eighth Amending Agreement dated as of March 6, 2008, among Videotron Ltd., Royal Bank of Canada, as administrative agent, and the financial institutions signatory thereto and acknowledged by Le SuperClub-Vidéotron ltée, Groupe de Divertissement SuperClub inc., CF Cable TV Inc., Les Propriétés SuperClub inc. and SuperClub Vidéotron Canada inc., as guarantors, and by Quebecor Media Inc.

4.3		Eighth Amending Agreement, dated as of March 6, 2008, to the Credit Agreement, dated as of November 28, 2000, as amended by the First Amending Agreement, dated as of January 5, 2001, a Second Amending Agreement, dated as of June 29, 2001, a Third Amending Agreement, dated as of December 12, 2001, a Fourth Amending Agreement, dated as of December 23, 2002, a Fifth Amending Agreement, dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003 and a Seventh Amending Agreement, dated as of November 19, 2004 among Videotron Ltd., Royal Bank of Canada, as administrative agent, and the financial institutions signatory thereto and acknowledged by Le SuperClub-Vidéotron ltée, Groupe de Divertissement SuperClub inc., CF Cable TV Inc., Les Propriétés SuperClub inc. and SuperClub Vidéotron Canada inc., as guarantors, and by Quebecor Media Inc.

4.4		Seventh Amending Agreement, dated as of November 19, 2004, to the Credit Agreement, dated as of November 28, 2000, as amended by the First Amending Agreement, dated as of January 5, 2001, a Second Amending Agreement, dated as of June 29, 2001, a Third Amending Agreement, dated as of December 12, 2001, a Fourth Amending Agreement, dated as of December 23, 2002, a Fifth Amending Agreement, dated as of March 24, 2003 and a Sixth Amending Agreement dated as of October 8, 2003 among Videotron Ltd., Royal Bank of Canada, as administrative agent, and the financial institutions signatory thereto and acknowledged by Le SuperClub Vidéotron ltée, Groupe de Divertissement SuperClub inc., Vidéotron (1998) ltée, CF Cable TV Inc. Videotron Regional Ltd., 9139-3256 Québec inc., Videotron TVN inc., Les Propriétés SuperClub inc. and SuperClub Vidéotron Canada inc., as guarantors (the “Guarantors”), and by Quebecor Media Inc. (incorporated by reference to Exhibit 10.2 to Videotron Ltd.’s Registration Statement on Form F-4 dated December 6, 2004, Registration Statement No. 333-121032).

4.5		Form of Guarantee of the Guarantors of the Credit Agreement (incorporated by reference to Schedule D of Exhibit 10.5 to Quebecor Media Inc.’s Registration Statement on Form F-4 dated September 5, 2001, Registration Statement No. 333-13792).

4.6		Form of Share Pledge of the shares of Videotron Ltd. and the Guarantors of the Credit Agreement (incorporated by reference to Schedule E of Exhibit 10.5 to Quebecor Media Inc.’s Registration Statement on Form F-4 dated September 5, 2001, Registration Statement No. 333-13792).

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4.7		Management Services Agreement, effective as of January 1, 2002, between Quebecor Media Inc. and Videotron Ltd. (incorporated by reference to Exhibit 10.5 to Videotron Ltd.’s Registration Statement on Form F-4 dated November 24, 2003, Registration Statement No. 333-110697).

4.8		Lease Agreement, dated November 24, 1993, between Le Groupe Vidéotron ltée and National Bank of Canada for the property located at 300 Viger Street East, Montréal, Province of Québec, Canada, together with a summary thereof in the English language (incorporated by reference to Exhibit 10.3 to Quebecor Media Inc.’s Registration Statement on Form F-4 dated September 5, 2001, Registration Statement No. 333-13792).

4.9		Form of Share Pledge of the shares of Vidéotron ltée and the Guarantors of the Credit Agreement (incorporated by reference to Schedule E of Exhibit 10.5 to Quebecor Media Inc.’s Registration Statement on Form F-4 dated September 5, 2001, Registration Statement No. 333-13792).

4.10		Subordinated Loan Agreement, dated January 3, 2007, between Quebecor Media Inc. and Videotron Ltd.

4.11		Subordinated Loan Agreement, dated May 31, 2007, between Quebecor Media Inc. and Videotron Ltd.

4.12		Subordinated Loan Agreement, dated May 31, 2007, between Quebecor Media Inc. and CF Cable TV Inc.

4.13		Subordinated Loan Agreement, dated January 4, 2008, between Quebecor Media Inc. and Videotron Ltd.

4.14		Subordinated Loan Agreement, dated January 4, 2008, between Quebecor Media Inc. and CF Cable TV Inc.

7.1		Statement regarding calculation of ratio of earnings to fixed charges.

8.1		Subsidiaries of Videotron Ltd.

11.1		Code of Ethics.

12.1		Certification of Robert Dépatie, President and Chief Executive Officer of Videotron Ltd., pursuant to 15 U.S.C. Section 78(m)(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

12.2		Certification of Marie-Josée Marsan, Vice President, Finance and Chief Financial Officer of Videotron Ltd., pursuant to 15 U.S.C. Section 78(m)(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

13.1		Certification of Robert Dépatie, President and Chief Executive Officer of Videotron Ltd., pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

13.2		Certification of Marie-Josée Marsan, Vice President, Finance and Chief Financial Officer of Videotron Ltd. pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.1		Letter from KPMG LLP

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SIGNATURE

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

VIDEOTRON LTD.

By:
	/s/ Marie-Josée Marsan
	Name:	Marie-Josée Marsan
	Title:	Vice President, Finance and Chief Financial Officer

Dated: March 6, 2009

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Videotron Ltd.
*Annual Consolidated Financial Information as at December 31, 2008 and 2007 and for the Years Ended December 31, 2008, 2007 and 2006*
Report of Independent Registered Public Accounting Firm		F-2
Report of Independent Registered Public Accounting Firm		F-3
Consolidated Statements of Income for the years ended December 31, 2008, 2007 and 2006		F-4
Consolidated Statements of Comprehensive Income for the years ended December 31, 2008, 2007 and 2006		F-5
Consolidated Statements of Shareholder’s Equity (Deficiency in Assets) for the years ended December 31, 2008, 2007 and 2006		F-6
Consolidated Statements of Cash Flows for the years ended December 31, 2008, 2007 and 2006		F-7
Consolidated Balance Sheets as at December 31, 2008 and 2007		F-8
Notes to Consolidated Financial Statements for the years ended December 31, 2008, 2007 and 2006		F-10

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND TO THE SHAREHOLDER OF VIDEOTRON LTD.

We have audited the accompanying consolidated balance sheet of Videotron Ltd. as of December 31, 2008 and the related consolidated statements of income, comprehensive income, shareholder’s equity and cash flows for the year ended December 31, 2008. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit. The financial statements of Videotron Ltd. for the years ended December 31, 2007 and 2006, were audited by other auditors whose report dated February 29, 2008, expressed an unqualified opinion on those statements and included an explanatory paragraph that effective January 1, 2007 the Company adopted the Canadian Institute of Chartered Accountants’ new accounting standards on (i) Comprehensive income; (ii) Financial instruments and (iii) Hedges.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company’s internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Videotron Ltd. as of December 31, 2008, and the consolidated results of their operations and their cash flows for the year ended December 31, 2008, in conformity with Canadian generally accepted accounting principles.

/s/ ERNST & YOUNG LLP(1)
Chartered Accountants
Montreal, Canada
February 11, 2009 except as to note 25(a), which is as of
February 26, 2009

(1) CA auditor permit no. 19483

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND TO THE SHAREHOLDER OF VIDEOTRON LTD.

We have audited the accompanying consolidated balance sheet of Videotron Ltd. and its subsidiaries as of December 31, 2007 and the related consolidated statements of income, comprehensive income, shareholder’s equity and cash flows for each of the years in the two-year period ended December 31, 2007. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Videotron Ltd. and its subsidiaries as of December 31, 2007 and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2007 in conformity with Canadian generally accepted accounting principles. Also, as discussed in note 1 h) to the consolidated financial statements, effective January 1, 2007 the Company adopted the Canadian Institute of Chartered Accountants’ new accounting standards on (i) Comprehensive income; (ii) Financial instruments and (iii) Hedges.

Canadian generally accepted accounting principles vary in certain significant respects from US generally accepted accounting principles (“US GAAP”). Information relating to the nature and effect of such differences is presented in note 24 to the consolidated financial statements. Also, as discussed in note 24 to the consolidated financial statements, in 2007 the Company changed in its US GAAP reconciliation its method of accounting for uncertainty in income taxes.

/s/ KPMG LLP
Chartered Accountants
Montréal, Canada
February 29, 2008

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VIDEOTRON LTD.

CONSOLIDATED STATEMENTS OF INCOME

Years ended December 31, 2008, 2007 and 2006

(in thousands of Canadian dollars)

	2008			2007			2006
Operating revenues:
Cable television	$	809,891		$	735,832		$	677,273
Internet	499,627			422,448			345,075
Telephony	286,063			195,477			107,357
Wireless telephony	31,630			17,717			1,208
Business solution	63,592			70,189			74,352
Video stores	57,015			59,956			55,585
Other	56,388			50,987			48,745
	1,804,206			1,552,606			1,309,595
Direct costs and operating expenses	1,007,050			909,923			796,887
Amortization	214,281			206,083			185,115
Financial expenses (note 2)	90,924			76,147			81,779
Loss (gain) on valuation and translation of financial instruments (note 3)	24,673			(9,095		)	(2,193		)
Impairment of goodwill and other items (note 4)	(1,414		)	5,425			—
Income before income taxes and non-controlling interest	468,692			364,123			248,007
Income taxes (note 6)	73,102			38,258			64,230
	395,590			325,865			183,777
Non-controlling interest	148			173			86
Net income	$	395,442		$	325,692		$	183,691

See accompanying notes to consolidated financial statements.

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VIDEOTRON LTD.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Years ended December 31, 2008, 2007 and 2006

(in thousands of Canadian dollars)

	2008			2007			2006
Net income	$	395,442		$	325,692		$	183,691
Other comprehensive income:
Gain (loss) on valuation of derivative financial instruments	(4,076		)	17,172			—
Income taxes	(15,720		)	(2,028		)	—
	(19,796		)	15,144			—
Comprehensive income	$	375,646		$	340,836		$	183,691

See accompanying notes to consolidated financial statements.

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VIDEOTRON LTD.

CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY

Years ended December 31, 2008, 2007 and 2006

(in thousands of Canadian dollars)

	Share capital			Contributed surplus			Deficit			Accumulated other comprehensive loss (note 18)			Total shareholder’s equity
Balance as at December 31, 2005	$	342,940		$	576,957		$	(843,534	)	$	—		$	76,363
Transfer of tax deductions from a company controlled by the ultimate parent company (note 22)	—			22			—			—			22
Issuance of shares (note 16)	111,536			—			—			—			111,536
Reduction of paid-up capital (note 16)	(108,749		)	—			—			—			(108,749		)
Excess of consideration paid over the carrying value of debt transferred to the parent company (note 13)	—			—			(3,282		)	—			(3,282		)
Net income for the year	—			—			183,691			—			183,691
Dividend	—			—			(10,000		)	—			(10,000		)
Balance as at December 31, 2006, as previously reported	345,727			576,979			(673,125		)	—			249,581
Cumulative effect of changes in accounting policies	—			—			(9,311		)	(22,446		)	(31,757		)
Balance as at January 1, 2007, as restated	345,727			576,979			(682,436		)	(22,446		)	217,824
Reduction of paid-up capital (note 16)	(299,550		)	—			—			—			(299,550		)
Net income for the year	—			—			325,692			—			325,692
Other comprehensive income, net of income taxes	—			—			—			15,144			15,144
Balance as at December 31, 2007	$	46,177		$	576,979		$	(356,744	)	$	(7,302	)	$	259,110
Reduction of paid-up capital (note 16)	(46,176		)	(73,824		)	—			—			(120,000		)
Excess of the carrying value over consideration paid for the purchase of an affiliated company from the parent company (note 11)	—			—			952			—			952
Excess of consideration paid over the carrying value of assets transferred from affiliated companies (note 22)	—			—			(2,054		)	—			(2,054		)
Net income for the year	—			—			395,442			—			395,442
Other comprehensive income, net of income taxes	—			—			—			(19,796		)	(19,796		)
Dividend	—			—			(110,000		)	—			(110,000		)
Balance as at December 31, 2008	$	1		$	503,155		$	(72,404	)	$	(27,098	)	$	403,654

See accompanying notes to consolidated financial statements.

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VIDEOTRON LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Years ended December 31, 2008, 2007 and 2006

(in thousands of Canadian dollars)

	2008			2007			2006
Cash flows related to operating activities:
Net income	$	395,442		$	325,692		$	183,691
Adjustments:
Amortization of fixed assets	212,861			203,902			183,619
Amortization of other assets	28,754			21,435			17,835
Impairment of goodwill (note 4)	—			5,425			—
Loss on disposal of fixed assets	450			3,245			1,416
Loss (gain) on valuation and translation of financial instruments (note 3)	19,677			(10,510		)	(3,305		)
Amortization of financing costs and long-term debt premium or discount (note 2)	1,623			441			432
Future income taxes (note 6)	72,031			38,191			64,669
Non-controlling interest	148			173			86
Other	(1,315		)	1,142			755
	729,671			589,136			449,198
Net change in non-cash balances related to operating activities:
Accounts receivable	(2,217		)	(26,832		)	(22,187		)
Amounts receivable from and payable to affiliated companies	(15,913		)	3,715			3,606
Inventories	(10,477		)	104			(10,225		)
Prepaid expenses	4,490			(7,824		)	(1,363		)
Accounts payable and accrued liabilities	51,399			(1,044		)	19,015
Deferred revenue	12,233			15,298			19,013
Other assets	(36,303		)	(20,973		)	(18,902		)
Other liabilities	(21,349		)	1,343			2,464
	(18,137		)	(36,213		)	(8,579		)
Cash flows provided by operating activities	711,534			552,923			440,619
Cash flows related to investing activities:
Acquisition of fixed assets	(404,759		)	(330,075		)	(302,629		)
Acquisition of shares of a company under common control (note 9)	(60,000		)	(1,995,000		)	—
Acquisition of a company under common control (note 11)	(554,549		)	—			—
Decrease in temporary investments	—			987			39,509
Acquisition of tax deductions from the ultimate parent company (note 22)	(18,378		)	(14,863		)	—
Other	(5,534		)	787			(1,981		)
Cash flows used in investing activities	(1,043,220		)	(2,338,164		)	(265,101		)
Sub-total, balance carried forward	(331,686		)	(1,785,241		)	175,518

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VIDEOTRON LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS, Continued

Years ended December 31, 2008, 2007 and 2006

(in thousands of Canadian dollars)

	2008			2007			2006
Sub-total, balance brought forward	$	(331,686	)	$	(1,785,241	)	$	175,518
Cash flows related to financing activities:
Net change in bank indebtedness	(5,892		)	(8,965		)	18,470
Net borrowings under bank credit facility (note 14)	59,949			98,721			49,000
Issuance of long-term debt, net of financing costs	447,629			—			—
Subordinated loan from parent company (note 9)	60,000			1,995,000			—
Issuance of shares	—			—			111,536
Transfer of Additional Amount payable to parent company	—			—			(111,536		)
Repayment of subordinated loan to parent company	—			—			(150,000		)
Dividends	(110,000		)	—			(10,000		)
Reduction in paid-up capital	(120,000		)	(299,550		)	(108,749		)
Other	—			35			(938		)
Cash flows provided by (used in) financing activities	331,686			1,785,241			(202,217		)
Net change in cash and cash equivalents	—			—			(26,699		)
Cash and cash equivalents at beginning of year	—			—			26,699
Cash and cash equivalents at end of year	$	—		$	—		$	—
Cash interest payments	$	109,298		$	80,143		$	80,514
Cash interest payments to parent company	269,571			159,078			17,951
Cash income tax payments (net of refunds)	274			(206		)	988

See accompanying notes to consolidated financial statements.

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VIDEOTRON LTD.

CONSOLIDATED BALANCE SHEETS

As at December 31

(in thousands of Canadian dollars)

	2008			2007
Assets
Current assets:
Accounts receivable (note 7)	$	164,375		$	161,366
Income taxes	189			220
Amounts receivable from affiliated companies (note 22)	15,611			32,843
Inventories (note 8)	48,296			39,445
Prepaid expenses	11,756			16,316
Future income taxes (note 6)	35,982			31,585
	276,209			281,775
Investments (note 9)	2,055,000			1,995,000
Fixed assets (note 10)	1,612,475			1,408,805
Future income taxes (note 6)	1,038			2,970
Derivative financial instruments (note 21)	124,187			—
Intangible assets (note 11)	567,065			—
Other assets (note 12)	36,080			30,466
Goodwill	433,878			433,759
	$	5,105,932		$	4,152,775
Liabilities and Shareholder’s Equity
Current liabilities:
Bank indebtedness	$	3,613		$	9,505
Accounts payable and accrued charges	343,283			267,432
Amounts payable to affiliated companies (note 22)	19,358			75,260
Deferred revenue	164,779			151,928
Income taxes	1,317			119
	532,350			504,244
Long-term debt (note 14)	1,807,997			950,988
Subordinated loan from parent company (note 9)	2,055,000			1,995,000
Derivative financial instruments (note 21)	45,688			245,556
Future income taxes (note 6)	229,654			166,162
Other liabilities (note 15)	31,589			31,715
	4,702,278			3,893,665
Shareholder’s equity:
Capital stock (note 16)	1			46,177
Contributed surplus	503,155			576,979
Deficit	(72,404		)	(356,744		)
Accumulated other comprehensive loss (note 18)	(27,098		)	(7,302		)
	403,654			259,110
	$	5,105,932		$	4,152,775
Commitments and contingencies (note 19)
Guarantees (note 20)
Subsequent events (note 25)

On behalf of the Board of Directors

Jean La Couture, Director

Michel Lavigne, Director

See accompanying notes to consolidated financial statements.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

Videotron Ltd. (the “Company”) is a wholly owned subsidiary of Quebecor Media Inc. (the parent company) and is a subsidiary of Quebecor Inc. (the ultimate parent company). The Company is a cable service provider in the province of Québec for pay-television services, Internet access and telephony services. The Company also provides business telecommunication services, wireless communication services and operates a chain of video stores.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

The consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles (“GAAP”). The significant differences between generally accepted accounting principles in Canada and in the United States are described in note 24.

(a) Basis of presentation:

These consolidated financial statements include the accounts of the Company and all its subsidiaries. Intercompany transactions and balances are eliminated on consolidation.

Certain comparative figures for the years 2007 and 2006 have been reclassified to conform to the presentation adopted for the year ended December 31, 2008.

(b) Change in accounting policies:

On January 1, 2008, the Company adopted the Canadian Institute of Chartered Accountants (“CICA”) Section 3031, Inventories, which provides more extensive guidance on the recognition and measurement of inventories and related disclosures. The adoption of this new section had no impact on the consolidated financial statements. The new accounting policy is described in note 1(j).

On January 1, 2008, the Company adopted the CICA Handbook Section 1535, Capital Disclosures, Section 3862, Financial Instruments — Disclosures , and Section 3863, Financial Instruments — Presentation . These sections relate to disclosures and presentation of information and did not affect the consolidated financial results. All the disclosure requirements related to these new accounting standards are presented in note 21.

The Company estimates the fair value of its derivative financial instruments using a discounted cash flow valuation technique, since no quoted market prices exist for such instruments. In the second quarter of 2008, the Company made some amendments to the technique used in measuring the fair value of its derivatives in a liability position and in an asset position. These amendments change the way the Company factors counterparty and its own non-performance risk in its valuation technique, considering market developments and recent accounting guidelines. The cumulative impact of these changes as of December 31, 2008, is a decrease of the fair value of these derivatives by $10.8 million and an increase of the comprehensive loss by $10.8 million (before income taxes).

(d) Foreign currency translation:

Foreign currency transactions are translated using the temporal method. Translation gains and losses are included in gain or loss on valuation and translation of financial instruments unless hedge accounting is used.

(e) Use of estimates:

The preparation of consolidated financial statements in accordance with Canadian GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, related amounts of revenues and expenses, and disclosure of contingent assets and liabilities. Significant areas requiring the use of management estimates relate to the determination of pension and post-retirement benefit costs, key economic assumptions used in determining the allowance for doubtful accounts, the provision for obsolescence, legal contingencies, the useful life of assets for amortization and evaluation of expected future cash flows to be generated by those assets, the determination of implied fair value of goodwill and fair value of assets and liabilities for business purchase price allocations purposes and goodwill impairment tests purposes, provisions for income taxes and determination of future income tax assets and liabilities, and the determination of fair value of financial instruments and derivative instruments. Actual results could differ from these estimates.

(f) Impairment of long-lived assets:

The Company reviews long-lived assets with definite useful lives whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. An impairment loss is recognized when the carrying amount of an asset or a

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

(f) Impairment of long-lived assets (Continued):

group of assets held for use exceeds the sum of the undiscounted cash flows expected from its use and eventual disposition. Measurement of an impairment loss is based on the amount by which the carrying amount of a group of assets exceeds its fair value. Fair value is determined using quoted market prices, when available, or using accepted valuation techniques such as the discounted future cash flows method.

(g) Revenue recognition:

The Company recognizes its operating revenues when the following criteria are met:

· persuasive evidence of an arrangement exists;

· delivery has occurred or services have been rendered;

· the seller’s price to the buyer is fixed or determinable; and

· the collection of the sale is reasonably assured.

The portion of revenue that is unearned is recorded under “Deferred revenue” when customers are invoiced.

Revenue recognition policies for each of the Company’s main product lines are as follows:

Cable and wireless services are provided under arrangements with multiple deliverables, for which there are two separate accounting units: one for subscriber services (operating services and connecting fees) and the other, for equipment sales to subscribers, including activation fees related to wireless telephones. Components of multiple deliverable arrangements are separately accounted for provided the delivered elements have stand-alone value to the customers and the fair value of any undelivered elements can be objectively and reliably determined.

Cable connection fee revenues are deferred and recognized as revenues over the estimated average period that subscribers are expected to remain connected to the network. The incremental and direct costs related to cable connection fees, in an amount not exceeding the revenue, are deferred and recognized as an operating expense over the same period. The excess of these costs over the related revenues is recognized immediately. Operating revenues from cable and other services, such as Internet access, IP telephony and wireless telephone, are recognized when services are rendered. Revenue from equipment sales to subscribers and their costs are recognized in income when the equipment is delivered and in the case of wireless telephones, revenues from equipment sales are recognized in income when the telephone is delivered and activated. Revenues from video rentals are recorded as revenue when services are provided. Promotional offers related to subscriber services are accounted for as a reduction in the related service revenue over the period of performance of the service contract. Promotional offers related to equipment sales, including wireless telephones, are accounted for as a reduction in the related equipment sales when the equipment is delivered. Operating revenues related to service contracts are recognized in income over the life of the specific contracts on a straight-line basis over the period in which the services are provided.

(h) Financial instruments:

Classification, recognition and measurement:

Effective January 1, 2007, financial instruments must be classified as held-for-trading, available-for-sale, held-to-maturity, loans and receivables, or other financial liabilities and measurement in subsequent periods depends on their classification. The Company has classified its cash and cash equivalents, its temporary investments and its bank indebtedness as held-for-trading. Amounts receivable from affiliated companies, loans and other long-term receivables included in other assets have been classified as loans and receivables. All investments were classified as available-for-sale.

All of the Company’s financial liabilities, except for bank indebtedness, were classified as other liabilities.

Financial instruments held-for-trading are measured at fair value with changes recognized in income as a loss or gain on valuation and translation of financial instruments. Available-for-sale financial assets are measured at fair value or at cost in the case of equity instruments that do not have a quoted market price in an active market and changes in fair value recorded in comprehensive income. Financial assets classified as loans and receivables and other financial liabilities are measured at amortized cost, using the effective interest method of amortization.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

(h) Financial instruments (Continued):

Financing fees related to long-term financing are capitalized in reduction of long-term debt and amortized using the effective interest rate method.

Derivative financial instruments and hedge accounting:

The Company uses various derivative financial instruments to manage its exposure to fluctuations in foreign currency exchange rates and interest rates. The Company does not hold or use any derivative instruments for trading purposes. Under hedge accounting, the Company documents all hedging relationships between derivative financial instruments and hedged items, as well as its strategy for using hedges and its risk-management objective. The Company also designates its derivative financial instruments as either fair value hedges or cash flow hedges. The Company assesses the effectiveness of derivative financial instruments when the hedge is put in place and on an ongoing basis.

The Company enters into the following types of derivative financial instruments:

· The Company uses foreign exchange forward contracts to hedge the foreign currency rate exposure on anticipated equipment or inventory purchases in a foreign currency. These foreign exchange forward contracts are designated as cash flow hedges.

· The Company uses cross-currency interest rate swaps to hedge (i) the foreign currency rate exposure on interest and principal payments on certain foreign currency denominated debt and/or (ii) the fair value exposure on certain debt resulting from changes in interest rates. The cross-currency interest rate swaps that set all future interest and principal payments on U.S. denominated debt in fixed Canadian dollars are designated as cash flow hedges. The Company’s cross-currency interest rate swaps that set all future interest and principal payments on U.S. denominated debt in fixed Canadian dollars, in addition to converting the interest rate from a fixed rate to a floating rate, or converting a floating rate index to another floating rate index, are designated as fair value hedges.

Effective January 1, 2007, under hedge accounting, the Company applies the following accounting policies:

· For derivative financial instruments designated as fair value hedges, changes in the fair value of the hedging derivative recorded in income are substantially offset by changes in the fair value of the hedged item to the extent that the hedging relationship is effective. When a fair value hedge is discontinued, the carrying value of the hedged item is no longer adjusted and the cumulative fair value adjustments to the carrying value of the hedged item are amortized to income over the remaining term of the original hedging relationship.

· For derivative financial instruments designated as cash flow hedges, the effective portion of a hedge is reported in other comprehensive income until it is recognized in income during the same period in which the hedged item affects income, while the ineffective portion is immediately recognized in the consolidated statement of income. When a cash flow hedge is discontinued, the amounts previously recognized in accumulated other comprehensive income are reclassified to income when the variability in the cash flows of the hedged item affects income.

Prior to 2007, under hedge accounting, the Company recorded its hedge relationships as follows:

· For purchases of equipment or inventory hedged by foreign exchange forward contracts, foreign exchange translation gains and losses were recognized as an adjustment to the cost of the hedged item, when the transaction was recorded.

· For long-term debt in foreign currency hedged by foreign exchange forward contracts and cross-currency interest rate swaps, foreign exchange translation gains and losses on long-term debt were offset by corresponding gains and losses on a derivative instrument recorded under other assets or other liabilities. The fees on forward foreign exchange contracts and on cross-currency swaps were recognized as an adjustment to interest expense over the term of the agreement.

· In addition, realized and unrealized gains or losses associated with derivative financial instruments that were terminated or ceased to be effective prior to maturity, for hedge accounting purposes, were deferred under other current or non-current assets or liabilities on the consolidated balance sheets and recognized in income in the period in which the underlying hedged transaction was recognized. In the event a designated hedged item was sold, extinguished or matured prior to the termination of the related derivative instrument, any realized or unrealized gain or loss on such derivative financial instrument, was recognized in income.

Any change in the fair value of these derivative financial instruments recorded in income is included in the loss or gain on valuation and translation of financial instruments. Interest expense on hedged long-term debt is reported at the hedged interest and foreign currency rates.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

(h) Financial instruments (Continued):

Derivative financial instruments and hedge accounting: (Continued):

Derivative financial instruments that are ineffective or that are not designated as hedges, including derivatives that are embedded in financial or non-financial contracts that are not closely related to the host contracts, are reported on a market-to-market basis in the consolidated balance sheets. Any change in the fair value of these derivative financial instruments is recorded in the consolidated statements of income as a loss or gain on valuation and translation of financial instruments.

(i) Cash and cash equivalents:

Cash and cash equivalents include highly liquid investments purchased three months or less from maturity and are recorded at fair value.

(j) Inventories:

Inventories are valued at the lower of cost, determined by the weighted average cost method, and net realizable value. Net realizable value represents the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

(k) Income taxes:

The Company uses the liability method of accounting for income taxes. Under this method, future income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the carrying amounts of existing assets and liabilities in the consolidated financial statements and their respective tax bases. Future income tax assets and liabilities are measured using substantively enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on future income tax assets and liabilities is recognized in income in the period that includes the substantive enactment date. A valuation allowance is established, if necessary, to reduce any future income tax asset to an amount that is more likely than not to be realized.

In the course of the Company’s operations, there are a number of uncertain tax positions due to the complexity of certain transactions and due to the fact that related tax interpretations and legislation are continually changing. When a tax position is uncertain, the Company recognizes an income tax benefit or reduces an income tax liability only when it is probable that the tax benefit will be realized in the future or that the income tax liability is no longer probable.

(l) Fixed assets:

Fixed assets are stated at cost, net of government grants and investment tax credits. Cost represents acquisition or construction costs, including preparation, installation and testing costs and interest incurred with respect to the fixed assets until they are ready for commercial production. In the case of projects to construct and connect receiving and distribution networks of cable and wireless, cost includes equipment, direct labour and direct overhead costs. Projects under development may also include advances for equipment under construction. Expenditures for additions, improvements and replacements are capitalized, whereas maintenance and repair expenditures are expensed as incurred.

Amortization is calculated using the following depreciation bases and periods or rates:

Asset	Basis	Period/rate
Buildings	Declining balance	5%
Furniture and equipment	Declining balance	20% to 30%
	and straight-line	3 years to 7 years
Receiving and distribution networks	Straight-line	3 years to 20 years
Terminals and operating system	Straight-line	5 years and 10 years
Coding and transmission material	Declining balance	20%

Leasehold improvements are amortized over the lower of the term of the lease and economic life.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

The Company does not record an asset retirement obligation in connection with its cable distribution networks. The Company expects to renew all of its agreements with utility companies to access their support structures in the future, making the retirement date undeterminable for these assets.

(m) Goodwill and other intangible assets:

Goodwill is not amortized.

Goodwill is tested for impairment annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. The impairment test is carried out in two steps. In the first step, the carrying amount of the reporting unit is compared to its fair value. When the fair value of a reporting unit exceeds its carrying amount, then the goodwill of the reporting unit is considered not to be impaired and the second step is not required. The second step of the impairment test is carried out when the carrying amount of a reporting unit exceeds its fair value, in which case the implied fair value of the reporting unit’s goodwill is compared with its carrying amount to measure the amount of the impairment loss, if any. When the carrying amount of the reporting unit’s goodwill exceeds the implied fair value of the goodwill, an impairment loss is recognized in an amount equal to the excess.

Intangible assets are comprised of Advanced Wireless Services (“AWS”) licences and the cost of these licences includes acquisition costs and interest incurred during the development period of the wireless network project.

(n) Stock-based compensation:

The compensation cost attributable to stock-based awards to employees that call for settlement in cash or other assets, at the option of the employee is recognized in operating expense over the vesting period. Changes in the intrinsic value of the stock option awards between the grant date and the measurement date result in a change in the liability and of the compensation cost.

(o) Pension plans and postretirement benefits:

(i) Pension plans:

The Company offers defined benefit pension plans and defined contribution pension plans to some of its employees. Defined benefit pension plan costs are determined using actuarial methods and are funded through contributions determined in accordance with the projected benefit method pro-rated on service, which incorporates management’s best estimate of future salary levels, other cost escalations, retirement ages of employees and other actuarial factors. Pension plan expense is charged to operations and includes:

· Cost of pension plan benefits provided in exchange for employee services rendered during the year.

· Amortization of the initial net transition asset, prior service costs and amendments on a straight-line basis over the expected average remaining service period of the active employee group covered by the plans.

· Interest cost of pension plan obligations, expected return on pension fund assets, and amortization of cumulative unrecognized net actuarial gains and losses, in excess of 10% of the greater of the accrued benefit obligation or the fair value of plan assets, over the expected average remaining service period of the active employee group covered by the plans.

When an event gives rise to both a curtailment and a settlement, the curtailment is accounted for prior to the settlement.

Actuarial gains and losses arise from the difference between the actual rate of return on plan assets for a period and the expected return on plan assets for that period, or from changes in actuarial assumptions used to determine the accrued benefit obligation.

The Company uses the fair value of plan assets as of the end of the year to evaluate plan assets for the purpose of calculating the expected return on plan assets.

(ii) Postretirement benefits:

The Company offers health, life and dental insurance plans to some of its retired employees. The cost of postretirement benefits is determined using actuarial methods and the related benefits are funded by the Company as they become due. The Company amortizes the cumulative unrecognized net actuarial gains and losses, in excess of 10% of the accrued benefit obligation, over the expected average remaining service life of the active employee group covered by the plans.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):

(p) Rates subject to CTRC regulation:

The Company’s operations are subject to rate regulations on certain services based on geographical regions, mainly by the Broadcasting Act (Canada) and the Telecommunications Act (Canada) , both managed by the Canadian Radio-television and Telecommunication Commission (“CRTC”). Accordingly, the Company’s operating revenues could be affected by changes in regulations or decisions made by this regulating body. The Company does not select accounting policies that differ from GAAP, even though the Company is subject to these regulations.

(q) Future changes in accounting standards:

In January 2008, the CICA issued Section 3064, Goodwill and Intangible Assets , which will replace Section 3062, Goodwill and Other Intangible Assets , and which results in the withdrawal of Section 3450, Research and Development Costs and Emerging Issues Committee (“EIC”) Abstract 27, Revenues and Expenditures During the Pre-operating Period , and amendments to Accounting Guideline (“AcG”) 11, Enterprises in the Development Stage . The new standard provides guidance on the recognition of intangible assets in accordance with the definition of an asset and the criteria for asset recognition, as well as clarifying the application of the concept of matching revenues and expenses, whether those assets are separately acquired or internally developed. This standard applies to interim and annual financial statements relating to fiscal years beginning on or after October 1, 2008. The Company is currently evaluating the effects of adopting this standard, although it does not expect the adoption will have a material impact on its consolidated financial statements.

2. FINANCIAL EXPENSES:

	2008			2007			2006
Third parties:
Interest on long-term debt	$	111,601		$	81,218		$	81,316
Amortization of financing costs and long-term debt premium or discount	1,623			441			432
Other	(605		)	(68		)	(441		)
	112,619			81,591			81,307
Affiliated parties:
Interest expense (net of income)	269,822			165,460			472
Dividend income	(278,753		)	(170,904		)	—
	(8,931		)	(5,444		)	472
Interest capitalized to the cost of:
Fixed assets	(249		)	—			—
Intangible assets	(12,515		)	—			—
	(12,764		)	—			—
	$	90,924		$	76,147		$	81,779

3. LOSS (GAIN) ON VALUATION AND TRANSLATION OF FINANCIAL INSTRUMENTS:

	2008		2007			2006
Loss (gain) on embedded derivatives and derivative financial instruments to which hedge accounting is not used	$	6,829	$	2,031		$	(19	)
Loss (gain) on ineffective portion of fair value hedges	12,848		(12,541		)	—
Gain on revaluation of Additional Amount payable	—		—			(3,286		)
Loss on foreign currency translation of short-term monetary items	4,996		1,415			1,112
	$	24,673	$	(9,095	)	$	(2,193	)

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

4. IMPAIRMENT OF GOODWILL:

In the fourth quarter of 2007, the Company concluded that the goodwill of its subsidiary, Le SuperClub Vidéotron Ltée, related to the DVDs and games rental operations in Ontario was impaired. Accordingly, an impairment charge of $5.4 million was recorded.

5. BUSINESS REORGANIZATION:

On January 1, 2006, a company under common control, Videotron Telecom Ltd., merged with the Company. On July 1, 2006, the Company also merged with its parent, 9101-0827 Québec Inc. Those transactions have been accounted for using the continuity of interest method, and the results of operations and financial position of Videotron Telecom Ltd. and 9101-0827 Québec Inc. have been included in these consolidated financial statements as if the three companies had always been combined.

6. INCOME TAXES:

Income taxes on operations are as follows:

	2008		2007		2006
Current	$	1,071	$	67	$	(439	)
Future	72,031		38,191		64,669
	$	73,102	$	38,258	$	64,230

The following table reconciles income taxes at the Company’s domestic statutory tax rate of 30.9% in 2008 (32.02% in 2007 and in 2006) and income taxes in the consolidated statements of income:

	2008			2007			2006
Income taxes at domestic statutory tax rate	$	144,826		$	116,592		$	79,412
Increase (reduction) resulting from:
Effect of non-deductible charges, non-taxable income and differences between current and future tax rates	10,038			(4,207		)	(1,001		)
Change in valuation allowance	9,718			—			—
Change in future income tax balances due to a change in substantively enacted tax rates	—			(18,808		)	(14,914		)
Tax consolidation transactions with the parent company	(86,135		)	(54,723		)	—
Recognition of a deferred tax credit	(5,690		)	—			—
Other	345			(596		)	733
Income taxes	$	73,102		$	38,258		$	64,230

The tax effects of significant items comprising the Company’s net future tax positions are as follows:

	2008			2007
Loss carry-forwards	$	33,028		$	21,650
Other provisions	3,279			10,093
Long-term debt and derivative financial instruments	(3,171		)	13,614
Fixed assets	(190,833		)	(165,808		)
Other assets	(16,905		)	(11,156		)
	(174,602		)	(131,607		)
Valuation allowance	(18,032		)	—
Net future income tax liabilities	$	(192,634	)	$	(131,607	)

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

6. INCOME TAXES (Continued):

The current and long-term future income tax assets and liabilities are as follows:

	2008			2007
Future income tax assets:
Current	$	35,982		$	31,585
Long-term	1,038			2,970
	37,020			34,555
Future income tax liability:
Long-term	(229,654		)	(166,162		)
Net future income tax liabilities	$	(192,634	)	$	(131,607	)

As at December 31, 2008, the Company had operating loss carry-forwards for income tax purposes available to reduce future taxable income of approximately $106.4 million which will expire in 2028. As at December 31, 2008, the Company also had capital loss carry-forwards of approximately $2.1 million that can be carried forward indefinitely and applied only against future capital gains.

7. ACCOUNTS RECEIVABLE:

	2008		2007
Trade	$	163,014	$	159,197
Other	1,361		2,169
	$	164,375	$	161,366

8. INVENTORIES:

	2008		2007
Subscribers’ equipment	$	26,109	$	20,855
Network materials	19,472		12,932
Video store materials	2,715		5,658
	$	48,296	$	39,445

9. SUBORDINATED LOAN FROM PARENT COMPANY:

	2008		2007
Subordinated loan — Quebecor Media Inc.	$	2,055,000	$	1,995,000

On January 3, 2007, the Company contracted a subordinated loan of $1.0 billion from Quebecor Media Inc., bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 3, 2022. On May 31, 2007, the Company increased the subordinated loan by $870.0 million, maturing on May 31, 2022. The Company invested the total proceeds of $1.0 billion and $870.0 million into 1,000,000 and 870,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On May 31, 2007, CF Cable TV Inc., a wholly-owned subsidiary of the Company, contracted a subordinated loan of $125.0 million from Quebecor Media Inc., bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on May 31, 2022. On the same day, CF Cable TV Inc. invested the total proceeds of $125.0 million into 125,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

9. SUBORDINATED LOAN FROM PARENT COMPANY (Continued):

On January 4, 2008, the Company contracted a subordinated loan of $415.0 million from Quebecor Media Inc., bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 4, 2023. On the same day, the Company invested the total proceeds of $415.0 million into 415,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On January 4, 2008, CF Cable TV Inc., a wholly-owned subsidiary of the Company, contracted a subordinated loan of $170.0 million from Quebecor Media Inc., bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 4, 2023. On the same day, CF Cable TV Inc. invested the total proceeds of $170.0 million into 170,000 preferred shares, Series B, of 9101-0835 Québec Inc., a subsidiary of Quebecor Media Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

On December 23, 2008, 9101-0835 Québec Inc., a subsidiary of Quebecor Media Inc., redeemed 525,000 preferred shares, Series B, for a total cash consideration of $525.5 million, including cumulative dividends of $0.5 million. On the same day, the Company used the total proceeds of $525.0 million to repay part of its subordinated loan contracted from Quebecor Media Inc. on January 3, 2007.

The above transactions were carried out for tax consolidation purposes of Quebecor Media Inc. and its subsidiaries.

10. FIXED ASSETS:

	2008
	Cost		Accumulated amortization		Net book value
Land	$	2,999	$	—	$	2,999
Buildings	53,681		18,819		34,862
Furniture and equipment	475,432		310,248		165,184
Receiving and distribution networks	2,795,434		1,497,900		1,297,534
Terminals and operating system	145,795		64,914		80,881
Coding and transmission material	7,716		3,407		4,309
Projects under development (3G Network)	26,706		—		26,706
	$	3,507,763	$	1,895,288	$	1,612,475

	2007
	Cost		Accumulated amortization		Net book value
Land	$	2,840	$	—	$	2,840
Buildings	50,140		17,216		32,924
Furniture and equipment	413,637		291,776		121,861
Receiving and distribution networks	2,512,273		1,345,774		1,166,499
Terminals and operating system	138,583		58,439		80,144
Coding and transmission material	7,541		3,004		4,537
	$	3,125,014	$	1,716,209	$	1,408,805

11. INTANGIBLE ASSETS:

In May 2008, the Company subscribed to 200,000,000 preferred shares Series B of 9193-2962 Québec Inc., a subsidiary of Quebecor Media Inc., for a cash consideration of $200.0 million. In September 2008, the Company subscribed to an additional 336,601,953 preferred shares, Series B, of 9193-2962 Québec Inc. for a cash consideration of $336.6 million. On September 23, 2008, the Company acquired all the common shares of 9193-2962 Québec Inc. for a cash consideration of $17.9 million and issuance of one common share of the Company. These transactions were recorded at the carrying amount and resulted in an adjustment of $1.0 million to the deficit for the difference between the carrying amount and the consideration paid.

As a result of the spectrum auction for AWS that ended July 21, 2008, 17 new spectrum licences for AWS, covering all of the province of Québec and certain areas of Ontario, were acquired for an aggregate amount of $554.5 million, which was fully paid in the third quarter of

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Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

11. INTANGIBLE ASSETS (Continued):

2008. In addition, interest costs of $12.5 million were capitalized to the cost of these licences in 2008. The spectrum licenses were issued by Industry Canada on December 23, 2008, for an initial term of 10 years.

12. OTHER ASSETS:

	2008		2007
Deferred connection fees	$	19,251	$	18,794
Deferred pension charges (note 23)	2,915		3,035
Other	13,914		8,637
	$	36,080	$	30,466

13. ADDITIONAL AMOUNT PAYABLE:

Until its transfer in 2006, the value of the Additional Amount payable, resulting from the repurchase of redeemable preferred shares in 2003, fluctuated based on a formula established as per the repurchase agreement.

On June 30, 2006, the Additional Amount payable of $108.2 million was transferred to the parent company in exchange for a cash consideration of $111.5 million. The excess of the consideration paid in the amount of $3.3 million was recorded to the deficit.

14. LONG-TERM DEBT:

	Effective interest rate as of December 31, 2008	Year of maturity	2008			2007
Bank credit facility (i)	3.39%	2012	$	207,670		$	147,721
Senior Notes (ii)	6.59%	2014	800,397			652,816
Senior Notes (iii)	6.44%	2015	212,449			172,818
Senior Notes (iv)	9.38%	2018	546,152			—
Total long-term debt			1,766,668			973,355
Change in fair value related to hedged interest rate risk			49,402			(14,477		)
Adjustments related to embedded derivatives			11,465			4,636
Financing fees, net of amortization			(19,538		)	(12,526		)
			$	1,807,997		$	950,988

(i) On April 7, 2008, the Company entered into amendments to its Senior Secured Credit Facility pursuant to which commitments under the Senior Secured Credit Facility were increased from $450.0 million to $575.0 million and the maturity was extended to April 2012. Pursuant to these amendments, the Company may, subject to certain conditions, increase the commitments under the Senior Secured Credit Facility by an additional $75.0 million (for aggregate commitments of $650.0 million). The credit facility bears interest at Bankers’ acceptance or Canadian prime rates, plus a margin, depending on the Company’s leverage ratio. The credit facility is secured by a first ranking hypothec on the universality of all tangible and intangible assets, current and future, of the Company and its subsidiaries. As of December 31, 2008, the credit facility was secured by assets with a carrying value of $5,105.9 million ($4,152.8 million in 2007). The credit facility contains covenants such as maintaining certain financial ratios and some restrictions on the payment of dividends and asset acquisitions and dispositions.

(ii) In October 2003, a first series of US$335.0 million in aggregate principal amount of Senior Notes was issued at a discount price of 99.0806% for net proceeds of US$331.9 million, before issuance fees of US$5.7 million. In November 2004, a second series of US$315.0 million in aggregate principal amount of Senior Notes was issued at a premium price of 105.0% for net proceeds of US$330.8 million, before issuance fees of US$4.1 million. These Notes bear interest at a rate of 6.875%, payable every six months on January 15 and July 15, and will mature in January 2014. The Notes contain certain restrictions on the Company, including limitations on its ability to incur additional indebtedness, and are unsecured. The Senior Notes are guaranteed by specific subsidiaries of the

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

14. LONG-TERM DEBT (Continued):

Company. These Notes are redeemable at the option of the Company, in whole or in part, at any time on or after January 15, 2009, at a decreasing premium.

(iii) In September 2005, US$175.0 million in aggregate principal amount of Senior Notes was issued at a discount price of 99.5% for net proceeds of US$174.1 million, before issuance fees of US$3.2 million. These Notes bear interest at a rate of 6.375%, payable every six months on December 15 and June 15, and will mature on December 15, 2015. The Notes contain certain restrictions on the Company, including limitations on its ability to incur additional indebtedness, and are unsecured. The Senior Notes are guaranteed by specific subsidiaries of the Company. These Notes are redeemable at the option of the Company, in whole or in part, at any time on or after December 15, 2010, at a decreasing premium.

(iv) On April 15, 2008, the Company issued US$455.0 million in aggregate principal amount of Senior Notes at a discount price of 98.432% for net proceeds of US$447.9 million, before financing fees of US$7.7 million. The new Senior Notes bear interest at a rate of 9.125% for an effective interest rate of 9.64% payable every six months on June 15 and December 15, and will mature on April 15, 2018. The Notes contain certain restrictions on the Company, including limitations on its ability to incur additional indebtedness, to pay dividends and make other distributions, and are unsecured. The Senior Notes are guaranteed by specific subsidiaries of the Company. These Notes are redeemable at the option of the Company, in whole or in part, at any time on or after April 15, 2013, at a decreasing premium.

On December 31, 2008, the Company and its subsidiaries were in compliance with all debt covenants.

Principal repayments on long-term debt over the coming years are as follows:

2009	$	—
2010	—
2011	—
2012	207,670
2013	—
2014 and thereafter	1,558,998

15. OTHER LIABILITIES:

	2008		2007
Accrued pension and post-retirement benefits liability (note 23)	$	9,831	$	9,656
Deferred revenues	20,494		21,112
Non-controlling interest	1,047		947
Other	217		—
	$	31,589	$	31,715

16. CAPITAL STOCK:

(a) Authorized capital stock:

In December 2008, the Company amended its articles in order to add a new class of preferred shares, Series H.

As at December 31, 2008, the authorized capital stock is as follows:

An unlimited number of common shares, without par value, voting and participating

An unlimited number of preferred shares, Series B, Series C, Series D, Series E, Series F, and Series H, without par value, ranking prior to the common shares with regards to payment of dividends and repayment of capital, non-voting, non-participating, a fixed monthly non-cumulative dividend of 1%, retractable and redeemable

An unlimited number of preferred shares, Series G, ranking prior to all other shares with regards to payment of dividends and repayment of capital, non-voting, non-participating carrying the rights and restrictions attached to the class as well as a fixed annual cumulative preferred dividend of 11.25%, retractable and redeemable.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

16. CAPITAL STOCK (Continued):

(b) Issued capital stock and paid:

	2008		2007
2,515,277 common shares, Series A (2,515,276 as at December 31, 2007)	$	1	$	46,177

On January 1, 2006, 2,657,400,000 common shares were issued by 9101-0827 Québec Inc. to its parent company in exchange of the investment of 11,174,813 common shares of Videotron Ltd.

On January 1, 2006, as a result of the merger of Videotron Ltd. and Videotron Telecom Ltd., the previously issued common shares were converted into 2,515,276 common shares of the new authorized share capital; the 2 Class C shares of Videotron Telecom Ltd. previously issued were converted into 2 preferred shares, Series B of the new authorized share capital; the 170,000 preferred shares, Series G of Videotron Ltd. were converted into 170,000 preferred shares, Series G of the new authorized share capital.

In June 2006 and in December 2007, the Company redeemed 105,000 and 65,000 preferred shares, Series G, respectively, from Groupe de Divertissement SuperClub Inc. for total cash considerations of $105.0 million and $65.0 million, respectively. Series G shares were eliminated upon consolidation.

On June 30, 2006, 9101-0827 Québec inc. issued 103,274 common shares to its parent company for a total consideration of $111.5 million (see note 13).

On July 1, 2006, as a result of the merger of Videotron Ltd. and 9101-0827 Québec Inc., the previously issued common shares were converted into 2,515,276 common shares of the new authorized share capital; the 2 preferred shares, Series B of Videotron Ltd. were cancelled; the 65,000 preferred shares, Series G were converted into 65,000 preferred shares, Series G of the new authorized share capital.

On several occasions during the years ended December 31, 2008, 2007 and 2006, the Company reduced the paid-up capital of its common shares by total cash distributions of $120.0 million, $299.6 million and $108.7 million, respectively. In 2008, $73.8 million of the $120.0 million were recorded as a reduction of contributed surplus.

On September 23, 2008, as part of the acquisition of 9193-2962 Québec Inc., the Company issued one common share for a cash consideration of one dollar.

17. STOCK-BASED COMPENSATION PLAN:

Under a stock option plan established by the parent company, a number of Common shares of the parent company have been set aside for officers, senior employees, directors and other key employees of the Company and its subsidiaries. Each option may be exercised within a maximum period of 10 years following the date of grant at an exercise price not lower than, as the case may be, the fair market value of the Common shares of the parent company, at the date of grant, as determined by the parent company’s Board of Directors (if the Common shares of the parent company are not listed on a stock exchange at the time of the grant) or the five-day weighted average market price ending on the day preceding the date of grant of the Common shares of the parent company on the stock exchanges where such shares are listed at the time of grant. As long as the Common shares of the parent company have not been listed on a recognized stock exchange, optionees may exercise their vested options during one of the following periods: from March 1 to March 30, from June 1 to June 29, from September 1 to September 29 and from December 1 to December 30 of each year. Holders of options under the plan have the choice at the time of exercising their options to receive an amount in cash (equal to the difference between either the five-day weighted average market price ending on the day preceding the date of exercise of the Common Shares of the parent company on the stock exchanges where such shares are listed at the time of exercise or the fair market value, as determined by the parent company’s Board of Directors, and the exercise price of their vested options) or, subject to certain stated conditions, exercise their options to purchase Common shares of the parent company at the exercise price. Except under specific circumstances, and unless the Compensation Committee decides otherwise, options vest over a five-year period in accordance with one of the following vesting schedules as determined by the Compensation Committee at the time of grant: (i) equally over five years with the first 20% vesting on the first anniversary of the date of the grant; (ii) equally over four years with the first 25% vesting on the second anniversary of the date of grant; and (iii) equally over three years with the first 33 1 / 3 % vesting on the third anniversary of the date of grant. The acquisition of the “right to profit” on certain options may also be subject to performance criteria.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

17. STOCK-BASED COMPENSATION PLAN (Continued):

The following table gives summary information on outstanding options granted by the parent company to the employees of the Company as at December 31, 2008 and 2007:

	2008				2007
	Options		Weighted average exercise price		Options		Weighted average exercise price
Balance at beginning of year	2,101,226		$	35.95	861,767		$	23.43
Granted	70,000		45.82		1,255,000		44.45
Exercised	(610,962	)	20.38		(1,936	)	22.73
Cancelled	(178,229	)	43.53		(13,605	)	28.74
Balance at end of year	1,382,035		$	42.35	2,101,226		$	35.95
Vested options at end of year	27,999		$	27.75	558,096		$	19.44

During the year ended December 31, 2008, 610,962 stock options were exercised and resulted in cash payments of $19.1 million for the Company.

The following table gives summary information on outstanding options as at December 31, 2008:

	Outstanding options				Vested options
Range of exercise price	Number	Weighted average years to maturity	Weighted average exercise price		Number	Weighted average exercise price
$15.19 to 21.75	13,013	5.08	$	20.82	10,026	$	20.55
22.98 to 33.41	209,022	7.43	31.62		17,973	31.77
44.45 to 45.82	1,160,000	8.67	44.53		—	—
$15.19 to 45.82	1,382,035	8.44	$	42.35	27,999	$	27.75

For the year ended December 31, 2008, a net reversal of $2.4 million related to the stock-based plan is included in income (a net charge of $11.6 million and $5.1 million in 2007 and 2006, respectively).

18. ACCUMULATED OTHER COMPREHENSIVE LOSS:

Amounts accounted for in the accumulated comprehensive loss relate solely to cash flow hedges.

No significant amount is expected to be reclassified to income over the next 12 months in connection with derivatives designated as cash flow hedges. The balance is expected to reverse over a 9 1 / 2 -year period.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

19. COMMITMENTS AND CONTINGENCES:

(a) Leases and purchasing agreements:

Under the terms of operating leases or purchasing agreements, the Company is committed to make the following minimum annual payments over the next years:

	Leases		Other commitments
2009	$	22,764	$	10,980
2010	14,440		6,247
2011	11,079		5,410
2012	9,484		236
2013	7,901		—
2014 and thereafter	58,507		—

Operating lease expenses amounted to $20.9 million, $20.8 million and $21.0 million for the years ended December 31, 2008, 2007 and 2006, respectively.

(b) Contingencies:

A number of legal proceedings against the Company and its subsidiaries are pending. In the opinion of the management of the Company and its subsidiaries, the outcome of these proceedings is not expected to have a material adverse effect on the Company’s results or on its financial position.

20. GUARANTEES:

In the normal course of business, the Company enters into numerous agreements containing guarantees, including the following:

Operating leases:

The Company has guaranteed a portion of the residual values of certain assets under operating leases for the benefit of the lessor. Should the Company terminate these leases prior to term (or at the end of the lease term) and should the fair value of the leased assets be less than the guaranteed residual value, the Company must, under certain conditions, compensate the lessor for a portion of the shortfall. In addition, a subsidiary of the Company has provided guarantees to the lessor under premise leases for certain videostore franchisees, with expiry dates through 2017. Should the lessee default under the agreement, the Company must, under certain conditions, compensate the lessor. As at December 31, 2008, the maximum exposure in respect of these guarantees was $16.3 million and no liability has been recorded in the consolidated balance sheet. In prior years, the Company has not made any payments relating to these guarantees.

Outsourcing companies and suppliers:

In the normal course of its operations, the Company enters into contractual agreements with outsourcing companies and suppliers. In some cases, the Company agrees to provide indemnifications in the event of legal procedures initiated against them. In other cases, the Company provides indemnification to counterparties for damages resulting from the outsourcing companies and suppliers. The nature of the indemnification agreements prevents the Company from estimating the maximum potential liability it could be required to pay. No amount has been accrued in the consolidated financial statements with respect to these indemnifications. In prior years, the Company has not made any payments relating to these guarantees.

21. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT:

The Company’s financial risk management policies have been established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies are reviewed regularly to reflect changes in market conditions and in the Company’s activities.

From its use of financial instruments, the Company is exposed to credit risk, liquidity risk, and market risks relating to foreign exchange fluctuations, interest rate fluctuations and equity prices. In order to manage its foreign exchange and interest rate risks, the Company and its subsidiaries use derivative financial instruments (i) to achieve a targeted balance of fixed and variable rate debts and (ii) to set in Canadian dollars all future payments on debts denominated in U.S. dollars (interest and principal) and certain purchases of inventory and other capital expenditures denominated in a foreign currency. The Company does not intend to settle its financial derivative instruments prior to their

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

21. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Continued):

maturity, as none of these instruments are held or issued for speculative purposes. The Company designates its derivative financial instruments either as fair value hedges or cash flow hedges when they quality for hedge accounting.

(a) Description of derivative financial instruments:

(i) Foreign exchange forward contracts:

Currencies (sold/bought)		Maturing		Weighted average exchange rate		Notional amount (in millions of dollars)
$/US$		Less than 1 year		1.0865		75.5

(ii) Cross-currency interest rate swaps:

	Period covered	Notional amount (in millions of dollars)		Annual effective interest rate using hedged rate	Annual nominal interest rate of debt		CDN dollar exchange rate on interest and capital payments per one U.S. dollar
Senior Notes	2004 to 2014	US$	190.0	Bankers’ acceptances 3 months plus 2.80%	6.875	%	1.2000
Senior Notes	2004 to 2014	US$	125.0	7.45%	6.875	%	1.1950
Senior Notes	2003 to 2014	US$	200.0	Bankers’ acceptances 3 months plus 2.73%	6.875	%	1.3425
Senior Notes	2003 to 2014	US$	135.0	7.66%	6.875	%	1.3425
Senior Notes	2005 to 2015	US$	175.0	5.98%	6.375	%	1.1781
Senior Notes	2008 to 2018	US$	455.0	9.65%	9.125	%	1.0210

Certain cross-currency interest rate swaps entered into by the Company include an option that allows each party to unwind the transaction on a specific date at the then settlement amount.

(b) Fair value of financial instruments:

The carrying amount of accounts receivable from external or related parties (classified as loans and receivables), bank indebtedness, accounts payable and accrued charges to external or related parties (classified as other liabilities) approximates their fair value since these items will be realized or paid within one year or are due on demand.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

21. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Continued):

(b) Fair value of financial instruments (Continued):

The carrying values and fair values of long-term debt and derivative financial instruments as of December 31, 2008 and 2007 are as follows:

	2008						2007
	Carrying value			Fair value			Carrying value			Fair value
Long-term debt(1)	$	(1,766,668	)	$	(1,577,000	)	$	(973,355	)	$	(938,158	)
Cross currency interest rate swaps	69,486			69,486			(241,320		)	(241,320		)
Forward foreign exchange contract	9,013			9,013			(4,236		)	(4,236		)

(1) The carrying value of long-term debt excludes adjustments to record changes in the fair value of long-term debt related to hedged interest risk, the embedded derivatives or the financing fees.

The fair value of long-term debt is estimated based on discounted cash flows using year-end market yields or the market value of similar instruments with the same maturity, or quoted market prices when available. The majority of derivative financial instruments (e.g. cross currency interest rate swaps) are traded over the counter and, as such, there are no quoted prices. The fair value of derivative financial instruments is therefore estimated using valuation models that project future cash flows and discount the future amounts to a present value using the contractual terms of the derivative instrument and factors observable in external markets, such as period-end swap rates and foreign exchange rates. An adjustment is also included to reflect non-performance risk, impacted by the financial and economic environment prevailing at the date of the valuation, in the recognized measure of the fair value of the derivative instruments by applying a credit default premium to the net exposure of the counterparty or the Company. The fair value of early settlement options recognized as embedded derivatives is determined by option pricing models using market inputs and assumptions, including volatility and discount factors.

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial asset fails to meet its contractual obligations.

In the normal course of business, the Company continuously monitors the financial condition of its customers and reviews the credit history of each new customer. As of December 31, 2008, no customer balance represented a significant portion of the Company’s consolidated trade receivables. The Company establishes an allowance for doubtful accounts based on the specific credit risk of its customers and historical trends. The allowance for doubtful accounts amounted to $16.0 million as of December 31, 2008 ($11.7 million as of December 31, 2007). As of December 31, 2008, 8.9% of trade receivables were 90 days past their billing date (7.0% as of December 31, 2007).

The Company believes that its product lines and the diversity of its customer base are instrumental in reducing its credit risk, as well as the impact of fluctuations in product-line demand. The Company does not believe that it is exposed to an unusual level of customer credit risk.

From their use of derivative financial instruments, the Company is exposed to the risk of non-performance by a third party. When the Company enters into derivative contracts, the counterparties (either foreign or Canadian) must have credit ratings at least in accordance with the Company’s credit risk management policy and are subject to concentration limits. Given the high minimum credit ratings required under the Company’s policy, the Company does not foresee any failure by counterparties to meet their obligations.

(d) Liquidity risk management:

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due or the risk that those financial obligations have to be met at excessive cost. The Company manages this exposure through staggered debt maturities. The weighted average term of the Company’s consolidated debt was approximately 6.3 years as at December 31, 2008.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

21. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Continued):

(d) Liquidity risk management (Continued):

Company management believes that cash flows from continuing operations and available sources of financing should be sufficient to cover committed cash requirements for capital investments, working capital, interest payments, debt repayments, pension plan contributions, and dividends (or distributions) in the future. The Company has access to cash flows generated by its subsidiaries through dividends (or distributions) and cash advances paid by its wholly-owned subsidiaries.

As of December 31, 2008, material contractual obligations related to financial instruments included capital repayment and interest on long-term debt and obligations related to derivative financial instruments, less estimated future receipts on derivative instruments.

These obligations and their maturities are as follows:

	Total			1 year		Less than 1-3 years		3-5 years		5 years and more
Bank indebtedness	$	3,613		$	3,613	$	—	$	—	$	—
Accounts payable and accrued charges	322,568			322,568		—		—		—
Amounts payable to affiliated companies	19,358			19,358		—		—		—
Long-term debt	1,766,668			—		—		207,670		1,558,998
Interest payments(1)	829,706			120,659		241,319		228,684		239,044
Derivative financial instruments(2)	(60,269		)	—		—		—		(60,269		)
Total contractual obligations	$	2,881,644		$	466,198	$	241,319	$	436,354	$	1,737,773

(1) Estimate of interest to be paid on long-term debt is based on the hedged and unhedged interest rates and hedged foreign exchange rates at December 31, 2008.

(2) Estimated future receipts, net of future disbursements on derivative financial instruments related to foreign exchange hedging.

The table above excludes obligations under subordinated loans to the parent company for which proceeds are used to invest in preferred shares of an affiliated company for tax consolidation purposes of Quebecor Media Inc. and its subsidiaries (see note 9).

(e) Market risk:

Market risk is the risk that changes in market prices due to foreign exchange rates, interest rates and/or equity prices will affect the value of the Company’s financial instruments. The objective of market risk management is to mitigate and control exposures within acceptable parameters while optimizing the return on risk.

Foreign currency risk

Most of the Company’s consolidated revenues and expenses, other than interest expense on U.S. dollar-denominated debt, purchases of set-top boxes and cable modems and certain capital expenditures, are received or denominated in Canadian dollars. A large portion of the interest, principal and premium, if any, payable on the Company’s debt is payable in U.S. dollars. The Company has entered into transactions to hedge the foreign currency risk exposure on 100% of its U.S. dollar-denominated debt obligations outstanding as of December 31, 2008 and to hedge its exposure on certain purchases of set-top boxes, cable modems and capital expenditures. Accordingly, the Company’s sensitivity to the variation of foreign exchange rates is economically limited.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

21. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Continued):

(e) Market risk (Continued):

Foreign currency risk (Continued):

	Income			Other comprehensive income
Increase of $0.10
U.S. dollar-denominated accounts payable	$	(680	)	—
Gain (loss) on valuation and translation of financial instruments and of derivative financial instruments	(2,250		)	44,905

Decrease of $0.10
U.S. dollar-denominated accounts payable	680			—
Gain (loss) on valuation and translation of financial instruments and of derivative financial instruments	2,250			(44,905	)

Interest rate risk and non-performance risk

The Company’s bank credit facilities bear interest at floating rates based on the following reference rates: (i) bankers’ acceptance rate (BA) and (ii) bank prime rate (Prime). The Senior Notes issued by the Company bear interest at fixed rates. The Company has entered into various cross-currency interest rate swap agreements in order to manage cash flow and fair value risk exposure due to changes in interest rates. After taking into account the hedging instruments, the long-term debt is comprised of 58.7% of fixed rate debt and 41.3% of floating rate debt as of December 31, 2008.

The estimated sensitivity on financial expense, before income tax, of a 100 basis point variance in the year-end Canadian Banker’s acceptance rate is $7.0 million.

The estimated sensitivity on income and other comprehensive income, before income tax, of a 100 basis point variance in the discount rate used to calculate the fair value of financial instruments, as per the Company’s valuation model, is as follows:

	Income			Other comprehensive income
Increase of 100 basis point	$	2,609		$	(3,908	)
Decrease of 100 basis point	(2,609		)	3,908

(f) Capital management:

The Company’s primary objective in managing capital is to maintain an optimal capital base in order to support the capital requirements of its various activities, including growth opportunities.

In managing its capital structure, the Company takes into account the asset characteristics of its subsidiaries and planned requirements for funds, leveraging their individual borrowing capacities in the most efficient manner to achieve the lowest cost of financing. Management of the capital structure involves the issuance of new debt, the repayment of existing debt using cash generated by operations and the level of distributions to the parent company. The Company has not significantly changed its strategy regarding management of its capital structure since the last financial year.

The Company’s capital structure is composed of shareholder’s equity, bank indebtedness, long-term debt, assets and liabilities related to derivative financial instruments, and non-controlling interest, less cash and cash equivalents.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

21. FINANCIAL INSTRUMENTS AND FINANCIAL RISK MANAGEMENT (Continued):

(f) Capital management (Continued):

The capital structure is as follows:

	2008			2007
Bank indebtedness	$	3,613		$	9,505
Long-term debt	1,807,997			950,988
Net (assets) liabilities related to derivative financial instruments	(78,499		)	245,556
Non-controlling interest	1,047			947
Net debt	1,734,158			1,206,996
Shareholder’s equity	$	403,654		$	259,110

The Company is not subject to externally imposed capital requirements other than certain restrictions under the term of its borrowing agreements which relate to permitted investments, inter-company transactions or the declaration and payment of dividends and other distributions.

22. Related party transactions:

In addition to the related party transactions disclosed elsewhere in these consolidated financial statements, the Company entered into the following transactions with affiliated companies. These transactions have been recorded at the exchange value in the normal course of business, which is the amount established and agreed to by the related parties:

	2008			2007			2006
Ultimate Parent and Parent company:
Operating revenue	$	104		$	139		$	150
Direct costs and operating expenses	4,535			3,908			4,110
Operating expenses recovered	(373		)	(23		)	(23		)
Affiliated companies:
Operating revenue	10,165			22,164			25,146
Direct costs and operating expenses	51,942			60,590			60,066

Management fee:

The Company pays annual management fees to the parent company for services rendered to the Company, including internal audit, legal and corporate, financial planning and treasury, tax, real estate, human resources, risk management, public relations and other services. Management fees amounted to $25.4 million in 2008, $46.9 million in 2007 and $23.4 million in 2006. The agreement provides for an annual management fee to be agreed upon for the year 2009. In addition, the parent company is entitled to the reimbursement of out-of-pocket expenses incurred in connection with the services provided under the agreement.

Operating transactions:

The Company entered into an affiliation agreement with Groupe Archambault Inc. (“Archambault”), a company under common control, a subsidiary of Quebecor Media Inc. This agreement provided that the Company pay Archambault 54% of all revenues generated from the fees paid by customers to use Archambault’s video-on-demand services. In connection with this affiliation agreement, the Company entered into a video-on-demand services agreement with Archambault. Under this agreement, various technical services were provided to Archambault. In consideration of these services, Archambault paid a fee of 8% of all revenues generated from fees paid by customers to use Archambault’s video-on-demand services. The acquisition of the video-on-demand licence by the Company from Groupe Archambault Inc., for a total cash consideration of $0.8 million, put an end to these agreements on May 1, 2008.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

22. Related party transactions (Continued):

Tax transactions:

During the year ended December 31, 2006, the Company acquired from a company under common control of the ultimate parent company income tax deductions of $0.3 million that were recorded as income taxes receivable. This transaction allowed the Company to realize a gain of $0.02 million which was credited to contributed surplus.

On December 18 and 21, 2007, the Company’s ultimate parent company, Quebecor Inc., transferred to the Company a total of $57.1 million of non-capital tax losses in exchange for a net cash consideration of $12.8 million. This transaction was recorded at the exchange amount. As a result, the Company recorded an income tax asset of $17.7 million and the difference of $4.9 million, between the net cash consideration and the income tax asset, was recorded as a deferred credit, included in accounts payable and accrued charges, which reduced income tax expense in 2008 as these tax deductions were used.

On December 21, 2007, the Company’s ultimate parent company, Quebecor Inc., transferred to CF Cable TV Inc., a wholly-owned subsidiary of the Company, $9.4 million of non-capital tax losses in exchange for a net cash consideration of $2.1 million. This transaction was recorded at the exchange amount. As a result, CF Cable TV Inc. recorded an income tax asset of $2.9 million and the difference of $0.8 million between the net cash consideration and the income tax asset was recorded as a deferred credit, included in accounts payable and accrued charges, which reduced income tax expense in 2008 as these tax deductions were used.

On December 18, 2008, the Company’s ultimate parent company, Quebecor Inc., transferred to the Company a total of $104.9 million of non-capital tax losses in exchange for net cash consideration of $18.4 million. This transaction was recorded at the exchange amount. As a result, the Company recorded an income tax asset of $32.4 million and the difference of $14.0 million, between the net cash consideration and the income tax asset, was recorded as a deferred credit, included in accounts payable and accrued charges, which will reduce the income tax expense in the future as these tax deductions are used.

Quebecor World Inc.:

On January 21, 2008, Quebecor World Inc. and its U.S. subsidiaries were granted creditor protection under the Companies’ Creditors Arrangement Act in Canada. On the same date, its U.S. subsidiaries also filed a petition under Chapter 11 of the United States Bankruptcy Code. Quebecor World Inc. outsourced its corporate information technology services which generated $3.0 million in revenues for the Company in 2008 ($9.8 million in 2007 and $13.0 million in 2006). This agreement was terminated in 2008 and since January 21, 2008, Quebecor World Inc. is no longer considered a related company under Canadian GAAP.

Acquisition of assets:

On December 15, 2008, the Company acquired fixed assets from Les Editions CEC Inc., a wholly-owned subsidiary of Quebecor Media Inc., for a total consideration of $1.6 million. This transaction was recorded at the carrying amount. As a result, the Company recorded fixed assets of a net book value of $0.4 million, and the difference between the cash consideration and the net book value, of $1.2 million was charged to the deficit.

23. PENSION PLANS AND POSTRETIREMENT BENEFITS:

The Company and some of its subsidiaries maintain various defined benefit plans and defined contribution plans. The Company’s policy is to maintain its contribution at a level sufficient to cover benefits. Actuarial valuations of the Company’s numerous pension plans were performed once at least in the last three years and the next required valuations will be performed at least once over the next three years.

The Company provides postretirement benefits to eligible retired employees. The costs of these benefits, principally health care, are accounted for during the employee’s active service period.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

23. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued):

The following tables provide a reconciliation of the changes in the plans’ benefit obligations and the fair value of plan assets for the years ended December 31, 2008 and 2007, along with a statement of funded status as of those dates:

	2008									2007
	Pension benefits			Post-retirement benefits			Total			Pension benefits			Post-retirement benefits			Total
Change in benefit obligations:
Benefit obligations, beginning of year	$	90,339		$	9,848		$	100,187		$	87,523		$	9,822		$	97,345
Service costs	5,348			347			5,695			6,217			375			6,592
Interest costs	5,313			548			5,861			4,730			504			5,234
Plan participants’ contributions	4,445			—			4,445			3,428			—			3,428
Actuarial gain	(29,230		)	(3,468		)	(32,698		)	(6,574		)	(855		)	(7,429		)
Benefits and settlement paid	(4,664		)	(113		)	(4,777		)	(4,985		)	(108		)	(5,093		)
Other	—			(1		)	(1		)	—			110			110
Benefit obligations, end of year	$	71,551		$	7,161		$	78,712		$	90,339		$	9,848		$	100,187

	2008									2007
	Pension benefits			Post-retirement benefits			Total			Pension benefits			Post-retirement benefits			Total
Change in plan assets:
Fair value of plan assets at beginning of year	$	91,247		$	—		$	91,247		$	87,261		$	—		$	87,261
Actual return on plan assets	(14,487		)	—			(14,487		)	1,084			—			1,084
Employer contributions	4,534			113			4,647			4,459			108			4,567
Plan participants’ contributions	4,445			—			4,445			3,428			—			3,428
Benefits and settlement paid	(4,664		)	(113		)	(4,777		)	(4,985		)	(108		)	(5,093		)
Fair value of plan assets, end of year	$	81,075		$	—		$	81,075		$	91,247		$	—		$	91,247

The defined benefit plan assets are comprised of:

	2008		2007
Equity securities	50.0	%	61.7	%
Debt securities	39.3	%	29.3	%
Other	10.7	%	9.0	%

As at December 31, 2008, defined contribution plan assets included shares of the ultimate parent company representing an amount of $0.5 million ($1.0 million as at December 31, 2007, including shares of a company under common control).

	2008									2007
	Pension benefits			Post-retirement benefits			Total			Pension benefits		Post-retirement benefits			Total
Reconciliation of funded status:
Excess (deficit) of fair value of plan assets over benefit obligations at end of year	$	9,524		$	(7,161	)	$	2,363		$	908	$	(9,848	)	$	(8,940	)
Past service cost gain	—			(898		)	(898		)	—		(965		)	(965		)
Unrecognized actuarial (gain) loss	(7,537		)	(844		)	(8,381		)	566		2,718			3,284
Net amount recognized	$	1,987		$	(8,903	)	$	(6,916	)	$	1,474	$	(8,095	)	$	(6,621	)

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

23. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued):

Included in the above benefits and fair value of plan assets at year-end are the following amounts in respect of plans that are not fully funded:

	2008								2007
	Pension benefits		Post-retirement benefits			Total			Pension benefits			Post-retirement benefits			Total
Benefit obligations	$	—	$	(7,161	)	$	(7,161	)	$	(83,750	)	$	(9,848	)	$	(93,598	)
Fair value of plan assets	—		—			—			83,460			—			83,460
Funded status — plan deficit	$	—	$	(7,161	)	$	(7,161	)	$	(290	)	$	(9,848	)	$	(10,138	)

Amounts recognized in the consolidated balance sheets are as follows:

	2008									2007
	Pension benefits			Post-retirement benefits			Total			Pension benefits			Post-retirement benefits			Total
Deferred pension charges	$	3,034		$	(119	)	$	2,915		$	3,149		$	(114	)	$	3,035
Accrued benefit liability	(1,047		)	(8,784		)	(9,831		)	(1,675		)	(7,981		)	(9,656		)
Net amount recognized	$	1,987		$	(8,903	)	$	(6,916	)	$	1,474		$	(8,095	)	$	(6,621	)

Components of the net benefit costs are as follows:

	2008
	Pension benefits			Post-retirement benefits			Total
Service costs	$	5,348		$	347		$	5,695
Interest costs	5,313			548			5,861
Actual return on plan assets	14,487			—			14,487
Current actuarial gain	(29,230		)	(3,468		)	(32,698		)
Elements of net benefit cost adjustments to recognize the long-term nature and valuation allowance	(4,082		)	(2,573		)	(6,655		)
Difference between actual and expected return on plan assets	(21,188		)	—			(21,188		)
Deferral of current actuarial gain	29,230			3,468			32,698
Amortization of previously deferred actuarial loss	62			94			156
Other	—			(67		)	(67		)
Total adjustments to recognize the long-term nature of benefit costs	8,104			3,495			11,599
Net benefit costs	$	4,022		$	922		$	4,944

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

23. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued):

	2007
	Pension benefits			Post-retirement benefits			Total
Service costs	$	6,217		$	375		$	6,592
Interest costs	4,730			504			5,234
Actual return on plan assets	(1,084		)	—			(1,084		)
Current actuarial gain	(6,574		)	(855		)	(7,429		)
Elements of net benefit cost adjustments to recognize the long-term nature and valuation allowance	3,289			24			3,313
Difference between actual and expected return on plan assets	(5,311		)	—			(5,311		)
Deferral of current actuarial gain	6,574			855			7,429
Amortization of previously deferred actuarial loss	62			141			203
Other	—			(67		)	(67		)
Total adjustments to recognize the long-term nature of benefit costs	1,325			929			2,254
Net benefit costs	$	4,614		$	953		$	5,567

	2006
	Pension benefits			Post-retirement benefits			Total
Service costs	$	5,876		$	355		$	6,231
Interest costs	4,265			403			4,668
Actual return on plan assets	(13,616		)	—			(13,616		)
Current actuarial (gain) loss	(1,220		)	1,309			89
Elements of net benefit cost adjustments to recognize the long-term nature and valuation allowance	(4,695		)	2,067			(2,628		)
Difference between actual and expected return on plan assets	8,388			—			8,388
Deferral of current actuarial gain (loss)	1,220			(1,309		)	(89		)
Amortization of previously deferred actuarial loss	(676		)	135			(541		)
Other	—			(67		)	(67		)
Total adjustments to recognize the long-term nature of benefit costs	8,932			(1,241		)	7,691
Net benefit costs	$	4,237		$	826		$	5,063

The expense related to defined contribution pension plans amounts to $5.7 million in 2008 ($5.2 million in 2007 and $4.8 million in 2006).

The total cash amount paid or payable for employee future benefits for all plans, consisting of cash contributed by the Company to its funded pension plans, cash payment directly to beneficiaries for its unfunded other benefit plans, and cash contributed to its defined contribution plans, totaled $9.7 million for the year ended December 31, 2008 ($9.8 million in 2007 and $7.5 million in 2006).

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

23. PENSION PLANS AND POSTRETIREMENT BENEFITS (continued):

The weighted average rates used in measuring the Company’s benefit obligations as at December 31, 2008, 2007 and 2006 and current periodic costs are as follows:

	2008		2007		2006
Benefit obligations:

Rates at end of year:
Discount rate	7.50	%	5.50	%	5.00	%
Expected return on plan assets(1)	7.25		7.25		7.25
Rate of compensation increase	3.75		3.75		3.50

Current periodic costs:

Rates at beginning of year:
Discount rate	5.50	%	5.00	%	5.00	%
Expected return on plan assets(1)	7.25		7.25		7.50
Rate of compensation increase	3.75		3.50		3.50

(1) After management and professional fees.

The assumed health care cost trend rate used in measuring the accumulated postretirement benefit obligations was 8.6% at the end of 2008. The cost, as per an estimate, is expected to decrease gradually for the next seven years to 5% and remain at that level thereafter. A one-percentage point change in the assumed health care cost trend would have the following effects:

	Post-retirement benefits
Sensitivity analysis	1% Increase		1% Decrease
Effect on benefit cost	$	1	$	(1	)
Effect on benefit obligations	21		(18		)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES:

The Company’s consolidated financial statements are prepared in accordance with Canadian GAAP, which differ in some respects from those applicable in the United States (“U.S. GAAP”). The following tables set forth the impact of material differences between Canadian and U.S. GAAP on the Company’s consolidated financial statements of income, comprehensive income and shareholder’s equity:

(a) Consolidated statements of income

	2008			2007			2006
Net income as per Canadian GAAP	$	395,442		$	325,692		$	183,691
Adjustments:
Push-down basis of accounting (i)	(10,607		)	(5,249		)	(6,253		)
Development and pre-operating costs (iii)	1,963			1,522			(1,454		)
Change in the fair value and ineffective portion of derivative financial instruments (v)	(5,432		)	5,006			(8,185		)
Share-based compensation (vi)	1,800			(1,900		)	(900		)
Income taxes (vii)	(8,128		)	(1,354		)	1,866
	(20,404		)	(1,975		)	(14,926		)
Net income as adjusted per U.S. GAAP	$	375,038		$	323,717		$	168,765

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

(b) Consolidated statements of comprehensive income

	2008			2007			2006
Comprehensive income as per Canadian GAAP	$	375,646		$	340,836		$	183,691
Adjustments to net income as per (a) above	(20,404		)	(1,975		)	(14,926		)
Adjustments to other comprehensive income:
Pension and postretirement benefits (iv)	11,598			2,254			153
Derivative financial instruments (v)	4,674			302			1,963
Income taxes (vii)	(3,705		)	(851		)	(1,704		)
	12,567			1,705			412
Comprehensive income as per U.S. GAAP	$	367,809		$	340,566		$	169,177

Accumulated other comprehensive loss as at December 31, 2008, 2007 and 2006 is as follows:

	2008			2007			2006
Accumulated comprehensive loss as per Canadian GAAP	$	(27,098	)	$	(7,302	)	$	—
Adjustments:
Pension and postretirement benefits (iv)	9,359			(2,239		)	(4,493		)
Derivative financial instruments (v)	4,976			302			(31,624		)
Income taxes (vii)	(3,223		)	482			10,511
	11,112			(1,455		)	(25,606		)
Accumulated other comprehensive loss as per U.S. GAAP	$	(15,986	)	$	(8,757	)	$	(25,606	)

	2008			2007
Shareholder’s equity based on Canadian GAAP	$	403,654		$	259,110
Cumulative adjustments:
Push-down basis of accounting (i)	4,479,048			4,487,655
Goodwill impairment (ii)	(2,276,627		)	(2,274,627		)
Development and pre-operating costs (iii)	(661		)	(2,624		)
Pension and postretirement benefits (iv)	9,359			(2,239		)
Derivative financial instruments and hedging accounting (v)	4,194			4,952
Share-based compensation (vi)	(1,000		)	(2,800		)
Income taxes (vii)	8,627			6,426
Shareholder’s equity based on U.S. GAAP	$	2,626,594		$	2,475,853

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Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

(i) Push-down basis of accounting:

The basis of accounting used in the preparation of this reconciliation of Canadian GAAP to U.S. GAAP reflects the push-down resulting from the acquisition of the Company and its subsidiaries on October 23, 2000 by Quebecor Media Inc. Under Canadian GAAP, each entity has retained the historical carrying value basis of its assets and liabilities. The excess of the purchase price over the value assigned to the net assets of the Company at the date of acquisition has been allocated to goodwill and has been amortized, up to December 31, 2001, on the straight-line basis over 40 years.

As at December 31, 2008, the push-down resulted in an increase in fixed assets of $85.0 million, an increase in goodwill of $2,141.8 million, an increase in future income tax liability of $24.4 million, an increase in contributed surplus of $4,577.0 million, an increase in the deficit of $2,373.8 million and an increase in other comprehensive loss of $0.8 million.

(ii) Goodwill impairment:

The accounting requirements for goodwill under Canadian GAAP and U.S. GAAP are similar in all material respects. However, in accordance with the transitional provisions contained in Section 3062 of the CICA Handbook, an impairment loss recognized during the financial year in which the new recommendations are initially applied is recognized as the effect of a change in accounting policy and charged to opening retained earnings, without restatement of prior periods. Under U.S. GAAP, an impairment loss recognized as a result of a transitional goodwill impairment test is recognized as the effect of a change in accounting principles in the statement of operations above the caption “net income”.

(iii) Development and pre-operating costs:

Under Canadian GAAP, certain development and pre-operating costs that satisfy specified criteria for recoverability are deferred and amortized. Under U.S. GAAP, these costs must be included in income as incurred.

(iv) Pension and postretirement benefits:

Under U.S. GAAP, SFAS No. 158, Employer’s Accounting for Defined Benefit Pension and Other Postretirement Plans requires the recognition of the over- or under-funded positions of defined benefit pension and other postretirement plans on the balance sheet, along with a corresponding non-cash adjustment to be recorded in accumulated other comprehensive income (loss).

Under Canadian GAAP, a company is not required to recognize the over- or under-funded positions or to recognize an additional minimum liability. However, when a defined benefit plan gives rise to an accrued benefit asset, a company must recognize a valuation allowance for the excess of the adjusted benefit asset over the expected future benefit to be realized from the plan assets. U.S. GAAP does not provide for a valuation allowance against pension assets.

(v) Derivative financial instruments and hedging accounting:

Since January 1, 2007, standards for hedge accounting under Canadian GAAP are now similar to those under U.S. GAAP, as established by SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities .

However, under Canadian GAAP, certain embedded derivatives, such as early settlement options included in some of the Company’s borrowing agreements, do not meet the criteria to be considered closely related to their host contracts and, therefore must be recorded at their fair value with changes in income. Under U.S. GAAP, these embedded derivatives are considered closely related to their host contract and do not have to be recorded separately at their fair values. Accordingly, the measurement of ineffective hedging relationships recorded in income under U.S. GAAP differs from the measurement under Canadian GAAP.

(vi) Stock-based compensation:

Under U.S. GAAP, in accordance with SFAS 123(R), Share-Based Payment, the liability related to stock-based awards that call for settlement in cash or other assets must be measured at its fair value based on the fair value of stock option awards and is re-measured at the end of each reporting period. Under Canadian GAAP, the liability is measured and re-measured based on the intrinsic values of the stock option awards instead of the fair values.

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VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

(vii) Income taxes:

Under U.S. GAAP, the FASB issued interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48), an interpretation of SFAS 109, Accounting for Income Taxes. FIN 48 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS 109 and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This interpretation also provides guidance as to derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

Under Canadian GAAP, there is no such interpretation and, therefore, the reserve related to income tax contingencies is not based on the same level of likelihood as prescribed by FIN 48.

Further, under Canadian GAAP, income taxes are measured using substantively enacted tax rates, while under U.S. GAAP measurement is based on enacted tax rates.

During the years ended December 31, 2008 and 2007, the Company and a subsidiary entered into tax consolidation transactions with a parent company by which tax losses have been transferred between the parties. Under Canadian GAAP, those transactions resulted in the recognition of a deferred credit, included in accounts payable and accrued charges, of $14.0 million and $5.7 million, respectively. Under U.S. GAAP, since those transactions are related to asset transfers between related parties, the difference between the carrying value of the tax benefits transferred and the cash consideration received or paid is recognized in contributed surplus.

(viii) Fair value measurements:

On January 1, 2008, the Company adopted the provisions of SFAS 157, Fair Value Measurements which enhance guidance for using fair value to measure assets and liabilities. In February 2008, the FASB issued FASB Staff Position (FSP) FAS-157-1, Application of SFAS 157 to FASB Statement No. 13 and Other Accounting Pronouncements that Address Fair Value Measurements for Purposes of Lease Classification or Measurement Under Statement No. 13, which removes certain leasing transactions from the scope of SFAS 157. The FASB also issued FSP FAS 157-2, Effective Date of SFAS 157, which defers the effective date of SFAS 157 for one year for certain non-financial assets and non-financial liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company is still in the process of evaluating this standard with respect to its effect on non-financial assets and liabilities and has not yet determined the impact that it will have on its consolidated financial statements upon full adoption in 2009.

(ix) Business combinations and non-controlling interest:

In December 2007, the FASB issued SFAS 141 (Revised 2007), Business Combinations (SFAS 141R), and SFAS 160, Non-controlling Interests in Consolidated Financial Statements (SFAS 160), to improve and internationally converge the accounting for business combinations, the reporting of non-controlling interests in consolidated financial statements, the accounting and reporting standards for a non-controlling interest in a subsidiary and for the deconsolidation of a subsidiary. The provisions of SFAS 141R apply prospectively to business combinations for which the acquisition date is on or after December 31, 2008, and SFAS 160 will be effective as of the beginning of 2009. The Company is currently evaluating the impact of adopting SFAS 141R and SFAS 160 on its consolidated financial statements.

(x) Guaranteed debt:

The consolidated information below has been presented in accordance with the requirements of the Securities and Exchange Commission for guarantor financial statements.

The Company’s Senior Notes due 2014, 2015 and 2018 described in note 14 are guaranteed by specific subsidiaries of the Company (the “Subsidiary Guarantors”). The accompanying condensed consolidated financial information as at December 31, 2008 and 2007 and for the years ended 2008, 2007 and 2006 has been prepared in accordance with U.S. GAAP. The information under the column headed “Subsidiary Guarantors” is for all the Subsidiary Guarantors. Investments in the Subsidiary Guarantors are accounted for by the equity method in the separate column headed “Videotron Ltd.” Each Subsidiary Guarantor is wholly-owned by the Company. All guarantees are full and unconditional and joint and several (to the extent permitted by applicable law).

F-36

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

(x) Guaranteed debt (Continued):

The subsidiaries included under the column “Subsidiary Guarantors” are CF Cable TV Inc., Videotron US Inc., 9193-2962 Québec Inc. and Le SuperClub Vidéotron Ltée, and its subsidiary, Groupe de Divertissement SuperClub Inc.

The “Subsidiary Non-Guarantors” is SETTE Inc.

Revision of U.S. GAAP Guarantors Financial Statements Relating to valuation of investments

The Company revised the value of its investments in “Subsidiary Guarantors” and in “Subsidiary Non-Guarantors”, in order to conform fully to the equity method of accounting. These changes affected only the columns titled “Videotron Ltd.” and “Adjustments and Eliminations”.

The following 2007 and 2006 U.S. GAAP financial information from the consolidated statements of operations, consolidated statements of cash flows and consolidated balance sheets have been revised to reflect this change.

For the year ended December 31, 2007, equity income from subsidiaries under the Videotron Ltd. column was increased by $25.6 million to $29.9 million ($11.9 million to $23.3 million for 2006) and an offsetting adjustment was recorded in the Adjustments and eliminations column.

Other assets and shareholder’s equity under the Videotron Ltd. column, as at December 31, 2007, were increased by $795.0 million to $854.6 million and $2,475.9 million, respectively. Offsetting adjustments were recorded in the Adjustments and eliminations column.

Consolidated Statement of Income

In accordance with United States GAAP

For the year ended December 31, 2008

	Videotron Ltd.		Subsidiary Guarantors		Subsidiary Non- Guarantors			Adjustments and eliminations			Consolidated
Revenues	$	1,528,224	$	271,213	$	7,008		$	(1,782	)	$	1,804,663
Direct costs and operating expenses	827,346		174,945		4,473			(1,782		)	1,004,982
Amortization	193,996		30,417		1,207			(33		)	225,587
Financial expenses	88,947		2,001		(24		)	—			90,924
Loss on valuation and translation of financial instruments	30,105		—		—			—			30,105
Other	—		586		—			—			586
Income before the undernoted	387,830		63,264		1,352			33			452,479
Income taxes	67,335		9,539		419			—			77,293
	320,495		53,725		933			33			375,186
Equity income from subsidiaries	54,543		206		—			(54,749		)	—
Non-controlling interest	—		—		—			(148		)	(148		)
Net income (loss)	$	375,038	$	53,931	$	933		$	(54,864	)	$	375,038

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Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Statement of Cash Flows

In accordance with United States GAAP

For the year ended December 31, 2008

	Videotron Ltd.			Subsidiary Guarantors			Subsidiary Non- Guarantors			Adjustments and eliminations			Consolidated
Cash flows related to operating activities:
Net income (loss)	$	375,038		$	53,931		$	933		$	(54,864	)	$	375,038
Adjustments:
Amortization of fixed assets	192,759			30,234			1,207			(33		)	224,167
Amortization of other assets	20,692			8,062			—			—			28,754
Impairment of goodwill	—			2,000			—			—			2,000
Loss (gain) on disposal of fixed assets	1,514			(1,094		)	30			—			450
Loss on valuation and translation financial instruments	25,109			—			—			—			25,109
Amortization of financing costs and debt premium or discount	1,623			—			—			—			1,623
Future income taxes	67,335			8,958			(71		)	—			76,222
Equity income from subsidiaries	(54,543		)	(206		)	—			54,749			—
Other	18,151			—			—			148			18,299
Net change in non-cash balances related to operating activities	(35,830		)	(3,426		)	(144		)	(3		)	(39,403		)
	611,848			98,459			1,955			(3		)	712,259
Cash flows related to investing activities:
Acquisition of fixed assets	(363,939		)	(39,564		)	(1,256		)	—			(404,759		)
Acquisition of shares of a company under common control	110,000			(170,000		)	—			—			(60,000		)
Acquisition of a company under common control	(554,564		)	(554,549		)	—			554,564			(554,549		)
Acquisition of tax deductions from the ultimate parent company	(18,378		)	—			—			—			(18,378		)
Dividends	110,187			66			(300		)	(110,000		)	(47		)
Other	(13,032		)	5,408			—			1,412			(6,212		)
	(729,726		)	(758,639		)	(1,556		)	445,976			(1,043,945		)
Cash flows related to financing activities:
Net change in bank indebtedness	(3,831		)	—			—			(2,061		)	(5,892		)
Net borrowings under bank credit facility	59,949			—			—			—			59,949
Issuance of long-term debt, net of financing costs	447,629			—			—			—			447,629
Subordinated loan from parent company	(110,000		)	170,000			—			—			60,000
Issuance of shares	—			556,919			—			(556,919		)	—
Dividends	(110,000		)	(22,944		)	—			22,944			(110,000		)
Reduction in paid-up capital	(120,000		)	(88,000		)	—			88,000			(120,000		)
Advance (to) from an affiliated company	(45,869		)	45,869			—			—			—
	117,878			661,844			—			(448,036		)	331,686
Net change in cash and cash equivalents	—			1,664			399			(2,063		)	—
Cash and cash equivalents, beginning of year	—			314			557			(871		)	—
Cash and cash equivalents, end of year	$	—		$	1,978		$	956		$	(2,934	)	$	—

F-38

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Balance Sheet

In accordance with United States GAAP

As at December 31, 2008

	Videotron Ltd.			Subsidiary Guarantors			Subsidiary Non- Guarantors		Adjustments and eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	95		$	2,003		$	1,010	$	(3,108	)	$	—
Accounts receivable	154,145			9,359			871		—			164,375
Amounts receivable from affiliated companies	145,053			110,456			1,065		(240,963		)	15,611
Income taxes	163			—			—		26			189
Inventories and prepaid expenses	55,873			4,128			51		—			60,052
Future income taxes	34,884			1,367			—		—			36,251
	390,213			127,313			2,997		(244,045		)	276,478
Investments	1,758,542			296,458			—		—			2,055,000
Fixed assets	1,430,013			262,442			5,326		(292		)	1,697,489
Future income taxes	—			1,038			—		—			1,038
Derivative financial instruments	124,187			—			—		—			124,187
Other assets	1,377,817			560,654			—		(1,356,642		)	581,829
Goodwill	1,903,756			438,236			—		233,711			2,575,703
	$	6,984,528		$	1,686,141		$	8,323	$	(1,367,268	)	$	7,311,724
Liabilities and Shareholder’s Equity
Current liabilities:
Bank indebtedness	$	6,642		$	25		$	54	$	(3,108	)	$	3,613
Accounts payable and accrued charges	280,729			47,135			973		(137		)	328,700
Amounts payable to affiliated companies	128,103			132,063			13		(240,821		)	19,358
Deferred revenue	123,087			41,692			—		—			164,779
Income taxes	(16		)	998			309		26			1,317
	538,545			221,913			1,349		(244,040		)	517,767
Long-term debt	1,804,003			—			—		—			1,804,003
Subordinated loan to parent company	1,760,000			295,000			—		—			2,055,000
Derivative financial instruments	45,688			—			—		—			45,688
Future income taxes	198,614			51,358			363		—			250,335
Other liabilities	11,084			206			—		1,047			12,337
	4,357,934			568,477			1,712		(242,993		)	4,685,130
Shareholder’s Equity:
Capital stock	1			701,735			25		(701,760		)	1
Contributed surplus	5,118,353			792,495			488		(792,983		)	5,118,353
(Deficit) retained earnings	(2,475,774		)	(375,534		)	6,098		369,436			(2,475,774		)
Accumulated other comprehensive loss	(15,986		)	(1,032		)	—		1,032			(15,986		)
	2,626,594			1,117,664			6,611		(1,124,275		)	2,626,594
	$	6,984,528		$	1,686,141		$	8,323	$	(1,367,268	)	$	7,311,724

F-39

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Statement of Income

In accordance with United States GAAP

For the year ended December 31, 2007

	Videotron Ltd.			Subsidiary Guarantors			Subsidiary Non- Guarantors		Adjustments and eliminations			Consolidated
	(Revised)								(Revised)
Revenues	$	1,291,726		$	256,651		$	6,602	$	(1,779	)	$	1,553,200
Direct costs and operating expenses	729,005			181,435			4,150		(1,779		)	912,811
Amortization	187,372			28,208			1,164		(33		)	216,711
Financial expenses	66,378			9,769			—		—			76,147
Gain on valuation and translation of financial instruments	(14,101		)	—			—		—			(14,101		)
Dividend income from related companies	—			(7,092		)	—		7,092			—
Impairment of goodwill	—			5,425			—		—			5,425
Income (loss) before the undernoted	323,072			38,906			1,288		(7,059		)	356,207
Income taxes	29,220			2,892			205		—			32,317
	293,852			36,014			1,083		(7,059		)	323,890
Equity income from subsidiaries	29,865			241			—		(30,106		)	—
Non-controlling interest	—			—			—		(173		)	(173		)
Net income (loss)	$	323,717		$	36,255		$	1,083	$	(37,338	)	$	323,717

F-40

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Statement of Cash Flows

In accordance with United States GAAP

For the year ended December 31, 2007

	Videotron Ltd.			Subsidiary Guarantors			Subsidiary Non- Guarantors			Adjustments and eliminations			Consolidated
	(Revised)									(Revised)
Cash flows related to operating activities:
Net income (loss)	$	323,717		$	36,255		$	1,083		$	(37,338	)	$	323,717
Adjustments:
Amortization of fixed assets	185,368			28,031			1,164			(33		)	214,530
Amortization of other assets	13,363			8,072			—			—			21,435
Impairment of goodwill	—			5,425			—			—			5,425
Loss on disposal of fixed assets	2,391			777			77			—			3,245
Gain on valuation and translation financial instruments	(15,516		)	—			—			—			(15,516		)
Amortization of financing costs and debt premium or discount	441			—			—			—			441
Future income taxes	29,228			2,932			90			—			32,250
Equity income from subsidiaries	(29,865		)	(241		)	—			30,106			—
Other	(524		)	2,360			—			173			2,009
Net change in non-cash balances related to operating activities	(26,927		)	(6,065		)	(98		)	(1,917		)	(35,007		)
	481,676			77,546			2,316			(9,009		)	552,529
Cash flows related to investing activities:
Acquisition of fixed assets	(292,541		)	(36,419		)	(3,032		)	1,917			(330,075		)
Acquisition of shares of a company under common control	(1,870,000		)	(125,000		)	—			—			(1,995,000		)
Acquisition of tax deductions from the ultimate parent company	(12,763		)	(2,100		)	—			—			(14,863		)
Decrease in temporary investments	—			—			987			—			987
Net change in investment in a subsidiary	330,733			—			—			(330,733		)	—
Dividends	4,000			(4,000		)	—			—			—
Advance from (to) an affiliated company	65,000			(65,000		)	—			—			—
Other	2,125			(945		)	1			—			1,181
	(1,773,446		)	(233,464		)	(2,044		)	(328,816		)	(2,337,770		)
Cash flows related to financing activities:
Net change in bank indebtedness	(8,489		)	—			—			(476		)	(8,965		)
Net borrowings under bank credit facility	98,721			—			—			—			98,721
Subordinated loan from parent company	1,870,000			125,000			—			—			1,995,000
Repayment of subordinated loan to parent company	—			(25,969		)	—			25,969			—
Reduction in paid-up capital	(299,550		)	(145,816		)	—			145,816			(299,550		)
Redemption of shares	(65,000		)	65,000			—			—			—
Dividends	(7,092		)	(158,948		)	—			166,040			—
Advance (to) from an affiliated company	(296,855		)	296,855			—			—			—
Other	35			—			—			—			35
	1,291,770			156,122			—			337,349			1,785,241
Net change in cash and cash equivalents	—			204			272			(476		)	—
Cash and cash equivalents, beginning of year	—			110			285			(395		)	—
Cash and cash equivalents, end of year	$	—		$	314		$	557		$	(871	)	$	—

F-41

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Balance Sheet

In accordance with United States GAAP

As at December 31, 2007

	Videotron Ltd.			Subsidiary Guarantors			Subsidiary Non- Guarantors		Adjustments and eliminations			Consolidated
	(Revised)								(Revised)
Assets
Current assets:
Cash and cash equivalents	$	493		$	315		$	583	$	(1,391	)	$	—
Accounts receivable	150,597			9,234			1,535		—			161,366
Amounts receivable from affiliated companies	80,792			59,490			165		(107,604		)	32,843
Income taxes	199			21			—		—			220
Inventories and prepaid expenses	49,161			6,579			21		—			55,761
Future income taxes	26,866			5,599			7		—			32,472
	308,108			81,238			2,311		(108,995		)	282,662
Investments	1,870,000			125,000			—		—			1,995,000
Fixed assets	1,246,995			254,035			5,658		(325		)	1,506,363
Future income taxes	—			2,970			—		—			2,970
Other assets	854,568			7,383			—		(854,835		)	7,116
Goodwill	1,903,756			440,117			—		233,711			2,577,584
	$	6,183,427		$	910,743		$	7,969	$	(730,444	)	$	6,371,695
Liabilities and Shareholder’s Equity
Current liabilities:
Bank indebtedness	$	10,869		$	1		$	26	$	(1,391	)	$	9,505
Accounts payable and accrued charges	235,515			31,755			653		(126		)	267,797
Amounts payable to affiliated companies	134,168			50,691			676		(107,475		)	78,060
Deferred revenue	113,510			38,302			116		—			151,928
Income taxes	34			(10		)	95		—			119
	494,096			120,739			1,566		(108,992		)	507,409
Long-term debt	946,236			—			—		—			946,236
Subordinated loan to parent company	1,870,000			125,000			—		—			1,995,000
Derivative financial instruments	245,556			—			—		—			245,556
Future income taxes	139,857			48,429			435		—			188,721
Other liabilities	11,829			144			—		947			12,920
	3,707,574			294,312			2,001		(108,045		)	3,895,842
Shareholder’s Equity:
Capital stock	46,177			232,817			25		(232,842		)	46,177
Contributed surplus	5,178,143			792,495			488		(792,983		)	5,178,143
(Deficit) retained earnings	(2,739,710		)	(407,463		)	5,455		402,008			(2,739,710		)
Accumulated other comprehensive loss	(8,757		)	(1,418		)	—		1,418			(8,757		)
	2,475,853			616,431			5,968		(622,399		)	2,475,853
	$	6,183,427		$	910,743		$	7,969	$	(730,444	)	$	6,371,695

F-42

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Statement of Income

In accordance with United States GAAP

For the year ended December 31, 2006

	Videotron Ltd.		Subsidiary Guarantors			Subsidiary Non- Guarantors		Adjustments and eliminations			Consolidated
	(Revised)							(Revised)
Revenues	$	1,066,286	$	241,527		$	5,610	$	(1,158	)	$	1,312,265
Direct costs and operating expenses	631,230		169,000			4,163		(1,158		)	803,235
Amortization	170,246		25,448			674		(33		)	196,335
Financial expenses	61,973		19,806			—		—			81,779
Loss on valuation and translation of financial instruments	5,992		—			—		—			5,992
Dividend income from related companies	—		(13,170		)	—		13,170			—
Income (loss) before the undernoted	196,845		40,443			773		(13,137		)	224,924
Income taxes	51,350		4,492			231		—			56,073
	145,495		35,951			542		(13,137		)	168,851
Equity income from subsidiaries	23,270		119			—		(23,389		)	—
Non-controlling interest	—		—			—		(86		)	(86		)
Net income (loss)	$	168,765	$	36,070		$	542	$	(36,612	)	$	168,765

F-43

Table of Contents

VIDEOTRON LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, Continued

Years ended December 31, 2008, 2007 and 2006

(tabular amounts are in thousands of Canadian dollars)

24. SIGNIFICANT DIFFERENCES BETWEEN GAAP IN CANADA AND THE UNITED STATES (Continued):

Consolidated Statement of Cash Flows

In accordance with United States GAAP

For the year ended December 31, 2006

	Videotron Ltd.			Subsidiary Guarantors			Subsidiary Non- Guarantors			Adjustments and eliminations			Consolidated
	(Revised)									(Revised)
Cash flows related to operating activities:
Net income (loss)	$	168,765		$	36,070		$	542		$	(36,612	)	$	168,765
Adjustments:
Amortization of fixed assets	168,910			25,288			674			(33		)	194,839
Amortization of other assets	10,506			7,329			—			—			17,835
Loss on disposal of fixed assets	700			167			549			—			1,416
Loss on valuation and translation financial instruments	4,880			—			—			—			4,880
Amortization of financing costs and debt premium or discount	432			—			—			—			432
Future income taxes	51,997			4,482			33			—			56,512
Equity income from subsidiaries	(23,270		)	(119		)	—			23,389			—
Other	1,129			1,240			—			86			2,455
Net change in non-cash balances related to operating activities	(40,490		)	28,593			95			2,509			(9,293		)
	343,559			103,050			1,893			(10,661		)	437,841
Cash flows related to investing activities:
Acquisition of fixed assets	(260,720		)	(37,665		)	(1,793		)	(2,451		)	(302,629		)
Net decrease (increase) in temporary investments	40,000			—			(491		)	—			39,509
Dividends	19,000			(19,000		)	—			—			—
Other	514			283			—			—			797
	(201,206		)	(56,382		)	(2,284		)	(2,451		)	(262,323		)
Cash flows related to financing activities:
Net change in bank indebtedness	18,865			—			—			(395		)	18,470
Net borrowings under bank credit facility	49,000			—			—			—			49,000
Repayment of subordinated loan to parent company	(150,000		)	—			—			—			(150,000		)
Issuance of shares	111,536			—			—			—			111,536
Transfer of Additional Amount payable to parent company	(111,536		)	—			—			—			(111,536		)
Reduction in paid-up capital	(108,749		)	—			—			—			(108,749		)
Dividends	(23,170		)	—			—			13,170			(10,000		)
Advance from (to) an affiliated company	47,094			(47,036		)	—			(58		)	—
Other	(938		)	—			—			—			(938		)
	(167,898		)	(47,036		)	—			12,717			(202,217		)
Net change in cash and cash equivalents	(25,545		)	(368		)	(391		)	(395		)	(26,699		)
Cash and cash equivalents, beginning of year	25,545			478			676			—			26,699
Cash and cash equivalents, end of year	$	—		$	110		$	285		$	(395	)	$	—

25. SUBSEQUENT EVENTS:

(a) In January and February 2009, the Company paid dividends to its parent company, Quebecor Media Inc., for total cash distributions of $55.0 million.

(b) On January 9, 2009, CF Cable TV Inc., a wholly-owned subsidiary of the Company, increased the subordinated loan by $190.0 million from Quebecor Media Inc., bearing interest at a rate of 10.5%, payable every six months on June 20 and December 20, and maturing on January 9, 2024. On the same day, CF Cable TV Inc. invested the total proceeds of $190.0 million into 190,000 preferred shares, Series B, of 9101-0835 Québec Inc. These shares carry the right to receive an annual dividend of 10.85%, payable semi-annually.

26. Event (Unaudited) Subsequent to the Date of the Report of Independent Registered Public Accounting Firm:

On March 5, 2009, the Company issued US$260.0 million in aggregate principal amount of Senior Notes at a discount price of 98.625% for net proceeds of US$256.4 million, before financing fees of US$5.3 million. These Notes bear interest at a rate of 9.125% for an effective interest rate of 9.35% payable every six months on June 15 and December 15, and mature on April 15, 2018. The Notes contain certain restrictions on the Company, including limitations on its ability to incur additional indebtedness, pay dividends and make other distributions, and are unsecured. The Senior Notes are guaranteed by specific subsidiaries of the Company. These Notes are redeemable at the option of the Company, in whole or in part, at any time on or after April 15, 2013, at a decreasing premium.

F-44

Exhibit 1.2

[TRANSLATION]

[Logo of Québec Registrar]

CERTIFICATE OF AMENDMENT

Companies Act, Part IA
(R.S.Q., c. C-38)

I hereby certify that the company

VIDEOTRON LTD.

amended its articles on JUNE 30, 2008 , under Part IA of the Companies Act , as indicated in the Articles of Amendment attached hereto.

[Seal of Québec Registrar]

Filed in the register on July 2, 2008 under registration number 1163819882

[ Signed ]

Enterprise Registrar

T230Z12L88V90JA

[TRANSLATION]

Articles of Amendment

Companies Act (R.S.Q., c.C-38, Part IA)

	Québec enterprise number
	NEQ	1	1	6	3	8	1	9	8	8	2

1. Name - Enter the new name of the company, if changed, and enter the previous name in section 5.

- Enter the current name, if you are keeping it, and write N.A. in section 5.

Vidéotron Ltée / Videotron Ltd.

Mark and X in this box if you are apply for a designating number (numbered company) rather than a name o

2. The articles of the company are amended as follows:

Schedule “C” to the Articles of Amalgamation is superseded and replaced by a new Schedule “C” titled “Other Provisions of the Articles of Amalgamation of Videotron Ltd.” which is attached to these Articles of Amendment.

3. Effective date (if later than that on which the articles of amendement are filed):

Date following that of the filing date:

Year

Month

Day

4. Amendment of articles under sections 123.140 and following of the Companies Act

Mark an X if the application for amendment is presented to correct an illegal or irregular element, or to include a provision required under the Companies Act :

· where the correction or insertion does not affect the rights of the shareholders or creditors (sec. 123.140); o

· where the correction or insertion may affect the rights of the shareholders or creditors - append copy of judgment (sec. o 123.141).

Effective date (the amendment will be retroactive to the date of the certificate accompanying the articles being amended), unless these articles or the judgment provides for a later date):

Year Month Day

5. Name prior to the amendment (if different than the one mentioned in section 1)

N/A

Do not write in this space
Québec			/s/ Serge Gouin
Québec			Signature of Authorized Director
Filed on June 30, 2008 THE ENTERPRISE REGISTRAR
			If you need more space, attach an appendix in two copies,
			identify the relevant section, and number the pages, if any.

RETURN BOTH COPIES OF THIS FORM TOGETHER WITH YOUR PAYMENT. DO NOT SEND BY FAX.

Minister of Revenue

LE-50.0.11.04 (2007-04)

SCHEDULE “C”

Relating to

OTHER PROVISIONS OF THE ARTICLES OF AMALGAMATION OF

VIDEOTRON LTD. (the “Company”)

RESTRICTIONS ON THE TRANSFER OF SHARES

In addition to the requirements contained in Schedule “B” to the Articles of Amalgamation of the Company relating to the issuance and transfer of shares of the capital stock of the Company, no shares of the capital stock of the Company shall be transferred without the approval of the directors as evidenced by a resolution of the Board of Directors; the approval of such transfer of shares may be given as aforesaid after the transfer has been recorded on the books of the Company, in which case, unless such resolution provides otherwise, the transfer shall be valid and effective on the date it was recorded on the books of the Company.

RESTRICTIONS ON THE FREE TRANSFER OF SECURITIES

As long as the Company shall have the status of a “private issuer” within the meaning of Regulation 45-106 respecting Prospectus and Registration Exemptions , all transfers of securities (other than shares whose transfer was approved in accordance with this Schedule and non-convertible debt securities) of the Company shall be subject to the consent of the Board of Directors of the Company expressed in a resolution passed by the Board of Directors or, as the case may be, to the restrictions contained in any agreement of the holders.

COMPANY’S BORROWING POWERS

Without in any way limiting the borrowing powers of the Company, the Board of Directors may, without the consent of the shareholders:

(a) borrow money upon the credit of the Company;

(b) issue bonds, debentures or other securities of the Company, and pledge or sell the same for such sums and at such prices as may be deemed expedient; and

Exhibit 1.3

[TRANSLATION]

[Logo of Québec Registrar]

CERTIFICATE OF AMENDMENT

Companies Act, Part IA
(R.S.Q., c. C-38)

I hereby certify that the company

VIDEOTRON LTD.

amended its articles on DECEMBER 12, 2008 , under Part IA of the Companies Act , as indicated in the Articles of Amendment attached hereto.

[Seal of Québec Registrar]

Filed in the register on January 19, 2009 under registration number
1163819882

[ Signed ]
Enterprise Registrar

R930Z12L88V91JA

[TRANSLATION]

Articles of Amendment

Companies Act (R.S.Q., c.C-38, Part IA)

	Québec enterprise number
	NEQ	1	1	6	3	8	1	9	8	8	2

1. Name - Enter the new name of the company, if changed, and enter the previous name in section 5.

- Enter the current name, if you are keeping it, and write N.A. in section 5.

Videotron Ltd.

Mark and X in this box if you are apply for a designating number (numbered company) rather than a name o

2. The articles of the company are amended as follows:

See Schedule 1 to these articles of amendment which forms an integral part hereof.

3. Effective date (if later than that on which the articles of amendement are filed):

Date following that of the filing date:

Year

Month

Day

4. Amendment of articles under sections 123.140 and following of the Companies Act

Mark an X if the application for amendment is presented to correct an illegal or irregular element, or to include a provision required under the Companies Act :

· where the correction or insertion does not affect the rights of the shareholders or creditors (sec. 123.140); o

· where the correction or insertion may affect the rights of the shareholders or creditors - append copy of judgment (sec. o 123.141).

Effective date (the amendment will be retroactive to the date of the certificate accompanying the articles being amended), unless these articles or the judgment provides for a later date):

Year Month Day

5. Name prior to the amendment (if different than the one mentioned in section 1)

N/A

Do not write in this space
Québec			/s/ Serge Gouin
Québec			Signature of Authorized Director
Filed on Dec. 12, 2008 THE ENTERPRISE REGISTRAR

			If you need more space, attach an appendix in two copies,
			identify the relevant section, and number the pages, if any.


RETURN BOTH COPIES OF THIS FORM TOGETHER WITH YOUR PAYMENT. DO NOT SEND BY FAX.

Minister of Revenue

LE-50.0.11.04 (2007-04)

SCHEDULE 1

to the Articles of Amendment of

VIDEOTRON LTD. (the “Company”)

The unlimited share capital of the Company is modified by the creation of the Class “H” Preferred Shares, which shall carry the following rights:

(H) CLASS “H” PREFERRED SHARES: The number of Class “H” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “H” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

(1) Ranking of Class “H” Preferred Shares. Class “H” Preferred Shares shall have priority over the Common Shares, but not over the Class “B,” “C,” “D,” “E”, “F” and “G” Preferred Shares with respect to the order of payment of dividends and the distribution of the assets of the Company in the event of the liquidation, winding-up or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

(2) Right to Dividends. The holders of Class “H” Shares shall be entitled to receive, every year, in such manner and at such time as the Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “H” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

(3) Repayment. If, for any reason, including in the event of dissolution or liquidation or winding-up of the Company, whether or not voluntary, some or all of the assets of the Company are distributed among the shareholders, each holder of Class “H” Shares shall be entitled to repayment of the amount paid for the Class “H” Shares into the subdivision of the issued and paid-up share capital account relating to the Class “H” Shares.

(4) No Voting Right. Subject to the provisions of the Act or as otherwise expressly provided, the holders of Class “H” Shares shall not be entitled to receive notice of, attend or vote at the meeting of shareholders of the Company.

(5) Redemption Right. The Company shall be entitled, at its discretion, subject to the provisions of the Companies Act in this regard, to redeem at any time all or from time to time part of the Class “H” Shares then outstanding upon giving notice to that effect, on payment to the holders of the Class “H” Shares at a price equal to the “Redemption Value”, as described below, plus the amount of dividends declared but unpaid, if any, on the Class “H” Shares.

(a) Redemption Value

The “Redemption Value” of each share corresponds to the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “H” Shares, plus a premium equal to the amount by which the fair market value of the consideration received by the Company at the time such Class “H” Share was issued exceeds the total of:

(i) the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “H” Shares; and

(ii) the fair market value of any property, other than a Class “H” Share, given by the Company in payment of such consideration.

(b) Determination of Fair Market Value of the Consideration

Upon issuance of the Class “H” Shares, the Company and each subscriber of Class “H” Shares shall determine, by mutual consent and in good faith, based on a method deemed fair and reasonable, the fair market value of each of the assets that form part of the consideration received by the Company at the time the Class “H” Shares are issued.

(c) Adjustment of the Premium in Case of a Disagreement with the Department of Revenue

In the event of a disagreement with the federal or provincial department of revenue, or both, with respect to the appraisal of the fair market value of one or more of the assets that form part of the consideration received by the Company at the time the Class “H” Shares are issued, the appraisal by such department shall prevail. The amount of the premium relating to the redemption of the Class “H” Shares shall be adjusted accordingly if the department in question provides the Company and each holder of Class “H” Shares, or, where all of the shares are redeemed, the Company and each former holder of Class “H” Shares, with the opportunity to contest the appraisal with the department or before the courts. Where the federal and provincial appraisals differ, the amount of the premium shall be equal to the lower appraisal established in accordance with an uncontested assessment or another final judgment, as the case may be.

If, before the Redemption Value provided for in the foregoing sentence is adjusted, the Company pays, in cash or any other form of consideration, to a holder of Class “H” Shares, in connection with a redemption, retraction or purchase of Class “H” Shares, a sum for the Class “H” Shares that differs from the adjusted Redemption Value, the holder or the Company, as the case may be, shall immediately pay to the holder or the Company, as the case may be, the difference between the amount paid in connection with the redemption, retraction or purchase and the adjusted Redemption Value. Moreover, if, at the time of the adjustment, dividends have already been declared and paid on the Class “H” Shares, such dividends shall be adjusted so as to reflect the adjustment of the Redemption Value.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “H” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares of each such holder of Class “H” Shares to be redeemed. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “H” Shares called for redemption is deposited with the Company’s bankers or at any other place specified in the notice, on or before the Redemption Date, the holders of Class “H” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any accrued but unpaid dividends on such Class “H” Shares being redeemed, upon presentation and surrender of the certificates representing such number of shares to be redeemed.

Exhibit 1.5

[TRANSLATION]

[Logo of Québec Registrar]

CERTIFICATE OF AMALGAMATION

Companies Act, Part IA

(R.S.Q., c. C-38)

I hereby certify that the Companies mentioned in the Articles of Amalgamation amalgamated on DECEMBER 28, 2008 under Part IA of the Companies Act into one Company under the name

LE SUPERCLUB VIDÉOTRON LTÉE

as indicated in the Articles of Amalgamation attached hereto.

Filed in the register on December 30, 2008

under the business number 1144188886

		[signed] Enterprise Registrar

[stamp of the Enterprise Registrar Québec]

E020V16S88L83DA

LEX-302 (2007-04)

[TRANSLATION]

Mark an X in this box
if it is a simplified amalgamation x

1.	Name - Enter the name of the company created by the amalgamation, and its version in another language, if applicable.

	Le SuperClub Vidéotron ltée

	Mark an X in this box if you are applying for a designating number (numbered company) rather than a name. o

2.	Québec judicial district of the company head office - Enter the judicial district, as stipulated in the Territorial Division Act (R.S.Q. c. D-11).
	You can obtain additional information at the Court house, from Services Québec
	or online at www.justice.gouv.qc.ca/francais/recherche/district.asp.			Montréal

3.	Precise number or minimum and maximum number of directors	Minimum 3 - Maximum 15


4.	Effective Date		Year		Month	Day
	Enter the name of entry into force, if later than that on which the articles are filed.		2008		12	28

5.	Describe the authorized capital stock and the limits imposed - Unless otherwise indicated in its articles, the company has unlimited capital stock with shares without par value. (See the section “Description of Capital Stock”.)

	See Schedule A

6.	Restrictions on the transfer of shares and other provisions, if applicable

	See Schedule B and Schedule C

7.	Limits on activity, if applicable

	N/A

8.	Name and Québec enterprise number (NEQ) of each of the amalgamating companies Obtain the signature of an authorized director for each of the companies.

Name of the company		Québec enterprise number (NEQ)										Signature of Authorized Director

1.	Le SuperClub Vidéotron ltée	1	1	4	4	1	8	8	8	8	6	[SIGNATURE]

2.	Groupe de divertissement SuperClub inc.	1	1	4	0	2	8	4	1	7	6	[SIGNATURE]

3.	SuperClub Vidéotron Canada inc./ SuperClub Videotron Canada inc.	1	1	6	1	9	5	8	7	9	9	[SIGNATURE]

4.		1	1

Do not write in this space


Québec
Filed on
Dec. 23, 2008		If the space provided is not sufficient, include an appendix, in two copies,
		identifying the corresponding section. If necessary, number the pages.
Le registraire
des enterprises
	Remit the two copies of this form, along with your payment. Do not fax.
Ministère du Revenu	LE-50.0.11.06-T (2008-10)

SCHEDULE A

5. Description of share capital of the Company

Class A shares

An unlimited number of Class A shares without par value, subject to the following rights, privileges, conditions and restrictions:

The holders of Class A shares will have the right to:

1) vote at all shareholders’ meetings, each Class A share conferring one (1) vote;

2) participate in the property, profits and surplus assets of the Company and for this purpose receive any dividend declared

3) share in the residue of assets upon dissolution of the Company.

CLASS B SHARES

An unlimited number of Class B shares, with no par value and having the following rights, privileges and restrictions:

1) Dividend and participation . The bearers of B shares equally with the bearers of class A shares, are entitled to:

a) share in the property, profits or surplus assets of the Company and for this purpose receive any dividend declared by the Company;

b) share in the residue of assets upon the liquidation or dissolution of the Company.

2) Right to vote . Subject to the provisions of the Companies Act, the bearers of Class B shares do not have the right on this basis alone to vote at the meetings of the shareholders of the Company nor the right to attend them or receive notice of such meetings.

3) Right of redemption . Subject to the provisions of section 123.54 of the Québec Companies Act , the bearers of Class B shares have at all times upon written request the right to require the redemption by the Company of the Class B shares they hold at a price equal to the amount paid for these Class B shares plus any dividend declared but not paid. The written notice must specify the number of Class B shares to be redeemed and be accompanied by the share certificates representing the shares to be redeemed.

The Company shall proceed with the redemption of such shares and pay the redemption price no later than fifteen (15) days after receiving the notice mentioned above.

The Class B shares so redeemed shall be cancelled on the date of their redemption, and the Company shall reduce the subdivision of its issued and paid-up share capital account attached to the Class B shares in accordance with the provisions of section 123.51 of the Québec Companies Act.

SCHEDULE B

The shares of the Company may not be transferred without the consent of the directors, expressed in a duly adopted resolution.

SCHEDULE C

1. OTHER POWERS

The Company may use all or part of its funds to purchase shares of other companies to acquire and hold shares, bonds or other securities of companies to sell them or otherwise dispose of it. This power may be exercised by the directors of the Company, by simple resolution.

2. RESTRICTIONS ON THE TRANSFER OF SECURITIES

As long as the Company shall have the status of a « private issuer » as defined in Regulation 45-106 on Prospectus and Registration Exemptions , all transfers of securities of the Company (other than non-convertible debt securities) shall be subject to the approval of the Board of Directors of the Company as evidenced by a resolution passed by them or, as the case may be, to any restrictions contained in securities’ holders agreements.

Exhibit 1.9

State of Delaware

Secretary of State

Division of Corporations

Delivered 04:48 PM 09/20/2007

FILED 04:48 PM 09/20/2007
SRV 071037634 - 4426900 FILE

CERTIFICATE OF INCORPORATION

VIDEOTRON US INC.

FIRST: The name of the corporation is Videotron US Inc. (the “Corporation”).

SECOND: The registered office of the Corporation in the State of Delaware is located at Suite 1410, The Nemours Building, 1007 Orange Street, County of New Castle, Wilmington, Delaware 19801. The Registered Agent of the Corporation at such address is Delaware Incorporators & Registration Service, LLC.

THIRD: The nature of the business or purposes to be conducted or oriented is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”).

FOURTH: The total number of shares of stock the Corporation shall have the authority to issue is Ten Thousand (10,000) shares, of which Nine Thousand (9,000) shall be designated Common Stock, par value $1.00, and One Thousand (1,000) shall be designated Preferred Stock without par value.

The preferences, qualifications, limitations, restrictions and special or relative rights in respect of the shares as Preferred Stock are:

A. Rank. The Preferred Stock will rank with respect to dividend rights and rights on liquidation, winding up and dissolution senior to the Common Stock. Any distribution made pursuant to dividend rights or rights on liquidation, winding up, or dissolution will be made to the holders of the Corporation’s securities in accordance with the relative priorities set forth above.

B. Dividends.

General Obligation. When and as declared by the Corporation’s Board of Directors and to the extent permitted under the DGCL, the Corporation will pay an annual dividend of 9% of the Liquidation Value (as defined in Section C) on each share of Preferred Stock (a “Share”).

Dividends upon Preferred Stock will be non-cumulative, whether or not in any fiscal year there shall be net income or surplus available for the payment of dividends in such fiscal year, so that if in any fiscal year or years, dividends in whole or in part are not paid upon Preferred Stock, unpaid dividends shall not accumulate, so that no sums in any later years shall be paid to the holders of the Preferred Stock with respect to any prior year or years when dividends were not paid, and so that in no event shall the holders of the Preferred Stock receive dividends of more than 9% in any fiscal year.

C. Liquidation. The Liquidation Value, in relation to each Share, shall be $100.00. Upon any liquidation, dissolution or winding up of the Corporation (whether voluntary or involuntary), each holder of Preferred Stock will be entitled to be paid before any distribution or payment is made upon any Common Stock, an amount in cash equal to the aggregate Liquidation Value of all Shares held by such holder (plus any declared and unpaid dividends thereon). Upon such payment, the holders of Preferred Stock will not be entitled to receive any further payment from the Corporation. If upon any such liquidation, dissolution or winding up of the Corporation the Corporation’s assets to be distributed among the holders of Preferred Stock are insufficient to permit payment to such holders of the aggregate amount which they are entitled to be paid under this Section C, then the entire assets available to be distributed to the Corporation’s stockholders will be distributed pro rata among the holders of the Preferred Stock based upon the aggregate Liquidation Value (plus any declared and unpaid dividends) of the Preferred Stock held by each such holder. Neither the consolidation or merger of the Corporation into or with any other entity or entities (whether or not the Corporation is the surviving entity), nor the sale or transfer by the Corporation of all or any part of its assets, nor the reduction of the capital stock of the Corporation nor any other form of recapitalization, dissolution or winding up of the Corporation will be deemed to be a liquidation, dissolution or winding up of the Corporation within the meaning of this Section C.

D. Redemption. To the extent permitted under the DGCL, the Preferred Stock shall be redeemable at the Liquidation Value (plus any declared and unpaid dividends) at any time at the discretion of the Corporation.

E. Voting Rights. Except as otherwise may be required by the DGCL, the holders of Preferred Stock will not be entitled to notice of any meeting of the stockholders of the Corporation and will not be entitled to vote, together with any other stockholders or as a separate class, on any matter to be voted on by the Corporation’s stockholders.

FIFTH: The name and mailing address of the incorporator is Delaware Incorporators & Registration Service, LLC, Suite 1410, Nemours Building, 1007 Orange Street, Wilmington, Delaware 19801.

SIXTH: The Corporation is to have perpetual existence.

SEVENTH: In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors is expressly authorized to make, amend and repeal the Bylaws of the Corporation.

EIGHTH: Elections of directors need not be by written ballot unless the by-laws of the Corporation shall so provide. Meetings of the stockholders shall be held within or outside the State of Delaware, as the by-laws may provide. The books of the Corporation shall be kept (subject to the provisions contained in the General Corporation Law) within or outside the State of Delaware, at such place or places as may be designated from time to time by the Board of Directors or in the by-laws of the Corporation.

NINTH: The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.

TENTH: The Directors of the Corporation shall incur no personal liability to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty as a Director; provided, however, that the Directors of the Corporation shall continue to be subject to liability (i) for any breach of their duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for acts or omissions arising under Section 174 of the General Corporation Law of the State of Delaware, or (iv) for any transaction from which the Directors derived an improper personal benefit.

ELEVENTH: The powers of the Incorporator shall terminate upon the election of Directors.

* * *

THE UNDERSIGNED, being the Incorporator, for the purpose of forming a corporation under the laws of the State of Delaware, has executed this Certificate of Incorporation on this 20 th day of September, 2007.

		DELAWARE INCORPORATORS &
		REGISTRATION SERVICE, LLC

		By:	/s/ C. ANTHONY SHIPPAM
			C. Anthony Shippam
			CEO and President

Exhibit 1.10

Delaware

The First State

I, HARRIET SMITH WINDSOR, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE RESTATED CERTIFICATE OF “VIDEOTRON US INC.”, FILED IN THIS OFFICE ON THE FIRST DAY OF OCTOBER, A.D. 2008, AT 2:31 O’CLOCK P.M.

A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW CASTLE COUNTY RECORDER OF DEEDS.

/s/ HARRIET SMITH WINDSOR

4426900 8100

081003894

Harriet Smith Windsor, Secretary of State

AUTHENTICATION: 6888718

DATE: 10-01-08

You may verify this certificate on line

at corp.delaware.gov/authver.shtml

	State of Delaware
	Secretary of State
	Division of Corporations Delivered 02:31 PM 10/01/2008
	FILED 02:31 PM 10/01/2008
	SRV 081003894 - 4426900 FILE

AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
VIDEOTRON US INC.

Pursuant to Sections 242 and 245 of
the General Corporation Law of the State of Delaware

Videotron US Inc, (the “Corporation”), a corporation duly organized and existing under and by virtue of the General Corporation Law of the State of Delaware (“GCL”), in order to amend and restate its Certificate of Incorporation pursuant to Sections 242 and 245 of the GCL of the State of Delaware, hereby certifies as follows:

1. The name of the Corporation is Videotron US Inc. The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on September 20, 2007.

2. The Corporation has received payment for its stock.

3. The Board of Directors of the Corporation, at a Special Meeting held on September 30, 2008, duly adopted a resolution proposing and declaring advisable the amendment and restatement of the Corporation’s Certificate of Incorporation and the adoption of an Amended and Restated Certificate of Incorporation of the Corporation in the form hereinafter set forth in Item 7.

4. The sole Stockholder of the Corporation, acting pursuant to a Written Consent of Sole Stockholder, dated as of September 30, 2008, in accordance with Section 228 of the GCL, duly adopted such amendment and restatement of the Certificate of Incorporation.

5. The Amended and Restated Certificate of Incorporation and the amendments made thereby were duly adopted in accordance with the applicable provisions of sections 242 and 245 of the GCL.

6. The Amended and Restated Certificate of Incorporation amends and restates the provisions of the Certificate of Incorporation as originally filed.

7. The text of the Certificate of Incorporation, as originally filed, is hereby amended and restated to read in its entirety as follows:

[Remainder of Page Intentionally Left Blank]

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION
OF
VIDEOTRON US INC.

FIRST: The name of the corporation is Videotron US Inc. (the “Corporation”).

The preferences, qualifications, limitations, restrictions and special or relative rights in respect of the shares as Preferred Stock are:

A. Rank. The Preferred Stock will rank with respect to dividend rights and rights on liquidation, winding up and dissolution senior to the Common Stock. Any distribution made pursuant to dividend rights or rights on liquidation, winding up, or dissolution will be made to the holders of the Corporation’s securities in accordance with the relative priorities set forth above.

B. Dividends.

General Obligation. When and as declared by the Corporation’s Board of Directors and to the extent permitted under the DGCL, the Corporation will pay an annual dividend of 9% of the

Liquidation Value (as defined in Section C) on each share of Preferred Stock (a “Share”). Dividends upon Preferred Stock will be non-cumulative, whether or not in any fiscal year there shall be net income or surplus available for the payment of dividends in such fiscal year, so that if in any fiscal year or years, dividends in whole or in part are not paid upon Preferred Stock, unpaid dividends shall not accumulate, so that no sums in any later years shall be paid to the holders of the Preferred Stock with respect to any prior year or years when dividends were not paid, and so that in no event shall the holders of the Preferred Stock receive dividends of more than 9% in any fiscal year.

C. Liquidation. The Liquidation Value, in relation to each Share, shall be equal to the consideration received by the Corporation at the time each Share was issued. Upon any liquidation, dissolution or winding up of the Corporation (whether voluntary or involuntary), each holder of Preferred Stork will be entitled to be paid before any distribution or payment is made upon any Common Stock, an amount in cash equal to the aggregate Liquidation Value of all Shares held by such holder (plus any declared and unpaid dividends thereon). Upon such payment, the holders of Preferred Stock will not be entitled to receive any further payment from the Corporation. If upon any such liquidation, dissolution or winding up of the Corporation the Corporation’s assets to be distributed among the holders of Preferred Stock are insufficient to permit payment to such holders of the aggregate amount which they are entitled to be paid under this Section C, then the entire assets available to be distributed to the Corporation’s stockholders will be distributed pro rata among the holders of the Preferred Stock based upon the aggregate Liquidation Value (plus any declared and unpaid dividends) of the Preferred Stock held by each such holder. Neither the consolidation or merger of the Corporation into or with any other entity or entities (whether or not the Corporation is the surviving entity), nor the sale or transfer by the Corporation of all or any part of its assets, nor the reduction of the capital stock of the Corporation nor any other form of recapitalization, dissolution or winding up of the Corporation will be deemed to be a liquidation, dissolution or winding up of the Corporation within the meaning of this

Section C.

D. Redemption. To the extent permitted under the DGCL, the Preferred Stock shall be redeemable at the Liquidation Value (plus any declared and unpaid dividends) at any time at the discretion of the Corporation.

E. Voting Rights. Except as otherwise may be required by the DGCL, the holders of Preferred Stock will not be entitled to notice of any meeting of the stockholders of the Corporation and will not be entitled to vote, together with any other stockholders or as a separate class, on any matter to be voted on by the Corporation’s stockholders.

FIFTH: The name and mailing address of the Incorporator is Delaware Incorporators & Registration Service, LLC, Suite 1410, Nemours Building, 1007 Orange Street, Wilmington, Delaware 19801.

SIXTH: The Corporation is to have perpetual existence.

EIGHTH: Elections of directors need not be by written ballot unless the by-laws of the Corporation shall so provide. Meetings of the stockholders shall be held within or outside the State of Delaware. as the by-laws may provide. The books of the Corporation shall be kept (subject to the provisions contained in the General Corporation Law) within or outside the State of Delaware, at such place or places as may be designated from time to time by the Board of Directors or in the by-laws of the Corporation.

* * *

THE UNDERSIGNED, being the Secretary of the Corporation, has caused this Amended and Restated Certificate of Incorporation to be executed and to be effective upon its filing with the Delaware Secretary of State.

Exhibit 1.11

VIDEOTRON US INC.

BY-LAWS

ARTICLE I

OFFICES

Section 1. The registered office shall be in the City of Wilmington, County of New Castle, State of Delaware.

Section 2. The corporation may also have offices at such other places both within and without the State of Delaware as the board of directors may from time to time determine or the business of the corporation may require.

ARTICLE Il

MEETINGS OF STOCKHOLDERS

Section 1 . All meetings of the stockholders for the election of directors shall be held at such place either within or without the State of Delaware as shall be designated from time to time by the board of directors and stated in the notice of the meeting. Meetings of stockholders for any other purpose may be held at such time and place, within or without the State of Delaware, as shall be stated in the notice of the meeting or in a duly executed waiver of notice thereof

Section 2. Annual meetings of stockholders shall be held at such date and time as shall be designated from time to time by the board of directors and stated in the notice of the meeting, at which they shall elect by a plurality vote a board of directors and transact such other business as may properly be brought before the meeting.

Section 3 . Written notice of the annual meeting stating the place, date and hour of the meeting shall be given to each stockholder entitled to vote at such meeting not less than ten nor more than sixty days before the date of the meeting.

Section 4. Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the certificate of incorporation, may be called by the chairman or the president and shall be called by the president or secretary at the request in writing of:

a) a majority of the board of directors: or

b) stockholders owning a majority in amount of the entire capital stock

of the corporation issued and outstanding and entitled to vote.

Such request shall state the purpose or purposes of the proposed meeting.

Section 5 . Written notice of a special meeting stating the place, date and hour of the meeting and the purpose or purposes for which the meeting is called shall be given not less than ten nor more than sixty days before the date of the meeting, to each stockholder entitled to vote at such meeting.

Section 6. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.

Section 7. The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.

Section 8. The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute or by the certificate of incorporation. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Section 9. When a quorum is present at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which by express provision of the statutes or of the certificate of incorporation, a different vote is required in which case such express provision shall govern and control the decision of such question.

Section 10. Unless otherwise provided in the certificate of incorporation, each stockholder shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of the capital stock having voting power held by such stockholder, but no proxy shall be voted on after three years from its date, unless the proxy provides for a longer period.

Section 11. Unless otherwise provided in the certificate of incorporation, any action required to be taken at any annual or special meeting of stockholders of the corporation, or any action which may be taken at any annual or special meeting of such stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.

ARTICLE III

DIRECTORS

Section 1. The business of the corporation shall be managed by or under the direction of its board of directors which may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the certificate of incorporation or by these by-laws directed or required to be exercised or done by the stockholders.

Section 2 . The number of directors which all constitute the whole board shall be not less than one not more than seven. Within the limits above specified, the number of directors shall be fixed from time to time by resolution of the board of directors or by the stockholders at the annual meeting. The directors shall be elected at the annual meeting of the stockholders, except as provided in Section 3 of this Article, and each director elected shall hold office until his successor is elected and qualified. Directors need not be stockholders.

Section 3. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled by a majority of the directors then in office, though less than a quorum, or by a sole remaining director, and the directors so chosen shall hold office until the next annual election and until their successors are duly elected and shall qualify, unless sooner displaced. If there are no directors in office, then an election of directors may be held in the manner provided by statute. If, at the time of filling any vacancy or any newly created directorship, the directors then in office shall constitute less than a majority of the whole board (as constituted immediately prior to any such increase), the Court of chancery may, upon application of any stockholder or stockholders holding at least ten percent

of the total number of the shares at the time outstanding having the right to vote for such directors, summarily order an election to be held to fill any such vacancies or newly created directorships, or to replace the directors chosen by the directors then in office.

MEETINGS OF THE BOARD OF DIRECTORS

Section 4. The board of directors of the corporation may hold meetings, both regular and special, either within or without the State of Delaware.

Section 5. The first meeting of each newly elected board of directors all be held at such time and place as shall be fixed by the vote of the stockholders at the annual meeting and no notice of such meeting shall be necessary to the newly elected directors in order legally to constitute the meeting, provided a quorum shall be present. In the event of the failure of the stockholders to fix the time or place of such first meeting of the newly elected board of directors, or in the event such meeting is not held at the time and place so fixed by the stockholders, the meeting may be held at such time and place as shall be specified in a notice given as hereinafter provided for special meetings of the board of directors, or as shall be specified in a written waiver signed by all of the directors.

Section 6. Regular meetings of the board of directors may be held without notice at such time and at such place as shall from time to time be determined by the board.

Section 7. Special meetings of the board may be called by the chairman or the president on two days’ notice to each director, either personally or by mail or by telegram; special meetings shall be called in like manner and on like notice on the written request of two directors, unless the board consists of only one director in which case special meetings shall be called in like manner and on like notice on the written request of the sole director.

Section 8. At all meetings of the board, a majority of the directors shall constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the board of directors, except as may be otherwise specifically provided by statute or by the certificate of incorporation. If a quorum shall not be present at any meeting of the board of directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

Section 9 . Unless otherwise restricted by the certificate of incorporation or these by-laws, any action required or permitted to be taken at any meeting of the board of directors or of any committee thereof may be taken without a meeting, if all members of the board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the board or committee.

Section 10. Unless otherwise restricted by the certificate of incorporation or these - by-laws, members of the board of directors, or any committee designated by the board of directors, may participate in a meeting of the board of directors, or any committee, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

COMMITTEES OF DIRECTORS

Section 11 . The board of directors may, by resolution passed by a majority of the whole board, designate one or more committees, each committee to consist of one or more of the directors of the corporation. The board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the board of directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the board of directors, shall have and may exercise all the powers and authority of the board of directors in the management of the business and affairs of the corporation, and may authorize the seal of the corporation to be affixed to all papers which may require it; but no such committee shall have the power or authority in reference to amending the certificate of incorporation (except that a committee may, to the extent authorized in the resolution or resolutions providing for the issuance of shares of stock adopted by the board of directors as provided in Section 151(a) of the General Corporation Law of Delaware, fix any of the preferences or rights of such shares relating to dividends, redemption, dissolution, any distribution of assets of the corporation, or the conversion into, or the exchange of such shares for, shares of any other class or classes or any other series of the same or any other class or classes of stock of the corporation), adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the corporation’s property and assets, recommending to the stockholders a dissolution of the corporation or a revocation of a dissolution, or amending the by-laws of the corporation; and, unless the resolution or the certificate of incorporation expressly so provides, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock or to adopt a certificate of ownership and merger. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the board of directors.

Section 12 . Each committee shall keep regular minutes of its meetings and report the same to the board of directors when required.

COMPENSATION OF DIRECTORS

Section 13. Unless otherwise restricted by the certificate of incorporation or these by-laws, the board of directors shall have the authority to fix the compensation of directors. The directors may be paid their expenses, if any, of attendance at each meeting of the board of directors and may be paid a fixed sum for attendance at each meeting of the board of directors or a stated salary as director. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefore. Members of special or standing committees may be allowed like compensation for attending committee meetings.

REMOVAL OF DIRECTORS

Section 14. Unless otherwise restricted by the certificate of incorporation or by laws, any director or the entire board of directors may be removed, with or without cause, by the holders of a majority of shares entitled to vote at an election of directors.

ARTICLE IV

NOTICES

Section 1 . Whenever, under the provisions of the statutes or of the certificate of incorporation or of these by-laws, notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, addressed to such director or stockholder, at his address as it appears on the records of the corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. Notice to directors may also be given by telegram.

Section 2 . Whenever any notice is required to be given under the provisions of the statutes or of the certificate of incorporation or of these by-laws, a waiver thereof in writing, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto.

ARTICLE V

OFFICERS

Section 1. The officers of the corporation shall be chosen by the board of directors and shall consist of a president and a secretary. The board of directors may also choose one or more vice-presidents, a treasurer, one or more assistant treasurers and one or more assistant secretaries. Any number of offices may be held by the same person, unless the certificate of incorporation or these by-laws otherwise provide.

Section 2. The board of directors may appoint such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the board.

Section 3. The board of directors at its first meeting after each annual meeting of stockholders shall choose the officers of the corporation who shall hold their offices until their successors are chosen and qualified, or until their resignation or removal. If any officers are not chosen at an annual meeting, any such officers may be chosen at any subsequent regular or special meeting.

Section 4. The salaries of all officers and agents of the corporation shall be fixed by the board of directors.

Section 5 . The officers of the corporation shall hold office until their successors are chosen and qualified. Any officer elected or appointed by the board of directors may be removed at any time by the affirmative vote of a majority of the board of directors. Any vacancy occurring in any office of the corporation shall be filled by the board of directors.

THE CHAIRMAN

Section 6. The chairman shall preside at all stockholders’ meetings and all meetings of the board of directors at which he is present and shall have such other duties as may be assigned to him by the board of directors.

THE PRESIDENT

Section 7 . The president shall have general and active management of the business of the corporation and shall see that all orders and resolutions of the board of directors are carried into effect. In the absence of the chairman or in the event of his inability or refusal to act, the president shall also perform the duties of the chairman and, when so acting, shall have all the powers of and be subject to all the restrictions upon the chairman.

Section 8 . The president shall execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the board of directors to

some other officer or agent of the corporation. The president shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

THE VICE-PRESIDENT

Section 9 . In the absence of the president or in the event of his inability or refusal to act, the vice-president (or in the event there be more than one vice-president, the vice-presidents in the order designated by the directors, or in the absence of any designation, then in the order of their election) shall perform the duties of the president and, when so acting, shall have all the powers of and be subject to all the restrictions upon the president. The vice-president shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

THE SECRETARY AND ASSISTANT SECRETARY

Section 10. The secretary shall attend all meetings of the board of directors and all meetings of the stockholders and record all the proceedings of the meetings of the corporation and of the board of directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required. The secretary shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the board of directors, and shall perform such other duties as may be prescribed by the board of directors or president, under whose supervision he shall be. The secretary shall have custody of the corporate seal of the corporation and the secretary, or an assistant secretary, shall have authority to affix the same to any instrument requiring it and, when so affixed, it may be attested by the secretary’s signature or by the signature of such assistant secretary. The board of directors may give general authority to any other officer to affix the seal of the corporation and to attest the affixing by that officer’s signature.

Section 11 . The assistant secretary or, if there be more than one, the assistant secretaries in the order determined by the board of directors (or, if there be no such determination, then in the order of their election) shall, in the absence of the secretary or in the event of his inability or refusal to act, perform the duties and exercise the powers of the secretary and shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

THE TREASURER AND ASSISTANT TREASURER

Section 12 . The treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the board of directors.

Section 13. The treasurer shall disburse the funds of the corporation as may be ordered by the board of directors, taking proper vouchers for such disbursements, and shall render to the chairman, the president and the board of directors, at its regular meetings, or when the board of directors so requires, an account of all his transactions as treasurer and of the financial condition of the corporation.

Section 14 . If required by the board of directors, the treasurer shall give the corporation a bond (which shall be renewed every six years) in such sum and with such surety or sureties as shall be satisfactory to the board of directors for the faithful performance of the duties of the treasurer’s office and for the restoration to the corporation, in case of the treasurer’s death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the treasurer’s possession or under the treasurer’s control belonging to the corporation.

Section 15. The assistant treasurer or, if there shall be more than one, the assistant treasurers in the order determined by the board of directors (or, if there be no such determination, then in the order of their election) shall, in the absence of the treasurer or in the event of his inability or refusal to act, perform the duties and exercise the powers of the treasurer and shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

ARTICLE VI

CERTIFICATES FOR SHARES

Section 1. The shares of the corporation shall be represented by a certificate or shall be uncertificated. Certificates shall be signed by, or in the name of the corporation by, (a) the chairman or the president or a vice-president of the corporation and (b) the treasurer or an assistant treasurer or the secretary or an assistant secretary of the corporation. Within a reasonable time after the issuance or transfer of uncertificated stock, the corporation shall send to the registered owner thereof a written notice containing the information required to be set forth or stated on certificates pursuant to Sections 151, 156, 202(a) or 218(a) of the General Corporation Law of Delaware or a statement that the corporation will furnish without charge to each stockholder who so requests the powers, designations

preferences and relative participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.

Section 2. Any of or all the signatures on a certificate may be facsimile. In case any officer, transfer agent or registrer who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrer before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent or registrer at the date of issue.

LOST CERTIFICATES

Section 3. The board of directors may direct a new certificate or certificates or uncertificated shares to be issued in place of any certificate or certificates therefore issued by the corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate or certificates or uncertificated shares, the board of directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or to give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost, stolen or destroyed.

TRANSFER OF STOCK

Section 4. Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books. Upon receipt of proper transfer instructions from the registered owner of uncertificated shares, such uncertificated shares shall be cancelled and issuance of new equivalent uncertificated shares or certificated shares shall be made to the person entitled thereto and the transaction shall be recorded upon the books of the corporation.

FIXING RECORD DATE

Section 5. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other

distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the board of directors may fix, in advance, a record date, which shall not be more than sixty nor less than ten days before the date of such meeting, nor more than sixty days prior to any other action. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the board of directors may fix a new record date for the adjourned meeting.

REGISTERED STOCKHOLDERS

Section 6 . The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware.

ARTICLE VII

GENERAL PROVISIONS DIVIDENDS

Section 1 . Dividends upon the capital stock of the corporation, subject to the provisions of the certificate of incorporation, if any, may be declared by the board of directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the certificate of incorporation.

Section 2 . Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the corporation, or for such other purpose as the directors shall think conducive to the interest of the corporation, and the directors may modify or abolish any such reserve in the manner in which it was created.

ANNUAL STATEMENT

Section 3 . The board of directors shall present at each annual meeting; and at any special meeting of the stockholders when called for by vote of the stockholders, a full and clear statement of the business and condition of the corporation.

CHECKS

Section 4. All checks or demands for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the board of directors may from time to time designate.

FISCAL YEAR

Section 5. The fiscal year of the corporation shall be fixed by resolution of the board of directors.

SEAL

Section 6. The corporate seal shall have inscribed thereon the name of the corporation, the year of its organization and the words “Corporate Seal, Delaware.” The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

INDEMNIFICATION

Section 7 . The corporation shall indemnify its officers, directors, employees and agents to the extent permitted by the General Corporation Law of Delaware.

ARTICLE VIII

AMENDMENTS

Section 1. These by-laws may be altered, amended or repealed or new by-laws may be adopted by the stockholders or by the board of directors, when such power is conferred upon the board of directors by the certificate of incorporation at any regular meeting of the stockholders or of the board of directors or at any special meeting of the stockholders or of the board of directors if notice of such alteration, amendment, repeal or adoption of new by-laws be contained in the notice of such special meeting. If the power to adopt, amend or repeal by-laws is conferred upon the board of directors by the certificate of incorporation, it shall not divest or limit the power of the stockholders to adopt, amend or repeal by-laws.

Exhibit 1.12

[Translation]

[Logo of Québec Registrar]

CERTIFICATE OF CONSTITUTION

Companies Act, Part IA
(R.S.Q., c. C-38)

I hereby certify that the company

9193-2962 QUÉBEC INC.

was constituted on FEBRUARY 28, 2008 , under Part IA of the Companies Act , as indicated in the Articles of Constitution attached hereto.

		[ Signed ]
	*Filed in the register on March 3, 2008 under registration number 1165008898*
*[Seal of Québec Registrar]*		Acting Enterprise Registrar

S310I18Q98980MA

[Translation]

Registraire des entreprises		Articles of Constitution
QUÉBEC		Articles of Continuance

		Companies Act (R.S.Q., c. C-38, Part IA)

Mark an X in the appropriate box.
Articles of Constitution x Articles of Continuance: o		For articles of continuance only.

Québec enterprise number

NEQ	1	1

1.		Name – Constitution: Enter the company name, and its version in another language, if applicable. Leave blank if you are applying for a designating number rather than a name. Continuance: enter the current name, if you are keeping it, and its version if applicable, and N.A. in section 8 or enter the new name, and its version in another language if applicable.

		9193-2962 QUÉBEC INC.

		Mark an x in this box if you are applying for a designating number (numbered company) rather than a name. x

2.	Québec judicial district of the company head office —		Enter the judicial district, such as stipulated in the Territorial
	Montréal		Division Act (R.S.Q., c. D-11). You can obtain additional information at the Court house, from Services Québec or online at www.justice.gouv.qc.ca/francais/recherche/district.asp

3.	Precise number or minimum and maximum number of directors	4.	Effective Date Enter the date of entry into force, if later than that on which the articles are filed.	Year	Month	Day
	Minimum: 1 Maximum: 10

5.	Describe the authorized capital stock and the limits imposed – Unless otherwise indicated in its articles, the company has unlimited capital stock with shares without par value. (See the section “Description of capital stock”.)

	See Schedule A hereof which is an integral part of these Articles of Constitution.

6.	Restrictions on the transfer of shares and other provisions, if applicable.

	See Schedules B and C hereof which are integral parts of these Articles of Constitution.

7.	Limits on activity, if applicable.

	S/O

8.	Name prior to the continuance (if different than the one mentioned in section 1)


9.	Founders (for articles of constitution only) – Enter first and last names, address(es) of founder(s) or name and address of head office of the legal person acting in this capacity.

	Last and first names or name of the legal person acting in the quality of founder

	Fondateurs Inteltex Inc./Inteltex Incorporators Inc.

	Street and no., apartment/suite, city/province, postal code and country

	651 Notre-Dame Street West, 3rd floor, Montréal, Quebec, H3C 1J1, Canada

	Loi constitutive de la personne morale agissant à titre de fondateur
		Signature of founder or the person
	Loi canadienne sur les sociétés par actions	authorized by the legal person

	Last and first names or name of the legal person acting in the quality of founder

	Street and no., apartment/suite, city/province, postal code and country	Signature of founder or the person
		authorized by the legal person
	Constituting act of the legal person acting in the quality of founder

		For articles of continuance only:
		Signature of authorized director

Do not write in this space		If the space provided is not sufficient, include an appendix, in two copies, identifying the corresponding section. If necessary, number the pages. Sign the two copies of this form and remit them, accompanied by the documents and the required payment. Do not fax.

Ministére du Revenu

LE-50.0.11.03-T (2008-10)

[Translation]

SCHEDULE A
SHARE CAPITAL

The unlimited share capital of the Company shall consist of seven (7) classes of shares, which shall carry the following rights:

A) CLASS “A” COMMON SHARES: The number of Class “A” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “A” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Dividend and Participation. Subject to the rights and privileges conferred by the other classes of shares, the holders of Class “A” Shares shall be entitled to:

a) participate in the property, profits and surplus assets of the Company and, to that end, receive any dividend declared by the Company, the amount, timing and terms of payment of which are at the sole discretion of the Board of Directors; and

b) share in the remaining property of the Company upon liquidation or winding-up, whether or not voluntary, dissolution or any other distribution of the property of the Company.

2) Restriction. In addition to the restrictions set forth in Sections 123.70 and 123.56 of the Companies Act , the Company may neither pay a dividend on Class “A” Shares nor purchase any such shares by private agreement if, as a result thereof, the book value of the net assets of the Company would be insufficient to redeem the Class “B,” “C,” “D,” “E,” “F” and “G” Shares.

3) Voting Right. The holders of Class “A” Shares shall be entitled to receive notice of, attend and vote at meetings of shareholders of the Company, except meetings at which only the holders of another class of shares are entitled to vote, and each Class “A” Share shall entitle the holder thereof to one (1) vote.

B) CLASS “B” PREFERRED SHARES: The number of Class “B” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “B” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Ranking of Class “B” Preferred Shares. Class “B” Preferred Shares shall have priority over the Common Shares and the Class “C,” “D,” “E,” and “F” Preferred Shares, but not over the Class “G” Preferred Shares with respect to the order of payment of dividends and the distribution of the assets of the Company in the event

of the liquidation, winding-up or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

2) Right to Dividends. The holders of Class “B” Shares shall be entitled to receive, every year, in such manner and at such time as the Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “B” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

3) Repayment. If, for any reason, including in the event of dissolution or liquidation or winding-up of the Company, whether or not voluntary, some or all of the assets of the Company are distributed among the shareholders, each holder of Class “B” Shares shall be entitled to repayment of the amount paid for the Class “B” Shares into the subdivision of the issued and paid-up share capital account relating to the Class “B” Shares.

4) No Voting Right. Subject to the provisions of the Act or as otherwise expressly provided, the holders of Class “B” Shares shall not be entitled to receive notice of, attend or vote at the meeting of shareholders of the Company.

5) Redemption Right. The Company shall be entitled, at its discretion, subject to the provisions of the Companies Act in this regard, to redeem at any time all or from time to time part of the Class “B” Shares then outstanding upon giving notice to that effect, on payment to the holders of the Class “B” Shares of an aggregate redemption price equal to the consideration received by the Company at the time the Class “B” Shares were issued.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “B” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares of each such holder of Class “B” Shares to be redeemed. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “B” Shares called for redemption is deposited with the Company’s bankers or at any other place specified in the notice, on or before the Redemption Date, the holders of Class “B” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any accrued but unpaid dividends on such Class “B” Shares being redeemed, upon presentation and surrender of the certificates representing such number of shares to be redeemed.

6) Retraction Right. Subject to paragraph two of Section 123.54 of the Companies Act , each holder of Class “B” Shares shall be entitled, at any time and at such holder’s discretion, upon written notice, to require the Company to redeem all

or part of such holder’s shares at a price equal to the “Redemption Value,” as described below, plus the amount of dividends declared but unpaid, if any, on the Class “B” Shares.

a) Redemption Value

The “Redemption Value” of each share corresponds to the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “B” Shares, plus a premium equal to the amount by which the fair market value of the consideration received by the Company at the time such Class “B” Share was issued exceeds the total of:

(i) the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “B” Shares; and

(ii) the fair market value of any property, other than a Class “B” Share, given by the Company in payment of such consideration.

b) Determination of Fair Market Value of the Consideration

Upon issuance of the Class “B” Shares, the Company and each subscriber of Class “B” Shares shall determine, by mutual consent and in good faith, based on a method deemed fair and reasonable, the fair market value of each of the assets that form part of the consideration received by the Company at the time the Class “B” Shares are issued.

c) Adjustment of the Premium in Case of a Disagreement with the Department of Revenue

In the event of a disagreement with the federal or provincial department of revenue, or both, with respect to the appraisal of the fair market value of one or more of the assets that form part of the consideration received by the Company at the time the Class “B” Shares are issued, the appraisal by such department shall prevail. The amount of the premium relating to the redemption of the Class “B” Shares shall be adjusted accordingly if the department in question provides the Company and each holder of Class “B” Shares, or, where all of the shares are redeemed, the Company and each former holder of Class “B” Shares, with the opportunity to contest the appraisal with the department or before the courts. Where the federal and provincial appraisals differ, the amount of the premium shall be equal to the lower appraisal established in accordance with an uncontested assessment or another final judgment, as the case may be.

If, before the Redemption Value provided for in the foregoing sentence is adjusted, the Company pays, in cash or any other form of consideration, to a holder of Class “B” Shares, in connection with a redemption, retraction or purchase of Class “B” Shares, a sum for the Class “B” Shares that differs from the adjusted Redemption Value, the holder or the Company, as the

case may be, shall immediately pay to the holder or the Company, as the case may be, the difference between the amount paid in connection with the redemption, retraction or purchase and the adjusted Redemption Value. Moreover, if, at the time of the adjustment, dividends have already been declared and paid on the Class “B” Shares, such dividends shall be adjusted so as to reflect the adjustment of the Redemption Value.

7) Right to Purchase by Private Agreement. Subject to Section 123.56 of the Companies Act , the Company may, at any time, without giving notice and without taking into consideration the other classes of shares, purchase by private agreement and at the best possible price all or part of the issued and outstanding Class “B” Shares. However, such purchase price shall never exceed the Redemption Value mentioned above or the book value of the net assets of the Company.

C) CLASS “C” PREFERRED SHARES: The number of Class “C” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “C” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Ranking of Class “C” Preferred Shares. Class “C” Preferred Shares shall have priority over the Common Shares and the Class “D,” “E” and “F” Preferred Shares, but not over the Class “B” and “G” Preferred Shares with respect to the order of payment of dividends and the distribution of the assets of the Company in the event of the liquidation, winding-up or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

2) Right to Dividends. The holders of Class “C” Shares shall be entitled to receive, every year, in such manner and at such time as the Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “C” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

3) Repayment. If, for any reason, including in the event of dissolution or liquidation or winding-up of the Company, whether or not voluntary, some or all of the assets of the Company are distributed among the shareholders, each holder of Class “C” Shares shall be entitled to repayment of the amount paid for the Class “C” Shares into the subdivision of the issued and paid-up share capital account relating to the Class “C” Shares.

4) No Voting Right. Subject to the provisions of the Act or as otherwise expressly provided, the holders of Class “C” Shares shall not be entitled to receive notice of, attend or vote at the meeting of shareholders of the Company.

5) Redemption Right. The Company shall be entitled, at its discretion, subject to the provisions of the Companies Act in this regard, to redeem at any time all or from time to time part of the Class “C” Shares then outstanding upon giving notice to that effect, on payment to the holders of the Class “C” Shares of an aggregate redemption price equal to the consideration received by the Company at the time the Class “C” Shares were issued.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “C” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares of each such holder of Class “C” Shares to be redeemed. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “C” Shares called for redemption is deposited with the Company’s bankers or at any other place specified in the notice, on or before the Redemption Date, the holders of Class “C” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any accrued but unpaid dividends on such Class “C” Shares being redeemed, upon presentation and surrender of the certificates representing such number of shares to be redeemed.

6) Retraction Right. Subject to paragraph two of Section 123.54 of the Companies Act , each holder of Class “C” Shares shall be entitled, at any time and at such holder’s discretion, upon written notice, to require the Company to redeem all or part of such holder’s shares at a price equal to the “Redemption Value,” as described below, plus the amount of dividends declared but unpaid, if any, on the Class “C” Shares.

a) Redemption Value

The “Redemption Value” of each share corresponds to the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “C” Shares, plus a premium equal to the amount by which the fair market value of the consideration received by the Company at the time such Class “C” Share was issued exceeds the total of:

(i) the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “C” Shares; and

(ii) the fair market value of any property, other than a Class “C” Share, given by the Company in payment of such consideration.

b) Determination of Fair Market Value of the Consideration

Upon issuance of the Class “C” Shares, the Company and each subscriber of Class “C” Shares shall determine, by mutual consent and in good faith,

based on a method deemed fair and reasonable, the fair market value of each of the assets that form part of the consideration received by the Company at the time the Class “C” Shares are issued.

c) Adjustment of the Premium in Case of a Disagreement with the Department of Revenue

In the event of a disagreement with the federal or provincial department of revenue, or both, with respect to the appraisal of the fair market value of one or more of the assets that form part of the consideration received by the Company at the time the Class “C” Shares are issued, the appraisal by such department shall prevail. The amount of the premium relating to the redemption of the Class “C” Shares shall be adjusted accordingly if the department in question provides the Company and each holder of Class “C” Shares, or, where all of the shares are redeemed, the Company and each former holder of Class “C” Shares, with the opportunity to contest the appraisal with the department or before the courts. Where the federal and provincial appraisals differ, the amount of the premium shall be equal to the lower appraisal established in accordance with an uncontested assessment or another final judgment, as the case may be.

If, before the Redemption Value provided for in the foregoing sentence is adjusted, the Company pays, in cash or any other form of consideration, to a holder of Class “C” Shares, in connection with a redemption, retraction or purchase of Class “C” Shares, a sum for the Class “C” Shares that differs from the adjusted Redemption Value, the holder or the Company, as the case may be, shall immediately pay to the holder or the Company, as the case may be, the difference between the amount paid in connection with the redemption, retraction or purchase and the adjusted Redemption Value. Moreover, if, at the time of the adjustment, dividends have already been declared and paid on the Class “C” Shares, such dividends shall be adjusted so as to reflect the adjustment of the Redemption Value.

7) Right to Purchase by Private Agreement. Subject to Section 123.56 of the Companies Act , the Company may, at any time, without giving notice and without taking into consideration the other classes of shares, purchase by private agreement and at the best possible price all or part of the issued and outstanding Class “C” Shares. However, such purchase price shall never exceed the Redemption Value mentioned above or the book value of the net assets of the Company.

D) CLASS “D” PREFERRED SHARES: The number of Class “D” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “D” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Ranking of Class “D” Preferred Shares. Class “D” Preferred Shares shall have priority over the Common Shares and the Class “E” and “F” Preferred Shares, but not over the Class “B,” “C” and “G” Preferred Shares with respect to the order of payment of dividends and the distribution of the assets of the Company in the event of the liquidation, winding-up or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

2) Right to Dividends. The holders of Class “D” Shares shall be entitled to receive, every year, in such manner and at such time as the Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “D” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

3) Repayment. If, for any reason, including in the event of dissolution or liquidation or winding-up of the Company, whether or not voluntary, some or all of the assets of the Company are distributed among the shareholders, each holder of Class “D” Shares shall be entitled to repayment of the amount paid for the Class “D” Shares into the subdivision of the issued and paid-up share capital account relating to the Class “D” Shares.

4) No Voting Right. Subject to the provisions of the Act or as otherwise expressly provided, the holders of Class “D” Shares shall not be entitled to receive notice of, attend or vote at the meeting of shareholders of the Company.

5) Redemption Right. The Company shall be entitled, at its discretion, subject to the provisions of the Companies Act in this regard, to redeem at any time all or from time to time part of the Class “D” Shares then outstanding upon giving notice to that effect, on payment to the holders of the Class “D” Shares of an aggregate redemption price equal to the consideration received by the Company at the time the Class “D” Shares were issued.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “D” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares of each such holder of Class “D” Shares to be redeemed. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “D” Shares called for redemption is deposited with the Company’s bankers or at any other place specified in the notice, on or before the Redemption Date, the holders of Class “D” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any accrued but unpaid dividends on such Class “D” Shares being redeemed, upon

presentation and surrender of the certificates representing such number of shares to be redeemed.

6) Retraction Right. Subject to paragraph two of Section 123.54 of the Companies Act , each holder of Class “D” Shares shall be entitled, at any time and at such holder’s discretion, upon written notice, to require the Company to redeem all or part of such holder’s shares at a price equal to the “Redemption Value,” as described below, plus the amount of dividends declared but unpaid, if any, on the Class “D” Shares.

a) Redemption Value

The “Redemption Value” of each share corresponds to the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “D” Shares, plus a premium equal to the amount by which the fair market value of the consideration received by the Company at the time such Class “D” Share was issued exceeds the total of:

(i) the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “D” Shares; and

(ii) the fair market value of any property, other than a Class “D” Share, given by the Company in payment of such consideration.

b) Determination of Fair Market Value of the Consideration

Upon issuance of the Class “D” Shares, the Company and each subscriber of Class “D” Shares shall determine, by mutual consent and in good faith, based on a method deemed fair and reasonable, the fair market value of each of the assets that form part of the consideration received by the Company at the time the Class “D” Shares are issued.

c) Adjustment of the Premium in Case of a Disagreement with the Department of Revenue

In the event of a disagreement with the federal or provincial department of revenue, or both, with respect to the appraisal of the fair market value of one or more of the assets that form part of the consideration received by the Company at the time the Class “D” Shares are issued, the appraisal by such department shall prevail. The amount of the premium relating to the redemption of the Class “D” Shares shall be adjusted accordingly if the department in question provides the Company and each holder of Class “D” Shares, or, where all of the shares are redeemed, the Company and each former holder of Class “D” Shares, with the opportunity to contest the appraisal with the department or before the courts. Where the federal and provincial appraisals differ, the amount of the premium shall be equal to the lower appraisal established in accordance with an uncontested assessment or another final judgment, as the case may be.

If, before the Redemption Value provided for in the foregoing sentence is adjusted, the Company pays, in cash or any other form of consideration, to a holder of Class “D” Shares, in connection with a redemption, retraction or purchase of Class “D” Shares, a sum for the Class “D” Shares that differs from the adjusted Redemption Value, the holder or the Company, as the case may be, shall immediately pay to the holder or the Company, as the case may be, the difference between the amount paid in connection with the redemption, retraction or purchase and the adjusted Redemption Value. Moreover, if, at the time of the adjustment, dividends have already been declared and paid on the Class “D” Shares, such dividends shall be adjusted so as to reflect the adjustment of the Redemption Value.

7) Right to Purchase by Private Agreement. Subject to Section 123.56 of the Companies Act , the Company may, at any time, without giving notice and without taking into consideration the other classes of shares, purchase by private agreement and at the best possible price all or part of the issued and outstanding Class “D” Shares. However, such purchase price shall never exceed the Redemption Value mentioned above or the book value of the net assets of the Company.

E) CLASS “E” PREFERRED SHARES: The number of Class “E” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “E” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Ranking of Class “E” Preferred Shares. Class “E” Preferred Shares shall have priority over the Common Shares and the Class “F” Preferred Shares, but not over the Class “B,” “C,” “D” and “G” Preferred Shares with respect to the order of payment of dividends and the distribution of the assets of the Company in the event of the liquidation, winding-up or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

2) Right to Dividends. The holders of Class “E” Shares shall be entitled to receive, every year, in such manner and at such time as the Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “E” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

3) Repayment. If, for any reason, including in the event of dissolution or liquidation or winding-up of the Company, whether or not voluntary, some or all of the assets of the Company are distributed among the shareholders, each holder of Class “E” Shares shall be entitled to repayment of the amount paid for the Class “E” Shares into the subdivision of the issued and paid-up share capital account relating to the Class “E” Shares.

4) No Voting Right. Subject to the provisions of the Act or as otherwise expressly provided, the holders of Class “E” Shares shall not be entitled to receive notice of, attend or vote at the meeting of shareholders of the Company.

5) Redemption Right. The Company shall be entitled, at its discretion, subject to the provisions of the Companies Act in this regard, to redeem at any time all or from time to time part of the Class “E” Shares then outstanding upon giving notice to that effect, on payment to the holders of the Class “E” Shares of an aggregate redemption price equal to the consideration received by the Company at the time the Class “E” Shares were issued.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “E” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares of each such holder of Class “E” Shares to be redeemed. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “E” Shares called for redemption is deposited with the Company’s bankers or at any other place specified in the notice, on or before the Redemption Date, the holders of Class “E” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any accrued but unpaid dividends on such Class “E” Shares being redeemed, upon presentation and surrender of the certificates representing such number of shares to be redeemed.

6) Retraction Right. Subject to paragraph two of Section 123.54 of the Companies Act , each holder of Class “E” Shares shall be entitled, at any time and at such holder’s discretion, upon written notice, to require the Company to redeem all or part of such holder’s shares at a price equal to the “Redemption Value,” as described below, plus the amount of dividends declared but unpaid, if any, on the Class “E” Shares.

a) Redemption Value

The “Redemption Value” of each share corresponds to the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “E” Shares, plus a premium equal to the amount by which the fair market value of the consideration received by the Company at the time such Class “E” Share was issued exceeds the total of:

(i) the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “E” Shares; and

(ii) the fair market value of any property, other than a Class “E” Share, given by the Company in payment of such consideration.

b) Determination of Fair Market Value of the Consideration

Upon issuance of the Class “E” Shares, the Company and each subscriber of Class “E” Shares shall determine, by mutual consent and in good faith, based on a method deemed fair and reasonable, the fair market value of each of the assets that form part of the consideration received by the Company at the time the Class “E” Shares are issued.

c) Adjustment of the Premium in Case of a Disagreement with the Department of Revenue

In the event of a disagreement with the federal or provincial department of revenue, or both, with respect to the appraisal of the fair market value of one or more of the assets that form part of the consideration received by the Company at the time the Class “E” Shares are issued, the appraisal by such department shall prevail. The amount of the premium relating to the redemption of the Class “E” Shares shall be adjusted accordingly if the department in question provides the Company and each holder of Class “E” Shares, or, where all of the shares are redeemed, the Company and each former holder of Class “E” Shares, with the opportunity to contest the appraisal with the department or before the courts. Where the federal and provincial appraisals differ, the amount of the premium shall be equal to the lower appraisal established in accordance with an uncontested assessment or another final judgment, as the case may be.

If, before the Redemption Value provided for in the foregoing sentence is adjusted, the Company pays, in cash or any other form of consideration, to a holder of Class “E” Shares, in connection with a redemption, retraction or purchase of Class “E” Shares, a sum for the Class “E” Shares that differs from the adjusted Redemption Value, the holder or the Company, as the case may be, shall immediately pay to the holder or the Company, as the case may be, the difference between the amount paid in connection with the redemption, retraction or purchase and the adjusted Redemption Value. Moreover, if, at the time of the adjustment, dividends have already been declared and paid on the Class “E” Shares, such dividends shall be adjusted so as to reflect the adjustment of the Redemption Value.

7) Right to Purchase by Private Agreement. Subject to Section 123.56 of the Companies Act , the Company may, at any time, without giving notice and without taking into consideration the other classes of shares, purchase by private agreement and at the best possible price all or part of the issued and outstanding Class “E” Shares. However, such purchase price shall never exceed the Redemption Value mentioned above or the book value of the net assets of the Company.

F) CLASS “F” PREFERRED SHARES: The number of Class “F” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited; Class “F”

Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Ranking of Class “F” Preferred Shares. Class “F” Preferred Shares shall have priority over the Common Shares, but not over the Class “B,” “C,” “D,” “E” and “G” Preferred Shares with respect to the order of payment of dividends and the distribution of the assets of the Company in the event of the liquidation, winding-up or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

2) Right to Dividends. The holders of Class “F” Shares shall be entitled to receive, every year, in such manner and at such time as the Board of Directors may declare, a non-cumulative dividend at the fixed rate of 1% per month, calculated on the redemption price of the Class “F” Preferred Shares, payable in cash, property or through the issuance of fully paid shares of any class of the Company.

3) Repayment. If, for any reason, including in the event of dissolution or liquidation or winding-up of the Company, whether or not voluntary, some or all of the assets of the Company are distributed among the shareholders, each holder of Class “F” Shares shall be entitled to repayment of the amount paid for the Class “F” Shares into the subdivision of the issued and paid-up share capital account relating to the Class “F” Shares.

4) No Voting Right. Subject to the provisions of the Act or as otherwise expressly provided, the holders of Class “F” Shares shall not be entitled to receive notice of, attend or vote at the meeting of shareholders of the Company.

5) Redemption Right. The Company shall be entitled, at its discretion, subject to the provisions of the Companies Act in this regard, to redeem at any time all or from time to time part of the Class “F” Shares then outstanding upon giving notice to that effect, on payment to the holders of the Class “F” Shares of an aggregate redemption price equal to the consideration received by the Company at the time the Class “F” Shares were issued.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “F” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares of each such holder of Class “F” Shares to be redeemed. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “F” Shares called for redemption is deposited with the Company’s bankers or at any other place specified in the notice, on or before the Redemption Date, the holders of Class “F” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any

accrued but unpaid dividends on such Class “F” Shares being redeemed, upon presentation and surrender of the certificates representing such number of shares to be redeemed.

6) Retraction Right. Subject to paragraph two of Section 123.54 of the Companies Act , each holder of Class “F” Shares shall be entitled, at any time and at such holder’s discretion, upon written notice, to require the Company to redeem all or part of such holder’s shares at a price equal to the “Redemption Value,” as described below, plus the amount of dividends declared but unpaid, if any, on the Class “F” Shares.

a) Redemption Value

The “Redemption Value” of each share corresponds to the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “F” Shares, plus a premium equal to the amount by which the fair market value of the consideration received by the Company at the time such Class “F” Share was issued exceeds the total of:

(i) the amount paid for such share into the subdivision of the issued and paid-up share capital account relating to the Class “F” Shares; and

(ii) the fair market value of any property, other than a Class “F” Share, given by the Company in payment of such consideration.

b) Determination of Fair Market Value of the Consideration

Upon issuance of the Class “F” Shares, the Company and each subscriber of Class “F” Shares shall determine, by mutual consent and in good faith, based on a method deemed fair and reasonable, the fair market value of each of the assets that form part of the consideration received by the Company at the time the Class “F” Shares are issued.

c) Adjustment of the Premium in Case of a Disagreement with the Department of Revenue

In the event of a disagreement with the federal or provincial department of revenue, or both, with respect to the appraisal of the fair market value of one or more of the assets that form part of the consideration received by the Company at the time the Class “F” Shares are issued, the appraisal by such department shall prevail. The amount of the premium relating to the redemption of the Class “F” Shares shall be adjusted accordingly if the department in question provides the Company and each holder of Class “F” Shares, or, where all of the shares are redeemed, the Company and each former holder of Class “F” Shares, with the opportunity to contest the appraisal with the department or before the courts. Where the federal and provincial appraisals differ, the amount of the premium shall be equal to

the lower appraisal established in accordance with an uncontested assessment or another final judgment, as the case may be.

If, before the Redemption Value provided for in the foregoing sentence is adjusted, the Company pays, in cash or any other form of consideration, to a holder of Class “F” Shares, in connection with a redemption, retraction or purchase of Class “F” Shares, a sum for the Class “F” Shares that differs from the adjusted Redemption Value, the holder or the Company, as the case may be, shall immediately pay to the holder or the Company, as the case may be, the difference between the amount paid in connection with the redemption, retraction or purchase and the adjusted Redemption Value. Moreover, if, at the time of the adjustment, dividends have already been declared and paid on the Class “F” Shares, such dividends shall be adjusted so as to reflect the adjustment of the Redemption Value.

7) Right to Purchase by Private Agreement. Subject to Section 123.56 of the Companies Act , the Company may, at any time, without giving notice and without taking into consideration the other classes of shares, purchase by private agreement and at the best possible price all or part of the issued and outstanding Class “F” Shares. However, such purchase price shall never exceed the Redemption Value mentioned above or the book value of the net assets of the Company.

The number of Class “G” Shares is unlimited, and the consideration paid into the subdivision of the issued and paid-up share capital account relating to such shares is also unlimited. Class “G” Shares shall have no par value and shall carry the following rights, privileges, conditions and restrictions:

1) Ranking of Class “G” Preferred Shares. Class “G” Preferred Shares shall have priority over the Common Shares and the other shares of the Company with respect to the order of payment of dividends and the distribution of the assets of the Company in the event of the liquidation or dissolution of the Company, whether or not voluntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs.

2) Right to Dividends . The holders of record of the Class “G” Shares shall be entitled to receive, in each fiscal year of the Company, a fixed cumulative preferential dividend at the rate of 11.25% per annum per share, calculated daily on the Redemption Price (as defined below) of the Class “G” Shares. Such dividends shall be cumulative from the respective date of issue of each Class “G” Share.

For greater certainty, it is hereby declared that (a) wherever it is used in this Section 2, the expression “dividend at the rate of 11.25% per annum per share” shall mean, with respect to the Class “G” Shares, a dividend calculated at such rate for at least the number of days during which such share was outstanding in the fiscal year with respect to which the calculation is being made and (b) nothing herein contained

or implied shall require prorating of dividends with respect to any share not outstanding during the entire period for or with respect to which such dividends are accrued. However, the directors of the Company may, at their discretion, prorate dividends with respect to any share not outstanding for the entire period for or with respect to which dividends are accrued if such right to prorate dividends was reserved by the Company at the time such shares were issued.

All dividends declared on the Class “G” Shares shall be payable semi-annually on a cumulative basis on the 20th day of the months of June and December in every year, at such place as the directors of the Company may determine, in cash or by certified cheque, bank draft or wire transfer, provided that, in respect of any payment of dividends denominated in a currency other than Canadian dollars, the applicable exchange rate shall be that published by the Bank of Canada in effect on the date of payment.

The holders of Class “G” Shares shall be entitled to receive only the aforementioned dividends. No dividends may be paid on any shares ranking junior to the Class “G” Shares, unless all dividends that have become payable on the Class “G” Shares have been paid or set aside for payment.

3) Liquidation or Winding-Up . In the event of the liquidation, winding-up, dissolution or reorganization of the Company or any other distribution of its assets among its shareholders for the purpose of winding up its affairs, whether voluntarily or involuntarily, the holders of Class “G” Shares shall be entitled to receive, in preference to the holders of any other class of shares of the Company, an amount equal to the Redemption Price (as defined below) for each Class “G” Share held and any accrued but unpaid dividends on such shares.

4) No Voting Right . The holders of Class “G” Shares shall not be entitled to receive notice of, attend or vote at the meetings of shareholders of the Company, unless the Company has failed to pay eight (8) semi-annual dividends on the Class “G” Shares, whether or not consecutive. In that event and only so long as the said dividends remain in arrears, the holders of Class “G” Shares shall be entitled to receive notice of, attend and vote at the meetings of shareholders of the Company, except meetings at which only the holders of another specified series or class of shares are entitled to vote. At each such meeting, each Class “G” Share shall entitle the holder thereof to one (1) vote.

5) Redemption Right . The Company shall be entitled, at its discretion, subject to the provisions of the Act in this regard, to redeem at any time all or part of the Class “G” Shares then outstanding upon giving notice as hereinafter provided, on payment to the holders of the Class “G” Shares of an aggregate amount equal to the Redemption Price (as defined below) and any accrued but unpaid dividends on such Class “G” Shares being redeemed. In the case of partial redemption, the Class “G” Shares to be redeemed shall be selected pro rata among the holders of all Class “G” Shares then outstanding, except that, with the consent of all the holders of Class “G” Shares, the shares to be redeemed may be selected in another manner.

The Company shall, at least one (1) business day prior to the date fixed for redemption (the “Redemption Date”), give written notice, to each then registered holder of Class “G” Shares, of the Company’s intention to redeem such shares. Such notice shall set out the date and the place at which the redemption is to take place and where payment is to occur and, in the case of partial redemption, the number of shares to be redeemed from each such holder of Class “G” Shares. If notice of redemption is given as aforesaid and an amount sufficient to redeem the Class “G” Shares called for redemption is deposited with the Company’s bankers or at any other place or places specified in the notice, on or before the Redemption Date, the holders of Class “G” Shares shall, after the Redemption Date, no longer have any right in or against the Company, except the right to receive payment of the Redemption Price and any accrued but unpaid dividends on such Class “G” Shares being redeemed, upon presentation and surrender of the certificates representing such number of shares to be redeemed.

6) Retraction Right . Each holder of Class “G” Shares shall be entitled, at such holder’s discretion, upon prior written notice of no less than one (1) business day to the Company, to require the Company to redeem all or part of such holder’s Class “G” Shares for an aggregate amount equal to the Redemption Price (as defined below) and any accrued but unpaid dividends on such shares, payable, subject to the provisions of the Act in this regard, upon presentation and surrender by such holder of Class “G” Shares of the certificates representing the number of Class “G” Shares to be redeemed (the date on which such presentation and surrender occur being the “Retraction Date”). As of the Retraction Date, the Class “G” Shares shall be considered redeemed, and the Company shall pay to such holder of Class “G” Shares the Redemption Price (as defined below) and any accrued but unpaid dividends on such shares. In the event the Company is unable to pay the Redemption Price of the Class “G” Shares on the Retraction Date, it shall forthwith give the holder of Class “G” Shares written notice thereof.

7) Redemption Price . The Redemption Price of the Class “G” Shares shall be an amount equal to $1,000 per Class “G” Share being redeemed. The Redemption Price may be paid in cash, or by certified cheque, bank draft or wire transfer, or by the delivery of assets having equivalent value, provided that in respect of any such payment denominated in a currency other than Canadian dollars, for the purposes of this Section (7), the applicable exchange rate shall be that published by the Bank of Canada in effect on the date of payment.

End of Share Capital

[Translation]

SCHEDULE B

RESTRICTIONS ON THE TRANSFER OF SHARES

No shares of capital stock of the Company shall be transferred without the approval of the Board of Directors as evidenced by a valid resolution. Such approval may be given after the transfer of shares has been registered in the Book of the Company, in which case, the transfer is valid and shall come into force on the date of its registration.

[Translation]

SCHEDULE C

OTHER PROVISIONS

1. RESTRICTIONS ON THE TRANSFER OF SECURITIES

As long as the Company shall have the status of a « private issuer » as defined in Regulation 45-106 on Prospectus and Registration Exemptions , all transfers of securities of the Company (other than shares and non-convertible debt securities) shall be subject to the consent of the Board of Directors of the Company as evidenced by a valid resolution.

2. COMPANY’S BORROWING POWERS

Without in any way limiting the Corporation’s powers, the Board of directors may without the consent of the shareholders:

(a)		borrow money upon credit of the Company;
(b)		issue debentures or other securities of the Company, and pledge or sell the same for such sums and at such prices as may be deemed expedient; and
(c)		hypothecate the immoveable and moveable or otherwise affect the moveable property of the Company.

[Translation]

Registraire
des entreprises		Notice Establishing the
QUÉBEC		Address of the Head Office List of Directors

		Companies Act (R.S.Q., c. C-38, Part IA)

1.		Identification – Enter the company name. Leave blank if you are applying for a designating number rather than a name (numbered company).

		9193-2962 QUÉBEC INC.

COMPLETE THE APPROPRIATE SECTIONS

2.	Head office address – Notice is hereby given that the address of the company head office, within the limits of the judicial district indicated in the articles, is as follows:

	No.	Street		Apt./office

	612	Saint-Jacques

	Municipality/city		Province	Postal code

	Montréal		Québec	H	3	C	4	M	8

List of directors – Enter the full name and address of all directors.

Last Name and first name

No.

Street

Apartment/suite

Péladeau, Pierre-Karl

6150

du Boisé

PH-L

Municipality/city

Province/state

Postal Code

Country

Montréal

Quebec

Canada

Last Name and first name

No.

Street

Apartment/suite

Morin, Louis

des Lilas

Municipality/city

Province/state

Postal Code

Country

Kirkland

Quebec

Last Name and first name

No.

Street

Apartment/suite

Municipality/city

Province/state

Postal Code

Country

Last Name and first name

No.

Street

Apartment/suite

Municipality/city

Province/state

Postal Code

Country

Last Name and first name

No.

Street

Apartment/suite

Municipality/city

Province/state

Postal Code

Country

Last Name and first name

No.

Street

Apartment/suite

Municipality/city

Province/state

Postal Code

Country


		Signature of authorized person

Do not write in this space		If the space provided is not sufficient, include an appendix, in two copies, identifying the corresponding section. If necessary, number the pages. Sign the two copies of this form and remit them with your articles Do not fax.

Ministére du Revenu

LE-50.0.11.03-T (2008-10)

Exhibit 1.13

[Translation]

9193-2962 QUÉBEC INC.

(the “Company”)

GENERAL BY-LAWS

BY-LAW ONE

SHAREHOLDERS

ARTICLE 1. ANNUAL MEETINGS The annual meeting of shareholders of the Company shall be held at such place, on such date and at such time as the Board of Directors may determine from time to time. Annual meetings of shareholders may be called at any time by order of the Board of Directors, the Chairman of the Board or, provided they are directors of the Company, the President or any Vice-President.

ARTICLE 2. SPECIAL GENERAL MEETINGS Special general meetings of shareholders shall be held at such place, on such date and at such time as the Board of Directors may determine from time to time or at any place where all the shareholders of the Company entitled to vote thereat are present in person or represented by proxy or at such other place as all the shareholders of the Company shall approve in writing.

Special general meetings of shareholders may be called at any time by order of the Board of Directors, the Chairman of the Board or, provided they are directors of the Company, the President or any Vice-President.

ARTICLE 3. NOTICE OF MEETING Notice specifying the place, date, time and purpose of any meeting of shareholders shall be given to all the shareholders entitled thereto at least 21 days but not more than 50 days prior to the date fixed for the meeting. The notice may be mailed, postage prepaid, to the shareholders at their respective addresses as they appear on the books of the Company or delivered by hand or transmitted by any means of telecommunication.

If the convening of a meeting of shareholders is a matter of urgency, notice of such meeting may be given not less than 48 hours before such meeting is to be held.

In the case of joint holders of a share, the notice of meeting shall be given to that one of them whose name stands first in the books of the Company and notice so given shall be sufficient notice to all the joint holders.

Irregularities in the notice or in the giving thereof as well as the unintentional omission to give notice to, or the non-receipt of any such notice by, any of the shareholders shall not invalidate any action taken by or at any such meeting.

ARTICLE 4. CHAIRMAN The Chairman of the Board or, in his absence, the President, if he is a director, or, in his absence, one of the Vice-Presidents who is a director of the Company (to be designated by the meeting in the event of more than one such Vice-President being present) shall preside at all meetings of shareholders. If all of the aforesaid officers be absent or decline to act, the persons present and entitled to vote may choose one of their number to act as chairman of the meeting. In the event of an equality of votes, the chairman of any meeting shall not be entitled to a casting vote in respect of any matter submitted to the vote of the meeting.

ARTICLE 5. QUORUM, VOTING AND ADJOURNMENTS The holder or holders of not less than 30% of the outstanding shares of the share capital of the Company carrying voting rights at such meeting, present in person or represented by proxy, shall constitute a quorum for any meeting of shareholders of the Company.

The acts of the holders of a majority of the shares so present or represented and carrying voting rights thereat shall be the acts of all the shareholders except as to matters on which the vote or consent of the holders of a greater number of shares is required or directed by the laws governing the Company, the constituting act or the by-laws of the Company.

Should a quorum not be present at any meeting of shareholders, those present in person and entitled to be counted for the purpose of forming a quorum shall have power to adjourn the meeting from time to time and from place to place without notice other than announcement at the meeting until a quorum shall be present. At any such adjourned meeting, provided a quorum is present, any business may be transacted which might have been transacted at the meeting adjourned.

ARTICLE 6. RIGHT TO VOTE AND PROXY At all meetings of shareholders, each shareholder present and entitled to vote thereat shall have on a show of hands one vote and, upon a poll, each shareholder present in person or represented by proxy shall be entitled to one vote for each share carrying voting

rights registered in his name in the books of the Company unless, under the terms of the constituting act some other scale of voting is fixed, in which event such scale of voting shall be adopted. Any shareholder or proxy may demand a ballot (either before or on the declaration of the result of a vote upon a show of hands) in respect of any matter submitted to the vote of the shareholders.

In the case of joint holders of a share, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and for this purpose seniority shall be determined by the order in which the names stand in the books of the Company.

ARTICLE 7. SCRUTINEERS The chairman at any meeting of shareholders may appoint one or more persons, who need not be shareholders, to act as scrutineer or scrutineers at the meeting.

ARTICLE 8. ADDRESSES OF SHAREHOLDERS Every shareholder shall furnish to the Company an address to which all notices intended for such shareholder shall be given, failing which, any such notice may be given to him at any other address appearing on the books of the Company. If no address appears on the books of the Company, such notice may be sent to such address as the person sending the notice may consider to be the most likely to result in such notice promptly reaching such shareholder.

BY-LAW TWO

BOARD OF DIRECTORS

ARTICLE 1. ELECTION OF DIRECTORS AND TERM OF OFFICE Except as herein otherwise provided, each director shall be elected at an annual meeting of shareholders or at any special general meeting of shareholders called for that purpose, by a majority of the votes cast in respect of such election. It shall not be necessary that the voting for the election of directors of the Company be conducted by ballot unless voting by ballot is requested by a shareholder or proxy. Each director so elected shall hold office until the election of his successor unless he shall resign or his office become vacant by death, removal or other cause.

ARTICLE 2. ACTS OF DIRECTORS All acts done by the directors or by any person acting as a director, until their successors have been duly elected or appointed, shall, notwithstanding that it be afterwards discovered that there was some defect in the election of the directors or such person acting as

aforesaid or that they or any of them were disqualified, be as valid as if the directors or such other person, as the case may be, had been duly elected and were qualified to be directors of the Company.

ARTICLE 3. POWER TO ALLOT STOCK AND GRANT OPTIONS Subject to the provisions of the constituting act of the Company, the shares of the Company shall be at all times under the control of the directors who may by resolution, from time to time, accept subscriptions, allot, issue, grant options in respect of or otherwise dispose of the whole or any part of the unissued shares of the share capital of the Company on such terms and conditions, for such consideration not contrary to law or to the constituting act of the Company and at such times prescribed in such resolutions. The directors may, from time to time, make calls upon the shareholders in respect of any moneys unpaid upon their shares. Each shareholder shall pay the amount called on his shares at the time and place fixed by the directors.

ARTICLE 4. POWER TO DECLARE DIVIDENDS The directors may from time to time as they may deem advisable, declare and pay dividends out of any funds available for dividends to the shareholders according to their respective rights and interest therein.

Any dividend may be paid by cheque or warrant made payable to and mailed to the address on the books of the Company of the shareholder entitled thereto and in the case of joint holders to that one of them whose name stands first in the books of the Company, and the mailing of such cheque or warrant shall constitute payment unless the cheque or warrant is not paid upon presentation.

ARTICLE 5. PLACE OF MEETINGS AND NOTICES All meetings of the Board of Directors shall be held at such place, on such date and at such time as may be determined from time to time by the Board of Directors or at any place where all the directors are present.

Any meeting of the Board of Directors may be called at any time by or on the order of the Chairman of the Board or, provided they are directors of the Company, the President or any Vice-President or by any two directors.

Notice specifying the place, date and time of any meeting of the Board of Directors shall be given to each of the directors at least 72 hours prior to the date fixed for such meeting. The notice may be mailed, postage prepaid, to each director at his residence or usual place of business, or delivered by hand or transmitted by any means of telecommunication.

In any case where the convening of a meeting of directors is a matter of urgency, notice of such meeting may be given not less than 3 hours before such meeting is to be held.

Notwithstanding any other provisions of this ARTICLE 5, immediately after the annual meeting of shareholders in each year, a meeting of such of the newly elected directors as are then present shall be held, provided they shall constitute a quorum, without further notice, for the election or appointment of officers of the Company and the transaction of such other business as may come before them.

ARTICLE 6. CHAIRMAN The Chairman of the Board or, in his absence, the President, if he is a director, or, in his absence, one of the Vice-Presidents who is a director of the Company (to be designated by the meeting in the event of more than one such Vice-President being present) shall preside at all meetings of the directors. If all of the aforesaid officers are absent or decline to act, the directors present may choose one of their number to act as chairman of the meeting. In the event of an equality of votes, the chairman of any meeting shall be entitled to cast one vote as a director, but not a second or casting vote in respect of any matter submitted to the vote of the meeting.

ARTICLE 7. QUORUM Except when the Company has only one director, the directors may from time to time fix by resolution the quorum for meetings of directors, but until otherwise fixed, a majority of the directors in office shall constitute a quorum.

ARTICLE 8. VACANCIES AND RESIGNATION In the case of a vacancy occurring in the Board of Directors, the directors then in office, by the affirmative vote of a majority of said remaining directors, so long as a quorum of the Board remains in office, may from time to time and at any time fill such vacancy for the remainder of the term.

ARTICLE 9. SOLE DIRECTOR In the case where the Company has only one director, the acts that may be or are required to be taken by the Board of Directors or by two directors of the Company, under the Company’s by-laws, may be taken by the sole director of the Company.

BY-LAW THREE

OFFICERS

ARTICLE 1. OFFICERS The directors shall elect or appoint a President, shall appoint a Secretary and may also elect or appoint as officers a Chairman of the Board, one or more Vice-Presidents, one or more Assistant-Secretaries, a Treasurer and one or more Assistant-Treasurers. Such officers shall be elected or appointed at the first meeting of the Board of Directors after each annual meeting of shareholders. There may also be appointed such other officers as the Board of Directors may from time to time deem necessary. Such officers shall respectively perform such duties, in addition to those specified in the by-laws of the Company, as shall from time to time be prescribed by the Board of Directors. The same person may hold more than one office, provided, however, that the same person shall not hold the office of President and Vice-President. None of such officers except the Chairman of the Board need be a director of the Company.

ARTICLE 2. CHAIRMAN OF THE BOARD The Chairman of the Board, if any, shall preside at all meetings of directors and shareholders of the Company and he shall have such other powers and duties as the Board of Directors may determine from time to time.

ARTICLE 3. PRESIDENT The President shall be the chief executive officer of the Company and shall exercise a general control of and supervision over its affairs. He shall have such other powers and duties as the Board of Directors may determine from time to time.

ARTICLE 4. VICE-PRESIDENT OR VICE-PRESIDENTS The Vice-President or Vice-Presidents shall have such powers and duties as may be determined by the Board of Directors from time to time. In case of the absence, disability, refusal or omission to act of the President, a Vice-President designated by the directors may exercise the powers and perform the duties of the President and, if such Vice-President exercises any of the powers or performs any of the duties of the President, the absence, disability, refusal or omission to act of the President shall be presumed.

ARTICLE 5. TREASURER AND ASSISTANT-TREASURERS The Treasurer shall have general charge of the finances of the Company. He shall render to the Board of Directors, whenever directed by the Board and as soon as possible after the close of each financial year, an account of the financial condition of the Company and of all his transactions as Treasurer. He shall have charge and custody of and be responsible for the keeping of the books of account required under the laws governing the Company. He shall perform all the acts incidental to the office of Treasurer or as may be determined by the Board of Directors from time to time.

Assistant-Treasurers shall perform any of the duties of the Treasurer delegated to them from time to time by the Board of Directors or by the Treasurer.

ARTICLE 6. SECRETARY AND ASSISTANT-SECRETARIES The Secretary shall attend to the giving of all notices of the Company and shall keep the records of all meetings and resolutions of the shareholders and of the Board of Directors in a book to be kept for that purpose. He shall keep in safe custody the seal of the Company, if any. He shall have charge of the books containing the names and addresses of the shareholders and directors of the Company and such other books and papers as the Board of Directors may direct. He shall perform such other duties incidental to his office or as may be required by the Board of Directors from time to time.

Assistant-Secretaries shall perform any of the duties of the Secretary delegated to them from time to time by the Board of Directors or by the Secretary.

ARTICLE 7. SECRETARY-TREASURER Whenever the Secretary shall also be the Treasurer he may, at the option of the Board of Directors, be designated the “Secretary-Treasurer”.

ARTICLE 8. REMOVAL The Board of Directors may, subject to the law and the provisions of any contract, remove and discharge any officer of the Company at any meeting called for that purpose and may elect or appoint any other person.

BY-LAW FOUR

SHARE CAPITAL

ARTICLE 1. SHARE CERTIFICATES Certificates representing shares of the share capital of the Company shall be approved by the Board of Directors. Share certificates shall bear the signatures of two directors or two officers of the Company or of one director and one officer of the Company. Such signatures may be engraved, lithographed or otherwise mechanically reproduced thereon. Any certificate bearing the facsimile reproduction of the signature of any of such authorized persons shall be deemed to have been manually signed by him and shall be as valid to all intents and purposes as if it had been manually signed, notwithstanding that the person whose signature is so reproduced shall, at the time that the certificate is issued or on the date of

such certificate, have ceased to be an officer or director of the Company, as the case may be.

ARTICLE 2. TRANSFER OF SHARES A register of transfers containing the date and particulars of all transfers of shares of the share capital of the Company shall be kept either at the head office or at such other office of the Company or at such other place in the Province of Québec as may be determined, from time to time, by resolution of the Board of Directors. One or more branch registers of transfers may be kept at any office of the Company or any other place within the Province of Québec or elsewhere as may from time to time be determined by resolution of the Board of Directors. The date and particulars of all transfers of shares contained in a branch register of transfers must also be entered in the register of transfers. Such register of transfers and branch registers of transfers shall be kept by the Secretary or by such other officer or officers as may be specially charged with this duty or by such agent or agents as may be appointed from time to time for that purpose by resolution of the Board of Directors.

Entry of the transfer of any share of the share capital of the Company may be made in the register of transfers or in a branch register of transfers regardless of where the certificate representing the share to be transferred shall have been issued.

If the shares of the share capital of the Company to be transferred are represented by a certificate, the transfer of such shares shall not be entered in the register of transfers or the branch register of transfers, unless or until the certificate representing the shares to be transferred has been duly endorsed and surrendered for cancellation.

ARTICLE 3. CLOSING OF BOOKS The Board of Directors may, from time to time, by resolution close the register of transfers and the branch registers of transfers, if any, for any time or times not exceeding in the whole 60 days in each financial year of the Company on giving notice by advertisement in a newspaper published in the place where the register of transfers is kept and in a newspaper published in the place where each of the branch registers of transfers is kept. The Board of Directors may by resolution fix in advance a date not exceeding 60 days preceding the date of any meeting of shareholders of the Company or the date for the payment of any dividend or the date for the allotment of any rights as a record date for the determination of the shareholders entitled to receive notice of any such meeting or to receive payment of any such dividend or to be allotted any such rights. Only shareholders of record on the record date so fixed shall be entitled to receive such notice or to receive payment of such dividend or to be allotted such rights,

as the case may be, notwithstanding any transfer of any shares on the books of the Company after such record date.

ARTICLE 4. TRANSFER AGENTS AND REGISTRARS The Board of Directors may appoint or remove from time to time transfer agents or registrars of transfers of shares of the share capital of the Company and, subject to the laws governing the Company, make regulations generally, from time to time, with reference to the transfer of the shares of the share capital of the Company. Upon any such appointment being made, all certificates representing shares of the share capital of the Company thereafter issued shall be countersigned by one of such transfer agents or one of such registrars of transfers and shall not be valid unless so countersigned.

BY-LAW FIVE

FINANCIAL YEAR

The financial year of the Company shall end on the last saturday of December of each year. Such date may, however, be changed from time to time by resolution of the Board of Directors.

BY-LAW SIX

CONTRACTS

All contracts, deeds, agreements, documents, bonds, debentures and other instruments requiring execution by the Company may be signed by two directors or two officers of the Company or by one director and one officer of the Company or by such persons as the Board of Directors may otherwise authorize from time to time by resolution. Any such authorization may be general or confined to specific instances. Save as aforesaid or as otherwise provided in the by-laws of the Company, no director, officer, agent or employee shall have any power or authority to bind the Company under any contract or obligation or to pledge its credit.

The Company may transact business with one or more of its directors or with any firm of which one or more of its directors are members or employees or with any Company or association of which one or more of its

directors are shareholders, directors, officers or employees. The director who has an interest in such transaction shall disclose it to the Company and to the other directors making a decision in respect of such transaction and shall abstain from discussing and voting on the question except if his vote is required to bind the Company in respect of such transaction.

BY-LAW SEVEN

DECLARATIONS

Any director or officer of the Company or any other person nominated for that purpose by any director or officer of the Company is authorized and empowered to give instructions to an attorney, for civil or for criminal, to appear and make answer for and on behalf and in the name of the Company to all writs, orders and interrogatories upon articulated facts issued out of any court and to declare for and on behalf and in the name of the Company any answer to writs of attachment by way of garnishment in which the Company is garnishee. Any director, officer or person so nominated is authorized and empowered to make all affidavits and sworn declarations in connection therewith or in connection with any and all judicial proceedings to which the Company is a party and to instruct an attorney to make demands of abandonment or petitions for winding-up or bankruptcy orders upon any debtor of the Company and to attend and vote at all meetings of creditors of the Company’s debtors and grant proxies in connection therewith. Any such director, officer or person is authorized to appoint by general or special power or powers of attorney any person or persons, including any person other than those directors, officers and persons hereinbefore mentioned, as attorney or attorneys of the Company to do any of the foregoing things.

BY-LAW EIGHT

SEAL

The seal of the Company, if any, may be affixed by any director or officer of the Company or by any person designated by such director or officer.

BY-LAW NINE

REGULATION 45-106

ARTICLE 1. NUMBER OF HOLDERS OF SHARES AND SECURITIES The beneficial ownership of securities of the Company, including its shareholders, shall be limited to fifty (50) persons, not including employees and former employees of the Company or its affiliates, provided that each person is counted as one beneficial owner unless the person is created or used solely to purchase or hold securities of the Company in which case each beneficial owner or each beneficiary of the person, as the case may be, must be counted as a separate beneficial owner

ARTICLE 2. ISSUE OF SECURITIES The directors, by way of resolution, may accept subscriptions for securities, allot or issue securities of the Company at such times, on such terms and conditions, to such persons and for such consideration as they see fit.

ARTICLE 3. PRIVATE ISSUER STATUS The directors shall use their best efforts to ensure that the Company remains a private issuer and complies with the provisions of the Regulation 45-106 .

ARTICLE 4. DECLARATION OF SUBSCRIBER Any person who subscribes shares or other securities issued by the Company shall declare to the Company that this subscription is exempted from prospectus and registration requirements pursuant to section 2.4 of the Regulation 45-106

ARTICLE 5. DECLARATION OF TRANSFEREE Any person who purchases shares or other securities of the Company shall declare that his acquisition is exempted from prospectus and registration requirements pursuant to the Regulation 45-106 .

ARTICLE 6. COMMISSION No commission or other remuneration, including a finder’s fee, shall be paid in connection with the sale of shares or other securities to a director, executive officer, control person or founder of the Company or of an affiliate of the Company.

	ENACTED February 28, 2008.

	The President,


	Pierre Karl Péladeau

	The Secretary,


	Claudine Tremblay
	Secretary

9193-2962 QUÉBEC INC.

(the “Company”)

BY-LAW TEN

BORROWING POWERS

The administrators of the Company are hereby authorized, when to their best judgment, it is in the best interest of the Company to:

(a) borrow money on the credit of the Company from any bank, Company, firm, association or individual, in the amount and in the conditions the Board of directions see fit, and in the best interest of the Company;

(b) increase or decrease the amount to be borrowed;

(c) issue or have issued, sell or pledge bonds, debentures, notes or other debt obligations of the Company as by the terms, agreements and conditions and for the sums as see fit by the Board of directors;

(d) hypothecate movable and immovable property of the Company currently owned or subsequently acquired to secure payment or performance of an obligation or other debt obligations of the Company;

(e) mortgage, hypothecate, charge, pledge or otherwise create a security interest in all or any currently owned or subsequently acquired movable and immovable property of the Company to secure such bonds, debentures, notes or other debt obligations, other than those contracted by the issuing of the shares;

(f) provide a guarantee on behalf of the Company to secure payment of all debt obligations such as borrowed monies, debentures, notes, credits, overdraft advances, or other debts in favour of a bank, Company, firm or person, including interest, hypothecate and provide to any bank, Company, firm or any individual, all or any one of the Company property, movable or immovable, currently owned or subsequently acquired and provide guarantees that may be accepted by a bank in virtue of the different sections of the Bank Act, renew, modify or substitute such guarantees from time to time, with the authority to contract promises, to provide guarantees in virtue of the Bank Act related to any current debt or subsequently contracted by the Company with any bank;

(g) the Board of directors may from time to time, by resolution, delegate to any one or more directors or officers all or any of the powers conferred on the directors by paragraph 1 of this by-law to the full extent thereof or such lesser extent as the directors may in any such resolution provide;

AND the powers hereby conferred shall be deemed to be permanent and not subject to cease after the first exercise. Such powers can be used from time to time as long as they are not revoked by a written resolution.

	ENACTED February 28, 2008.

	The President,


	Pierre Karl Péladeau


	The Secretary,


	Claudine Tremblay
	Secretary

Exhibit 2.5

VIDÉOTRON LTÉE

SUPPLEMENTAL INDENTURE

Dated as of April 15, 2008

Wells Fargo Bank, National Association

Trustee

THIRD SUPPLEMENTAL INDENTURE , dated as of April 15, 2008 (this “Supplemental Indenture” ), by and among Vidéotron Ltée, a company continued under the laws of the Province of Quebec (the “Company” ), Videotron US Inc., a wholly-owned subsidiary of the Company incorporated under the laws of Delaware (the “Additional Subsidiary Guarantor” ) and Wells Fargo Bank, National Association, as trustee (the “Trustee” ), to the Indenture, dated as of October 8, 2003 (as supplemented by the a supplemental indenture dated as of July 12, 2004 (the “First Supplemental Indenture” ), by and among the Company, each Person listed as an additional subsidiary guarantor on the signature pages to the First Supplemental Indenture (collectively referred to as the “First Additional Subsidiary Guarantors” ), and the Trustee, and as supplemented by the supplemental indenture dated as of July 15, 2005 (the “Second Supplemental Indenture” ), by and among the Company, the Person listed as an additional subsidiary guarantor on the signature pages to the Second Supplemental Indenture (the “Second Additional Subsidiary Guarantor” ), and the Trustee, the “Indenture” ), by and among the Company, each Person listed as a guarantor on the signature pages to the Indenture (collectively referred to as the “Original Subsidiary Guarantors” ) and Wells Fargo Bank Minnesota, N.A. (now known as Wells Fargo Bank, National Association).

WHEREAS, the Company, the Original Subsidiary Guarantors and the Trustee entered into the Indenture governing the Company’s 6 7 / 8 % Senior Notes due January 15, 2014 (the “Notes” );

WHEREAS, Section 4.19 of the Indenture provides that under certain circumstances the Company shall cause a Restricted Subsidiary to execute and deliver to the Trustee a supplemental indenture providing for a Subsidiary Guarantee of the payment of the Notes by such Restricted Subsidiary;

WHEREAS, pursuant to the First Supplemental Indenture, the First Additional Subsidiary Guarantors provided for such Subsidiary Guarantees;

WHEREAS, pursuant to the Second Supplemental Indenture, the Second Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, the parties hereto are desirous of further supplementing the Indenture in the manner hereinafter provided for the purpose of providing a Subsidiary Guarantee by the Additional Subsidiary Guarantor in accordance with the terms of the Indenture;

WHEREAS, Section 9.01(e) of the Indenture provides that the Company and the Trustee may amend or supplement the Indenture without the consent of any Holder to add additional guarantees with respect to the Notes; and

WHEREAS, all things necessary have been done to make this Supplemental Indenture a valid agreement of the Company, the Additional Subsidiary Guarantor and the Trustee, in accordance with its terms.

NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:

For and in consideration of the premises contained herein, the parties hereto mutually covenant and agree as follows:

1. Terms used in this Supplemental Indenture that are not defined herein shall have the meanings set forth in the Indenture.

2. The Additional Subsidiary Guarantor hereby agrees to provide an unconditional Subsidiary Guarantee on the terms and subject to the conditions and limitations set forth in the Indenture, including but not limited to Article 10 of the Indenture.

3. This Supplemental Indenture shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and, as supplemented, modified and restated hereby, is hereby ratified, approved and confirmed.

4. This Supplemental Indenture shall be effective as of the date hereof. On and after the date hereof, each reference in the Indenture to “this Indenture,” “hereunder,” “hereof,” or “herein” shall mean and be a reference to the Indenture as supplemented by this Supplemental Indenture unless the context otherwise requires.

5. Except as provided below, in the event of a conflict between the terms and conditions of the Indenture and the terms and conditions of this Supplemental Indenture, the terms and conditions of this Supplemental Indenture shall prevail.

6. If any provision of this Supplemental Indenture limits, qualifies or conflicts with another provision of the Indenture that is required to be included by the Trust Indenture Act of 1939, as amended (the “Act” ), as in force at the date this Supplemental Indenture is executed, the provision required by said Act shall control.

7. This Supplemental Indenture shall be governed and construed in accordance with the laws of the State of New York.

8. This Supplemental Indenture may be signed in any number of counterparts with the same effect as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this Supplemental Indenture.

9. The recitals contained in this Supplemental Indenture shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Supplemental Indenture.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed as of the day and year first above written.

COMPANY:

VIDÉOTRON LTÉE

By: /s/ Jean-Francois Pruneau

Name: Jean-Francois Pruneau
Title: Treasurer


ADDITIONAL SUBSIDIARY GUARANTOR:

VIDEOTRON US INC.

By: /s/ Joan L. Yori

Name: Joan L. Yori
Title: Secretary


TRUSTEE:

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: /s/ Joseph P. O’Donnell

Name: Joseph P. O’Donnell
Title: Vice President

Third Supplemental Indenture (Videotron US Inc. guarantee)

Exhibit 2.6

VIDEOTRON LTD. / VIDÉOTRON LTÉE

FIFTH SUPPLEMENTAL INDENTURE

Dated as of September 23, 2008

Wells Fargo Bank, National Association

Trustee

FIFTH SUPPLEMENTAL INDENTURE , dated as of September 23, 2008 (this “Fifth Supplemental Indenture” ), by and among Vidéotron Ltée, a company continued under the laws of the Province of Québec (the “Company” ), 9193-2962 Québec Inc., a wholly-owned subsidiary of the Company incorporated under the laws of the Province of Québec (the “Additional Subsidiary Guarantor” ) and Wells Fargo Bank, National Association, as trustee (the “Trustee” ), to the Indenture, dated as of October 8, 2003 (as supplemented by the supplemental indenture dated as of July 12, 2004 (the “First Supplemental Indenture” ), by and among the Company, each person listed as an additional subsidiary guarantor on the signature pages to the First Supplemental Indenture (collectively referred to as the “First Additional Subsidiary Guarantors” ), and the Trustee, as further supplemented by the supplemental indenture dated as of July 15, 2005 (the “Second Supplemental Indenture” ), by and among the Company, the person listed as an additional subsidiary guarantor on the signature pages to the Second Supplemental Indenture (the “Second Additional Subsidiary Guarantor” ), and the Trustee, as further supplemented by the supplemental indenture dated as of April 15, 2008 (the “Third Supplemental Indenture” ), by and among the Company, the person listed as an additional subsidiary guarantor on the signature page to the Third Supplemental Indenture (the “Third Additional Subsidiary Guarantor” ), and the Trustee, and as further supplemented by the supplemental indenture dated as of April 28, 2008 (the “Fourth Supplemental Indenture” ), by and among the Company, the person listed as an additional subsidiary guarantor on the signature page to the Fourth Supplemental Indenture (the “Fourth Additional Subsidiary Guarantor” ), and the Trustee, the “Indenture” ), by and among the Company, each person listed as a guarantor on the signature pages to the Indenture (collectively referred to as the “Original Subsidiary Guarantors” ) and the Trustee.

WHEREAS, the Company, the Original Subsidiary Guarantors and the Trustee entered into the Indenture governing the Company’s 6 7 / 8 % Senior Notes due January 15, 2014 (the “Notes” );

WHEREAS, pursuant to the First Supplemental Indenture, the First Additional Subsidiary Guarantors provided for such Subsidiary Guarantees;

WHEREAS, pursuant to the Second Supplemental Indenture, the Second Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, pursuant to the Third Supplemental Indenture, the Third Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, pursuant to the Fourth Supplemental Indenture, the Fourth Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, all things necessary have been done to make this Fifth Supplemental Indenture a valid agreement of the Company, the Additional Subsidiary Guarantor and the Trustee, in accordance with its terms.

NOW, THEREFORE, THIS FIFTH SUPPLEMENTAL INDENTURE WITNESSETH:

For and in consideration of the premises contained herein, the parties hereto mutually covenant and agree as follows:

1. Terms used in this Fifth Supplemental Indenture that are not defined herein shall have the meanings set forth in the Indenture.

3. This Fifth Supplemental Indenture shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and, as supplemented, modified and restated hereby, is hereby ratified, approved and confirmed.

4. This Fifth Supplemental Indenture shall be effective as of the date hereof. On and after the date hereof, each reference in the Indenture to “this Indenture,” “hereunder,” “hereof,” or “herein” shall mean and be a reference to the Indenture as supplemented by this Fifth Supplemental Indenture unless the context otherwise requires.

5. Except as provided below, in the event of a conflict between the terms and conditions of the Indenture and the terms and conditions of this Fifth Supplemental Indenture, the terms and conditions of this Fifth Supplemental Indenture shall prevail.

6. If any provision of this Fifth Supplemental Indenture limits, qualifies or conflicts with another provision of the Indenture that is required to be included by the Trust Indenture Act of 1939, as amended (the “Act” ), as in force at the date this Fifth Supplemental Indenture is executed, the provision required by said Act shall control.

7. This Fifth Supplemental Indenture shall be governed and construed in accordance with the laws of the State of New York.

8. This Fifth Supplemental Indenture may be signed in any number of counterparts with the same effect as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this Fifth Supplemental Indenture.

9. The recitals contained in this Fifth Supplemental Indenture shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Fifth Supplemental Indenture.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, the parties hereto have caused this Fifth Supplemental Indenture to be duly executed as of the day and year first above written.

COMPANY:

VIDÉOTRON LTÉE

By: /s/ Jean-Francois Pruneau

Name: Jean-Francois Pruneau
Title: Treasurer


ADDITIONAL SUBSIDIARY GUARANTOR:

9193-2962 QUÉBEC INC.

By: /s/ Jean-Francois Pruneau

Name: Jean-Francois Pruneau
Title: Authorized Signatory


TRUSTEE:

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: Julie Salovitch-Miller

Name: Julie Salovitch-Miller
Title: Vice President

Fifth Supplemental Indenture (9193-2962 Québec Inc. Guarantee)

Exhibit 2.10

VIDÉOTRON LTÉE

SUPPLEMENTAL INDENTURE

Dated as of April 15, 2008

Wells Fargo Bank, National Association

Trustee

FIRST SUPPLEMENTAL INDENTURE , dated as of April 15, 2008 (this “Supplemental Indenture” ), by and among Vidéotron Ltée, a company continued under the laws of the Province of Quebec (the “Company” ), Videotron US Inc., a wholly-owned subsidiary of the Company incorporated under the laws of Delaware (the “Additional Subsidiary Guarantor” ) and Wells Fargo Bank, National Association, as trustee (the “Trustee” ), to the Indenture, dated as of September 16, 2005 (the “Indenture” ), by and among the Company, each Person listed on the signature pages to the Indenture (collectively referred to as the “Original Subsidiary Guarantors” ) and the Trustee.

WHEREAS, the Company, the Original Subsidiary Guarantors and the Trustee entered into the Indenture governing the Company’s 6 3 / 8 % Senior Notes due December 15, 2015 (the “Notes” );

WHEREAS, the parties hereto are desirous of supplementing the Indenture in the manner hereinafter provided for the purpose of providing a Subsidiary Guarantee by the Additional Subsidiary Guarantor in accordance with the terms of the Indenture;

WHEREAS, all things necessary have been done to make this Supplemental Indenture a valid agreement of the Company, the Additional Subsidiary Guarantor and the Trustee, in accordance with its terms.

NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:

For and in consideration of the premises contained herein, the parties hereto mutually covenant and agree as follows:

1. Terms used in this Supplemental Indenture that are not defined herein shall have the meanings set forth in the Indenture.

4. This Supplemental Indenture shall be effective as of the date hereof. On and after the date hereof, each reference in the Indenture to “this Indenture,” “hereunder,” “hereof,”

or “herein” shall mean and be a reference to the Indenture as supplemented by this Supplemental Indenture unless the context otherwise requires.

7. This Supplemental Indenture shall be governed and construed in accordance with the laws of the State of New York.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the day and year first above written.

COMPANY:

VIDÉOTRON LTÉE

By: /s/ Jean-Francois Pruneau

Name: Jean-Francois Pruneau
Title: Treasurer


ADDITIONAL SUBSIDIARY GUARANTOR:

VIDEOTRON US INC.

By: /s/ Joan L. Yori

Name: Joan L. Yori
Title: Secretary


TRUSTEE:

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: /s/ Joseph P. O’Donnell

Name: Joseph P. O’Donnell
Title: Vice President

First Supplemental Indenture (Videotron US Inc. guarantee)

Exhibit 2.11

VIDEOTRON LTD. / VIDÉOTRON LTÉE

SUPPLEMENTAL INDENTURE

Dated as of September 23, 2008

Wells Fargo Bank, National Association

Trustee

THIRD SUPPLEMENTAL INDENTURE , dated as of September 23, 2008 (this “Third Supplemental Indenture” ), by and among Vidéotron Ltée, a company continued under the laws of the Province of Québec (the “Company” ), 9193-2962 Québec Inc., a wholly-owned subsidiary of the Company incorporated under the laws of the Province of Québec (the “Additional Subsidiary Guarantor” ) and Wells Fargo Bank, National Association, as trustee (the “Trustee” ), to the Indenture, dated as of September 16, 2005 (as supplemented by the supplemental indenture dated as of April 15, 2008 (the “First Supplemental Indenture” ), by and among the Company, the person listed as an additional subsidiary guarantor on the signature page to the First Supplemental Indenture (the “First Additional Subsidiary Guarantor” ), and the Trustee, and as further supplemented by the supplemental indenture dated as of April 28, 2008 (the “Second Supplemental Indenture” ), by and among the Company, the person listed as an additional subsidiary guarantor on the signature page to the Second Supplemental Indenture (the “Second Additional Subsidiary Guarantor” ), and the Trustee, the “Indenture” ), by and among the Company, each person listed as a guarantor on the signature pages to the Indenture (collectively referred to as the “Original Subsidiary Guarantors” ) and the Trustee.

WHEREAS, the Company, the Original Subsidiary Guarantors and the Trustee entered into the Indenture governing the Company’s 6 3 / 8 % Senior Notes due December 15, 2015 (the “Notes” );

WHEREAS, pursuant to the First Supplemental Indenture, the First Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, pursuant to the Second Supplemental Indenture, the Second Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, all things necessary have been done to make this Third Supplemental Indenture a valid agreement of the Company, the Additional Subsidiary Guarantor and the Trustee, in accordance with its terms.

NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH:

For and in consideration of the premises contained herein, the parties hereto mutually covenant and agree as follows:

1. Terms used in this Third Supplemental Indenture that are not defined herein shall have the meanings set forth in the Indenture.

3. This Third Supplemental Indenture shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and, as supplemented, modified and restated hereby, is hereby ratified, approved and confirmed.

4. This Third Supplemental Indenture shall be effective as of the date hereof. On and after the date hereof, each reference in the Indenture to “this Indenture,” “hereunder,” “hereof,” or “herein” shall mean and be a reference to the Indenture as supplemented by this Third Supplemental Indenture unless the context otherwise requires.

5. Except as provided below, in the event of a conflict between the terms and conditions of the Indenture and the terms and conditions of this Third Supplemental Indenture, the terms and conditions of this Third Supplemental Indenture shall prevail.

6. If any provision of this Third Supplemental Indenture limits, qualifies or conflicts with another provision of the Indenture that is required to be included by the Trust Indenture Act of 1939, as amended (the “Act” ), as in force at the date this Third Supplemental Indenture is executed, the provision required by said Act shall control.

7. This Third Supplemental Indenture shall be governed and construed in accordance with the laws of the State of New York.

8. This Third Supplemental Indenture may be signed in any number of counterparts with the same effect as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this Third Supplemental Indenture.

9. The recitals contained in this Third Supplemental Indenture shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Third Supplemental Indenture.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, the parties hereto have caused this Third Supplemental Indenture to be duly executed as of the day and year first above written.

COMPANY:

VIDÉOTRON LTÉE

By: /s/ Jean-Francois Pruneau

Name: Jean-Francois Pruneau
Title: Treasurer

ADDITIONAL SUBSIDIARY GUARANTOR:

9193-2962 QUÉBEC INC.

By: /s/ Jean-Francois Pruneau

Name: Jean-Francois Pruneau
Title: Authorized Signatory


TRUSTEE:

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: Julie Salovitch-Miller

Name: Julie Salovitch-Miller
Title: Vice President

Third Supplemental Indenture (9193-2962 Quebec Inc. Guarantee)

Exhibit 2.14

VIDEOTRON LTD./VIDÉOTRON LTÉE

US$455,000,000

9 1 / 2 % SENIOR NOTES DUE APRIL 15, 2018

INDENTURE

Dated as of April 15, 2008

Wells Fargo Bank, National Association,

as Trustee

This INDENTURE, dated as of April 15, 2008, is by and among VIDEOTRON LTD., a company incorporated under the laws of the Province of Québec, each Subsidiary Guarantor listed on the signature pages hereto, and WELLS FARGO BANK, NATIONAL ASSOCIATION, as trustee (the “ Trustee ”).

The Company, each Subsidiary Guarantor and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the 9 1 / 8 % Senior Notes due April 15, 2018 (the “ Notes ”):

ARTICLE 1.

DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01. Definitions .

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

“ 144A Global Note ” means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold for initial resale in reliance on Rule 144A.

“ Acquired Debt ” means, with respect to any specified Person:

(1) Indebtedness of any other Person existing at the time such other Person is merged with or into or becomes a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Subsidiary of such specified Person; and

(2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

“ Additional Notes ” means any Notes (other than Initial Notes and Exchange Notes and Notes issued under Sections 2.06, 2.07, 2.10 and 3.06 hereof) issued under this Indenture in accordance with Sections 2.02, 2.15 and 4.09 hereof, as part of the same series as the Initial Notes or as an additional series.

“ Affiliate ” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however , that beneficial ownership of more than 10% of the Voting Stock of a Person shall be deemed to be control. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” shall have correlative meanings.

“ Agent ” means any Registrar, co-registrar, Paying Agent or additional paying agent.

“ Applicable Procedures ” means, with respect to any transfer, redemption or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer, redemption or exchange.

“ Asset Acquisition ” means (a) an Investment by the Company or any Restricted Subsidiary in any other Person pursuant to which such Person shall become a Restricted Subsidiary or shall be consolidated or merged with or into the Company or any Restricted Subsidiary or (b) any acquisition by the Company or any Restricted Subsidiary of the assets of any Person that constitute substantially all of an operating unit, a division or line of business of such Person or that is otherwise outside of the ordinary course of business.

“ Asset Sale ” means:

(1) the sale, lease, conveyance or other disposition of any assets or rights, other than sales of inventory in the ordinary course of business; provided , however , that the sale, conveyance or other disposition of all or substantially all of the assets of the Company and its Restricted Subsidiaries, taken as a whole, shall be governed by the provisions of Sections 4.18 and 5.01 hereof and not by the provisions of Section 4.12 hereof; and

(2) the issuance of Equity Interests of any Restricted Subsidiary or the sale of Equity Interests by the Company or any of its Restricted Subsidiaries in any Restricted Subsidiary.

Notwithstanding the preceding, the following items shall not be deemed to be Asset Sales:

(1) any single transaction or series of related transactions that involves assets having a fair market value (as determined by the Board of Directors of the Company and evidenced by a resolution of the Board of Directors of the Company) of less than US$1.0 million;

(2) a sale, lease, conveyance or other disposition of assets between or among the Company and its Restricted Subsidiaries;

(3) an issuance of Equity Interests by a Restricted Subsidiary to the Company or to another Restricted Subsidiary;

(4) the sale, lease, conveyance or other disposition of equipment, inventory, accounts receivable or other assets in the ordinary course of business;

(5) the sale or other disposition of cash or Cash Equivalents;

(6) any Tax Benefit Transaction; and

(7) a Restricted Payment or Permitted Investment that is permitted by Section 4.10 hereof.

“ Asset Swap ” means an exchange of assets by the Company or a Restricted Subsidiary for:

(1) one or more Permitted Businesses;

(2) a controlling equity interest in any Person whose assets consist primarily of one or more Permitted Businesses; provided such Person becomes a Restricted Subsidiary; and/or

(3) long-term assets that are used in a Permitted Business in a like-kind exchange or transfer pursuant to Section 1031 of the Code or any similar or successor provision of the Code or Sections 51, 85, 85.1, 86, 87 or 88(1) of the Income Tax Act (Canada) or any similar or successor provisions of the Income Tax Act (Canada).

“ Attributable Debt ” in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended. Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP.

“ Back-to-Back Debt ” means any loans made or debt instruments issued as part of a Back-to-Back Transaction and in which each party to such Back-to-Back Transaction, other than a Videotron Entity, executes a subordination agreement in favor of the Holders in substantially the form attached hereto as Exhibit F .

“ Back-to-Back Preferred Shares ” means Preferred Shares issued:

(1) to a Videotron Entity by an Affiliate of the Company in circumstances where, immediately prior to or after, as the case may be, the issuance of such Preferred Shares, an Affiliate of such Videotron Entity has loaned on an unsecured basis to such Videotron Entity, or an Affiliate of such Videotron Entity has subscribed for Preferred Shares of such Videotron Entity in, an amount equal to the requisite subscription price for such Preferred Shares;

(2) by a Videotron Entity to one of its Affiliates in circumstances where, immediately prior to or after, as the case may be, the issuance of such Preferred Shares, such Videotron Entity has loaned an amount equal to the proceeds of such issuance to an Affiliate on an unsecured basis; or

(3) by a Videotron Entity to one of its Affiliates in circumstances where, immediately prior to or after, as the case may be, the issuance of such Preferred Shares, such Videotron Entity has used the proceeds of such issuance to subscribe for Preferred Shares issued by an Affiliate;

in each case on terms whereby:

(i) the aggregate redemption amount applicable to the Preferred Shares issued to or by such Videotron Entity is identical:

(A) in the case of (1) above, to the principal amount of the loan made or the aggregate redemption amount of the Preferred Shares subscribed for by such Affiliate;

(B) in the case of (2) above, to the principal amount of the loan made to such Affiliate; or

(ii) the dividend payment date applicable to the Preferred Shares issued to or by such Videotron Entity shall:

(A) in the case of (1) above, be immediately prior to, or on the same date as, the interest payment date relevant to the loan made or the dividend payment date on the Preferred Shares subscribed for by such Affiliate;

(B) in the case of (2) above, be immediately after, or on the same date as, the interest payment date relevant to the loan made to such Affiliate; or

(C) in the case of (3) above, be immediately after, or on the same date as, the dividend payment date on the Preferred Shares issued by such Affiliate;

(iii) the amount of dividends provided for on any payment date in the share conditions attaching to the Preferred Shares issued:

(A) to a Videotron Entity in the case of (1) above, shall be equal to or in excess of the amount of interest payable in respect of the loan made or the amount of dividends provided for in respect of the Preferred Shares subscribed for by such Affiliate;

(B) by a Videotron Entity in the case of (2) above, shall be less than or equal to the amount of interest payable in respect of the loan made to such Affiliate; or

(C) by a Videotron Entity in the case of (3) above, shall be equal to the amount of dividends in respect of the Preferred Shares issued by such Affiliate;

and provided that, in the case of Preferred Shares issued by a Restricted Subsidiary that is not a Subsidiary Guarantor, each holder of such Preferred Shares under such Back-to-Back Transaction, other than such Restricted

Subsidiary, executes a subordination agreement in favor of the Holders in substantially the form attached hereto as Exhibit F.

“ Back-to-Back Securities ” means Back-to-Back Preferred Shares or Back-to-Back Debt or both, as the context requires; provided that a Back-to-Back Security issued by any Restricted Subsidiary that is not a Subsidiary Guarantor (A) shall provide that (i) such Restricted Subsidiary shall suspend any payment on such Back-to-Back Security until such Restricted Subsidiary receives payment on the corresponding Back-to-Back Security in an amount equal to or exceeding the amount to be paid on the Back-to-Back Security issued by such Restricted Subsidiary and (ii) if the holder of such Back-to-Back Security is paid any amount on or with respect to such Back-to-Back Security by such Restricted Subsidiary, then to the extent such amounts are paid out of proceeds in excess of the corresponding payment received by such Restricted Subsidiary on the corresponding Back-to-Back Security held by it, the holder of such Back-to-Back Security will hold such excess payment in trust for the benefit of such Restricted Subsidiary and will forthwith repay such payment to such Restricted Subsidiary and (B) may provide that, notwithstanding clause (A), such Restricted Subsidiary may make payment on such Back-to-Back Security if at the time of payment such Restricted Subsidiary would be permitted to make such payment under Section 4.10 hereof; provided that any payment made pursuant to this clause (B) which is otherwise prohibited under clause (A) would constitute a Restricted Payment.

“ Back-to-Back Transaction ” means any of the transactions described under the definition of Back-to-Back Preferred Shares.

“ Bankruptcy Law ” means Title 11, U.S. Code or any similar federal or state law for the relief of debtors, the Bankruptcy and Insolvency Act (Canada), the Companies’ Creditors Arrangement Act (Canada) or any other Canadian federal or provincial law or the law of any other jurisdiction relating to bankruptcy, insolvency, winding up, liquidation, reorganization or relief of debtors.

“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as such term is used in Section 13(d)(3) of the Exchange Act), such “person” shall be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition. The terms “Beneficially Owns” and “Beneficially Owned” shall have corresponding meanings.

“ Board of Directors ” means:

(1) with respect to a corporation, the board of directors of the corporation;

(2) with respect to a partnership, the board of directors of the general partner of the partnership; and

(3) with respect to any other Person, the board or committee of such Person serving a similar function.

“ Board Resolution” means a copy of a resolution certified by the secretary or an assistant secretary (or individual performing comparable duties) of the applicable Person to have been duly adopted by the Board of Directors of such Person and to be in full force and effect on the date of such certification, and delivered to the Trustee.

“ Business Day ” means any day other than a Legal Holiday.

“ Canadian Taxing Authority ” means any federal, provincial, territorial or other Canadian government or any authority or agency therein having the power to tax.

“ Capital Lease Obligation ” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP.

“ Capital Stock ” means:

(1) in the case of a corporation, corporate stock;

(2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

“ Capital Stock Sale Proceeds ” means the aggregate net cash proceeds received by the Company after October 8, 2003:

(1) as a contribution to the common equity capital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock or Back-to-Back Securities); or

(2) from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of the Company that have been converted into or exchanged for such Equity Interests,

other than, in either (1) or (2), Equity Interests (or convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities) sold to a Subsidiary of the Company.

“ Cash Equivalents ” means:

(1) United States dollars or Canadian dollars;

(2) investments in securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth, territory or province of the United States of America or Canada, or by any political subdivision or taxing authority thereof, and rated in the “R-1” category by the Dominion Bond Rating Service Limited;

(3) certificates of deposit and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of US$500.0 million;

(4) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (2) and (3) above entered into with any financial institution meeting the qualifications specified in clause (3) above;

(5) commercial paper having the highest rating obtainable from Moody’s Investors Service, Inc. or Standard & Poor’s Rating Services and in each case maturing within one year after the date of acquisition or with respect to commercial paper in Canada, a rating in the “R-1” category by the Dominion Bond Rating Service Limited; and

(6) money market funds at least 90% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (5) of this definition.

“ Change of Control ” means the occurrence of any of the following:

(1) the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and the Restricted Subsidiaries, taken as a whole, to any “person” (as that term is used in Section 13(d)(3) of the Exchange Act) other than a Permitted Holder or a Related Party;

(2) the adoption of a plan relating to the liquidation or dissolution of the Company;

(3) the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any Person, other than a Permitted Holder or a Related Party, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of the Company, measured by voting power rather than number of shares; or

(4) during any consecutive two-year period, the first day on which individuals who constituted the Board of Directors of the Company as of the beginning of such two-year period (together with any new directors who were nominated for election or elected to such Board of Directors with the approval of a majority of the individuals who were members of such Board of Directors, or whose nomination or election was previously so approved at the beginning of such two-year period) cease to constitute a majority of the Board of Directors of the Company.

“ Clearstream ” means Clearstream Banking S.A. and any successor thereto.

“ Code ” means the U.S. Internal Revenue Code of 1986, as amended.

“ Commission ” means the U.S. Securities and Exchange Commission and any successor entity thereto.

“Company” means Videotron Ltd. (Vidéotron Ltée in its French version) and any successor thereto.

“ Consolidated Cash Flow ” means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such period plus:

(1) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted in computing such Consolidated Net Income; plus

(2) Consolidated Interest Expense of such Person and its Restricted Subsidiaries for such period, including for the purpose of this clause (2) any interest expense on the QMI Subordinated Loan that was otherwise excluded from the definition of Consolidated Interest Expense, in each case to the extent that any such expense was deducted in computing such Consolidated Net Income; plus

(3) depreciation, amortization (including amortization of goodwill and other intangibles, but excluding amortization of prepaid cash expenses that were paid in a prior period to the extent such expense is amortized) and other non-cash expenses (excluding any such non-cash expense to the extent that it represents (i) an accrual of or reserve for cash expenses in any future period, or (ii) amortization of a prepaid cash expense that was paid in a prior period to the extent such expense is amortized) of such Person and its Restricted Subsidiaries for such period, to the extent that such depreciation, amortization and other non-cash expenses were deducted in computing such Consolidated Net Income; minus

(4) any interest and other payments made to Persons other than any Videotron Entity in respect of Back-to-Back Securities to the extent such interest and other payments were not deducted in computing such Consolidated Net Income; minus

(5) non-cash items increasing such Consolidated Net Income for such period, other than the accrual of revenue in the ordinary course of business,

in each case, on a consolidated basis and determined in accordance with GAAP.

Notwithstanding the foregoing, the provision for taxes based on the income or profits of, the Consolidated Interest Expense of and the depreciation and amortization and other non-cash expenses of a Restricted Subsidiary shall be added to Consolidated Net Income to compute Consolidated Cash Flow of the Company only to the extent that a corresponding amount would be permitted at the date of determination to be dividended or distributed to the Company by such Restricted Subsidiary without prior governmental approval (unless such approval has been obtained), and without direct or indirect restriction pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to that Restricted Subsidiary or its shareholders.

“ Consolidated Indebtedness ” means, with respect to any Person as of any date of determination, without duplication, the total amount of Indebtedness of such Person and its Restricted Subsidiaries, including (i) the total amount of Indebtedness of any other Person, to the extent that such Indebtedness has been guaranteed by the referent Person or one or more of its Restricted Subsidiaries, and (ii) the aggregate liquidation value of all Disqualified Stock of such Person and all Preferred Shares of Restricted Subsidiaries of such Person, in each case, determined on a consolidated basis in accordance with GAAP.

“ Consolidated Interest Expense ” means, with respect to any Person, for any period, without duplication, the sum of (i) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued (including, without limitation, amortization of original issue discount, non-cash interest payments, the interest component of any deferred payment Obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt, commissions, discounts, and other fees, and charges incurred in respect of letter of credit or bankers’ acceptance financings), all calculated after taking into account the effect of all Hedging Obligations, (ii) the consolidated interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period, (iii) any interest expense on Indebtedness of another Person that is guaranteed by such Person or any of its Restricted Subsidiaries or secured by a Lien on assets of such Person or any of its Restricted Subsidiaries (whether or not such guarantee or Lien is called upon), (iv) the product of (a) all dividend payments on any series of Preferred Shares of such Person or any of its Restricted Subsidiaries, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state, provincial, territorial and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP, and (v) to the extent not included in clause (iv) above for purposes of GAAP, the product of (a) all dividend payments on any series of Disqualified Stock of such Person or any of its Restricted Subsidiaries, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state, provincial, territorial and local statutory tax rate of such Person, expressed as a decimal, in each case, on a consolidated basis and in accordance with GAAP. Interest and other payments on Back-to-Back Securities, and any accrual, or payment-in-kind, of interest on the QMI Subordinated Loan to the extent that such interest is not paid in cash, shall not be included as Consolidated Interest Expense.

“ Consolidated Net Income ” means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided, however, that:

(1) the Net Income (but not loss) of any Person that is not a Restricted Subsidiary (other than an Unrestricted Subsidiary) or that is accounted for by the equity method of accounting shall be included; provided , that the Net Income shall be included only to the extent of the amount of dividends or distributions paid in cash to the specified Person or a Restricted Subsidiary thereof;

(2) the Net Income of any Restricted Subsidiary shall be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (unless such approval has been obtained) or, directly or indirectly, by operation of the terms of its charter or any agreement,

instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary or its equityholders;

(3) the Net Income of any Person acquired during the specified period for any period prior to the date of such acquisition shall be excluded;

(4) the cumulative effect of a change in accounting principles shall be excluded;

(5) the Net Income (but not loss) of any Unrestricted Subsidiary shall be excluded, whether or not distributed to the specified Person or one of its Subsidiaries; provided, however , that for purposes of Sections 4.10 hereof, the Net Income of any Unrestricted Subsidiary shall be included to the extent it would otherwise be included under clause (1) of this definition; and

(6) any non-cash compensation expense realized for grants of performance shares, stock options or other rights to officers, directors and employees of the Company or any Restricted Subsidiary shall be excluded, provided that such shares, options or other rights can be redeemed at the option of the holders thereof for Capital Stock of the Company or Quebecor Media (other than in each case Disqualified Stock of the Company).

“ Consolidated Revenues ” means the gross revenues of the Company and the Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that (1) any portion of gross revenues derived directly or indirectly from Unrestricted Subsidiaries, including dividends or distributions from Unrestricted Subsidiaries, shall be excluded from such calculation, and (2) any portion of gross revenues derived directly or indirectly from a Person (other than a Subsidiary of the Company or a Restricted Subsidiary) accounted for by the equity method of accounting shall be included in such calculation only to the extent of the amount of dividends or distributions actually paid to the Company or a Restricted Subsidiary by such Person.

“ Corporate Trust Office of the Trustee ” shall be at the address of the Trustee specified in Section 12.02 hereof, or such other address as to which the Trustee may give notice to the Company.

“Credit Agreement” means the amended credit facility between the Company, the guarantor subsidiaries named therein, Royal Bank of Canada, as administrative agent, RBC Dominion Securities Inc., as lead arranger, and the lenders thereto dated as of November 28, 2000, as thereafter amended.

“ Credit Facilities ” means, one or more debt facilities (including, without limitation, the Credit Agreement) or commercial paper facilities, in each case with banks or other institutional lenders providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or letters of credit, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

“ Currency Exchange Protection Agreement ” means, in respect of a Person, any foreign exchange contract, currency swap agreement, currency option or other similar agreement or arrangement designed to protect such Person against fluctuations in currency exchange rates entered into with any commercial bank or other financial institutions having capital and surplus in excess of US$500.0 million.

“ Custodian ” means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03(c) hereof as Custodian with respect to the Notes, and any and all successors thereto appointed as custodian hereunder and having become such pursuant to the applicable provisions of this Indenture.

“ Debt to Cash Flow Ratio ” means, as of any date of determination (the “Determination Date”), the ratio of (a) the Consolidated Indebtedness of the Company (excluding the QMI Subordinated Loan) as of such Determination Date to (b) the Consolidated Cash Flow of the Company for the most recently ended fiscal quarter ending immediately prior to such Determination Date for which internal financial statements are available (the

“Measurement Period”) multiplied by four, determined on a pro forma basis after giving effect to all acquisitions or dispositions of assets made by the Company and the Restricted Subsidiaries from the beginning of such quarters through and including such Determination Date (including any related financing transactions) as if such acquisitions and dispositions had occurred at the beginning of such quarter. For purposes of calculating Consolidated Cash Flow for each Measurement Period immediately prior to the relevant Determination Date, (i) any Person that is a Restricted Subsidiary on the Determination Date (or would become a Restricted Subsidiary on such Determination Date in connection with the transaction that requires the determination of such Consolidated Cash Flow) shall be deemed to have been a Restricted Subsidiary at all times during the applicable Measurement Period; (ii) any Person that is not a Restricted Subsidiary on such Determination Date (or would cease to be a Restricted Subsidiary on such Determination Date in connection with the transaction that requires the determination of such Consolidated Cash Flow) shall be deemed not to have been a Restricted Subsidiary at any time during the applicable Measurement Period; (iii) if the Company or any Restricted Subsidiary shall have in any manner (x) acquired through an Asset Acquisition or (y) disposed of (including by way of an Asset Sale or the termination or discontinuance of activities constituting such operating business) any operating business during the applicable Measurement Period or after the end of such period and on or prior to such Determination Date, such calculation shall be made on a pro forma basis in accordance with GAAP, as if, in the case of an Asset Acquisition, all such transactions (including any related financing transactions) had been consummated on the first day of the applicable Measurement Period, and, in the case of an Asset Sale or termination or discontinuance of activities constituting such operating business, all such transactions (including any related financing transactions) had been consummated prior to the first day of the applicable Measurement Period; (iv) if (A) since the beginning of the applicable Measurement Period, the Company or any Restricted Subsidiary has incurred any Indebtedness that remains outstanding or has repaid any Indebtedness, or (B) the transaction giving rise to the need to calculate the Debt to Cash Flow Ratio is an incurrence or repayment of Indebtedness, Consolidated Interest Expense for such Measurement Period shall be calculated after giving effect on a pro forma basis to such incurrence or repayment as if such Indebtedness was incurred or repaid on the first day of such period, provided that, in the event of any such repayment of Indebtedness, Consolidated Cash Flow for such period shall be calculated as if the Company or such Restricted Subsidiary had not earned any interest income actually earned during such period in respect of the funds used to repay such Indebtedness; and (v) if any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest expense on such Indebtedness shall be calculated as if the base interest rate in effect for such floating rate of interest on the Determination Date had been the applicable base interest rate for the entire Measurement Period (taking into account any Interest Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement has a remaining term in excess of twelve months). For purposes of this definition, any pro forma calculation shall be made in good faith by a responsible financial or accounting officer of the Company consistent with Article 11 of Regulation S-X of the Securities Act, as such Regulation may be amended.

“ Default ” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.

“ Deferred Management Fees ” means, for any period, any Management Fees that were payable during any prior period, the payment of which was not effected when due.

“ Definitive Note ” means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.06 or 2.10 hereof, in substantially the form of Exhibit A hereto except that such Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.

“ Depositary ” means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03(b) hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provisions of this Indenture

“ Disqualified Stock ” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is 91 days after the date on which the Notes mature. Notwithstanding the preceding sentence, (i) Back-to-Back Preferred

Shares shall not constitute Disqualified Stock and (ii) any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale shall not constitute Disqualified Stock if the terms of such Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the provisions of Section 4.10 hereof. The term “Disqualified Stock” shall also include any options, warrants or other rights that are convertible into Disqualified Stock or that are redeemable at the option of the holder, or required to be redeemed, prior to the date that is 91 days after the date on which the Notes mature.

“ Distribution Compliance Period ” means the 40-day distribution compliance period as defined in Regulation S.

“ Equity Interests ” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).

“ Equity Offering ” means an offering by the Company of Equity Interests (other than Disqualified Stock or Back-to-Back Securities) of the Company however designated and whether voting or non-voting or an equity contribution by a direct or indirect parent company to the common equity of the Company.

“ Euroclear ” means Euroclear Bank, S.A./N.V., as operator of the Euroclear systems, and any successor thereto.

“Exchange Act ” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, including any successor legislation and rules and regulations.

“ Exchange Notes ” means Notes registered under the Securities Act to be exchanged for Notes not so registered, pursuant to and as set forth in a Registration Rights Agreement relating to such an exchange.

“ Exchange Offer ” has the meaning set forth in a Registration Rights Agreement relating to an exchange of Notes registered under the Securities Act for Notes not so registered.

“ Exchange Offer Registration Statement ” has the meaning set forth in a Registration Rights Agreement.

“ Existing Indebtedness ” means Indebtedness of the Company and the Restricted Subsidiaries (other than Indebtedness under the Credit Agreement) in existence on October 8, 2003, until such amounts are repaid.

“ GAAP ” means generally accepted accounting principles, consistently applied, as in effect in Canada from time to time .

“ Global Note Legend ” means the legend set forth in Section 2.06(g)(ii) hereof, which is required to be placed on all Global Notes issued under this Indenture.

“ Global Notes ” means the global Notes in the form of Exhibit A hereto issued in accordance with Article 2 hereof.

“ Government Securities ” means direct obligations of, or obligations guaranteed by, the United States of America (including any agency or instrumentality thereof) and the payment for which the United States of America pledges its full faith and credit, and which are not callable or redeemable at the issuer’s option.

“ guarantee ” means, as to any Person, a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business, direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness of another Person.

“ Hedging Obligations ” means, with respect to any specified Person, the obligations of such Person pursuant to any Interest Rate Agreement or Currency Exchange Protection Agreement.

“ Holder ” means a Person in whose name a Note is registered.

“ Incur ” means , with respect to any Indebtedness or other Obligation of any Person, to create, incur, issue, assume, guarantee or otherwise become indirectly or directly liable, contingently or otherwise, with respect of such Indebtedness or other Obligation.

“ Indebtedness ” means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent:

(1) representing principal of and premium, if any, in respect of borrowed money;

(2) representing principal of and premium, if any, evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);

(3) in respect of bankers’ acceptances;

(4) representing Capital Lease Obligations of such Person and all Attributable Debt in respect of sale and leaseback transactions entered into by such Person;

(5) representing the balance deferred and unpaid of the purchase price of any property, except any such balance that constitutes an accrued expense or trade payable;

(6) representing the amount of all obligations of such Person with respect to the repayment of any Disqualified Stock or, with respect to any Subsidiary of such Person, any Preferred Stock (in each case, valued at the greater of its voluntary or involuntary maximum fixed repurchase price plus accrued dividends); or

(7) representing any Hedging Obligations,

if and to the extent any of the preceding items (other than letters of credit, Hedging Obligations, Attributable Debt, Disqualified Stock and Preferred Stock) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP. In addition, the term “ Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the guarantee by the specified Person of any Indebtedness of any other Person. For purposes hereof, the “maximum fixed repurchase price” of any Disqualified Stock or Preferred Stock which does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Stock or Preferred Stock as if such Disqualified Stock or Preferred Stock were purchased on any date on which Indebtedness shall be required to be determined pursuant to this Indenture, and if such price is based upon, or measured by, the fair market value of such Disqualified Stock or Preferred Stock, such fair market value shall be determined in good faith by the Board of Directors of the issuer of such Disqualified Stock or Preferred Stock. The term “Indebtedness” shall not include Back-to-Back Securities.

The amount of any Indebtedness described above in clauses (1) through (7) and in the preceding paragraph outstanding as of any date shall be the outstanding balance at such date of all unconditional obligations as described above and, with respect to contingent obligations, the maximum liability upon the occurrence of the contingency giving rise to the obligation, and shall be:

(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount, and

(2) the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness;

provided , however , that if any Indebtedness denominated in a currency other than Canadian dollars is hedged or swapped through the maturity of such Indebtedness under a Currency Exchange Protection Agreement, the amount of such Indebtedness shall be adjusted to the extent of any positive or negative value (to the extent the Obligation under such Currency Exchange Protection Agreement is not otherwise included as Indebtedness of such Person) of such Currency Exchange Protection Agreement.

“ Indenture ” means this instrument, as originally executed or as it may from time to time be supplemented or amended in accordance with Article 9 hereof.

“ Indirect Participant ” means a Person who holds a beneficial interest in a Global Note through a Participant.

“ Initial Notes ” means US$455.0 million aggregate principal amount of Notes issued under this Indenture on the date hereof.

“ Institutional Accredited Investor ” means an institution that is an “accredited investor” as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

“Interest Payment Dates” shall have the meaning set forth in paragraph 1 of each Note.

“ Interest Rate Agreement ” means, for any Person, any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement or other similar agreement or arrangement designed to protect against fluctuations in interest rates entered into with any commercial bank or other financial institution having capital and surplus in excess of US$500.0 million.

“ Investments ” means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans or other extensions of credit (including guarantees, but excluding advances to customers or suppliers in the ordinary course of business that are, in conformity with GAAP, recorded as accounts receivable, prepaid expenses or deposits on the balance sheet of the Company or its Restricted Subsidiaries and endorsements for collection or deposit arising in the ordinary course of business), advances (excluding commission, travel and similar advances to officers and employees made consistent with past practices), capital contributions (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP and include the designation of a Restricted Subsidiary as an Unrestricted Subsidiary. If the Company or any Restricted Subsidiary sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary of the Company, the Company shall be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Investment in such Restricted Subsidiary not sold or disposed of in an amount determined as provided in Section 4.10(c) hereof. The acquisition by the Company or any Restricted Subsidiary of a Person that holds an Investment in a third Person shall be deemed to be an Investment by the Company or such Restricted Subsidiary in such third Person in an amount equal to the fair market value of the Investment held by the acquired Person in such third Person in an amount determined as provided in Section 4.10(c) hereof.

“ Issue Date ” means April 15, 2008.

“ Legal Holiday ” means a Saturday, a Sunday or a day on which banking institutions in each of the City of New York, Montréal, the city in which the Corporate Trust Office of the Trustee is located or any other place of payment on the Notes are authorized by law, regulation or executive order to remain closed.

“ Lien ” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest, hypothecation, assignment for security or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or capital lease or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest

in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

“ Letter of Transmittal ” means the letter of transmittal, or its electronic equivalent in accordance with the Applicable Procedures, to be prepared by the Company and sent to all Holders of the Initial Notes or any Additional Notes for use by such Holders in connection with an Exchange Offer.

“ Management Fees ” means any amounts payable by the Company or any Restricted Subsidiary in respect of management or similar services.

“ Net Income ” means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of Preferred Shares dividends, excluding, however:

(1) any gain (or loss), together with any related provision for taxes on such gain (or loss), realized in connection with: (a) any Asset Sale (without regard to the $1.0 million limitation set forth in the definition thereof) or (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and

(2) any extraordinary gain (or loss), together with any related provision for taxes on such extraordinary gain (or loss).

“ Net Proceeds ” means the aggregate cash proceeds received by the Company or any Restricted Subsidiary in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of (a) the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, (b) any relocation expenses incurred as a result of the Asset Sale, (c) taxes paid or payable as a result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, (d) amounts required to be applied to the repayment of Indebtedness or other liabilities, secured by a Lien on the asset or assets that were the subject of such Asset Sale, or required to be paid as a result of such sale, (e) any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP, and (f) all distributions and other payments required to be made to minority interest holders in Subsidiaries or joint ventures of the Company or such Restricted Subsidiary as a result of such Asset Sale.

“ Non-Recourse Debt ” means Indebtedness:

(1) as to which neither the Company nor any Restricted Subsidiary (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise or (c) constitutes the lender;

(2) no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit, upon notice, lapse of time or both, any holder of any other Indebtedness (other than the Notes ) of the Company or any Restricted Subsidiary to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its Stated Maturity; and

(3) as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Company or any Restricted Subsidiary.

“ Obligations ” means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.

“ Officer ” means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the Secretary or any Vice President of the Company.

“ Officers’ Certificate ” means a certificate signed by two Officers of the Company, at least one of whom shall be the principal executive officer, principal financial officer or the principal accounting officer of the Company, and delivered to the Trustee.

“ Opinion of Counsel ” means a written opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company, an Affiliate of the Company or the Trustee.

“ Participant ” means, with respect to the Depositary, Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively, and, with respect to DTC, shall include Euroclear and Clearstream.

“ Permitted Business ” means the businesses conducted by the Company and its Restricted Subsidiaries in the cable and telecommunications industry, including on-line internet services, telephony and the sale and rental of videocassettes, or anything related or ancillary thereto.

“ Permitted Holders ” means one or more of the following persons or entities:

(1) Quebecor Inc.;

(2) Quebecor Media;

(3) any issue of the late Pierre Péladeau;

(4) any trust having as its sole beneficiaries one or more of the persons listed in clause (3) above;

(5) any corporation, partnership or other entity controlled by one or more of the persons or trusts referred to in clause (3) or (4) above or in this clause (5); and

(6) CDP Capital d’Amérique Investissements Inc.

“ Permitted Investments ” means:

(1) any Investment in the Company or in a Restricted Subsidiary;

(2) any Investment in cash or Cash Equivalents;

(3) any Investment by the Company or any Restricted Subsidiary in a Person, if as a result of such Investment:

(a) such Person becomes a Restricted Subsidiary; or

(b) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or any Restricted Subsidiary,

provided that, in each case, such Person’s primary business is a Permitted Business;

(4) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the provisions of Section 4.12 hereof;

(5) any acquisition of assets solely in exchange for the issuance of Equity Interests (other than Disqualified Stock or Back-to-Back Securities) of the Company;

(6) Hedging Obligations entered into in the ordinary course of business of the Company or any Restricted Subsidiary and not for speculative purposes, and that do not increase the Indebtedness of the obligor outstanding at any time other than as a result of fluctuations in interest rates or foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder;

(7) payroll, travel and similar advances to officers, directors and employees of the Company and the Restricted Subsidiaries for business-related travel expenses, moving expenses and other similar expenses that are expected at the time of such advances ultimately to be treated as expenses in accordance with GAAP;

(8) any Investment in connection with Back-to-Back Transactions;

(9) any Investment existing on October 8, 2003; and

(10) other Investments in any Person that is not an Affiliate of the Company (other than a Restricted Subsidiary) having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (10) since October 8, 2003 not to exceed US$50.0 million.

“ Permitted Liens ” means:

(1) Liens on the assets of the Company and any Restricted Subsidiaries securing Indebtedness and other Obligations of the Company and Restricted Subsidiaries under Credit Facilities, which Indebtedness was permitted by the terms of this Indenture to be incurred, provided , however , that the aggregate principal amount of such Indebtedness secured by such Liens shall not exceed an aggregate of Cdn$650.0 million at any one time outstanding;

(2) Liens in favor of the Company or a Restricted Subsidiary;

(3) Liens on property of a Person existing at the time such Person is merged with or into or consolidated or amalgamated with the Company or any Restricted Subsidiary, provided that such Liens were in existence prior to the contemplation of such merger, consolidation or amalgamation and do not extend to any assets other than those of the Person merged into or consolidated or amalgamated with the Company or the Restricted Subsidiary;

(4) Liens on property existing at the time of acquisition thereof by the Company or any Restricted Subsidiary, provided that such Liens were in existence prior to the contemplation of such acquisition and do not extend to any assets other than such property;

(5) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the ordinary course of business;

(6) Liens to secure Indebtedness (including Capital Lease Obligations) permitted by Section 4.09(b)(4) hereof covering only the assets acquired with such Indebtedness;

(7) Liens existing on October 8, 2003;

(8) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded, provided that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor;

(9) Liens securing Permitted Refinancing Indebtedness, provided that any such Lien does not extend to or cover any property, Capital Stock or Indebtedness other than the property, shares or debt securing the Indebtedness so refunded, refinanced or extended;

(10) attachment or judgment Liens not giving rise to a Default or an Event of Default;

(11) Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security;

(12) Liens incurred or deposits made to secure the performance of tenders, bids, leases, statutory or regulatory obligations, bankers’ acceptance, surety and appeal bonds, government contracts, performance and return-of-money bonds and other obligations of a similar nature incurred in the ordinary course of business, exclusive of Obligations for the payment of borrowed money;

(13) licenses, permits, reservations, servitudes, easements, rights-of-way and rights in the nature of easements (including, without limiting the generality of the foregoing, licenses, easements, rights-of-way and rights in the nature of easements for railways, sidewalks, public ways, sewers, drains, gas or oil pipelines, steam, gas and water mains or electric light and power, or telephone and telegraph or cable television conduits, poles, wires and cables, reservations, limitations, provisos and conditions expressed in any original grant from any governmental entity or other grant of real or immovable property, or any interest therein) and zoning land use and building restrictions, by-laws, regulations and ordinances of federal, provincial, regional, state, municipal and other governmental authorities in respect of real property not interfering, individually or in the aggregate, in any material respect with the use of the affected real property for the ordinary conduct of the business of the Company or any of its Restricted Subsidiaries at such real property;

(14) Liens of franchisors or other regulatory bodies arising in the ordinary course of business;

(15) Liens securing reimbursement obligations with respect to letters of credit that encumber documents and other property relating to such letters of credit and the products and proceeds thereof;

(16) Liens encumbering customary initial deposits and margin deposits, and other Liens that are within the general parameters customary in the industry and incurred in the ordinary course of business, in each case, securing Indebtedness under Hedging Obligations and forward contracts, options, future contracts, future options or similar agreements or arrangements, including mark-to-market transactions designed solely to protect the Company or any Restricted Subsidiary from fluctuations in interest rates, currencies or the price of commodities;

(17) Liens consisting of any interest or title of licensor in the property subject to a license;

(18) Liens arising from sales or other transfers of accounts receivable which are past due or otherwise doubtful of collection in the ordinary course of business;

(19) any extensions, substitutions, replacements or renewals of the foregoing clauses (2) through (18); and

(20) Liens incurred in the ordinary course of business of the Company or any Restricted Subsidiary with respect to Obligations that do not exceed US$25 million at any one time outstanding.

“ Permitted Refinancing Indebtedness ” means any Indebtedness of the Company or any Restricted Subsidiary issued in exchange for, or the net proceeds of which are used to extend, refinance, renew, replace, defease or refund other Indebtedness of the Company or any Subsidiary Guarantor (other than intercompany Indebtedness); provided, however, that:

(1) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded (plus all accrued interest thereon and the amount of any reasonably determined premium necessary to accomplish such refinancing and such reasonable expenses incurred in connection therewith);

(2) such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded;

(3) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the Notes or the Subsidiary Guarantees, such Permitted Refinancing Indebtedness is subordinated in right of payment to, the Notes on terms at least as favorable to the Holders of Notes as those contained in the documentation governing the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded;

(4) if the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is pari passu in right of payment with the Notes or any Subsidiary Guarantees, such Permitted Refinancing Indebtedness is pari passu with, or subordinated in right of payment to, the Notes or such Subsidiary Guarantees; and

(5) such Indebtedness is incurred either by the Company, a Subsidiary Guarantor or by the Restricted Subsidiary who is the obligor on the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded.

“ Person ” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity.

“ Predecessor Note ” of any particular Note means every previous Note evidencing all or a portion of the same Indebtedness as that evidenced by such particular Note; and any Note authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same Indebtedness as the lost, destroyed or stolen Note.

“ Preferred Shares ” means any Capital Stock of a Person, however designated, which entitles the holder thereof to a preference with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of any other class of Capital Stock issued by such Person.

“ Private Placement Legend ” means the legend set forth in Section 2.06(g)(i) hereof to be placed on all Notes issued under this Indenture except as otherwise permitted by the provisions of this Indenture.

“ QIB ” means a “qualified institutional buyer” as defined in Rule 144A.

“QMI Subordinated Loan” means the Indebtedness owed by the Company to Quebecor Media pursuant to the Subordinated Loan Agreement dated March 24, 2003 between the Company and Quebecor Media, as amended.

“ Quebecor Media ” means Quebecor Media Inc., the parent of the Company.

“ Registration Rights Agreement ” means the Registration Rights Agreement, dated as of the Issue Date, among the Company, each Subsidiary Guarantor and the initial purchasers named therein, as such agreement may be amended, modified or supplemented from time to time and, with respect to any Additional Notes, one or more registration rights agreements between the Company and the other parties thereto, as such agreement(s) may be amended, modified or supplemented from time to time, relating to rights given by the Company to the purchasers of

Additional Notes to register such Additional Notes, or exchange such Additional Notes for registered notes, under the Securities Act.

“ Regular Record Date ” for the interest payable on any Interest Payment Date means the applicable date specified as a “Record Date” on the face of the Note.

“ Regulation S ” means Regulation S promulgated under the Securities Act.

“ Regulation S Global Note ” means a Global Note in the form of Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend and deposited with and registered in the name of the Depositary or its nominee that will be issued in a denomination equal to the outstanding principal amount of the Notes sold for initial resale in reliance on Rule 904.

“ Related Party ” means:

(1) any controlling shareholder, 80% (or more) owned Subsidiary, or immediate family member (in the case of an individual) of any Permitted Holder, or

(2) any trust, corporation, partnership or other entity, the beneficiaries, shareholders, partners, owners or Persons beneficially holding an 80% or more controlling interest of which consist of any one or more Permitted Holder and/or such other Persons referred to in the immediately preceding clause (1).

“ Responsible Officer ,” when used with respect to the Trustee, means any officer within the Corporate Trust Department of the Trustee (or any successor group of the Trustee) with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his or her knowledge of and familiarity with the particular subject.

“ Restricted Definitive Note ” means one or more Definitive Notes bearing the Private Placement Legend.

“ Restricted Global Notes ” means 144A Global Notes and Regulation S Global Notes.

“ Restricted Investment ” means an Investment other than a Permitted Investment.

“ Restricted Payment ” means:

(1) the declaration or payment of any dividend or the making of any other payment or distribution on account of the Company’s or any Restricted Subsidiary’s Equity Interests, including, without limitation, any payment in connection with any merger or consolidation involving the Company or any Restricted Subsidiary, or to the direct or indirect holders of the Company’s or any Restricted Subsidiary’s Equity Interests in their capacity as such, other than dividends, payments or distributions payable in Equity Interests (other than Disqualified Stock or Back-to-Back Securities) of the Company or to the Company or a Restricted Subsidiary (and, if such Restricted Subsidiary is not a Wholly Owned Restricted Subsidiary, to the other shareholders of such Restricted Subsidiary on a pro rata basis or on a basis that results in the receipt by the Company or a Restricted Subsidiary of dividends or distributions of greater value than it would receive on a pro rata basis);

(2) the purchase, redemption or other acquisition or retirement for value, including, without limitation, in connection with any merger or consolidation involving the Company, of any Equity Interests of the Company, other than such Equity Interests of the Company held by the Company or any of its Restricted Subsidiaries;

(3) the making of any payment on or with respect to, or the purchase, redemption, defeasance or other acquisition or retirement for value of any Back-to-Back Securities or Indebtedness that is subordinated to the Notes or the Subsidiary Guarantees, except, in the case of Indebtedness that is

subordinated to the Notes or Subsidiary Guarantees (other than Back-to-Back Securities and the QMI Subordinated Loan), a payment of interest at the Stated Maturity of such interest or principal at or within one year of the Stated Maturity of principal of such Indebtedness; provided that any accretion or payment-in-kind of interest on the QMI Subordinated Loan, to the extent such accretion or payment is not made in cash, will not be a Restricted Payment;

(4) any Restricted Investment; or

(5) the payment of any amount of Management Fees (including Deferred Management Fees) to a Person other than the Company or a Restricted Subsidiary.

“ Restricted Subsidiary ” means any Subsidiary of the Company that is not an Unrestricted Subsidiary.

“ Rule 144 ” means Rule 144 promulgated under the Securities Act.

“ Rule 144A ” means Rule 144A promulgated under the Securities Act.

“ Rule 903 ” means Rule 903 promulgated under the Securities Act.

“ Rule 904 ” means Rule 904 promulgated under the Securities Act.

“sale and leaseback transaction” means, with respect to any Person, any transaction involving any of the assets or properties of such Person whether now owned or hereafter acquired, whereby such Person sells or transfers such assets or properties and then or thereafter leases such assets or properties or any part thereof or any other assets or properties which such Person intends to use for substantially the same purpose or purposes as the assets or properties sold or transferred.

“ Securities Act ” means the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder, including any successor legislation and rules and regulations.

“ Shelf Registration Statement ” has the meaning set forth in any Registration Rights Agreement relating to registering Notes under the Securities Act.

“ Significant Subsidiary ” means any Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on October 8, 2003.

“ Special Interest ” has the meaning set forth in any Registration Rights Agreement and relating to amounts to be paid in the event the Company fails to satisfy certain conditions set forth therein. For all purposes of this Indenture, the term “interest” shall include Special Interest, if any, with respect to the Notes.

“ Stated Maturity ” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which such payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and shall not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.

“ Subordinated Indebtedness ” means any Indebtedness of the Company or any Subsidiary Guarantor (whether outstanding on October 8, 2003 or thereafter incurred) that is subordinate or junior in right of payment to the Notes or any Subsidiary Guarantee pursuant to a written agreement to that effect.

“ Subsidiary ” means, with respect to any specified Person:

(1) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to

vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and

(2) any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof).

“ Subsidiary Guarantee ” means a guarantee on the terms set forth in this Indenture by a Subsidiary Guarantor of the Company’s obligations with respect to the Notes.

“ Subsidiary Guarantor ” means (1) each Restricted Subsidiary on the Issue Date other than SETTE inc. and (2) any other Person that becomes a Subsidiary Guarantor pursuant to the provisions of Section 4.19 hereof or who otherwise executes and delivers a supplemental indenture to the Trustee providing for a Subsidiary Guarantee, and in each case their respective successors and assigns until released from their obligations under their Subsidiary Guarantees and this Indenture in accordance with the terms hereof.

“ Tax ” means any tax, duty, levy, impost, assessment or other governmental charge (including penalties, interest and any other liabilities related thereto).

“ Tax Benefit Transaction ” means, for so long as the Company is a direct or indirect Subsidiary of Quebecor Inc., any transaction between a Videotron Entity and Quebecor Inc. or any of its Affiliates, the primary purpose of which is to create tax benefits for any Videotron Entity or for Quebecor Inc. or any of its Affiliates; provided, however, that (1) the Videotron Entity involved in the transaction obtains a favorable tax ruling from a competent tax authority or a favorable tax opinion from a nationally recognized Canadian law or accounting firm having a tax practice of national standing as to the tax efficiency of the transaction for such Videotron Entity; (2) the Company delivers to the Trustee (a) a resolution of the Board of Directors of the Company to the effect the transaction will not prejudice the Holders and certifying that such transaction has been approved by a majority of the disinterested members of such Board of Directors and (b) an opinion as to the fairness to such Videotron Entity of such transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada, provided that such an opinion shall not be required for Tax Benefit Transactions in amounts not exceeding Cdn$1.0 million (and not exceeding in the aggregate Cdn$10.0 million for the preceeding 12-month period); (3) such transaction is set forth in writing; and (4) the Consolidated Cash Flow of the Company is not reduced after giving pro forma effect to the transaction as if the same had occurred at the beginning of the most recently ended full fiscal quarter of the Company for which internal financial statements are available; provided, however , that if such transaction shall thereafter cease to satisfy the preceding requirements as a Tax Benefit Transaction, it shall thereafter cease to be a Tax Benefit Transaction for purposes of this Indenture and shall be deemed to have been effected as of such date and, if the transaction is not otherwise permitted by this Indenture as of such date, the Company shall be in default under this Indenture if such transaction does not comply with the preceding requirements or is not otherwise unwound within 30 days of that date.

“ TIA ” means the U.S. Trust Indenture Act of 1939, as amended, and the rules and regulations thereunder, including any successor legislation and rules and regulations.

“ Trustee ” means the Person named as the “Trustee” in the first paragraph of this Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean such successor Trustee.

“ Unrestricted Definitive Notes ” means one or more Definitive Notes that do not and are not required to bear the Private Placement Legend.

“ Unrestricted Global Notes ” means one or more Global Notes that do not and are not required to bear the Private Placement Legend and are deposited with and registered in the name of the Depositary or its nominee.

“ Unrestricted Subsidiary ” means:

(1) any Subsidiary of the Company that is designated after the Issue Date as an Unrestricted Subsidiary as permitted or required pursuant to the provisions of Section 4.17 hereof and is not thereafter redesignated as a Restricted Subsidiary as permitted pursuant thereto; and

(2) any Subsidiary of an Unrestricted Subsidiary.

“ Videotron Entity ” means any of the Company or any of its Restricted Subsidiaries.

“ Voting Stock ” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.

“ Weighted Average Life to Maturity ” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:

(1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by

(2) the then outstanding principal amount of such Indebtedness.

“ Wholly Owned Restricted Subsidiary ” of any specified Person means a Restricted Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) will at the time be owned by such Person or by one or more Wholly Owned Restricted Subsidiaries of such Person.

Section 1.02. Other Definitions .

		Defined in
Term		Section
“Acceleration Notice”		6.02
“Additional Amounts”		4.20(a)(3)
“Affiliate Transaction”		4.14(a)
“Asset Sale Offer”		4.12(e)
“Authentication Order”		2.02(d)
“Automatic Exchange”		2.06(b)
“Automatic Exchange Date”		2.06(b)
“Base Currency”		12.13(a)
“Benefited Party”		10.01
“Change of Control Offer”		4.18(a)
“Change of Control Amount”		4.18(a)
“Covenant Defeasance”		8.03
“DTC”		2.03(b)
“Event of Default”		6.01
“Excess Proceeds”		4.12
“Excluded Holder”		4.20(b)
“First Currency”		12.14
“judgment currency”		12.13(a)
“Legal Defeasance”		8.02
“losses”		7.07
“Offer Amount”		3.09(b)(ii)
“Offer Period”		3.09(c)
“Offer to Purchase”		3.09(a)

“Paying Agent”		2.03(a)
“Payment Default”		6.01(v)(a)
“Permitted Debt”		4.09(b)
“Purchase Date”		3.09(c)
“rate(s) of exchange”		12.13
“Registrar”		2.03(a)
“Security Register”		3.03
“Surviving Company”		5.01(a)(1)
“Surviving Guarantor”		5.01(b)(1)

Section 1.03. Incorporation by Reference of Trust Indenture Act .

(a) Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture.

(b) The following TIA terms used in this Indenture have the following meanings:

“ indenture securities ” means the Notes;

“ indenture security holder ” means a Holder of a Note;

“ indenture to be qualified ” means this Indenture;

“ indenture trustee ” or “ institutional trustee ” means the Trustee; and

“obligor” on the Notes means the Company and any successor obligor upon the Notes.

(c) All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule under the TIA and not otherwise defined herein have the meanings so assigned to them.

Section 1.04. Rules of Construction .

(a) Unless the context otherwise requires:

(i) a term has the meaning assigned to it;

(ii) an accounting term not otherwise defined herein has the meaning assigned to it in accordance with GAAP;

(iii) “or” is not exclusive;

(iv) words in the singular include the plural, and in the plural include the singular;

(v) all references in this instrument to “Articles,” “Sections” and other subdivisions are to the designated Articles, Sections and subdivisions of this instrument as originally executed;

(vi) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.

(vii) “including” means “including without limitation;”

(viii) provisions apply to successive events and transactions; and

(ix) references to sections of or rules under the Securities Act, the Exchange Act or the TIA shall be deemed to include substitute, replacement or successor sections or rules adopted by the Commission from time to time thereunder.

ARTICLE 2.

THE NOTES

Section 2.01. Form and Dating .

(a) General . The Notes and the Trustee’s certificate of authentication shall be substantially in the form included in Exhibit A hereto, which is hereby incorporated in and expressly made part of this Indenture. The Notes may have notations, legends or endorsements required by law, exchange rule or usage in addition to those set forth on Exhibit A. Each Note shall be dated the date of its authentication. The Notes shall be in denominations of US$1,000 and integral multiples thereof. The terms and provisions contained in the Notes shall constitute a part of this Indenture, and the Company, the Subsidiary Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. To the extent any provision of any Note conflicts with the express provisions of this Indenture, the provisions of this Indenture shall govern and be controlling.

(b) Form of Notes . Notes shall be issued initially in global form and shall be substantially in the form of Exhibit A attached hereto (including the Global Note Legend thereon and the “Schedule of Exchanges of Interests in the Global Note” attached thereto). Notes issued in definitive form shall be substantially in the form of Exhibit A attached hereto (but without the Global Note Legend thereon and without the “Schedule of Exchanges of Interests in the Global Note” attached thereto). Each Global Note shall represent such aggregate principal amount of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions and transfers of interests therein. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.06 hereof.

(c) Book-Entry Provisions . This Section 2.01(c) shall apply only to Global Notes deposited with the Trustee, as custodian for the Depositary. Participants and Indirect Participants shall have no rights under this Indenture or any Global Note with respect to any Global Note held on their behalf by the Depositary or by the Trustee as custodian for the Depositary, and the Depositary shall be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Participants or Indirect Participants, the Applicable Procedures or the operation of customary practices of the Depositary governing the exercise of the rights of a holder of a beneficial interest in any Global Note.

(d) Euroclear and Clearstream Procedures Applicable . The provisions of the “Operating Procedures of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear” and the “General Terms and Conditions of Clearstream” and “Customer Handbook” of Clearstream shall be applicable to transfers of beneficial interests in Global Notes that are held by Participants through Euroclear or Clearstream.

Section 2.02. Execution and Authentication .

(a) One Officer shall execute the Notes on behalf of the Company by manual or facsimile signature.

(b) If an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated by the Trustee, the Note shall nevertheless be valid.

(c) A Note shall not be valid until authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.

(d) The Trustee shall, upon a written order of the Company signed by an Officer (an “ Authentication Order ”), authenticate Notes for original issue.

(e) The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Notes. Unless otherwise provided in such appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent shall have the same rights as an Agent with respect to Holders.

Section 2.03. Registrar and Paying Agent .

(a) The Company shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange (“ Registrar ”) and an office or agency where Notes may be presented for payment (“ Paying Agent ”). The Registrar shall keep a register of the Notes and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The term “Registrar” includes any co-registrar and the term “Paying Agent” includes any additional paying agent. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the Company fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar.

(b) The Company initially appoints The Depository Trust Company (“ DTC ”) to act as Depositary with respect to the Global Notes.

(c) The Company initially appoints the Trustee to act as Registrar and Paying Agent and to act as Custodian with respect to the Global Notes, and the Trustee hereby agrees so to initially act.

Section 2.04. Paying Agent to Hold Money in Trust .

The Company shall require each Paying Agent other than the Trustee to agree in writing that the Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal, premium, if any, or interest on the Notes, and shall notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all funds held by it relating to the Notes to the Trustee. The Company at any time may require a Paying Agent to pay all funds held by it relating to the Notes to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for such funds. If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all funds held by it as Paying Agent. Upon any Event of Default under Sections 6.01(viii) and (ix) hereof relating to the Company, the Trustee shall serve as Paying Agent for the Notes.

Section 2.05. Holder Lists .

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders and shall otherwise comply with TIA §312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least seven Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such date or such shorter time as the Trustee may allow, as the Trustee may reasonably require of the names and addresses of the Holders and the Company shall otherwise comply with TIA §312(a).

Section 2.06. Transfer and Exchange .

(a) Transfer and Exchange of Global Notes . A Global Note may not be transferred as a whole except by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or to another nominee of the Depositary, or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. The Company shall exchange Global Notes for Definitive Notes if: (1) the Company delivers to the Trustee a notice from the Depositary that the Depositary is unwilling or unable to continue to act as Depositary for the Global Notes or that it has ceased to be a clearing agency registered under the Exchange Act and, in either case, a successor Depositary is not appointed by the Company within 120 days after the date of such notice from the Depositary; (2) the Company at its option determines that the Global Notes shall be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee; or (3) a Default or Event of Default shall have occurred and be continuing. Upon the occurrence of any of the preceding events in clauses (1), (2) or (3) above, Definitive Notes shall be issued in denominations of US$1,000 or integral multiples thereof and in such names as the Depositary shall instruct the Trustee in writing. Global Notes also may be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and 2.10 hereof. Except as provided above, every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06 or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form of, and shall be, a Global Note. A Global Note may not be exchanged for another Note other than as provided in this Section 2.06(a), and beneficial interests in a Global Note may not be transferred and exchanged other than as provided in Section 2.06(b), (c) or (f) hereof.

(b) Transfer and Exchange of Beneficial Interests in the Global Notes . The transfer and exchange of beneficial interests in the Global Notes shall be effected through the Depositary in accordance with the provisions of this Indenture and the Applicable Procedures. Beneficial interests in Restricted Global Notes shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Transfers of beneficial interests in Global Notes also shall require compliance with either clause (i) or (ii) below, as applicable, as well as one or more of the other following clauses, as applicable:

(i) Transfer of Beneficial Interests in the Same Global Note . Beneficial interests in any Restricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Note in accordance with the transfer restrictions set forth in the Private Placement Legend and any Applicable Procedures; provided , however , that prior to the expiration of the Distribution Compliance Period, transfers of beneficial interests in Regulation S Global Note may not be made to or for the account or benefit of a “U.S. Person” (as defined in Rule 902(k) of Regulation S) (other than a “distributor” (as defined in Rule 902(d) of Regulation S)). Beneficial interests in any Unrestricted Global Note may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note. Except as may be required by any Applicable Procedures, no written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.06(b)(i).

(ii) All Other Transfers and Exchanges of Beneficial Interests in Global Notes . In connection with all transfers and exchanges of beneficial interests that are not subject to Section 2.06(b)(i) above, the transferor of such beneficial interest must deliver to the Registrar either (A)(1) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to credit or cause to be credited a beneficial interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase or (B) if permitted under Section 2.06(a) hereof, (1) a written order from a Participant or an Indirect Participant given to the Depositary in accordance with the Applicable Procedures directing the Depositary to cause to be issued a Definitive Note in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given by the Depositary to the Registrar containing information regarding the Person in whose name such Definitive Note shall be registered to effect the transfer or exchange referred to in (B)(1) above. Upon consummation of an Exchange Offer by the Company in accordance with Section 2.06(f) hereof, the requirements of this Section 2.06(b)(ii) shall be deemed to have been satisfied upon receipt by the Registrar of the instructions contained in the Letter of Transmittal delivered by the Holder of such beneficial interests in the Restricted Global Notes. Upon

satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained in this Indenture and the Notes or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 2.06(h) hereof.

(iii) Transfer of Beneficial Interests in a Restricted Global Note to Another Restricted Global Note . A beneficial interest in any Restricted Global Note may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Note if the transfer complies with the requirements of Section 2.06(b)(ii) above and the Registrar receives the following:

(A) if the transferee will take delivery in the form of a beneficial interest in a 144A Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof; and

(B) if the transferee will take delivery in the form of a beneficial interest in a Regulation S Global Note, then the transferor must deliver a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof.

(iv) Transfer and Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note . A beneficial interest in any Restricted Global Note may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Note or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note only if the exchange or transfer complies with the requirements of Section 2.06(b)(ii) above and:

(A) such exchange or transfer is effected pursuant to an Exchange Offer in accordance with a Registration Rights Agreement and the holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, makes any and all certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement;

(B) such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;

(C) such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or

(D) the Registrar receives the following:

(1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(a) thereof; or

(2) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.

If any such transfer is effected pursuant to clause (B) or (D) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to clause (B) or (D) above.

(v) Transfer or Exchange of Beneficial Interests in Unrestricted Global Notes for Beneficial Interests in Restricted Global Notes Prohibited . Beneficial interests in an Unrestricted Global Note may not be exchanged for, or transferred to Persons who take delivery thereof in the form of, beneficial interests in a Restricted Global Note.

(vi) Automatic Exchange of Beneficial Interests in a Restricted Global Note for Beneficial Interests in an Unrestricted Global Note . Beneficial interests in a Restricted Global Note will be automatically exchanged into beneficial interests in an Unrestricted Global Note without any action required by or on behalf of the Holder (the “ Automatic Exchange ”) on the date that is the 366th calendar day after (A) with respect to the Initial Notes, the Issue Date or (B) with respect to Additional Notes, if any, the issue date of such Additional Notes, or, in each case, if such day is not a Business Day, on the next succeeding Business Day (the “ Automatic Exchange Date ”). At least 15 days but not more than 30 days prior to the Automatic Exchange Date, the Company shall deliver a notice of Automatic Exchange (an “ Automatic Exchange Notice ”) to each Holder at such Holder’s address appearing in the Securities Register, with a copy to the Registrar and the Trustee. The Automatic Exchange Notice shall identify the Notes subject to the Automatic Exchange and shall state: (w) the Automatic Exchange Date; (x) the section of this Indenture pursuant to which the Automatic Exchange shall occur; (y) the “CUSIP” number of the Restricted Global Note from which such Holders’ beneficial interests will be transferred and (z) the “CUSIP” number of the Unrestricted Global Note into which such Holders’ beneficial interests will be transferred. At the Company’s request on no less than 5 days’ notice, the Trustee shall deliver, in the Company’s name and at its expense, the Automatic Exchange Notice to each Holder at such Holder’s address appearing in the Securities Register, with a copy to the Registrar; provided, however , that the Company shall have delivered to the Trustee an Officers’ Certificate requesting that the Trustee give the Automatic Exchange Notice (in the name and at the expense of the Company) and setting forth the information to be stated in the Automatic Exchange Notice as provided in the preceding sentence. As a condition to any Automatic Exchange, the Company shall provide (i) an Officers’ Certificate in form reasonably acceptable to the Registrar to the effect that no Affiliate of the Company is a holder of beneficial interests in such Restricted Global Note; and (ii) an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that the Automatic Exchange shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act. The Restricted Global Note from which beneficial interests are transferred pursuant to an Automatic Exchange shall be cancelled following the Automatic Exchange. If an Automatic Exchange is effected at a time when an Unrestricted Global Note has not yet been issued, the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred pursuant to the Automatic Exchange.

(i) Beneficial Interests in Restricted Global Notes to Restricted Definitive Notes . Subject to Section 2.06(a) hereof, if any holder of a beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of a Restricted Definitive Note, then, upon receipt by the Registrar of the following documentation:

(A) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for a Restricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (2)(a) thereof;

(B) if such beneficial interest is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof;

(C) if such beneficial interest is being transferred to a “non-U.S. Person” (as defined in Rule 902(k) of Regulation S) in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof;

(D) if such beneficial interest is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(a) thereof;

(E) if such beneficial interest is being transferred to an Institutional Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in clauses (B) through (D) above, a certificate to the effect set forth in Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3)(d) thereof, as applicable; or

(F) if such beneficial interest is being transferred to the Company or any of its Subsidiaries, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (3)(b) thereof,

the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of the applicable Restricted Global Note, and the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver a Restricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder. Any Restricted Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall designate in such instructions. The Trustee shall deliver such Restricted Definitive Notes to the Persons in whose names such Notes are so registered. Any Restricted Definitive Note issued in exchange for a beneficial interest in a Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear the Private Placement Legend and shall be subject to all restrictions on transfer contained therein.

(ii) Beneficial Interests in Restricted Global Notes to Unrestricted Definitive Notes . Subject to Section 2.06(a) hereof, a holder of a beneficial interest in a Restricted Global Note may exchange such beneficial interest for an Unrestricted Definitive Note or may transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note only if:

(A) such exchange or transfer is effected pursuant to an Exchange Offer in accordance with a Registration Rights Agreement and the holder of such beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, makes any and all certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement;

(B) such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;

(C) such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or

(D) the Registrar receives the following:

(1) if the holder of such beneficial interest in a Restricted Global Note proposes to exchange such beneficial interest for an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(b) thereof; or

(2) if the holder of such beneficial interest in a Restricted Global Note proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

and, in each such case set forth in this clause (D), if the Registrar so requests or if the Applicable Procedures so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.

Upon satisfaction of the conditions of any of the clauses of this Section 2.06(c)(ii) the Company shall execute, and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder, and the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of the applicable Restricted Global Note.

(iii) Beneficial Interests in Unrestricted Global Notes to Unrestricted Definitive Notes . Subject to Section 2.06(a) hereof, if any holder of a beneficial interest in an Unrestricted Global Note proposes to exchange such beneficial interest for an Unrestricted Definitive Note or to transfer such beneficial interest to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note, then, upon satisfaction of the applicable conditions set forth in Section 2.06(b)(ii) hereof, the Trustee shall reduce or cause to be reduced in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of the applicable Unrestricted Global Note, and the Company shall execute and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such beneficial interest in instructions delivered to the Registrar by the Depositary and the applicable Participant or Indirect Participant on behalf of such holder. Any Unrestricted Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest shall designate in such instructions. The Trustee shall deliver such Unrestricted Definitive Notes to the Persons in whose names such Notes are so registered. Any Unrestricted Definitive Note issued in exchange for a beneficial interest pursuant to this Section 2.06(c)(iii) shall not bear the Private Placement Legend.

(d) Transfer and Exchange of Definitive Notes for Beneficial Interests .

(i) Restricted Definitive Notes to Beneficial Interests in Restricted Global Notes . If any holder of a Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note or to transfer such Restricted Definitive Notes to a Person who takes delivery thereof in the

form of a beneficial interest in a Restricted Global Note, then, upon receipt by the Registrar of the following documentation:

(A) if the holder of such Restricted Definitive Note proposes to exchange such Note for a beneficial interest in a Restricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (2)(b) thereof;

(B) if such Restricted Definitive Note is being transferred to a QIB in accordance with Rule 144A, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (1) thereof; or

(C) if such Restricted Definitive Note is being transferred to a “non-U.S. Person” (as defined in Rule 902(k) of Regulation S) in an offshore transaction in accordance with Rule 903 or Rule 904, a certificate to the effect set forth in Exhibit B hereto, including the certifications in item (2) thereof,

the Trustee shall cancel the Restricted Definitive Note, increase or cause to be increased in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of, in the case of clause (A) above, the appropriate Restricted Global Note, in the case of clause (B) above, a 144A Global Note, and in the case of clause (C) above, a Regulation S Global Note.

(ii) Restricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes . A holder of a Restricted Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Restricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note only if:

(A) such exchange or transfer is effected pursuant to a Exchange Offer in accordance with a Registration Rights Agreement and the holder of such beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, makes such certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement;

(B) such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;

(C) such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or

(D) the Registrar receives the following:

(1) if the holder of such Restricted Definitive Note proposes to exchange such Note for a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(c) thereof; or

(2) if the holder of such Restricted Definitive Note proposes to transfer such Note to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

Upon satisfaction of the conditions of any of the clauses in this Section 2.06(d)(ii), the Trustee shall cancel such Restricted Definitive Note and increase or cause to be increased in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of the Unrestricted Global Note.

(iii) Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes . A holder of an Unrestricted Definitive Note may exchange such Note for a beneficial interest in an Unrestricted Global Note or transfer such Unrestricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note at any time. Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive Note and increase or cause to be increased in a corresponding amount pursuant to Section 2.06(h) hereof the aggregate principal amount of one of the Unrestricted Global Notes.

(iv) Transfer or Exchange of Unrestricted Definitive Notes to Beneficial Interests in Restricted Global Notes Prohibited . An Unrestricted Definitive Note may not be exchanged for, or transferred to Persons who take delivery thereof in the form of, beneficial interests in a Restricted Global Note.

(v) Issuance of Unrestricted Global Notes . If any such exchange or transfer of a Definitive Note for a beneficial interest in an Unrestricted Global Note is effected pursuant to clause (ii)(B), (ii)(D) or (iii) above at a time when an Unrestricted Global Note has not yet been issued, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of Definitive Notes so transferred.

(e) Transfer and Exchange of Definitive Notes for Definitive Notes . Upon request by a holder of Definitive Notes and such holder’s compliance with the provisions of this Section 2.06(e), the Registrar shall register the transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting holder shall present or surrender to the Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such holder. In addition, the requesting holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.06(e).

(i) Restricted Definitive Notes to Restricted Definitive Notes . Any Restricted Definitive Note may be transferred to and registered in the name of Persons who take delivery thereof in the form of a Restricted Definitive Note if the Registrar receives the following:

(A) if the transfer will be made pursuant to Rule 144A, a certificate in the form of Exhibit B hereto, including the certifications in item (1) thereof;

(B) if the transfer will be made pursuant to Rule 903 or Rule 904, a certificate in the form of Exhibit B hereto, including the certifications in item (2) thereof; and

(C) if the transfer will be made pursuant to any other exemption from the registration requirements of the Securities Act, a certificate in the form of Exhibit B hereto, including the certifications, certificates and Opinion of Counsel required by item (3) thereof, if applicable.

(ii) Restricted Definitive Notes to Unrestricted Definitive Notes . Any Restricted Definitive Note may be exchanged by the holder thereof for an Unrestricted Definitive Note or transferred to a Person or Persons who take delivery thereof in the form of an Unrestricted Definitive Note only if:

(A) such exchange or transfer is effected pursuant to an Exchange Offer in accordance with a Registration Rights Agreement and the holder of such beneficial interest, in the case of an exchange, or the transferee, in the case of a transfer, makes such certifications in the applicable Letter of Transmittal (or is deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement;

(B) any such transfer is effected pursuant to a Shelf Registration Statement in accordance with a Registration Rights Agreement;

(C) any such transfer is effected by a broker-dealer pursuant to an Exchange Offer Registration Statement in accordance with a Registration Rights Agreement; or

(D) the Registrar receives the following:

(1) if the holder of such Restricted Definitive Notes proposes to exchange such Notes for an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit C hereto, including the certifications in item (1)(d) thereof; or

(2) if the holder of such Restricted Definitive Notes proposes to transfer such Notes to a Person who shall take delivery thereof in the form of an Unrestricted Definitive Note, a certificate from such holder in the form of Exhibit B hereto, including the certifications in item (4) thereof;

and, in each such case set forth in this clause (D), if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer shall be effected in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend shall no longer be required in order to maintain compliance with the Securities Act.

Upon satisfaction of the conditions of any of the clauses of Section 2.06(e)(ii) the Trustee shall cancel the prior Restricted Definitive Note and the Company shall execute, and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate and deliver an Unrestricted Definitive Note in the appropriate principal amount to the Person designated by the holder of such prior Restricted Definitive Note in instructions delivered to the Registrar by such holder.

(iii) Unrestricted Definitive Notes to Unrestricted Definitive Notes . A holder of Unrestricted Definitive Notes may transfer such Notes to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note. Upon receipt of a request to register such a transfer, the Registrar shall register the Unrestricted Definitive Notes pursuant to the instructions from the Holders thereof.

(f) Exchange Offer . Upon the occurrence of an Exchange Offer in accordance with a Registration Rights Agreement, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, the Trustee shall authenticate (i) one or more Unrestricted Global Notes in an aggregate principal amount equal to the principal amount of the beneficial interests in the applicable Restricted Global Notes (A) tendered for acceptance by Persons that make any and all certifications in the applicable Letters of Transmittal (or are deemed to have made such certifications if delivery is made through the Applicable Procedures) as may be required by such Registration Rights Agreement, and (B) accepted for exchange in the Exchange Offer and

(ii) Unrestricted Definitive Notes in an aggregate principal amount equal to the principal amount of the Restricted Definitive Notes tendered for acceptance by Persons who made the foregoing certification and accepted for exchange in the Exchange Offer. Concurrently with the issuance of such Notes, the Trustee shall reduce or cause to be reduced in a corresponding amount the aggregate principal amount of the applicable Restricted Global Notes, and the Company shall execute and the Trustee shall authenticate and deliver to the Persons designated by the holders of Restricted Definitive Notes so accepted Unrestricted Definitive Notes in the appropriate principal amount.

(g) Legends . The following legends shall appear on the face of all Global Notes and Definitive Notes issued under this Indenture unless specifically stated otherwise in the applicable provisions of this Indenture.

(i) Private Placement Legend .

(A) Except as permitted by clause (B) below, each Global Note and each Definitive Note (and all Notes issued in exchange therefor or substitution thereof) shall bear the legend in substantially the following form:

“THIS NOTE AND THE GUARANTEES ENDORSED HEREON HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR THE GUARANTEES ENDORSED HEREON NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

THE HOLDER OF THIS NOTE AND THE GUARANTEES ENDORSED HEREON BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH VIDEOTRON LTD. (THE “COMPANY”) OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE AND THE GUARANTEES ENDORSED HEREON (OR ANY PREDECESSOR OF THIS NOTE AND THE GUARANTEES ENDORSED HEREON) (THE “RESALE RESTRICTION TERMINATION DATE”) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES IN OFFSHORE TRANSACTIONS MEETING THE REQUIREMENTS OF RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE, OR TRANSFER (i) PURSUANT TO CLAUSE (D) OR (E) PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (ii) TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF A HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”

(B) Notwithstanding the foregoing, any Global Note or Definitive Note issued pursuant to clauses (b)(iv), (b)(vi), (c)(ii), (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section 2.06 (and all Notes issued in exchange therefor or substitution thereof) shall not bear the Private Placement Legend.

(ii) Global Note Legend . Each Global Note shall bear a legend in substantially the following form:

“THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

(h) Cancellation and/or Adjustment of Global Notes . At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or cancelled in whole and not in part, each such Global Note shall be returned to or retained and cancelled by the Trustee in accordance with Section 2.11 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depositary at the direction of the Trustee to reflect such increase.

(i) General Provisions Relating to Transfers and Exchanges .

(i) No service charge shall be made to a Holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 4.12, 4.18 and 9.05 hereof).

(ii) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid obligations of the Company, evidencing the same Indebtedness, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.

(iii) Neither the Registrar nor the Company shall be required (A) to issue, to register the transfer of or to exchange any Notes during a period beginning at the opening of business 15 days before the day of any selection of Notes for redemption under Section 3.02 hereof and ending at the close of business on the date of selection, (B) to register the transfer of or to exchange any Note so selected for redemption in whole

or in part, except the unredeemed portion of any Note being redeemed in part or (C) to register the transfer of or to exchange a Note between a record date (including a Regular Record Date) and the next succeeding Interest Payment Date.

(iv) Prior to due presentment for the registration of a transfer of any Note, the Trustee, any Agent and the Company may deem and treat the Person in whose name any Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Note and for all other purposes, in each case regardless of any notice to the contrary.

(v) All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted by facsimile.

(vi) The Trustee is hereby authorized and directed to enter into a letter of representation with the Depositary in the form provided by the Company and to act in accordance with such letter.

Section 2.07. Replacement Notes .

If any mutilated Note is surrendered to the Trustee or the Company and the Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, the Company shall issue and the Trustee, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, shall authenticate a replacement Note. If required by the Trustee or the Company, the Holder of such Note shall provide indemnity sufficient, in the judgment of the Trustee or the Company, as applicable, to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer in connection with such replacement. If required by the Company, such Holder shall reimburse the Company for its reasonable expenses in connection with such replacement.

Every replacement Note issued in accordance with this Section 2.07 shall be the valid obligation of the Company evidencing the same Indebtedness as the destroyed, lost or stolen Note and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.

Section 2.08. Outstanding Notes .

(a) The Notes outstanding at any time shall be the entire principal amount of Notes represented by all the Global Notes and Definitive Notes authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation, those subject to reductions in beneficial interests effected by the Trustee in accordance with Section 2.06 hereof, and those described in this Section 2.08 as not outstanding. Except as set forth in Section 2.09 hereof, a Note shall not cease to be outstanding because the Company or an Affiliate of the Company holds the Note; provided, however, that Notes held by the Company or a Subsidiary of the Company shall be deemed not to be outstanding for purposes of Section 3.07(c) hereof.

(b) If a Note is replaced pursuant to Section 2.07 hereof, it shall cease to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.

(c) If the principal amount of any Note is considered paid under Section 4.01 hereof, it shall cease to be outstanding and interest on it shall cease to accrue.

(d) If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on a redemption date, a Purchase Date or maturity date, funds sufficient to pay Notes payable on that date, then on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to accrue interest.

Section 2.09. Treasury Notes .

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company, or by any Affiliate of the Company, shall be

considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that the Trustee knows are so owned shall be so disregarded.

Section 2.10. Temporary Notes .

Until certificates representing Notes are ready for delivery, the Company may prepare and the Trustee, upon receipt of an Authentication Order in accordance with Section 2.02 hereof, shall authenticate temporary Notes. Temporary Notes shall be substantially in the form of Definitive Notes but may have variations that the Company considers appropriate for temporary Notes and as shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Global Notes or Definitive Notes in exchange for temporary Notes, as applicable.

Holders of temporary Notes shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.

Section 2.11. Cancellation .

The Company at any time may deliver Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. Upon sole direction of the Company, the Trustee shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall destroy cancelled Notes (subject to the record retention requirements of the Exchange Act or other applicable laws). Certification of the destruction of all cancelled Notes shall be delivered to the Company from time to time upon request. The Company may not issue new Notes to replace Notes that it has paid or that have been delivered to the Trustee for cancellation.

Section 2.12. Defaulted Interest .

If the Company defaults in a payment of interest on the Notes, it shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the Notes and in Section 4.01 hereof. The Company shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each Note and the date of the proposed payment. The Company shall fix or cause to be fixed each such special record date and payment date, provided that no such special record date shall be less than 10 days prior to the related payment date for such defaulted interest. At least 15 days before the special record date, the Company (or, upon the written request of the Company, the Trustee in the name and at the expense of the Company) shall mail or cause to be mailed to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid.

Section 2.13. CUSIP or ISIN Numbers .

The Company in issuing the Notes may use “CUSIP” or “ISIN” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” or “ISIN” numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption or notice of an Offer to Purchase and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption or Offer to Purchase shall not be affected by any defect in or omission of such numbers. The Company shall promptly notify the Trustee of any change in the “CUSIP” or “ISIN” numbers.

Section 2.14. Special Interest

If Special Interest is payable by the Company pursuant to a Registration Rights Agreement and paragraph 1 of the Notes, the Company shall deliver to the Trustee a certificate to that effect stating (i) the amount of such Special Interest that is payable and (ii) the date on which such interest is payable pursuant to Section 4.01 hereof. Unless and until a Responsible Officer of the Trustee receives such a certificate or instruction or direction

from the Holders in accordance with the terms of this Indenture, the Trustee may assume without inquiry that no Special Interest is payable. The foregoing shall not prejudice the rights of the Holders with respect to their entitlement to Special Interest as otherwise set forth in this Indenture or the Notes and pursuing any action against the Company directly or otherwise directing the Trustee to take any such action in accordance with the terms of this Indenture and the Notes. If the Company has paid Special Interest directly to the Persons entitled to it, the Company shall deliver to the Trustee an Officers’ Certificate setting forth the details of such payment.

Section 2.15. Issuance of Additional Notes

The Company shall be entitled, subject to its compliance with Section 4.09 hereof, to issue Additional Notes under this Indenture which shall have identical terms as the Initial Notes issued on the date hereof, other than with respect to the date of issuance, issue price and rights under a related Registration Rights Agreement, if any. The Initial Notes issued on the date hereof, any Additional Notes and all Exchange Notes issued in exchange therefor shall be treated as a single class for all purposes under this Indenture, including without limitation, directions, waivers, consents, redemptions and Offers to Purchase.

With respect to any Additional Notes, the Company shall set forth in a Board Resolution and an Officers’ Certificate, a copy of each of which shall be delivered to the Trustee, the following information:

(a) the aggregate principal amount of such Additional Notes to be authenticated and delivered pursuant to this Indenture;

(b) the issue price, the issue date and the CUSIP and/or ISIN number of such Additional Notes; provided, however, that no Additional Notes may be issued at a price that would cause such Additional Notes to have “original issue discount” within the meaning of Section 1273 of the Code; and

(c) whether such Additional Notes shall be subject to the restrictions on transfer set forth in Section 2.06 hereof relating to Restricted Global Notes and Restricted Definitive Notes.

ARTICLE 3.

REDEMPTION AND PREPAYMENT

Section 3.01. Notices to Trustee .

If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee, at least 45 days but not more than 60 days before a redemption date (or such shorter period as allowed by the Trustee), an Officers’ Certificate setting forth (i) the applicable section of this Indenture pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption price.

Section 3.02. Selection of Notes to Be Redeemed .

If less than all of the Notes are to be redeemed at any time, the Trustee shall select the Notes to be redeemed among the Holders of the Notes in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not so listed, on a pro rata basis, by lot or in accordance with any other method the Trustee considers fair and appropriate. In the event of partial redemption by lot, the particular Notes to be redeemed shall be selected, unless otherwise provided herein, not less than 30 nor more than 60 days prior to the redemption date by the Trustee from the outstanding Notes not previously called for redemption.

The Trustee shall promptly notify the Company in writing of the Notes selected for redemption and, in the case of any Note selected for partial redemption, the principal amount thereof to be redeemed. Notes and portions of Notes selected shall be in amounts of US$1,000 or integral multiples of US$1,000, except that if all of the Notes of a Holder are to be redeemed, the entire outstanding amount of Notes held by such Holder, even if not

an integral multiple of US$1,000, shall be redeemed. Except as provided in the preceding sentence, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for redemption.

Section 3.03. Notice of Redemption .

At least 30 days but not more than 60 days prior to a redemption date, the Company shall mail or cause to be mailed, by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed at such Holder’s address appearing in the securities register maintained in respect of the Notes by the Registrar (the “ Security Register ”).

The notice shall identify the Notes to be redeemed and shall state:

(a) the redemption date;

(b) the redemption price or if the redemption is made pursuant to Section 3.07(b) hereof a calculation of the redemption price;

(c) if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the redemption date upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion shall be issued upon cancellation of the original Note;

(d) the name and address of the Paying Agent;

(e) that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price;

(f) that, unless the Company defaults in making such redemption payment, interest on Notes called for redemption ceases to accrue on and after the redemption date;

(g) the applicable section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and

(h) that no representation is made as to the correctness of the CUSIP or ISIN numbers, if any, listed in such notice or printed on the Notes.

At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at its expense; provided, however , that the Company shall have delivered to the Trustee, at least 45 days (or such shorter period allowed by the Trustee) prior to the redemption date, an Officers’ Certificate requesting that the Trustee give such notice (in the name and at the expense of the Company) and setting forth the information to be stated in such notice as provided in this Section 3.03.

Section 3.04. Effect of Notice of Redemption .

Once notice of redemption is mailed in accordance with Section 3.03 hereof, Notes called for redemption shall become irrevocably due and payable on the redemption date at the redemption price. A notice of redemption may not be conditional.

Section 3.05. Deposit of Redemption Price .

On or prior to 11:00 a.m. Eastern time on the Business Day prior to any redemption date, the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption price of and accrued and unpaid interest on all Notes to be redeemed on that date. The Trustee or the Paying Agent shall promptly return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the redemption price of, and accrued and unpaid interest on, all Notes to be redeemed.

If the Company complies with the provisions of the preceding paragraph, on and after the redemption date, interest shall cease to accrue on the Notes or the portions of Notes called for redemption in accordance with Section 2.08(d) hereof. If a Note is redeemed on or after a Regular Record Date but on or prior to the related Interest Payment Date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such Regular Record Date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal from the redemption date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 4.01 hereof.

Section 3.06. Notes Redeemed in Part .

Upon surrender of a Note that is redeemed in part, the Company shall issue and, upon the Company’s written request, the Trustee shall authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the Note surrendered.

Section 3.07. Optional Redemption

(a) Except as set forth in clauses (b) and (c) of this Section 3.07, the Notes shall not be redeemable at the option of the Company prior to April 15, 2013. Beginning on April 15, 2013, the Company may redeem all or a part of the Notes, at once or over time, in accordance with Section 3.03 hereof, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest thereon on the Notes redeemed, to the applicable redemption date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date), if redeemed during the twelve-month period commencing on April 15 of the years indicated below:

Redemption Year	Percentage

2013	104.563	%
2014	103.042	%
2015	101.521	%
2016 and thereafter	100.000	%

(b) At any time and from time to time prior to April 15, 2011, the Company may on one or more occasions redeem up to 35% of the aggregate principal amount of the Notes issued under this Indenture at a redemption price (expressed as a percentage of principal amount) equal to 109.125% of the principal amount thereof, plus accrued and unpaid interest thereon to the redemption date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date) with the net cash proceeds of one or more Equity Offerings; provided, however , that (i) at least 65% of the aggregate principal amount of the Notes issued under this Indenture (excluding Notes held by the Company and its Subsidiaries) remain outstanding immediately following such redemption and (ii) any such redemption shall be made within 90 days of the date of closing of any such Equity Offering.

(c) If the Company becomes obligated to pay any Additional Amounts because of a change in the laws or regulations of Canada or any Canadian Taxing Authority, or a change in any official position regarding the application or interpretation thereof, in either case that is publicly announced or becomes effective on or after the Issue Date, the Company may, at any time, redeem all, but not part, of the Notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest to the redemption date, provided that at any time that the aggregate principal amount of the Notes outstanding is greater than US$20.0 million, any Holder of the Notes may, to the extent that it does not adversely affect the Company’s after-tax position, at its option, waive the Company’s compliance with the provisions of Section 4.20 hereof with respect to such Holder’s Notes; provided, further , that if any Holder waives such compliance, the Company may not redeem that Holder’s Notes pursuant to this Section 3.07(c).

(d) Any prepayment pursuant to this Section 3.07 shall be made pursuant to the provisions of Sections 3.01 through 3.06 hereof.

Section 3.08. Mandatory Redemption .

Except as set forth in Sections 4.12 and 4.18 hereof, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to, or offers to purchase, the Notes.

Section 3.09. Offers To Purchase .

(a) In the event that, pursuant to Section 4.12 or 4.18 hereof, the Company shall be required to commence an Asset Sale Offer or Change of Control Offer (each, an “ Offer to Purchase ”), it shall follow the procedures specified below.

(b) The Company shall commence the Offer to Purchase by sending, by first-class mail, with a copy to the Trustee, to each Holder, at such Holder’s address appearing in the Security Register a notice, the terms of which shall govern the Offer to Purchase, stating:

(i) that the Offer to Purchase is being made pursuant to this Section 3.09 and Section 4.12 or 4.18, as the case may be, and, in the case of a Change of Control Offer, that a Change of Control has occurred, the transaction or transactions that constitute the Change of Control, and that a Change of Control Offer is being made pursuant to Section 4.18 hereof;

(ii) the principal amount of Notes required to be purchased pursuant to Section 4.12 or 4.18 hereof (the “ Offer Amount ”), the purchase price, the Offer Period and the Purchase Date (each as defined below);

(iii) except as provided in clause (ix), that all Notes timely tendered and not withdrawn shall be accepted for payment;

(iv) that any Note not tendered or accepted for payment shall continue to accrue interest;

(v) that, unless the Company defaults in making such payment, any Note accepted for payment pursuant to the Offer to Purchase shall cease to accrue interest on or after the Purchase Date;

(vi) that Holders electing to have a Note purchased pursuant to the Offer to Purchase may elect to have Notes purchased in integral multiples of US$1,000 only;

(vii) that Holders electing to have a Note purchased pursuant to the Offer to Purchase shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, or transfer by book-entry transfer, to the Company, a Depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice at least three days before the Purchase Date;

(viii) that Holders shall be entitled to withdraw their election if the Company, the Depositary or the Paying Agent, as the case may be, receives, not later than the expiration of the Offer Period, a telegram, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note (or portions thereof) the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;

(ix) that, in the case of an Asset Sale Offer, if the aggregate principal amount of Notes surrendered by Holders exceeds the Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of US$1,000 or integral multiples thereof shall be purchased);

(x) that Holders whose Notes were purchased in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer)

(xi) any other procedures that Holders must follow in order to tender their Notes (or portions thereof) for payment.

(c) The Offer to Purchase shall remain open for a period of at least 30 days but no more than 60 days following its commencement, except to the extent that a longer period is required by applicable law (the “ Offer Period ”). No later than five Business Days after the termination of the Offer Period (the “ Purchase Date ”), the Company shall purchase the Offer Amount or, if less than the Offer Amount has been tendered, all Notes tendered in response to the Offer to Purchase. Payment for any Notes so purchased shall be made in the same manner as interest payments are made.

(d) On or prior to the Purchase Date, the Company shall, to the extent lawful:

(i) accept for payment (on a pro rata basis to the extent necessary in connection with an Asset Sale Offer) the Offer Amount of Notes or portions of Notes properly tendered pursuant to the Offer to Purchase, or if less than the Offer Amount has been tendered, all Notes tendered;

(ii) deposit with the Paying Agent an amount equal to the Offer Amount in respect of all Notes or portions of Notes properly tendered; and

(iii) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company and that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.09.

(e) The Company, the Depositary or the Paying Agent, as the case may be, shall promptly (but in any event not later than five Business Days after the Purchase Date) deliver to each tendering Holder of Notes properly tendered and accepted by the Company for purchase the Purchase Amount for such Notes, and the Company shall promptly execute and issue a new Note, and the Trustee, upon receipt of an Authentication Order shall authenticate and deliver (or cause to be transferred by book-entry) such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered provided, however, that each such new Note shall be in a principal amount of US$1,000 or an integral multiple of US$1,000. Any Note not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Company shall publicly announce the results of the Offer to Purchase on or as soon as practicable after the Purchase Date.

(f) If the Purchase Date is on or after a Regular Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such Regular Record Date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Offer to Purchase.

(g) The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the Offer to Purchase. To the extent that the provisions of any securities laws or regulations conflict with Section 4.12 or 4.18, as applicable, this Section 3.09 or other provisions of this Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under Section 4.12 or 4.18, as applicable, this Section 3.09 or such other provision by virtue of such conflict.

(h) Other than as specifically provided in this Section 3.09, any purchase pursuant to this Section 3.09 shall be made in accordance with the provisions of Section 3.01 through 3.06 hereof.

ARTICLE 4.

COVENANTS

Section 4.01. Payment of Notes .

The Company shall pay or cause to be paid the principal of, premium, if any, and interest on, the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary thereof, holds as of 11:00 a.m. Eastern Time on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay all principal, premium, if any, and interest then due. The Company shall pay Special Interest, if any, in the same manner, on the dates and in the amounts set forth in a Registration Rights Agreement, the Notes and this Indenture. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on such payment for the intervening period.

The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the rate then in effect; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful.

Interest shall be computed on the basis of a 360-day year of twelve 30-day months. For the purposes of the Interest Act (Canada), the yearly rate of interest which is equivalent to the rate payable hereunder is the rate payable multiplied by the actual number of days in the year and divided by 360.

Section 4.02. Maintenance of Office or Agency .

(a) The Company shall maintain an office or agency (which may be an office or drop facility of the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where Notes may be presented or surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served. The Company shall give prompt written notice to the Trustee of any change in the location of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.

(b) The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations. The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

(c) The Company hereby designates the Corporate Trust Office of the Trustee, as such office, drop facility or agency of the Company in accordance with Section 2.03 hereof.

Section 4.03. Reports .

(a) Notwithstanding that the Company may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, so long as any Notes are outstanding the Company shall file with the Commission, and shall furnish to the Holders and the Trustee:

(1) within 120 days after the end of each fiscal year of the Company, annual reports on Form 20-F or 40-F, as applicable, or any successor form; and

(2) (a) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Company, reports on Form 10-Q or any successor form, or (b) within 60 days after the end of each of the first three fiscal quarters of each fiscal year of the Company, reports on Form 6-K, or any successor form, which in each case, regardless of applicable requirements, shall, at a minimum, contain a “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and, with respect to any such reports, a reconciliation to U.S. GAAP as permitted by the Commission for foreign private issuers.

(b) For so long as any Notes remain outstanding, the Company shall furnish to the Holders, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

(c) If the Company has designated any of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly and annual financial information required by this Section shall include a reasonably detailed presentation, either on the face of the financial statements or in the footnotes thereto, and in Management’s Discussion and Analysis of Financial Condition and Results of Operations, of the financial condition and results of operations of the Company and the Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Company.

Section 4.04. Compliance Certificate .

(a) The Company shall deliver to the Trustee, within 120 days after the end of each fiscal year, beginning with the fiscal year ending December 31, 2008, an Officers’ Certificate stating that a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether the Company and its Subsidiaries have kept, observed, performed and fulfilled their obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best of his or her knowledge the Company and its Subsidiaries have kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance or observance of any of the terms, provisions and conditions of this Indenture (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is taking or proposes to take with respect thereto) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of which payments on account of the principal of, premium, if any, or interest on the Notes is prohibited or if such event has occurred, a description of the event and what action the Company is taking or proposes to take with respect thereto.

(b) The Company shall otherwise comply with TIA §314(a)(2).

(c) The Company shall deliver to the Trustee, within 30 days after the occurrence thereof, written notice in the form of an Officers’ Certificate of any Default or Event of Default, its status and what action the Company is taking or proposes to take with respect thereto.

Section 4.05. Taxes .

The Company shall pay, and shall cause each of its Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and governmental levies, except such as are being contested in good faith and by appropriate proceedings or where the failure to effect such payment is not adverse in any material respect to the Holders.

Section 4.06. Stay, Extension and Usury Laws .

The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, hinder, delay or impede the

execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted.

Section 4.07. Corporate Existence .

Subject to Article 5 hereof, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect (i) its corporate existence, and the corporate, partnership or other existence of each Restricted Subsidiary, in accordance with the respective organizational documents (as the same may be amended from time to time) of the Company or any such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses and franchises of the Company and the Restricted Subsidiaries; provided, however , that the Company shall not be required to preserve any such right, license or franchise, or the corporate, partnership or other existence of any Restricted Subsidiary, if the Board of Directors of the Company shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and the Restricted Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders of the Notes, or that such preservation is not necessary in connection with any transaction not prohibited by this Indenture.

Section 4.08. Payments for Consent .

The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, pay or cause to be paid any consideration, to or for the benefit of any Holder for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be paid and is paid to all Holders that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.

Section 4.09. Incurrence of Indebtedness and Issuance of Preferred Shares.

(a) The Company shall not, and shall not permit any of its Subsidiaries to, Incur, directly or indirectly, any Indebtedness, including Acquired Debt, and the Company shall not issue any Disqualified Stock and shall not permit any of its Subsidiaries to issue any Preferred Shares; provided, however, that the Company may Incur Indebtedness, including Acquired Debt, or issue Disqualified Stock, and the Subsidiary Guarantors may Incur Indebtedness, including Acquired Debt, or issue Preferred Shares if the Company’s Debt to Cash Flow Ratio at the time of Incurrence of such Indebtedness or the issuance of such Disqualified Stock or Preferred Shares, after giving pro forma effect to such Incurrence or issuance as of such date and to the use of proceeds therefrom, taking into account any substantially concurrent transactions related to such Incurrence, as if the same had occurred at the beginning of the most recently ended full fiscal quarter of the Company for which internal financial statements are available, would have been no greater than 5.5 to 1.0.

(b) Paragraph (a) of this Section 4.09 shall not prohibit the Incurrence of any of the following items of Indebtedness or issuances of Preferred Shares (each such item being referred to herein as “ Permitted Debt ”):

(1) the Incurrence by the Company or a Subsidiary Guarantor of Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of the Company and the Restricted Subsidiaries thereunder) not to exceed an aggregate of Cdn$575.0 million, less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiaries subsequent to October 8, 2003 to permanently repay Indebtedness under a Credit Facility (and, in the case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to the provisions of Section 4.12 hereof;

(2) the Incurrence by the Company and the Restricted Subsidiaries of the Existing Indebtedness;

(3) the Incurrence by (a) the Company of Indebtedness represented by the Initial Notes and the Exchange Notes to be issued in exchange for such Initial Notes and in exchange for any Additional Notes, and (b) the Subsidiary Guarantors of Indebtedness represented by the Subsidiary Guarantees relating to the Initial Notes and the guarantees issued in exchange for such Subsidiary Guarantees and in exchange for the Subsidiary Guarantees relating to any Additional Notes;

(4) the Incurrence by the Company or a Subsidiary Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, Incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of the Company or such Subsidiary Guarantor, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness Incurred pursuant to this clause (4), not to exceed US$40.0 million at any time outstanding;

(5) the Incurrence by the Company or any Subsidiary Guarantor of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness, other than intercompany Indebtedness, that was permitted by this Indenture to be incurred under paragraph (a) or clauses (b)(2), (b)(3) and (b)(4) of this Section 4.09;

(6) the Incurrence by the Company or any Subsidiary Guarantor of intercompany Indebtedness between or among the Company and any Restricted Subsidiary; provided, however, that:

(i) if the Company or any Subsidiary Guarantor is the obligor on such Indebtedness, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Subsidiary Guarantee, in the case of a Subsidiary Guarantor, and

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

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

(8) the Incurrence by the Company or any Restricted Subsidiary of Hedging Obligations that are Incurred in the ordinary course of business of the Company or such Restricted Subsidiary and not for speculative purposes; provided, however , that, in the case of:

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

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

(9) the guarantee by the Company or a Subsidiary Guarantor of Indebtedness of the Company or a Subsidiary Guarantor that was permitted to be Incurred by another provision of this Section 4.09;

(10) the Incurrence by the Company or any Subsidiary Guarantors of Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this clause (10), not to exceed US$25.0 million;

(11) the Incurrence by the Company or any Restricted Subsidiary of Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness Incurred to refund, refinance or replace any Indebtedness Incurred pursuant to this clause (11), not to exceed US$25.0 million, less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary subsequent to October 8, 2003 to permanently repay such Indebtedness (and, in the case of any revolving credit Indebtedness, to effect a corresponding commitment reduction thereunder) pursuant to the provisions of Section 4.12 hereof;

(12) the issuance of Preferred Shares by the Company’s Unrestricted Subsidiaries or the Incurrence by the Company’s Unrestricted Subsidiaries of Non-Recourse Debt; provided, however , that if any such Indebtedness ceases to be Non-Recourse Debt of an Unrestricted Subsidiary, that event shall be deemed to constitute an Incurrence of Indebtedness by a Restricted Subsidiary that was not permitted by this clause (12);

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

(c) The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock (to the extent provided for when the Indebtedness or Disqualified Stock on which such interest or dividend is paid was originally issued) shall not be deemed to be an Incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this Section 4.09; provided that in each case the amount thereof is for all other purposes included in the Consolidated Interest Expense and Indebtedness of the Company or its Restricted Subsidiary as accrued.

(d) Neither the Company nor any Subsidiary Guarantor shall Incur any Indebtedness, including Permitted Debt, that is contractually subordinated in right of payment to any other Indebtedness of the Company or such Subsidiary Guarantor, as applicable, unless such Indebtedness is also contractually subordinated in right of payment to the Notes or the Subsidiary Guarantee, as applicable, on substantially identical terms; provided, however , that no Indebtedness of the Company or a Subsidiary Guarantor shall be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or such Subsidiary Guarantor, as applicable, solely by virtue of collateral or lack thereof.

(e) Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that may be Incurred pursuant to this Section 4.09 will not be deemed to be exceeded with respect to any outstanding Indebtedness due solely to the result of fluctuations in the exchange rate of currencies.

(f) For purposes of determining compliance with this Section 4.09, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in

clauses (b)(1) through (13) above, or is entitled to be Incurred pursuant to paragraph (a) of this Section 4.09, the Company shall be permitted to classify such item of Indebtedness on the date of its Incurrence or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this Section. Indebtedness under Credit Facilities outstanding on the date on which Notes are first issued and authenticated under this Indenture shall be deemed to have been Incurred on such date in reliance on the exception provided by clause (1) of paragraph (b) of this Section 4.09.

Section 4.10. Restricted Payments .

(a) The Company shall not make, and shall not permit any Restricted Subsidiary to make, directly or indirectly, any Restricted Payment, unless, at the time of and after giving effect to such Restricted Payment,

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

(2) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable fiscal quarter, have been permitted to Incur at least US$1.00 of additional Indebtedness, other than Permitted Debt, pursuant to the Debt to Cash Flow Ratio test set forth in Section 4.09(a) hereof; and

(3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments declared or made by the Company and its Restricted Subsidiaries after October 8, 2003, excluding Restricted Payments made pursuant to clauses (2), (3), (4), (6), (7), (8), (9) and (10) of paragraph (b) below, shall not exceed, at the date of determination, the sum, without duplication, of:

(a) an amount equal to the Company’s Consolidated Cash Flow from October 1, 2003 to the end of the Company’s most recently ended full fiscal quarter for which internal financial statements are available, taken as a single accounting period, less 1.5 times the Company’s Consolidated Interest Expense from the October 1, 2003 to the end of the Company’s most recently ended full fiscal quarter for which internal financial statements are available, taken as a single accounting period (or, if such amount for such period is a deficit, minus 100% of such deficit); plus

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

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

(ii) an Incurrence of Indebtedness pursuant to Section 4.09(b)(8) hereof; plus

(c) to the extent that any Restricted Investment that was made after October 8, 2003 is sold for cash or otherwise liquidated or repaid for cash (except to the extent any such payment or proceeds are included in the calculation of Consolidated Cash Flow), the lesser of (i) the cash return of capital with respect to such Restricted Investment, less the cost of disposition, if any, and (ii) the initial amount of such Restricted Investment; plus

(d) to the extent that the Board of Directors of the Company designates any Unrestricted Subsidiary that was designated as such after October 8, 2003 as a Restricted Subsidiary, the lesser of (i) the aggregate fair market value of all

Investments owned by the Company and the Restricted Subsidiaries in such Subsidiary at the time such Subsidiary was designated as an Unrestricted Subsidiary and (ii) the then aggregate fair market value of all Investments owned by the Company and the Restricted Subsidiaries in such Unrestricted Subsidiary.

(b) The provisions of paragraph (a) above shall not prohibit:

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

(2) so long as no Default has occurred and is continuing or would be caused thereby, the redemption, repurchase, retirement, defeasance or other acquisition of any Subordinated Indebtedness of the Company or any Subsidiary Guarantor or of any Equity Interests of the Company in exchange for, or out of the net cash proceeds of the substantially concurrent sale, other than to a Subsidiary of the Company or an employee stock ownership plan or to a trust established by the Company or any Subsidiary of the Company for the benefit of its employees, of, Equity Interests of the Company (other than Disqualified Stock or Back-to-Back Securities); provided that the amount of any such net cash proceeds that are utilized for any such redemption, repurchase, retirement, defeasance or other acquisition shall be excluded from clause (a)(3)(b) above;

(3) so long as no Default has occurred and is continuing or would be caused thereby, the defeasance, redemption, repurchase or other acquisition of Subordinated Indebtedness of the Company or any Subsidiary Guarantor with the net cash proceeds from an Incurrence of Permitted Refinancing Indebtedness;

(4) any payment by the Company or a Restricted Subsidiary to any one of the other of them;

(5) so long as no Default has occurred and is continuing or would be caused thereby, the repurchase, redemption or other acquisition or retirement for value by the Company of any Equity Interests of the Company held by any member of the management of the Company or any of its Subsidiaries pursuant to any management equity subscription agreement or stock option agreement in effect as of October 8, 2003; provided, however, that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests shall not exceed US$2.0 million in any twelve-month period;

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

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

(8) so long as no Default has occurred and is continuing or would be caused thereby, the payment of any Management Fees or other similar expenses by the Company to its direct or indirect parent company for bona fide services (including reimbursement for expenses Incurred in connection with, or allocation of corporate expenses in relation to, providing such services) provided to, and directly related to the operations of, the Company and the

Restricted Subsidiaries, in an aggregate amount not to exceed 1.5% of Consolidated Revenues in any twelve-month period;

(9) so long as no Default has occurred and is continuing or would be caused thereby, other Restricted Payments since October 8, 2003 in an aggregate amount not to exceed US$30.0 million; and

(10) so long as no Default has occurred and is continuing or would be caused thereby and the Debt to Cash Flow Ratio is no greater than 5.0 to 1 (calculated on a pro forma basis as if such payment, including any related financing transaction, had occurred at the beginning of the applicable fiscal quarter), the payment of dividends or distributions to Quebecor Media or the repayment of the QMI Subordinated Loan, in an aggregate amount not to exceed Cdn$200.0 million since October 8, 2003.

(c) The amount of any Restricted Payment, other than those effected in cash, shall be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued to or by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any assets or securities that are required to be valued pursuant to this Section 4.10 shall be determined by the Board of Directors of the Company whose resolution with respect thereto shall be delivered to the Trustee. The determination of the Board of Directors of the Company shall be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada if the fair market value exceeds US$25.0 million; provided , that the Board of Directors of the Company shall not be required to obtain such an opinion or appraisal in connection with any payments with respect to Back-to-Back Securities to the extent such Back-to-Back Transactions were approved in accordance with the provisions of Section 4.14 hereof. Not later than the date of making any Restricted Payment, the Company shall deliver to the Trustee an Officers’ Certificate stating that such Restricted Payment is permitted and setting forth the basis upon which the calculations required by this Section 4.10 were computed, together with a copy of any fairness opinion or appraisal required by this Indenture.

(d) For purposes of this Section 4.10, if (i) any Videotron Entity ceases to be the obligor under or issuer of any Back-to-Back Securities and a Person other than a Videotron Entity becomes the obligor thereunder (or the issuer of any Back-to-Back Preferred Shares) or (ii) any Restricted Subsidiary that is an obligor under or issuer of any Back-to-Back Securities ceases to be a Restricted Subsidiary other than by consolidation or merger with the Company or another Restricted Subsidiary, then the Company or such Restricted Subsidiary shall be deemed to have made a Restricted Payment in an amount equal to the accreted value of such Back-to-Back Debt (or the subscription price of any Back-to-Back Preferred Shares) at the time of the assumption thereof by such other Person or at the time such Restricted Subsidiary ceases to be a Restricted Subsidiary.

Section 4.11. Liens .

The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist or become effective any Lien of any kind on any asset owned at October 8, 2003 or thereafter acquired, except Permitted Liens, unless the Company or such Restricted Subsidiary has made or will make effective provision to secure the Notes and any applicable Subsidiary Guarantees equally and ratably with the obligations of the Company or such Restricted Subsidiary secured by such Lien for so long as such obligations are secured by such Lien.

Section 4.12. Asset Sales .

(a) The Company shall not, and shall not permit any Restricted Subsidiary to, consummate an Asset Sale unless:

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

(2) such fair market value is determined by the Company’s Board of Directors and evidenced by a Board Resolution set forth in an Officers’ Certificate delivered to the Trustee; and

(3) at least 75% of the consideration received in such Asset Sale by the Company or such Restricted Subsidiary is in the form of cash or Cash Equivalents. For purposes of this clause (3), each of the following shall be deemed to be cash:

(a) any Indebtedness or other liabilities, as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and Indebtedness that are by their terms pari passu with or subordinated to the Notes or any Subsidiary Guarantee and liabilities to the extent owed to the Company or any Affiliate of the Company), that are assumed by the transferee of any such assets pursuant to a written agreement that releases the Company or such Restricted Subsidiary from further liability with respect to such Indebtedness or liabilities; and

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

(b) Notwithstanding the terms of paragraph (a) above, the Company and the Restricted Subsidiaries may engage in Asset Swaps if (i) immediately after giving effect to any such Asset Swap, the Company would be permitted to Incur at least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth in Section 4.09(a), and (ii) the Company or such Restricted Subsidiary receives consideration at the time of such Asset Swap at least equal to the fair market value of the assets disposed of, which fair market value shall be determined by the Board of Directors of the Company or the Restricted Subsidiary, as the case may be, and evidenced by a Board Resolution set forth in an Officers’ Certificate delivered to the Trustee; provided, however, that the determination of the Board of Directors shall be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing in the United States or Canada if the fair market value exceeds US$25.0 million.

(c) Within 360 days after the receipt of any Net Proceeds from an Asset Sale, the Company may apply those Net Proceeds at its option:

(1) to permanently repay or reduce Indebtedness, other than Subordinated Indebtedness, of the Company or a Subsidiary Guarantor secured by such assets, Indebtedness of the Company or a Subsidiary Guarantor under Credit Facilities or Indebtedness of a Restricted Subsidiary that is not a Subsidiary Guarantor, and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto;

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

(3) to acquire, or enter into a binding agreement to acquire, Voting Stock of a Person engaged in a Permitted Business from a Person that is not an Affiliate of the Company; provided, however, that such commitment shall be subject only to customary conditions (other than financing) and such acquisition shall be consummated no later than 180 days after the end of such 360-day period; and provided, further, however , that (a) after giving effect thereto, the Person so acquired becomes a Restricted Subsidiary and (b) such acquisition is otherwise made in accordance with this Indenture, including, without limitation, Section 4.10 hereof; or

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

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

(d) Any Net Proceeds from Asset Sales that are not applied, invested or segregated from the general funds of the Company for investment in identified assets pursuant to a binding agreement, in each case as provided in paragraph (c) above shall constitute Excess Proceeds; provided, however, that the amount of any Net Proceeds that ceases to be so segregated as contemplated in paragraph (c) above shall also constitute “Excess Proceeds” at the time any such Net Proceeds cease to be so segregated; provided further, however , that the amount of any Net Proceeds that continues to be segregated for investment and that is not actually reinvested within twenty-four months from the date of the receipt of such Net Proceeds shall also constitute “Excess Proceeds.”

(e) When the aggregate amount of Excess Proceeds exceeds US$35.0 million, the Company shall make an offer (an “ Asset Sale Offer ”) to all Holders of Notes and all holders of other Indebtedness that is pari passu in right of payment with the Notes or any Subsidiary Guarantee containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets, to purchase the maximum principal amount of Notes and such other pari passu Indebtedness that may be purchased out of the Excess Proceeds in accordance with the procedures set forth in Section 3.09 hereof. The offer price in any Asset Sale Offer shall be equal to 100% of principal amount of the Notes and such other pari passu Indebtedness, plus accrued and unpaid interest to the date of purchase, and shall be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer and all Holders of Notes have been given the opportunity to tender their Notes for purchase in accordance with such Asset Sale Offer and this Indenture, the Company may use such Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and such other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Notes and such other pari passu Indebtedness shall be purchased on a pro rata basis (subject to Notes being in denominations of US$1,000 or integral multiples thereof) based on the principal amount of Notes and such other pari passu Indebtedness tendered. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero.

The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sales provisions of this Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Asset Sale provisions of this Indenture by virtue of such conflict.

Section 4.13. Dividend and Other Payment Restrictions Affecting Subsidiaries .

(a) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:

(1) pay dividends or make any other distributions on its Equity Interests to the Company or any other Restricted Subsidiary, or with respect to any other interest or participation in, or measured by, its profits, or pay any liabilities owed to the Company or any other Restricted Subsidiary;

(2) make loans or advances, or guarantee any such loans or advances, to the Company or any other Restricted Subsidiary; or

(3) transfer any of its properties or assets to the Company or any other Restricted Subsidiary.

(b) The restrictions set forth in paragraph (a) above shall not apply to encumbrances or restrictions existing under or by reason of:

(1) agreements governing Existing Indebtedness and Credit Facilities as in effect on October 8, 2003 and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings thereof; provided, however , that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacement or refinancings are no more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in such Existing Indebtedness and Credit Facilities, as in effect on October 8, 2003;

(2) this Indenture and the Notes;

(3) applicable law or any applicable rule, regulation or order;

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

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

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

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

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

(9) Liens securing Indebtedness that is permitted to be secured without also securing the Notes or the applicable Subsidiary Guarantee pursuant to Section 4.11 hereof that limit the right of the debtor to dispose of the assets subject to any such Lien;

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

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

(12) any Indebtedness or any agreement pursuant to which such Indebtedness was issued if the encumbrance or restriction applies only upon a payment or financial covenant default or event of default contained in such Indebtedness or agreement and (A) such encumbrance

or restriction is not materially more disadvantageous to the Holders than is customary in comparable financings (as determined in good faith by the Board of Directors of the Company) and (B) management of the Company delivers to the Trustee an Officers’ Certificate evidencing its determination at the time such agreement is entered into, that such encumbrance or restriction will not materially impair the Company’s ability to make payments on the Notes.

Section 4.14. Transactions with Affiliates .

(a) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, make any payment to, or sell, lease, transfer, exchange or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction or series of transactions, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate, officer or director of the Company (each, an “ Affiliate Transaction ”) unless:

(1) such Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable arm’s length transaction by the Company or such Restricted Subsidiary with an unrelated Person; and

(2) the Company delivers to the Trustee:

(i) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of US$10.0 million, a Board Resolution of the Company set forth in an Officers’ Certificate certifying that such Affiliate Transaction or series of related Affiliate Transactions complies with this Section 4.14 and that such Affiliate Transaction or series of related Affiliate Transactions has been approved by a majority of the disinterested members of the Board of Directors of the Company; and

(ii) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of US$40.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary of such Affiliate Transaction or series of related Affiliate Transactions from a financial point of view issued by an independent accounting, appraisal or investment banking firm of national standing in the United States or Canada.

(b) The following items shall be deemed not to constitute Affiliate Transactions and, therefore, shall not be subject to the provisions of paragraph (a) above:

(1) any employment agreement entered into by the Company or any Restricted Subsidiary in the ordinary course of business and consistent with the past practice of the Company or such Restricted Subsidiary;

(2) transactions between or among the Company and/or the Restricted Subsidiaries;

(3) transactions with a Person that is an Affiliate of the Company solely because the Company owns an Equity Interest in such Person, provided such transactions are on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable arm’s length transaction by the Company or such Restricted Subsidiary with an unrelated Person;

(4) payment of reasonable directors fees to Persons who are not otherwise Affiliates of the Company;

(5) sales of Equity Interests of the Company, other than Disqualified Stock or Back-to-Back Securities, to Affiliates of the Company;

(6) any agreement or arrangement as in effect on October 8, 2003 or any amendment thereto or any transaction contemplated thereby, including pursuant to any amendment thereto, in any replacement agreement or arrangement thereto so long as any such amendment or replacement agreement or arrangement is not more disadvantageous to the Company or the Restricted Subsidiaries, as the case may be, in any material respect than the original agreement as in effect on October 8, 2003;

(7) Restricted Payments that are permitted by the provisions of Section 4.10 hereof;

(8) Permitted Investments; and

(9) any Tax Benefit Transaction.

Section 4.15. Sale and Leaseback Transactions .

The Company shall not, and shall not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided, however , that the Company or any Restricted Subsidiary may enter into a sale and leaseback transaction if:

(a) the Company or that Restricted Subsidiary, as applicable, could have (i) Incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction under the Debt to Cash Flow Ratio test set forth in Section 4.09(a) hereof and (ii) created a Lien on such property securing Attributable Debt pursuant to the provisions of Section 4.11 hereof;

(b) the net cash proceeds of such sale and leaseback transaction are at least equal to the fair market value, as determined in good faith by the Board of Directors of the Company and set forth in an Officers’ Certificate delivered to the Trustee, of the property that is the subject of that sale and leaseback transaction; and

(c) the transfer of assets in such sale and leaseback transaction is permitted by, and the Company or such Restricted Subsidiary applies the proceeds of such transaction in compliance with, the provisions of Section 4.12 hereof.

Section 4.16. Issuances and Sales of Equity Interests in Subsidiaries .

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

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

(2) the Net Proceeds from such transfer, conveyance, sale, lease or other disposition (whether by way of merger, amalgamation or otherwise) are applied in accordance with the provisions of Section 4.12 hereof.

(b) The Company shall not permit any direct or indirect Restricted Subsidiary that constitutes a Significant Subsidiary or any group of Restricted Subsidiaries which, when taken as a whole, would constitute a Significant Subsidiary of the Company, to issue any Equity Interests to any Person, other than, (1) if necessary, shares of Capital Stock constituting directors’ qualifying shares, (2) Back-to-Back Securities or (3) to the Company or a Wholly Owned Restricted Subsidiary thereof.

Section 4.17. Designation of Restricted and Unrestricted Subsidiaries .

(a) The Board of Directors of the Company may designate any Subsidiary to be an Unrestricted Subsidiary if such Subsidiary:

(1) has no Indebtedness other than Non-Recourse Debt;

(2) does not own any Equity Interest of any Restricted Subsidiary, or hold any Liens on any property of the Company or any of its Restricted Subsidiaries;

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

(4) is a Person with respect to which neither the Company nor any Restricted Subsidiary has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results;

(5) except in the case of a Subsidiary Guarantor that is designated as an Unrestricted Subsidiary in accordance with this Indenture, has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any Restricted Subsidiary;

(6) has at least one director on its Board of Directors that is not a director or executive officer of the Company or any Restricted Subsidiary and has at least one executive officer that is not a director or executive officer of the Company or any Restricted Subsidiary; and

(7) such designation would not cause a Default or Event of Default.

(b) Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary shall be evidenced to the Trustee by filing with the Trustee a certified copy of the Board Resolution giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the provisions of paragraph (a) above and was permitted by the provisions of Section 4.10 hereof. If, at any time, any Unrestricted Subsidiary would fail to meet the requirements of the provisions of paragraph (a) above, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any Preferred Shares of such Subsidiary shall be deemed to be issued and any Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted Subsidiary as of such date and, if such Preferred Shares are not permitted to be issued or such Indebtedness is not permitted to be Incurred as of such date under the provisions of Section 4.09 hereof, the Company shall be in default of such Section.

(c) If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by the Company and the Restricted Subsidiaries in the Subsidiary so designated shall be deemed to be an Investment made as of the time of such designation and shall either reduce the amount available for Restricted Payments under Section 4.10(a) hereof or reduce the amount available for future Investments under one or more clauses of the definition of Permitted Investments, as the Company shall determine. Such designation shall be permitted only if such Investment would be permitted at such

time and if such Restricted Subsidiary otherwise meets the requirements of the provisions of paragraph (a) above. Upon designation of a Restricted Subsidiary as an Unrestricted Subsidiary in compliance with this Section 4.17, such Subsidiary shall be released from any Subsidiary Guarantee previously made by such Subsidiary in accordance with the provisions of Section 10.05 hereof.

(d) The Board of Directors of the Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that (i) such designation shall be deemed to be an Incurrence of Indebtedness by a Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation shall only be permitted if such Indebtedness is permitted under the provisions of Section 4.09 hereof, calculated on a pro forma basis as if such designation had occurred at the beginning of the most recently ended full fiscal quarter for which internal financial statements are available; (ii) all outstanding Investments owned by such Unrestricted Subsidiary shall be deemed to be made as of the time of such designation and such Investments shall only be permitted if such Investments would be permitted under the provisions of Section 4.10 hereof; (iii) all Liens upon property or assets of such Unrestricted Subsidiary existing at the time of such designation would be permitted under the provisions of Section 4.11 hereof; and (iv) no Default or Event of Default would be in existence following such designation.

Section 4.18. Repurchase at the Option of Holders Upon a Change of Control .

(a) Upon the occurrence of a Change of Control, the Company shall, within 30 days of a Change of Control, make an offer (the “ Change of Control Offer ”) pursuant to the procedures set forth in Section 3.09 hereof. Each Holder shall have the right to accept such offer and require the Company to repurchase all or any part (equal to US$1,000 or an integral multiple of US$1,000) of such Holder’s Notes pursuant to the Change of Control Offer at a purchase price, in cash (the “ Change of Control Amount ”), equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest on the Notes repurchased to the purchase date.

(b) The Company shall not be required to make a Change of Control Offer upon a Change of Control if a third party makes a Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes or portions of Notes properly tendered and not withdrawn under the Change of Control Offer.

Section 4.19. Future Guarantors .

The Company shall cause each Person that becomes a Wholly Owned Restricted Subsidiary of the Company following the Issue Date to become a Subsidiary Guarantor and to execute a supplemental indenture and deliver an Opinion of Counsel to the Trustee. In addition, the Company shall not permit any of its Restricted Subsidiaries, directly or indirectly, to guarantee any other Indebtedness (including any Back-to-Back Debt) of the Company or any of its Restricted Subsidiaries, unless such Restricted Subsidiary is a Subsidiary Guarantor or simultaneously executes and delivers a supplemental indenture providing for a Subsidiary Guarantee of the payment of the Notes by such Restricted Subsidiary, which Subsidiary Guarantee shall be senior to or pari passu with such Subsidiary’s guarantee of such other Indebtedness. The form of the Subsidiary Guarantee is attached hereto as Exhibit E.

Section 4.20. Additional Amounts .

(a) All payments made by or on behalf of the Company or the Subsidiary Guarantors on or with respect to the Notes shall be made without withholding or deduction for any Taxes imposed by any Canadian Taxing Authority, unless required by law or the interpretation or administration thereof by the relevant Canadian Taxing Authority. If the Company or any Subsidiary Guarantor (or any other payor) is required to withhold or deduct any amount on account of Taxes from any payment made under or with respect to any Notes that are outstanding on the date of the required payment, it shall:

(1) make such withholding or deduction;

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

(3) pay the additional amounts (“ Additional Amounts ”) as may be necessary so that the net amount received by each holder (including Additional Amounts) after such withholding or deduction will not be less than the amount the holder would have received if such Taxes had not been withheld or deducted;

(4) furnish to the Holders, within 30 days after the date the payment of any Taxes is due, certified copies of tax receipts evidencing such payment by the Company or such Subsidiary Guarantor;

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

(6) at least 30 days prior to each date on which any payment under or with respect to the Notes is due and payable, if the Company or any Subsidiary Guarantor becomes obligated to pay Additional Amounts with respect to such payment, deliver to the Trustee an Officers’ Certificate stating the amounts so payable and such other information necessary to enable the Trustee to pay such Additional Amounts to Holders on the payment date.

(b) Notwithstanding the provisions of paragraph (a) above, no Additional Amounts shall be payable to a Holder in respect of beneficial ownership of a Note (an “ Excluded Holder ”):

(1) with which the Company or such Subsidiary Guarantor does not deal at arm’s-length, within the meaning of the Income Tax Act (Canada), at the time of making such payment;

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

(3) if such Holder waives its right to receive Additional Amounts.

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

The obligations described under this Section 4.20 will survive any termination, defeasance or discharge of this Indenture and will apply mutatis mutandis to any jurisdiction in which any successor Person to the Company or any Subsidiary Guarantor, as applicable, is organized or any political subdivision or taxing authority or agency thereof or therein.

Section 4.21. Business Activities .

The Company shall not, and shall not permit any Restricted Subsidiary to, engage in any business other than the Permitted Businesses, except to such extent as would not be material to the Company and its Restricted Subsidiaries taken as a whole.

ARTICLE 5.

SUCCESSORS

Section 5.01. Merger, Consolidation and Sale of Assets of the Company and Subsidiary Guarantors .

(a) The Company may not directly or indirectly, (i) consolidate, merge or amalgamate with or into another Person, whether or not the Company is the surviving corporation, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of the Company and the Restricted Subsidiaries, taken as a whole, in one or more related transactions, to another Person, unless, in either case,

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

(2) the Surviving Company expressly assumes all the obligations of the Company under the Notes, this Indenture and, if applicable, any Registration Rights Agreements, pursuant to agreements reasonably satisfactory to the Trustee;

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

(4) the Company or the Surviving Company shall, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable fiscal quarter, be permitted to Incur at least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth in Section 4.09(a) hereof.

(b) Unless in connection with a disposition by the Company or a Subsidiary Guarantor of its entire ownership interest in a Subsidiary Guarantor or all or substantially all the assets of a Subsidiary Guarantor permitted by, and in accordance with the applicable provisions of, this Indenture (including, without limitation, the provisions of Section 4.12 hereof, the Company shall cause each Subsidiary Guarantor not to directly or indirectly, (i) consolidate, merge or amalgamate with or into another Person, whether or not such Subsidiary Guarantor is the surviving corporation, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of such Subsidiary Guarantor, in one or more related transactions, to another Person, unless, in either case,

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

(2) the Surviving Guarantor expressly assumes all the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee, this Indenture and, if applicable, any Registration Rights Agreements, pursuant to agreements reasonably satisfactory to the Trustee;

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

(4) such Subsidiary Guarantor or the Surviving Guarantor shall, on the date of such transaction after giving pro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable fiscal quarter, be permitted to Incur at least US$1.00 of additional Indebtedness pursuant to the Debt to Cash Flow Ratio test set forth in Section 4.09(a) hereof.

(c) In addition, the Company shall not, and shall cause each Subsidiary Guarantor not to, directly or indirectly, lease all or substantially all of its properties or assets, in one or more related transactions, to any other Person. Clauses (a)(4) and (b)(4) of this Section 5.01 shall not apply to a merger, consolidation or amalgamation, or a sale, assignment, transfer, conveyance or other disposition of assets, between or among the Company and any Restricted Subsidiary.

Section 5.02. Successor Corporation Substituted .

Each Surviving Company and Surviving Guarantor shall succeed to, and be substituted for, and may exercise every right and power of the Company or a Subsidiary Guarantor, as applicable, under this Indenture; provided, however, that in the case of:

(a) a sale, transfer, assignment, conveyance or other disposition (unless such sale, transfer, assignment, conveyance or other disposition is of all or substantially all of the assets of the Company and the Restricted Subsidiaries, taken as a whole, or in the case of a Subsidiary Guarantor, such sale, transfer, assignment, conveyance or other disposition is of all or substantially all of the assets of such Subsidiary Guarantor or all of the Capital Stock of such Subsidiary Guarantor to a Person that is not (either before or after giving effect to such transactions) a Subsidiary of the Company), or

(b) a lease,

the predecessor company shall not be released from any of the obligations or covenants under this Indenture, including with respect to the payment of the Notes and obligations under the Subsidiary Guarantees.

ARTICLE 6.

DEFAULTS AND REMEDIES

Section 6.01. Events of Default .

Each of the following is an “Event of Default:”

(i) default for 30 days in the payment when due of interest on, including Additional Amounts or Special Interest, if any, or with respect to, the Notes;

(ii) default in payment, when due at Stated Maturity, upon acceleration, redemption, required repurchase or otherwise, of the principal of, or premium, if any, on the Notes;

(iii) failure by the Company or any Restricted Subsidiary to comply with the provisions of Section 4.09, 4.10, 4.12, 4.18 or 5.01 hereof;

(iv) failure by the Company or any Restricted Subsidiary for 30 days after written notice thereof has been given to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% of the aggregate principal amount of the Notes outstanding to comply with any of its other covenants or agreements in this Indenture;

(v) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness by the Company or any Restricted Subsidiary,

or the payment of which is guaranteed by the Company or any Restricted Subsidiary, whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default:

(a) is caused by a failure to pay principal of, or interest or premium, if any, on, such Indebtedness when due at the final maturity of such Indebtedness (a “ Payment Default ”); or

(b) results in the acceleration of such Indebtedness prior to its Stated Maturity,

and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates US$25.0 million or more;

(vi) failure by the Company or any Restricted Subsidiary to pay final, non-appealable judgments aggregating in excess of US$25.0 million, which judgments are not paid, discharged or stayed for a period of 60 days;

(vii) any Subsidiary Guarantee of a Significant Subsidiary ceases, or the Subsidiary Guarantees of any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary cease, to be in full force and effect (other than in accordance with the terms of any such Subsidiary Guarantee) or any Subsidiary Guarantor that is a Significant Subsidiary denies or disaffirms its obligations under its Subsidiary Guarantee, or a group of Subsidiary Guarantors that, when taken together, would constitute a Significant Subsidiary deny or disaffirm their obligations under their respective Subsidiary Guarantees;

(viii) the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary, pursuant to or within the meaning of any Bankruptcy Law:

(A) commences a voluntary case or gives notice of intention to make a proposal under any Bankruptcy Law;

(B) consents to the entry of an order for relief against it in an involuntary case or consents to its dissolution or winding up;

(C) consents to the appointment of a receiver, interim receiver, receiver and manager, liquidator, trustee or custodian of it or for all or substantially all of its property;

(D) makes a general assignment for the benefit of its creditors;

(E) admits in writing its inability to pay its debts as they become due or otherwise admits its insolvency; or

(F) seeks a stay of proceedings against it or proposes or gives notice or intention to propose a compromise, arrangement or reorganization of any of its debts or obligations under any Bankruptcy Law; and

(ix) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(A) is for relief against the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary, in an involuntary case; or

(B) appoints a receiver, interim receiver, receiver and manager, liquidator, trustee or custodian of the Company or any of its Significant

Subsidiaries or any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary, or for all or substantially all of the property of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary;

(C) orders the liquidation of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary; or

(D) orders the presentation of any plan or arrangement, compromise or reorganization of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary;

and such order or decree remains unstayed and in effect for 60 consecutive days.

Section 6.02. Acceleration .

If any Event of Default (other than those of the type described in Section 6.01(viii) or (ix) occurs and is continuing, the Trustee may, and the Trustee upon the request of Holders of 25% in principal amount of the outstanding Notes shall, or the Holders of at least 25% in principal amount of outstanding Notes may, declare the principal of all the Notes, together with all accrued and unpaid interest, premium, if any, to be due and payable by notice in writing to the Company and the Trustee specifying the respective Event of Default and that such notice is a notice of acceleration (the “ Acceleration Notice ”), and the same shall become immediately due and payable.

In the case of an Event of Default specified in Section 6.01(viii) or (ix) hereof, all outstanding Notes shall become due and payable immediately without further action or notice by the Trustee or the Holders. Holders may not enforce this Indenture or the Notes except as provided in this Indenture.

At any time after a declaration of acceleration with respect to the Notes, the Holders of a majority in principal amount of the Notes then outstanding (by notice to the Trustee) may rescind and cancel such declaration and its consequences if:

(a) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction;

(b) all existing Defaults and Events of Default have been cured or waived except nonpayment of principal of or interest on the Notes that has become due solely by such declaration of acceleration;

(c) to the extent the payment of such interest is lawful, interest (at the same rate specified in the Notes) on overdue installments of interest and overdue payments of principal which has become due otherwise than by such declaration of acceleration has been paid;

(d) the Company has paid the Trustee its reasonable compensation and reimbursed the Trustee for its reasonable expenses, disbursements and advances; and

(e) in the event of the cure or waiver of an Event of Default of the type described in Section 6.01(viii) or (ix), the Trustee has received an Officers’ Certificate and Opinion of Counsel that such Event of Default has been cured or waived.

In the case of an Event of Default with respect to the Notes occurring by reason of any willful action or inaction taken or not taken by the Company or on the Company’s behalf with the intention of avoiding payment of the premium that the Company would have been required to pay if the Company had then elected to redeem the Notes pursuant to Section 3.07 hereof, an equivalent premium shall also become and be immediately due

and payable to the extent permitted by law upon the acceleration of the Notes. If an Event of Default occurs prior to April 15, 2013, by reason of any willful action or inaction taken or not taken by the Company or on the Company’s behalf with the intention of avoiding the prohibition on redemption of the Notes prior to April 15, 2013, then the premium specified in Section 3.07(b) hereof shall also become immediately due and payable to the extent permitted by law upon acceleration of the Notes.

Section 6.03. Other Remedies .

If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, and interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture.

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies shall be cumulative to the extent permitted by law.

Section 6.04. Waiver of Past Defaults .

The Holders of at least a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default, and its consequences, except a continuing Default or Event of Default (i) in the payment of the principal of or interest on the Notes and (ii) in respect of a covenant or provision which under this Indenture cannot be modified or amended without the consent of the Holder of each Note affected by such modification or amendment. Upon any waiver of a Default or Event of Default such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed cured for every purpose of this Indenture, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.

Section 6.05. Control by Majority .

Subject to Section 7.01, Section 7.02(e) (including the Trustee’s receipt of the security or indemnification described therein) and Section 7.07 hereof, in case an Event of Default shall occur and be continuing, the Holders of at least a majority in aggregate principal amount of the Notes then outstanding shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Notes; provided, however, the Trustee may refuse to follow any direction from the Holders of at least a majority in aggregate principal amount of the Notes then outstanding that conflicts with applicable law or this Indenture, or that the Trustee determines in good faith may be unduly prejudicial to the rights of the Holders not joining in the giving of such direction, and may take any other action it deems proper that is not inconsistent with such direction.

Section 6.06. Limitation on Suits .

No Holder shall have any right to institute any proceeding with respect to this Indenture, or for the appointment of a receiver or trustee, or for any remedy thereunder, unless:

(a) such Holder has previously given to the Trustee written notice of a continuing Event of Default,

(b) Holders of at least 25% in aggregate principal amount of the Notes then outstanding have made written request and offered indemnity satisfactory to the Trustee to institute such proceeding as trustee, and

(c) the Trustee shall not have received from the Holders of a majority in aggregate principal amount of the Notes then outstanding a direction inconsistent with such request and shall have failed to institute such proceeding within 60 days.

The preceding limitations shall not apply to a suit instituted by a Holder for enforcement of payment of principal of, and premium, if any, or interest on, a Note on or after the respective due dates for such payments set forth in such Note.

A Holder may not use this Indenture to affect, disturb or prejudice the rights of another Holder or to obtain a preference or priority over another Holder.

Section 6.07. Rights of Holders to Receive Payment .

Notwithstanding any other provision of this Indenture (including, without limitation, Section 6.06 hereof), the right of any Holder to receive payment of principal, premium, if any, and interest on the Notes held by such Holder, on or after the respective due dates expressed in the Notes (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.

Section 6.08. Collection Suit by Trustee .

If an Event of Default specified in Section 6.01 (i) or (ii) occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal of, premium, if any, and interest then due and owing (together with interest on overdue principal and, to the extent lawful, interest) and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

Section 6.09. Trustee May File Proofs of Claim .

The Trustee shall be authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee and its agents and counsel, and any other amounts due the Trustee under Section 7.07 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, moneys, securities and any other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

Section 6.10. Priorities .

If the Trustee collects any money pursuant to this Article 6, it shall pay out the money in the following order:

First: to the Trustee, its agents and attorneys for amounts due under Section 7.07 hereof, including payment of all compensation, expenses and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection;

Second: to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, and interest, respectively; and

Third: to the Company or to such party as a court of competent jurisdiction shall direct.

The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10.

Section 6.11. Undertaking for Costs .

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 shall not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in principal amount of the then outstanding Notes.

ARTICLE 7.

TRUSTEE

Section 7.01. Duties of Trustee .

(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in its exercise, as a prudent Person would exercise or use under the circumstances in the conduct of such Person’s own affairs.

(b) Except during the continuance of an Event of Default:

(1) the duties of the Trustee shall be determined solely by the express provisions of this Indenture and the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

(c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

(1) this paragraph does not limit the effect of paragraph (b) of this Section;

(2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and

(3) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05 hereof.

(d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.

(e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee shall be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holders, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.

(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

Section 7.02. Rights of Trustee .

(a) The Trustee may conclusively rely upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in any such document.

(b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel. The Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

(c) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Indenture.

(d) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company shall be sufficient if signed by an Officer of the Company.

(e) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction.

(f) The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a Default or Event of Default is received by a Responsible Officer of the Trustee at the Corporate Trust Office of the Trustee from the Company or the Holders of 25% in aggregate principal amount of the outstanding Notes, and such notice references the specific Default or Event of Default, the Notes and this Indenture.

(g) The Trustee shall not be required to give any bond or surety in respect of the performance of its power and duties hereunder.

(h) The Trustee shall have no duty to inquire as to the performance of the Company’s covenants herein.

(i) The Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder.

Section 7.03. Individual Rights of Trustee .

The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Subsidiary Guarantor or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue as Trustee or resign. Any Agent may do the same with like rights and duties. The Trustee shall also be subject to Sections 7.10 and 7.11 hereof.

Section 7.04. Trustee’s Disclaimer .

The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Company’s use of the proceeds from the Notes or any money paid to the Company or upon the Company’s direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication.

Section 7.05. Notice of Defaults .

If a Default or Event of Default occurs and is continuing and if it is known to the Trustee, the Trustee shall mail to Holders a notice of the Default or Event of Default within 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on any Note, the Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of the Holders.

Section 7.06. Reports by Trustee to Holders .

Within 60 days after each April 15 beginning April 15, 2009, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders a brief report dated as of such reporting date that complies with TIA §313(a) (but if no event described in TIA §313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA §313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA §313(c).

A copy of each report at the time of its mailing to the Holders shall be mailed to the Company and filed with the Commission and each stock exchange on which the Notes are listed in accordance with TIA §313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange and any delisting thereof.

Section 7.07. Compensation and Indemnity .

The Company shall pay to the Trustee from time to time reasonable compensation for its acceptance of this Indenture and services hereunder. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel.

The Company shall indemnify the Trustee (in its capacity as Trustee) or any predecessor Trustee (in its capacity as Trustee) against any and all losses, claims, damages, penalties, fines, liabilities or expenses, including incidental and out-of-pocket expenses and reasonable attorneys fees (for purposes of this Article 7, “ losses ”) incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Company (including this Section 7.07) and defending itself against any claim (whether asserted by the Company or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the

extent such losses may be attributable to its negligence or bad faith. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim, and the Trustee shall cooperate in the defense. The Trustee may have separate counsel if the Trustee has been reasonably advised by counsel that there may be one or more legal defenses available to it that are different from or additional to those available to the Company and in the reasonable judgment of such counsel it is advisable for the Trustee to engage separate counsel, and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss incurred by the Trustee through the Trustee’s own negligence or bad faith.

The obligations of the Company under this Section 7.07 shall survive the satisfaction and discharge of this Indenture, the resignation or removal of the Trustee and payment in full of the Notes.

To secure the Company’s payment obligations in this Section, the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal, premium, if any, and interest on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture.

When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(viii) or (ix) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.

Section 7.08. Replacement of Trustee .

A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.08.

The Trustee may resign in writing at any time upon 30 days’ prior notice to the Company and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee if:

(a) the Trustee fails to comply with Section 7.10 hereof;

(b) the Trustee is adjudged bankrupt or insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;

(d) the Trustee becomes incapable of acting.

If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company.

If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company, or the Holders of at least 10% in principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee.

If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10 hereof, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. Subject to the Lien provided for in Section 7.07 hereof, the retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee provided, however; that all sums owing to the Trustee hereunder shall have been paid. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Company’s obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee.

Section 7.09. Successor Trustee by Merger, etc .

If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation or banking association, the successor corporation or banking association without any further act shall, if such successor corporation or banking association is otherwise eligible hereunder, be the successor Trustee.

Section 7.10. Eligibility; Disqualification .

There shall at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least US$50.0 million (or a wholly-owned subsidiary of a bank or trust company, or of a bank holding company, the principal subsidiary of which is a bank or trust company having a combined capital and surplus of at least US$50.0 million) as set forth in its most recent published annual report of condition.

This Indenture shall always have a Trustee who satisfies the requirements of TIA §310(a)(1), (2) and (5). The Trustee is subject to TIA §310(b).

Section 7.11. Preferential Collection of Claims Against Company .

The Trustee is subject to TIA §311(a), excluding any creditor relationship listed in TIA §311(b). A Trustee who has resigned or been removed shall be subject to TIA §311(a) to the extent indicated therein.

ARTICLE 8.

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance .

The Company may, at its option and at any time, elect to have either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon compliance with the conditions set forth in this Article 8.

Section 8.02. Legal Defeasance and Discharge .

Upon the Company’s exercise under Section 8.01 hereof of the option applicable to this Section 8.02, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to have been discharged from its obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, “ Legal Defeasance ”) and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee. For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes, which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.05 hereof and the other Sections of this Indenture referred to in (a), (b) and (d) below, and to have satisfied all its other obligations under the Notes and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive solely from the trust fund described

in Section 8.04 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, or interest and Additional Amounts on such Notes when such payments are due, (b) the Company’s obligations with respect to such Notes under Article 2 and Sections 4.01 and 4.02 hereof, (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Company’s obligations and the Subsidiary Guarantor’s in connection therewith and (d) this Article 8. If the Company exercises under Section 8.01 hereof the option applicable to this Section 8.02, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, payment of the Notes may not be accelerated because of an Event of Default. Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03 hereof.

Section 8.03. Covenant Defeasance .

Upon the Company’s exercise under Section 8.01 hereof of the option applicable to this Section 8.03, the Company shall, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, be released from its obligations under the covenants contained in Sections 4.05 and 4.06, 4.09 through 4.19, and 4.21 hereof, and the operation of Sections 5.01(a)(4) and (b)(4) hereof, with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.04 hereof are satisfied (hereinafter, “ Covenant Defeasance ”) and each Subsidiary Guarantor shall be released from all of its obligations under its Subsidiary Guarantee with respect to such covenants in connection with such outstanding Notes and the Notes shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. If the Company exercises under Section 8.01 hereof the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04 hereof, payment of the Notes may not be accelerated because of an Event of Default specified in clause (iii) (with respect to the covenants contained in Sections 4.09, 4.10, 4.12 or 4.18 or Section 5.01(a)(4) or (b)(4) hereof), (iv) (with respect to Sections 4.05, 4.06, 4.11, 4.13 through 4.17, 4.19 and 4.21 hereof), (v), (vi), (vii), (viii) and (ix) of such Section 6.01 (but in the case of (viii) and (ix) of Section 6.01 hereof, with respect to Significant Subsidiaries only) or because of the Company’s failure to comply with Section 5.01(a)(4) or (b)(4) hereof.

Section 8.04. Conditions to Legal or Covenant Defeasance .

The following shall be the conditions to the application of either Section 8.02 or 8.03 hereof to the outstanding Notes.

In order to exercise Legal Defeasance or Covenant Defeasance:

(a) the Company shall irrevocably deposit with the Trustee, in trust, for the benefit of the Holders cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, or interest and premium, if any, on the outstanding notes on the Stated Maturity or on the applicable date of redemption, as the case may be, and the Company shall specify whether the Notes are being defeased to maturity or to a particular date of redemption;

(b) in the case of Legal Defeasance, the Company shall deliver to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that (i) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (ii) subsequent to the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred and

the Company shall have delivered to the Trustee an Opinion of Counsel in Canada reasonably acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for Canadian federal, provincial or territorial income tax purposes as a result of such Legal Defeasance and will be subject to Canadian federal, provincial or territorial income tax (including withholding tax) on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

(c) in the case of Covenant Defeasance, the Company shall deliver to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred and the Company shall have delivered to the Trustee an Opinion of Counsel in Canada reasonably acceptable to the Trustee confirming that Holders of the outstanding Notes will not recognize income, gain or loss for Canadian federal, provincial or territorial income tax purposes as a result of such Covenant Defeasance and will be subject to Canadian federal, provincial or territorial income tax (including withholding tax) on the same amounts, in the same manner and at the same time as would have been the case if such Covenant Defeasance had not occurred;

(d) no Default or Event of Default shall have occurred and be continuing either (a) on the date of such deposit, or (b) insofar as Events of Default from bankruptcy or insolvency events are concerned, at any time in the period ending on the 91 st day after the date of deposit, other than, in each case, a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit;

(e) such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under any material agreement or instrument, to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound;

(f) the Company shall deliver to the Trustee an Opinion of Counsel to the effect that, (a) assuming no intervening bankruptcy of the Company or any Subsidiary Guarantor between the date of deposit and the 91st day following such deposit and assuming that no Holder is an “insider” of the Company under applicable Bankruptcy Law, after the 91st day following such deposit, the trust funds will not be subject to the effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally and (b) the creation of the defeasance trust does not violate the Investment Company Act of 1940;

(g) the Company shall deliver to the Trustee an Officers’ Certificate stating that such deposit was not made by the Company with the intent of preferring the Holders of Notes over the other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others;

(h) if the Notes are to be redeemed prior to their Stated Maturity, the Company must deliver to the Trustee irrevocable instructions to redeem all of the Notes on the specified redemption date; and

(i) the Company shall deliver to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

Section 8.05. Deposited Cash and Government Securities to be Held in Trust; Other Miscellaneous Provisions .

Subject to Section 8.06 hereof, all cash and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.05, the “ Trustee ”) pursuant to Section 8.04 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of all sums due and to become due thereon in respect of principal, premium, if any, and interest but such cash and securities need not be segregated from other funds except to the extent required by law.

The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to Section 8.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.

Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any cash or non-callable Government Securities held by it as provided in Section 8.04 hereof which, in the opinion of a nationally recognized firm of independent certified public accountants of recognized international standing expressed in a written certification thereof delivered to the Trustee (which may be the certification delivered under Section 8.04(a) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

Section 8.06. Repayment to Company .

Subject to any applicable laws relating to abandoned property, any cash or non-callable Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal, premium, if any, or interest on any Note and remaining unclaimed for two years after such principal, premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such cash and securities remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining shall be repaid to the Company.

Section 8.07. Reinstatement .

If the Trustee or Paying Agent is unable to apply any cash or non-callable Government Securities in accordance with Section 8.02 or 8.03 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is permitted to apply all such cash and securities in accordance with Section 8.02 or 8.03 hereof, as the case may be; provided, however , that, if the Company makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders to receive such payment from the cash and securities held by the Trustee or Paying Agent.

ARTICLE 9.

AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01. Without Consent of Holders of Notes .

Notwithstanding Section 9.02 of this Indenture, the Company and the Trustee may amend or supplement this Indenture or the Notes without the consent of any Holder to:

(a) cure any ambiguity, defect or inconsistency;

(b) provide for uncertificated Notes in addition to or in place of certificated Notes ( provided that the uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code, or in a manner such that the uncertificated Notes are described in Section 163(f)(2)(B) of the Code);

(c) provide for the assumption of the obligations of the Company and/or a Subsidiary Guarantor to Holders in the case of a merger, consolidation, or amalgamation or sale of all or substantially all of the assets of the Company and/or a Subsidiary Guarantor; provided, however , that the Company shall deliver to the Trustee:

(i) an Opinion of Counsel to the effect that Holders will not recognize income, gain or loss for U.S. Federal income tax purposes as a result of such assumption by a successor corporation and will be subject to U.S. federal income tax on the same amount and in the same manner and at the same times as would have been the case if such assumption had not occurred, and

(ii) an Opinion of Counsel in Canada to the effect that Holders will not recognize income, gain or loss for Canadian federal, provincial or territorial tax purposes as a result of such assumption by a successor corporation and will be subject to Canadian federal, provincial or territorial taxes (including withholding taxes) on the same amounts, in the same manner and at the same times as would have been the case if such assumption had not occurred;

(d) make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under this Indenture of any such Holder;

(e) add additional guarantees with respect to the Notes or release Subsidiary Guarantors from Subsidiary Guarantees as provided or permitted by the terms of this Indenture;

(f) provide for the issuance of Additional Notes in accordance with this Indenture; or

(g) comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the TIA.

Section 9.02. With Consent of Holders of Notes .

Except as provided below in this Section 9.02, the Company and the Trustee may amend or supplement this Indenture and the Notes with the consent of the Holders of at least a majority in principal amount of the Notes, including Additional Notes, if any, then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (except a continuing Default or Event of Default (i) in the payment of principal, premium, if any, or interest on the Notes and (ii) in respect of a covenant or provision which under this Indenture cannot be modified or amended without the consent of the Holder of each Note affected by such modification or amendment ) or compliance with any provision of this Indenture or the Notes may be waived with the consent of the Holders of at least a majority in principal amount of the Notes, including Additional Notes, if any, then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes).

Without the consent of each Holder, an amendment or waiver under this Section 9.02 may not (with respect to any Notes held by a non-consenting Holder):

(a) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver;

(b) reduce the principal of or change the Stated Maturity of any Note or alter the provisions with respect to the redemption of the Notes;

(d) waive a Default or Event of Default in the payment of principal of, or interest or premium, if any, on the Notes, except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from such acceleration;

(e) make any Note payable in money other than that stated in the Notes;

(f) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders of Notes to receive payments of principal of, or interest or premium, if any, on the Notes, or to institute suit for the enforcement of any payment on or with respect to such Holders’ Notes or any Subsidiary Guarantee;

(g) amend, change or modify the obligation of the Company to make and consummate an Asset Sale Offer with respect to any Asset Sale in accordance with the provisions of Section 4.12 hereof after the obligation to make and consummate such Asset Sale Offer has arisen or the obligation of the Company to make and consummate a Change of Control Offer in the event of a Change in Control in accordance with the provisions of Section 4.18 hereof after such Change of Control has occurred, including, in each case, amending, changing or modifying any definition relating thereto;

(h) except as otherwise permitted under the provisions of Section 5.01 hereof, consent to the assignment or transfer by the Company or any Subsidiary Guarantor of any of their rights or obligations under this Indenture;

(i) subordinate the Notes or any Subsidiary Guarantee to any other obligation of the Company or the applicable Subsidiary Guarantor;

(j) amend or modify the provisions of Section 4.20 hereof;

(k) amend or modify any Subsidiary Guarantee in a manner that would adversely affect the Holders of the Notes or release any Subsidiary Guarantor from any of its obligations under its Subsidiary Guarantee or this Indenture (except in accordance with the terms of this Indenture); or

(l) make any change in the preceding amendment and waiver provisions.

The Company may, but shall not be obligated to, fix a record date for the purpose of determining the Persons entitled to consent to any supplemental indenture. If a record date is fixed, the Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to consent to such supplemental indenture, whether or not such Holders remain Holders after such record date; provided that unless such consent shall have become effective by virtue of the requisite percentage having been obtained prior to the date which is 120 days after such record date, any such consent previously given shall automatically and without further action by any Holder be cancelled and of no further effect.

It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.

After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Company shall mail to the Holder of each Note affected thereby to such Holder’s address appearing in the Security Register a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver.

Section 9.03. Compliance with Trust Indenture Act .

Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or supplemental indenture that complies with the TIA as then in effect.

Section 9.04. Revocation and Effect of Consents .

Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion thereof that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Note. However, any such Holder or subsequent Holder may revoke the consent as to its Note or portion thereof if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. An amendment, supplement or waiver shall become effective in accordance with its terms and thereafter shall bind every Holder.

Section 9.05. Notation on or Exchange of Notes .

The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment, supplement or waiver.

Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver.

Section 9.06. Trustee to Sign Amendments, etc.

The Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Company may not sign an amendment or supplemental indenture until the Board of Directors approves it. In executing any amended or supplemental indenture, the Trustee shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully protected in relying upon an Officers’ Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture and that such amended or supplemental indenture is the legal, valid and binding obligations of the Company enforceable against it in accordance with its terms, subject to customary exceptions and that such amended or supplemental indenture complies with the provisions hereof (including Section 9.03 hereof).

ARTICLE 10.

SUBSIDIARY GUARANTEES

Section 10.01. Guarantee .

Subject to this Article 10, each of the Subsidiary Guarantors hereby unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns (a) the due and punctual payment of the principal of, premium, if any, and interest on the Notes, subject to any applicable grace period, whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on the overdue principal and premium, if any, and to the extent permitted by law, interest, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee hereunder or thereunder, all in accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration pursuant to Section 6.02 hereof, redemption or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Subsidiary Guarantors shall be jointly and severally obligated to pay the same immediately. Each Subsidiary Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.

Each Subsidiary Guarantor hereby agrees that its obligations with regard to its Subsidiary Guarantee shall be joint and several, unconditional, irrespective of the validity or enforceability of the Notes or the obligations of the Company under this Indenture, the absence of any action to enforce the same, the recovery of any judgment against the Company or any other obligor with respect to this Indenture, the Notes or the Obligations of

the Company under this Indenture or the Notes, any action to enforce the same or any other circumstances (other than complete performance) which might otherwise constitute a legal or equitable discharge or defense of a Subsidiary Guarantor. Each Subsidiary Guarantor further, to the extent permitted by law, waives and relinquishes all claims, rights and remedies accorded by applicable law to guarantors and agrees not to assert or take advantage of any such claims, rights or remedies, including but not limited to: (a) any right to require any of the Trustee, the Holders or the Company (each a “ Benefited Party ”), as a condition of payment or performance by such Subsidiary Guarantor, to (1) proceed against the Company, any other guarantor (including any other Subsidiary Guarantor) of the Obligations under the Subsidiary Guarantees or any other Person, (2) proceed against or exhaust any security held from the Company, any such other guarantor or any other Person, (3) proceed against or have resort to any balance of any deposit account or credit on the books of any Benefited Party in favor of the Company or any other Person, or (4) pursue any other remedy in the power of any Benefited Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of the Company including any defense based on or arising out of the lack of validity or the unenforceability of the Obligations under the Subsidiary Guarantees or any agreement or instrument relating thereto or by reason of the cessation of the liability of the Company from any cause other than payment in full of the Obligations under the Subsidiary Guarantees; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Benefited Party’s errors or omissions in the administration of the Obligations under the Subsidiary Guarantees, except behavior which amounts to bad faith; (e)(1) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms of the Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary Guarantor’s obligations hereunder, (2) the benefit of any statute of limitations affecting such Subsidiary Guarantor’s liability hereunder or the enforcement hereof, (3) any rights to set-offs, recoupments and counterclaims and (4) promptness, diligence and any requirement that any Benefited Party protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentations, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance of the Subsidiary Guarantees, notices of default under the Notes or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Obligations under the Subsidiary Guarantees or any agreement related thereto, and notices of any extension of credit to the Company and any right to consent to any thereof; (g) to the extent permitted under applicable law, the benefits of any “One Action” rule and (h) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms of the Subsidiary Guarantees. Except to the extent expressly provided herein, including Sections 8.02, 8.03 and 10.05 hereof, each Subsidiary Guarantor hereby covenants that its Subsidiary Guarantee shall not be discharged except by complete performance of the obligations contained in its Subsidiary Guarantee and this Indenture.

If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Subsidiary Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Subsidiary Guarantors, any amount paid by either to the Trustee or such Holder, this Subsidiary Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.

Each Subsidiary Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Section 6.02 hereof for the purposes of this Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby and (y) in the event of any declaration of acceleration of such obligations as provided in Section 6.02 hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by the Subsidiary Guarantors for the purpose of this Subsidiary Guarantee. The Subsidiary Guarantors shall have the right to seek contribution from any non-paying Subsidiary Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Subsidiary Guarantee.

Section 10.02. Limitation on Subsidiary Guarantor Liability .

Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Subsidiary Guarantee of such Subsidiary Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the

Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any Subsidiary Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Subsidiary Guarantors hereby irrevocably agree that the obligations of such Subsidiary Guarantor under this Article 10 shall be limited to the maximum amount as shall, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Subsidiary Guarantor that are relevant under such laws, including, if applicable, its guarantee of all obligations under the Credit Agreement, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under this Article 10, result in the obligations of such Subsidiary Guarantor under its Subsidiary Guarantee not constituting a fraudulent transfer or conveyance. In addition, the liability of each Subsidiary Guarantor governed by the Companies Act (Quebec) under its Subsidiary Guarantee shall be limited to the maximum amount permitted under Section 123.66 of the Companies Act (Quebec). To that end, but only to the extent such obligations would otherwise be avoidable, the obligations of the Subsidiary Guarantor under this Article shall be limited to the maximum amount that, after giving effect to the incurrence thereof, would not render the Subsidiary Guarantor insolvent or unable to pay its debts as they mature.

Section 10.03. Execution and Delivery of Subsidiary Guarantee .

To evidence its Subsidiary Guarantee set forth in Section 10.01 hereof, each Subsidiary Guarantor hereby agrees that a notation of such Subsidiary Guarantee in substantially the form included in Exhibit E attached hereto shall be endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated and delivered by the Trustee and that this Indenture shall be executed on behalf of such Subsidiary Guarantor by its President or one of its Vice Presidents.

Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee set forth in Section 10.01 hereof shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of such Subsidiary Guarantee.

If an Officer whose signature is on this Indenture or on the Subsidiary Guarantee no longer holds that office at the time the Trustee authenticates the Note on which a Subsidiary Guarantee is endorsed, the Subsidiary Guarantee shall be valid nevertheless.

The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Subsidiary Guarantee set forth in this Indenture on behalf of the Subsidiary Guarantors.

Section 10.04. Subsidiary Guarantors May Consolidate, etc., on Certain Terms .

Except as otherwise provided in Section 10.05 hereof, no Subsidiary Guarantor may consolidate, merge or amalgamate with or into (whether or not such Subsidiary Guarantor is the Surviving Guarantor) another Person whether or not affiliated with such Subsidiary Guarantor unless:

(a) subject to Section 10.05 hereof, the Person formed by or surviving any such consolidation, merger or amalgamation (if other than a Subsidiary Guarantor or the Company) unconditionally assumes all the obligations of such Subsidiary Guarantor, pursuant to a supplemental indenture in form and substance reasonably satisfactory to the Trustee, under this Indenture, the Subsidiary Guarantee and any Registration Rights Agreements on the terms set forth herein or therein; and

(b) the Subsidiary Guarantor or the Surviving Guarantor, as applicable, complies with the requirements of Article 5 hereof.

In case of any such consolidation, merger, amalgamation, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the Subsidiary Guarantee endorsed upon the Notes and the due and punctual performance of all of the covenants and conditions of this Indenture to be performed by the Subsidiary Guarantor, such successor Person shall succeed to and be substituted for the Subsidiary Guarantor with the same effect as if it had been named herein as a Subsidiary Guarantor. Such successor Person thereupon may cause to be signed any or

all of the Subsidiary Guarantees to be endorsed upon all of the Notes issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee. All the Subsidiary Guarantees so issued shall in all respects have the same legal rank and benefit under this Indenture as the Subsidiary Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all of such Subsidiary Guarantees had been issued at the date of the execution hereof.

Except as set forth in Articles 4 and 5 hereof, and notwithstanding clauses (a) and (b) above, nothing contained in this Indenture or in any of the Notes shall prevent any consolidation, merger or amalgamation of a Subsidiary Guarantor with or into the Company or another Subsidiary Guarantor, or shall prevent any sale or conveyance of the property of a Subsidiary Guarantor as an entirety or substantially as an entirety to the Company or another Subsidiary Guarantor.

Section 10.05. Releases Following Sale of Assets .

In the event of a sale or other disposition of all of the Capital Stock of any Subsidiary Guarantor (including by way of consolidation, merger or amalgamation), in each case to a Person that is not (either before or after giving effect to such transaction) an Affiliate of the Company, then such Subsidiary Guarantor shall be released and relieved of any obligations under its Subsidiary Guarantee; provided that such sale or other disposition shall be subject to all applicable provisions of this Indenture, including without limitation Section 4.12 hereof. If a Subsidiary Guarantor is designated as an Unrestricted Subsidiary in accordance with the provisions of Section 4.17 hereof, such Subsidiary Guarantor shall be released and relieved of any obligations under its Subsidiary Guarantee. Upon delivery by the Company to the Trustee of an Officers’ Certificate and an Opinion of Counsel to the effect that such sale or other disposition or designation was made by the Company in accordance with the provisions of this Indenture, including without limitation Section 4.12 hereof, the Trustee shall execute any documents reasonably required in order to evidence the release of any Subsidiary Guarantor from its obligations under its Subsidiary Guarantee.

Any Subsidiary Guarantor not released from its obligations under its Subsidiary Guarantee shall remain liable for the full amount of principal of and interest on the Notes and for the other obligations of any Subsidiary Guarantor under this Indenture.

ARTICLE 11.

SATISFACTION AND DISCHARGE

Section 11.01. Satisfaction and Discharge .

This Indenture shall be discharged and shall cease to be of further effect, except as to surviving rights of registration of transfer or exchange of the Notes, as to all Notes issued hereunder, when:

(a) either:

(i) all Notes that have been previously authenticated (except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has previously been deposited in trust or segregated and held in trust by the Company and is thereafter repaid to the Company or discharged from the trust) have been delivered to the Trustee for cancellation; or

(ii) all Notes that have not been previously delivered to the Trustee for cancellation (A) have become due and payable by reason of a making of a notice of redemption or otherwise or (B) will become due and payable within one year, and the Company or any Subsidiary Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the Notes not previously delivered to the Trustee for cancellation for principal, premium, if

any, and interest on the Notes to the date of deposit, in the case of Notes that have become due and payable, or to the Stated Maturity or redemption date, as the case may be;

(b) no Default or Event of Default shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which the Company or any Subsidiary Guarantor is a party or by which the Company or any Subsidiary Guarantor is bound;

(c) the Company or any Subsidiary Guarantor has paid or caused to be paid all other sums payable by it under this Indenture;

(d) the Company shall have delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Notes at maturity or the date of redemption, as the case may be; and

(e) the Company shall have delivered to the Trustee an Officers’ Certificate and Opinion of Counsel stating that all conditions precedent under this Indenture relating to the satisfaction and discharge of this Indenture have been satisfied.

Section 11.02. Deposited Cash and Government Securities to be Held in Trust; Other Miscellaneous Provisions .

Subject to Section 11.03 hereof, all cash and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 11.02, the “ Trustee ”) pursuant to Section 11.01 hereof in respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest but such cash and securities need not be segregated from other funds except to the extent required by law.

Section 11.03. Repayment to Company .

Subject to any applicable laws relating to abandoned property, any cash or non-callable Government Securities deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest on, any Note and remaining unclaimed for two years after such principal, and premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such cash and securities remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash and securities then remaining shall be repaid to the Company.

ARTICLE 12.

MISCELLANEOUS

Section 12.01. Trust Indenture Act Controls .

If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the provision required by the TIA shall control.

Section 12.02. Notices .

Any notice or communication by the Company and/or a Subsidiary Guarantor or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), facsimile transmission or overnight air courier guaranteeing next-day delivery, to the other’s address:

If to the Company or a Subsidiary Guarantor:

Videotron Ltd.

612 St. Jacques Street

Montréal, Québec, H3C 4M8

Canada

Attention: Vice President, Legal Affairs

Facsimile No.: (514) 985-8834

With a copy to:

Ogilvy Renault LLP

1981 McGill College Avenue

Suite 1100

Montreal, QC H3A 3C1

Attention: Marc Lacourciere

Facsimile No.: (514) 286-5474

If to the Trustee:

Wells Fargo Bank, National Association

213 Court Street, Suite 703

Middletown, CT 06457

Attention: Corporate Trust Services

Facsimile No.: (860) 704-6219

The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications.

All notices and communications (other than those sent to the Trustee) shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if sent by facsimile transmission; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next-day delivery. All notices and communications to the Trustee shall be deemed duly given and effective only upon receipt.

Any notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight air courier guaranteeing next-day delivery to its address shown on the Security Register. Any notice or communication shall also be so mailed to any Person described in TIA § 313(c), to the extent required by the TIA. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.

If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it.

If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time.

Section 12.03. Communication by Holders of Notes with Other Holders of Notes .

Holders may communicate pursuant to TIA §312(b) with other Holders with respect to their rights under this Indenture or the Notes. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA §312(c).

Section 12.04. Certificate and Opinion as to Conditions Precedent .

Upon any request or application by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee:

(a) an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 12.05 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(b) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee (which shall include the statements set forth in Section 12.05 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with.

Section 12.05. Statements Required in Certificate or Opinion .

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA §314(a)(4)) shall comply with the provisions of TIA §314(e) and shall include:

(a) a statement that the Person making such certificate or opinion has read such covenant or condition;

(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(c) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable such Person to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(d) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been complied with.

With respect to matters of fact, an Opinion of Counsel may rely on an Officers’ Certificate, certificates of public officials or reports or opinions of experts.

Section 12.06. Rules by Trustee and Agents .

The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.

Section 12.07. No Personal Liability of Directors, Officers, Employees and Shareholders .

No past, present or future director, officer, employee, incorporator or stockholder of the Company or any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or of the Subsidiary Guarantors under the Notes, this Indenture, the Subsidiary Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes.

Section 12.08. Governing Law .

THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND THE NOTES.

Section 12.09. No Adverse Interpretation of Other Agreements .

This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

Section 12.10. Successors .

All covenants and agreements of the Company in this Indenture and the Notes shall bind its successors. All covenants and agreements of the Trustee in this Indenture shall bind its successors.

Section 12.11. Severability .

In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 12.12. Consent to Jurisdiction and Service of Process

(a) Each of the Company and each of the Subsidiary Guarantors irrevocably consents to the non-exclusive jurisdiction of the courts of the State of New York and the courts of the United States of America located in the Borough of Manhattan, City and State of New York over any suit, action or proceeding with respect to this Indenture or the transactions contemplated hereby. Each of the Company and each of the Subsidiary Guarantors waives any objection that it may have to the venue of any suit, action or proceeding with respect to this Indenture or the transactions contemplated hereby in the courts of the State of New York or the courts of the United States of America, in each case, located in the Borough of Manhattan, City and State of New York, or that such suit, action or proceeding brought in the courts of the State of New York or the United States of America, in each case, located in the Borough of Manhattan, City and State of New York was brought in an inconvenient court and agrees not to plead or claim the same.

(b) Each of the Company and each of the Subsidiary Guarantors irrevocably appoints CT Corporation System, as its authorized agent in the State of New York upon which process may be served in any such suit or proceedings, and agrees that service of process upon such agent, and written notice of said service to CT Corporation System, by the person serving the same to the address provided in Section 12.02 hereof, shall be deemed in every respect effective service of process upon the Company or any Subsidiary Guarantor in any such suit or proceeding. Each of the Company and each of the Subsidiary Guarantors further agrees to take any and all action as may be necessary to maintain such designation and appointment of such agent in full force and effect for a period of ten years from the date of this Indenture.

Section 12.13. Conversion of Currency .

The Company covenants and agrees that the following provisions shall apply to conversion of currency in the case of the Notes and this Indenture.

(a) (i) If, for the purpose of obtaining judgment in, or enforcing the judgment of, any court in any country, it becomes necessary to convert into a currency (the “ judgment currency ”) an amount due in any other currency (the “ Base Currency ”), then the conversion shall be made at the rate of exchange prevailing on the Business Day before the day on which the judgment is given or the order of enforcement is made, as the case may be (unless a court shall otherwise determine).

(ii) If there is a change in the rate of exchange prevailing between the Business Day before the day on which the judgment is given or an order of enforcement is made, as the case may be (or such other date as a court shall determine), and the date of receipt of the amount due, the Company shall pay such additional (or, as the case may be, such lesser) amount, if any, as may be necessary so that the amount paid in the judgment currency when converted at the rate of exchange prevailing on the date of receipt will produce the amount in the Base Currency originally due.

(b) In the event of the winding-up of the Company at any time while any amount or damages owing under the Notes and this Indenture, or any judgment or order rendered in respect thereof, shall remain outstanding, the Company shall indemnify and hold the Holders and the Trustee harmless against any deficiency arising or resulting from any variation in rates of exchange between (1) the date as of which the equivalent of the amount in U.S. Dollars or Canadian Dollars, as the case may be, due or contingently due under the Notes and this Indenture (other than under this paragraph (b)) is calculated for the purposes of such winding-up and (2) the final date for the filing of proofs of claim in such winding-up. For the purpose of this paragraph (b), the final date for the filing of proofs of claim in the winding-up of the Company shall be the date fixed by the liquidator or otherwise in accordance with the relevant provisions of applicable law as being the latest practicable date as at which liabilities of the Company may be ascertained for such winding-up prior to payment by the liquidator or otherwise in respect thereto.

(c) The obligations contained in paragraph (a)(ii) and (b) of this Section 12.13 shall constitute obligations of the Company separate and independent from its other respective obligations under the Notes and this Indenture, shall give rise to separate and independent causes of action against the Company, shall apply irrespective of any waiver or extension granted by any Holder or the Trustee or any of them from time to time and shall continue in full force and effect notwithstanding any judgment or order or the filing of any proof of claim in the winding-up of the Company for a liquidated sum in respect of amounts due hereunder (other than under paragraph (b) above) or under any such judgment or order. Any such deficiency as aforesaid shall be deemed to constitute a loss suffered by the Holders or the Trustee, as the case may be, and no proof or evidence of any actual loss shall be required by the Company or the liquidator or otherwise or any of them. In the case of paragraph (b) above, the amount of such deficiency shall not be deemed to be reduced by any variation in rates of exchange occurring between the said final date and the date of any liquidating distribution.

(d) The term “rate(s) of exchange” shall mean the rate of exchange quoted by Royal Bank of Canada at its central foreign exchange desk in its head office in Montréal at 12:00 noon (Montréal, Québec time) for purchases of the Base Currency with the judgment currency other than the Base Currency referred to in Subsections (a) and (b) above and includes any premiums and costs of exchange payable.

(e) The Trustee shall have no duty or liability with respect to monitoring or enforcing the Section 12.13.

Section 12.14. Currency Equivalent .

Except as provided in Section 12.13, for purposes of the construction of the terms of this Indenture or of the Notes, in the event that any amount is stated herein in the currency of one nation (the “ First Currency ”), as of any date such amount shall also be deemed to represent the amount in the currency of any other relevant nation which is required to purchase such amount in the First Currency at the rate of exchange quoted by Royal Bank of Canada at its central foreign exchange desk in its head office in Montréal at 12:00 noon (Montréal, Québec time) on the date of determination.

Section 12.15. Counterpart Originals

The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.

Section 12.16. Table of Contents, Headings, etc .

The Table of Contents, Cross-Reference Table and Headings in this Indenture have been inserted for convenience of reference only, are not to be considered a part of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof.

Section 12.17. Qualification of this Indenture .

The Company shall qualify this Indenture under the TIA in accordance with the terms and conditions of any Registration Rights Agreements and shall pay all reasonable costs and expenses (including attorneys’ fees and expenses for the Company, the Trustee and the Holders) incurred in connection therewith, including, but not limited to, costs and expenses of qualification of this Indenture and the Notes and printing this Indenture and the Notes. The Trustee shall be entitled to receive from the Company any such Officers’ Certificates, Opinions of Counsel or other documentation as it may reasonably request in connection with any such qualification of this Indenture under the TIA.

[Signatures on following page]

	SIGNATURES


Dated as of April 15, 2008.


	COMPANY:

	VIDEOTRON LTD.


	By:	/s/ Jean-Francois Pruneau
		Name:
		Title:


	SUBSIDIARY GUARANTORS:

	LE SUPERCLUB VIDÉOTRON LTÉE


	By:	/s/ Jean-Francois Pruneau
		Name:
		Title:


	GROUPE DE DIVERTISSEMENT SUPERCLUB INC.


	By:	/s/ Jean-Francois Pruneau
		Name:
		Title:


	SUPERCLUB VIDÉOTRON CANADA INC.


	By:	/s/ Jean-Francois Pruneau
		Name:
		Title:

	LES PROPRIÉTÉS SUPERCLUB INC.


	By:	/s/ Jean-Francois Pruneau
		Name:
		Title:


	CF CABLE TV INC.


	By:	/s/ Jean-Francois Pruneau
		Name:
		Title:


	VIDEOTRON US INC.


	By:	/s/ Joan L. Yori
		Name: Joan L. Yori
		Title: Secretary

	TRUSTEE:


	WELLS FARGO BANK, NATIONAL ASSOCIATION


	By:	Joseph P. O’Donnell
		Name: Joseph P. O’Donnell
		Title: Vice President

EXHIBIT A

(Face of Note)

9 1 / 8 % SENIOR NOTES DUE APRIL 15, 2018

		CUSIP
		ISIN
No.		US$

VIDEOTRON LTD.

promises to pay to CEDE & CO., or its registered assigns, the principal sum of Dollars (US$ ) on April 15, 2018.

Interest Payment Dates: June 15 and December 15, commencing June 15, 2008.

Record Dates: June 1 and December 1.

IN WITNESS WHEREOF, the Company has caused this Note to be signed by its duly authorized officer.

	VIDEOTRON LTD.


	By:
		Name:
		Title:

This is one of the [Global]

Notes referred to in the

within-mentioned Indenture:

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Trustee

By:
	Authorized Signatory

Dated , 2008

A-1

(Back of Note)

9 1 / 8 % SENIOR NOTES DUE APRIL 15, 2018

[THIS NOTE AND THE GUARANTEES ENDORSED HEREON HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR THE GUARANTEES ENDORSED HEREON NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

[I f this note is a global note, insert :] THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.

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NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

1. Interest . Videotron Ltd., a company incorporated under the laws of Québec (the “ Company ”), promises to pay interest (as defined in the Indenture) on the principal amount of this Note at 9.125% per annum until maturity and shall pay Special Interest, if any, as provided in the Registration Rights Agreement relating to these Notes. The Company shall pay interest semi-annually on June 15 and December 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an “ Interest Payment Date ”). Interest on the Notes shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided, however , that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided , further , that the first Interest Payment Date shall be June 15, 2008. The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand at a rate that is 1% per annum in excess of the interest rate then in effect under the Indenture and this Note; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods), from time to time on demand at the same rate to the extent lawful. Interest shall be computed on the basis of a 360-day year of twelve 30-day months. For the purposes of the Interest Act (Canada), the yearly rate of interest which is equivalent to the rate payable hereunder is the rate payable multiplied by the actual number of days in the year and divided by 360.

2. Method of Payment . The Company shall pay interest on the Notes (except defaulted interest) to the Persons in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the June 1 or December 1 next preceding the Interest Payment Date, even if such Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The Notes shall be payable as to principal, premium, if any, and interest at the office or agency of the Company maintained for such purpose, or, at the option of the Company, payment of interest may be made by check mailed to the Holders at their addresses set forth in the Security Register; provided , however , that payment by wire transfer of immediately available funds shall be required with respect to principal of and interest and premium, if any, on, all Global Notes and all other Notes the Holders of which shall have provided wire transfer instructions to the Company or the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

3. Paying Agent and Registrar . Initially, Wells Fargo Bank, National Association, the Trustee under the Indenture, shall act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice to any Holder. The Company or any of its Subsidiaries may act in any such capacity.

4. Indenture . The Company issued the Notes under an Indenture dated as of April 15, 2008 (“ Indenture ”) among the Company, the guarantors party thereto (the “ Subsidiary Guarantors ”) and the Trustee. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb). The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.

5. Optional Redemption .

(a) Except as set forth in clauses (b) and (c) of this Paragraph 5, the Notes shall not be redeemable at the option of the Company prior to April 15, 2013. Beginning on April 15, 2013, the Company may

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redeem all or a part of the Notes, at once or over time, in accordance with Section 3.03 of the Indenture, at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest thereon on the Notes redeemed, to the applicable redemption date (subject to the right of Holders of record on the relevant Regular Record Date to receive interest due on the relevant Interest Payment Date), if redeemed during the twelve-month period commencing on April 15 of the years indicated below:

Redemption Year	Percentage

2013	104.563	%
2014	103.042	%
2015	101.521	%
2016 and thereafter	100.000	%

(c) If the Company becomes obligated to pay any Additional Amounts because of a change in the laws or regulations of Canada or any Canadian Taxing Authority, or a change in any official position regarding the application or interpretation thereof, in either case that is publicly announced or becomes effective on or after the Issue Date, the Company may, at any time, upon not less than 30 nor more than 60 days’ notice, redeem all, but not part, of the Notes at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest to the redemption date, provided that at any time that the aggregate principal amount of the Notes outstanding is greater than US$20.0 million, any Holder of the Notes may, to the extent that it does not adversely affect the Company’s after-tax position, at its option, waive the Company’s compliance with the provisions of Section 4.20 of the Indenture with respect to such Holder’s Notes; provided, further , that if any Holder waives such compliance, the Company may not redeem that Holder’s Notes pursuant to this clause (c).

(d) Any prepayment pursuant to this paragraph 5 shall be made pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.

6. Mandatory Redemption . Except as set forth in Sections 4.12 and 4.18 of the Indenture, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes.

7. Repurchase at Option of Holder .

(a) Upon the occurrence of a Change of Control, the Company shall make an offer to all Holders to repurchase all (equal to US$1,000 or an integral multiple of US$1,000) of such Holder’s Notes at a purchase price in cash equal to 101% of the aggregate principal amount of the Notes repurchased, plus accrued and unpaid interest on the Notes repurchased to the purchase date in accordance with the procedures set forth in Section 3.09 of the Indenture.

(b) If the Company or a Restricted Subsidiary consummates any Asset Sales, it shall not be required to apply any Net Proceeds in accordance with the Indenture until the aggregate Excess Proceeds from all Asset Sales following the date the Notes are first issued exceeds US$35.0 million. Thereafter, the Company shall commence an Asset Sale Offer by applying the Excess Proceeds pursuant to Section 3.09 of the Indenture to purchase the maximum principal amount of Notes (including any Additional Notes) that may be purchased out of the Excess Proceeds at an offer price in cash equal to 100% of the principal amount thereof, plus accrued and unpaid interest and Special Interest, if any, to the Purchase Date in accordance with the procedures set forth in Section 3.09 of the

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Indenture. To the extent that the aggregate amount of Notes (including Additional Notes) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Company (or such Restricted Subsidiary) may apply such deficiency for any purpose not prohibited by the Indenture. If the aggregate principal amount of Notes surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes to be purchased on a pro rata basis.

8. Notice of Redemption . Notices of redemption shall be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose Notes are to be redeemed at its registered address. Notes in denominations larger than US$1,000 may be redeemed in part but only in integral multiples of US$1,000, unless all of the Notes held by a Holder are to be redeemed. On and after the redemption date interest shall cease to accrue on Notes or portions thereof called for redemption.

9. Denominations, Transfer, Exchange . The Notes are in registered form without coupons in denominations of US$1,000 and integral multiples of US$1,000. This Note shall represent the aggregate principal amount of outstanding Notes from time to time endorsed hereon and the aggregate principal amount of Notes represented hereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions. The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part. Also, the Company need not exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date.

10. Persons Deemed Owners . The registered Holder of a Note may be treated as its owner for all purposes.

11. Amendment, Supplement and Waiver . Subject to certain exceptions, the Company and the Trustee may amend or supplement the Indenture or the Notes with the consent of the Holders of at least a majority in principal amount of the then outstanding Notes, including Additional Notes, if any, voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes), and, subject to Sections 6.04 and 6.07 of the Indenture, any existing Default or Event of Default (except a continuing Default or Event of Default (i) in the payment of principal, premium, if any, interest or Special Interest or Additional Amounts, if any, on the Notes and (ii) in respect of a covenant or provision which under the Indenture cannot be modified or amended without the consent of the Holder of each Note affected by such modification or amendment) or compliance with any provision of the Indenture or the Notes may be waived with the consent of the Holders of at least a majority in principal amount of the then outstanding Notes, including Additional Notes, if any, then outstanding voting as a single class (including consents obtained in connection with a purchase of or tender offer or exchange offer for the Notes). Without the consent of any Holder, the Company and the Trustee may amend or supplement the Indenture or the Notes to (a) cure any ambiguity, defect or inconsistency; (b) provide for uncertificated Notes in addition to or in place of certificated Notes ( provided that the uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code, or in a manner such that the uncertificated Notes are described in Section 163(f)(2)(B) of the Code); (c) provide for the assumption of the obligations of the Company and/or a Subsidiary Guarantor to Holders in the case of a merger, consolidation, or amalgamation or sale of all or substantially all of the assets of the Company and/or a Subsidiary Guarantor; provided, however , that the Company shall deliver to the Trustee (i) an Opinion of Counsel to the effect that Holders will not recognize income, gain or loss for U.S. Federal income tax purposes as a result of such assumption by a successor corporation and will be subject to U.S. federal income tax on the same amount and in the same manner and at the same times as would have been the case if such assumption had not occurred, and (ii) an Opinion of Counsel in Canada to the effect that Holders will not recognize income, gain or loss for Canadian federal, provincial or territorial tax purposes as a result of such assumption by a successor corporation and will be subject to Canadian federal, provincial or territorial taxes (including withholding taxes) on the same amounts, in the same manner and at the same times as would have been the case if such assumption had not occurred; (d) make any change that would provide any additional rights or benefits to the Holders or that does not adversely affect the legal rights under this Indenture of any such Holder; (e) add additional guarantees with respect to the Notes or release Subsidiary Guarantors from Subsidiary Guarantees as provided or permitted by the terms of the Indenture; (f) provide for the issuance of Additional Notes in accordance

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with the Indenture; or (g) comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the TIA.

12. Defaults and Remedies . Each of the following is an Event of Default under the Indenture: (a) default for 30 days in the payment when due of interest on, including Additional Amounts or Special Interest, if any, or with respect to, the Notes; (b) default in payment, when due at Stated Maturity, upon acceleration, redemption, required repurchase or otherwise, of the principal of, or premium, if any, on the Notes; (c) failure by the Company or any Restricted Subsidiary to comply with the provisions of Section 4.09, 4.10, 4.12, 4.18 or 5.01 of the Indenture; (d) failure by the Company or any Restricted Subsidiary for 30 days after written notice thereof has been given to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% of the aggregate principal amount of the Notes outstanding to comply with any of its other covenants or agreements in the Indenture; (e) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness by the Company or any Restricted Subsidiary, or the payment of which is guaranteed by the Company or any Restricted Subsidiary, whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default: (i) is caused by a failure to pay principal of, or interest or premium, if any, on, such Indebtedness when due at the final maturity of such Indebtedness (a “ Payment Default ”); or (ii) results in the acceleration of such Indebtedness prior to its Stated Maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates US$25.0 million or more; (f) failure by the Company or any Restricted Subsidiary to pay final, non-appealable judgments aggregating in excess of US$25.0 million, which judgments are not paid, discharged or stayed for a period of 60 days; (g) any Subsidiary Guarantee of a Significant Subsidiary ceases, or the Subsidiary Guarantees of any group of Subsidiaries that, when taken together, would constitute a Significant Subsidiary cease, to be in full force and effect (other than in accordance with the terms of any such Subsidiary Guarantee) or any Subsidiary Guarantor that is a Significant Subsidiary denies or disaffirms its obligations under its Subsidiary Guarantee, or a group of Subsidiary Guarantors that, when taken together, would constitute a Significant Subsidiary deny or disaffirm their obligations under their respective Subsidiary Guarantees; and (h) certain events of bankruptcy, insolvency or reorganization affecting the Company or any of its Significant Subsidiaries.

If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes may declare all the Notes to be due and payable. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency described in the Indenture, all outstanding Notes shall become due and payable without further action or notice. Holders may not enforce the Indenture or the Notes except as provided in the Indenture. Subject to certain limitations, Holders of at least a majority in aggregate principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal, premium, if any, or interest or Special Interest or Additional Amounts, if any) if it determines in good faith that withholding notice is in the interests of the Holders. The Holders of at least a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of principal, premium, if any, or interest or Special Interest or Additional Amounts, if any. The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default.

13. Trustee Dealings with Company . Subject to certain limitations, the Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Subsidiary Guarantor or any Subsidiary Guarantor or any Affiliate of the Company with the same rights it would have if it were not Trustee.

14. No Recourse Against Others . No past, present or future director, officer, employee, incorporator or stockholder of the Company or of any Subsidiary Guarantor, as such, shall have any liability for any obligations of the Company or any Subsidiary Guarantor under the Indenture, the Notes, the Subsidiary Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability.

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15. Authentication . This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

16. Abbreviations . Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

17. Additional Rights of Holders of Restricted Global Notes and Restricted Definitive Notes . In addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Global Notes and Restricted Definitive Notes that are Initial Notes shall have all the rights set forth in the Registration Rights Agreement, dated as of April 15, 2008, among the Company and the parties named on the signature pages thereto or, in the case of Additional Notes, Holders of Restricted Global Notes and Restricted Definitive Notes shall have the rights set forth in one or more Registration Rights Agreements, if any, among the Company and the other parties thereto, relating to rights given by the Company to the purchasers of such Additional Notes.

18. CUSIP Numbers . Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes and has directed the Trustee to use CUSIP numbers in notices of redemption or notices of Offers to Purchase as a convenience to Holders. No representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of redemption or notice of an Offer to Purchase and reliance may be placed only on the other identification numbers printed thereon and any such redemption or Offer to Purchase shall not be affected by any defect in or omission of such numbers.

The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to: Videotron Ltd., 612 St. Jacques Street, Montréal, Québec H3C 4M8, Canada, Attention: Vice President, Legal Affairs.

19. Governing Law . The internal law of the State of New York shall govern and be used to construe this Note.

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Option of Holder to Elect Purchase

If you want to elect to have this Note purchased by the Company pursuant to Section 4.12 or 4.18 of the Indenture, check the box below:

o Section 4.12

o Section 4.18

If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.12 or Section 4.18 of the Indenture, state the amount you elect to have purchased: US$

Date:			Your Signature:
			(Sign exactly as your name appears on the face of this Note)

			Tax Identification No.:

			SIGNATURE GUARANTEE:



			Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

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Assignment Form

To assign this Note, fill in the form below:

(I) or (we) assign and transfer this Note to

(Insert assignee’s social security or other tax I.D. no.)

(Print or type assignee’s name, address and zip code)

and irrevocably appoint________________________________________________________________________________________

as agent to transfer this Note on the books of the Company. The agent may substitute another to act for him.

Date: _________________

Your Signature: __________________________________

(Sign exactly as your name appears on the face of this Note)

Signature Guarantee: ____________________________________________

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended.

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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:

Date of Exchange	Amount of decrease in Principal Amount of this Global Note	Amount of increase in Principal Amount of this Global Note	Principal Amount of this Global Note following such decrease (or increase)	Signature of authorized signatory of Trustee or Note Custodian

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EXHIBIT B

FORM OF CERTIFICATE OF TRANSFER

Videotron Ltd.
612 St. Jacques Street
Montréal, Québec H3C 4M8
Canada

Attention: Vice President, Legal Affairs

Wells Fargo Bank, National Association.
213 Court Street, Suite 703

Middletown, CT 06457

Attention: Corporate Trust Services

Facsimile No.: (860) 704-6219

Re: 9 1 / 8 % Senior Notes due April 15, 2018

Reference is hereby made to the Indenture, dated as of April 15, 2008 (the “ Indenture ”), among Videotron Ltd., as issuer (the “ Company ”), the Subsidiary Guarantors party thereto and Wells Fargo Bank, National Association, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture.

, (the “ Transferor ”) owns and proposes to transfer the Note[s] or interest in such Note[s] specified in Annex A hereto, in the principal amount of US$ in such Note[s] or interests (the “ Transfer ”), to (the “ Transferee ”), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that:

[CHECK ALL THAT APPLY]

1. o Check if Transferee will take delivery of a beneficial interest in the 144A Global Note or a Definitive Note Pursuant to Rule 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the “ Securities Act ”), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Definitive Note is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Definitive Note for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the 144A Global Note and/or the Definitive Note and in the Indenture and the Securities Act.

2. o Check if Transferee will take delivery of a beneficial interest in the Regulation S Global Note or a Definitive Note pursuant to Regulation S. The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a Person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(a) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Distribution Compliance Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than an Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the

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transferred beneficial interest or Definitive Note will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Note, the Temporary Regulation S Global Note and/or the Definitive Note and in the Indenture and the Securities Act.

3. o Check and complete if Transferee will take delivery of a Definitive Note pursuant to any provision of the Securities Act other than Rule 144A or Regulation S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Notes and Restricted Definitive Notes and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one):

(a) o such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act;

(b) o such Transfer is being effected to the Company or a Subsidiary thereof;

(c) o such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act;

(d) o such Transfer is being effected to an Institutional Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the transfer restrictions applicable to beneficial interests in a Restricted Global Note or Restricted Definitive Notes and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit D to the Indenture and (2) if such Transfer is in respect of a principal amount of Notes at the time of transfer of less than US$250,000, an Opinion of Counsel provided by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Definitive Notes and in the Indenture and the Securities Act.

4. o Check if Transferee will take delivery of a beneficial interest in an Unrestricted Global Note or of an Unrestricted Definitive Note.

(a) o Check if Transfer is pursuant to Rule 144 . (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.

(b) o Check if Transfer is Pursuant to Regulation S . (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not

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required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes, on Restricted Definitive Notes and in the Indenture.

(c) o Check if Transfer is Pursuant to Other Exemption . (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Definitive Note will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Notes or Restricted Definitive Notes and in the Indenture.

This certificate and the statements contained herein are made for your benefit and the benefit of the Company.


	[Insert Name of Transferor]


	By:
		Name:
		Title:

	Dated:

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ANNEX A TO CERTIFICATE OF TRANSFER

1. The Transferor owns and proposes to transfer the following:

[CHECK ONE OF (a) OR (b)]

(a) o a beneficial interest in the:

(i) o 144A Global Note (CUSIP ), or

(ii) o Regulation S Global Note (CUSIP ); or

(b) o a Restricted Definitive Note.

2. After the Transfer the Transferee will hold:

[CHECK ONE OF (a), (b) OR (c)]

(a) o a beneficial interest in the:

(i) o 144A Global Note (CUSIP ), or

(ii) o Regulation S Global Note (CUSIP ), or

(iii) o Unrestricted Global Note (CUSIP ); or

(b) o a Restricted Definitive Note; or

in accordance with the terms of the Indenture.

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EXHIBIT C

FORM OF CERTIFICATE OF EXCHANGE

Videotron Ltd.

612 St. Jacques Street

Montréal, Québec H3C 4M8

Canada

Attention: Vice President, Legal Affairs

Wells Fargo Bank, National Association.

213 Court Street, Suite 703

Middletown, CT 06457

Attention: Corporate Trust Services

Facsimile No.: (860) 704-6219

Re: 9 1 / 8 % Senior Notes due April 15, 2018

, (the “ Owner ”) owns and proposes to exchange the Note[s] or interest in such Note[s] specified herein, in the principal amount of US$ in such Note[s] or interests (the “ Exchange ”). In connection with the Exchange, the Owner hereby certifies that:

1. Exchange of Restricted Definitive Notes or Beneficial Interests in a Restricted Global Note for Unrestricted Definitive Notes or Beneficial Interests in an Unrestricted Global Note

(a) o Check if Exchange is from beneficial interest in a Restricted Global Note to beneficial interest in an Unrestricted Global Note . In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a beneficial interest in an Unrestricted Global Note in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the “ Securities Act ”), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(b) o Check if Exchange is from beneficial interest in a Restricted Global Note to Unrestricted Definitive Note . In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Note and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(c) o Check if Exchange is from Restricted Definitive Note to beneficial interest in an Unrestricted Global Note . In connection with the Owner’s Exchange of a Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in

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order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

(d) o Check if Exchange is from Restricted Definitive Note to Unrestricted Definitive Note . In connection with the Owner’s Exchange of a Restricted Definitive Note for an Unrestricted Definitive Note, the Owner hereby certifies (i) the Unrestricted Definitive Note is being acquired for the Owner’s own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Definitive Notes and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Definitive Note is being acquired in compliance with any applicable blue sky securities laws of any state of the United States.

2. Exchange of Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes for Restricted Definitive Notes or Beneficial Interests in Restricted Global Notes

(a) o Check if Exchange is from beneficial interest in a Restricted Global Note to Restricted Definitive Note . In connection with the Exchange of the Owner’s beneficial interest in a Restricted Global Note for a Restricted Definitive Note with an equal principal amount, the Owner hereby certifies that the Restricted Definitive Note is being acquired for the Owner’s own account without transfer. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the Restricted Definitive Note issued will continue to be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Definitive Note and in the Indenture and the Securities Act.

(b) o Check if Exchange is from Restricted Definitive Note to beneficial interest in a Restricted Global Note . In connection with the Exchange of the Owner’s Restricted Definitive Note for a beneficial interest in the [CIRCLE ONE] 144A Global Note, Regulation S Global Note, IAI Global Note with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner’s own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Definitive Note and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Note and in the Indenture and the Securities Act.

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This certificate and the statements contained herein are made for your benefit and the benefit of the Company.


	[Insert Name of Transferor]


	By:
		Name:
		Title:

	Dated:

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EXHIBIT D

FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR

Videotron Ltd.

612 St. Jacques Street

Montréal, Québec H3C 4M8

Canada

Attention: Vice President, Legal Affairs

Wells Fargo Bank, National Association.

213 Court Street, Suite 703

Middletown, CT 06457

Attention: Corporate Trust Services

Facsimile No.: (860) 704-6219

Re: 9 1 / 8 % Senior Notes due April 15, 2018

In connection with our proposed purchase of US$ aggregate principal amount of:

(a) o a beneficial interest in a Global Note, or

(b) o a Definitive Note,

we confirm that:

1. We understand that any subsequent transfer of the Notes or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes or any interest therein except in compliance with, such restrictions and conditions and the United States Securities Act of 1933, as amended (the “ Securities Act ”).

2. We understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Notes or any interest therein, we will do so only (A) to the Company or any subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to a “qualified institutional buyer” (as defined therein) that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that the transfer is being made in reliance on Rule 144A under the Securities Act, (C) to an institutional “accredited investor” (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter substantially in the form of this letter and, such transfer is in respect of a minimum principal amount of Notes of US$250,000, (D) pursuant to offers and sales to non-U.S. Persons that occur outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to any other available exemption under the Securities Act or (F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any Person purchasing the Definitive Note or beneficial interest in a Global Note from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein.

3. We understand that, on any proposed resale of the Notes or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you

D-1

and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Notes purchased by us will bear a legend to the foregoing effect.

4. We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. We have had access to such financial and other information and have been afforded the opportunity to ask such questions of representatives of the Company and receive answers thereto, as we deem necessary in connection with our decision to purchase the Notes.

5. We are acquiring the Notes or beneficial interest therein purchased by us for our own account, or for one or more accounts (each of which is an institutional “accredited investor”) as to each of which we exercise sole investment discretion, for investment purposes only and are not acquiring the Notes with a view to any distribution thereof in a transaction that would violate the Securities Act of the securities laws of any state of the United States or any other applicable jurisdiction.

You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. This letter shall be governed by, and construed in accordance with, the laws of the State of New York.


	[Insert Name of Accredited Investor]


	By:
		Name:
		Title:

Dated:

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EXHIBIT E

FORM OF NOTATION OF GUARANTEE

For value received, each Subsidiary Guarantor (which term includes any successor Person under the Indenture), jointly and severally, hereby unconditionally guarantees, to the extent set forth in the Indenture and subject to the provisions in the Indenture, dated as of April 15, 2008 (the “ Indenture ”), among Videotron Ltd., as issuer (the “ Company ”), the Subsidiary Guarantors listed on the signature pages thereto and Wells Fargo Bank, National Association, as trustee (the “ Trustee ”), (a) the due and punctual payment of the principal of, premium, if any, and interest and Special Interest and Additional Amounts, if any, on the Notes, whether at maturity, by acceleration, redemption or otherwise, the due and punctual payment of interest on overdue principal and premium, if any, and, to the extent permitted by law, interest and Special Interest and Additional Amounts, if any, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee under the Notes and the Indenture, all in accordance with the terms of the Notes and the Indenture; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that the same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration pursuant to Section 6.02 of the Indenture, redemption or otherwise. The obligations of the Subsidiary Guarantors to the Holders of Notes and to the Trustee pursuant to the Subsidiary Guarantee and the Indenture are expressly set forth in Article 10 of the Indenture and reference is hereby made to the Indenture for the precise terms of the Subsidiary Guarantee. Except to the extent provided in the Indenture, including Sections 8.02, 8.03 and 10.05 thereof, this Subsidiary Guarantee shall not be discharged except by complete performance of the obligations contained herein and in the Indenture. Each Holder of a Note, by accepting the same agrees to and shall be bound by such provisions. Capitalized terms used herein and not defined are used herein as so defined in the Indenture.

		[NAME OF GUARANTOR]

		By:
			Name:
			Title:

E-1

EXHIBIT F

FORM OF SUBORDINATION AGREEMENT

This SUBORDINATION AGREEMENT is dated as of (the “Agreement”).

To: Wells Fargo Bank, National Association., for itself and as trustee under the Indenture referred to below for the holders of the Notes (the “Trustee”)

[OBLIGOR] (the “Obligor”), as obligor under the obligation dated as of made or issued by the Obligor in favor of [HOLDER] (the “Subordinated Security”), and [HOLDER], as holder (the “Holder”) of the Subordinated Security, for ten dollars and other good and valuable consideration received by each of the Obligor and the Holder from the Trustee and any other Representative and by each of the Obligor and the Holder from the other, agree as follows:

1. Interpretation .

(a) “ Cash, Property or Securities ”. “Cash, Property or Securities” shall not be deemed to include securities of the Obligor or any other Person provided for by a plan of reorganization or readjustment, the payment of which is subordinated at least to the extent provided herein with respect to the Subordinated Security, to the payment of all Senior Indebtedness which may at the time be outstanding; provided, however, that (i) all Senior Indebtedness is assumed by the new Person, if any, resulting from any such reorganization or readjustment, and (ii) the rights of the holders of the Senior Indebtedness are not, without the consent of such holders, altered by such reorganization or readjustment.

(b) “ payment in full ”. “payment in full”, with respect to Senior Indebtedness, means the receipt on an irrevocable basis of cash in an amount equal to the unpaid principal amount of the Senior Indebtedness and premium, if any, and interest and any special interest thereon to the date of such payment, together with all other amounts owing with respect to such Senior Indebtedness.

(c) “ Representative ” means the agent (including an administrative agent), trustee or representative of holders of Senior Indebtedness.

(d) “ Senior Indebtedness ”. “Senior Indebtedness” means, at any date, all indebtedness (including, without limitation, any and all amounts of principal, interest, special interest, additional amounts, premium, fees, penalties, indemnities and “post-petition interest” in bankruptcy and any reimbursement of expenses) under (1) the Indenture, including, without limitation, the “Notes,” the “Subsidiary Guarantees,” the “Exchange Notes,” the “Additional Notes” and any “guarantee” of the Exchange Notes or the Additional Notes (in each case, as defined in the Indenture), (2) the indenture, dated as of September 16, 2005, as supplemented by the first supplemental indenture, dated as of April [15] , 2008 (the “2005 Indenture”), among Videotron, the guarantors thereto and Wells Fargo Bank, National Association, as Trustee, including, without limitation, the “Notes,” the “Subsidiary Guarantees,” the “Exchange Notes,” the “Additional Notes” and any “guarantee” of the Exchange Notes or the Additional Notes (in each case, as defined in the 2005 Indenture), (3) the indenture, dated as of October 8, 2003, as supplemented by the first supplemental indenture, dated as of July 12, 2004, the second supplemental indenture, dated as of July 15, 2005, and the third supplemental indenture, dated as of April [15] , 2008 (the “2003 Indenture”), among Videotron, the guarantors thereto and Wells Fargo Bank, National Association, as Trustee, including, without limitation, the “Notes,” the “Subsidiary Guarantees,” the “Exchange Notes,” the “Additional Notes” and any “guarantee” of the Exchange Notes or the Additional Notes (in each case, as defined in the 2003 Indenture) and (4) any Credit Facilities (as defined in the Indenture) of Videotron.

2. Agreement Entered into Pursuant to Indenture . The Obligor and the Holder are entering into this Agreement pursuant to the provisions of the Indenture, dated as of April 15 , 2008 (the “Indenture”; capitalized terms used herein without definition having the meanings set forth therein) among Videotron , the Subsidiary Guarantors and the Trustee. Pursuant to the Indenture, Videotron has issued and the Subsidiary Guarantors have guaranteed, 9 1 / 8 % Senior Notes due April 15, 2018 of Videotron .

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3. Subordination . The indebtedness or obligation represented by the Subordinated Security shall be subordinated as follows:

(a) Agreement to Subordinate . The Obligor, for itself and its successors and assigns, and the Holder agree, that the indebtedness or obligation evidenced by the Subordinated Security (including, without limitation, principal, interest, premium, redemption or retraction amount, dividend, fees, penalties, indemnities and “post-petition interest” in bankruptcy and any reimbursement of expenses) is subordinate and junior in right of payment, to the extent and in the manner provided in this Section 3, to the prior payment in full of all Senior Indebtedness. The provisions of this Section 3 are for the benefit of the Trustee and/or other Representative acting on behalf of the holders from time to time of Senior Indebtedness, and such holders are hereby made obligees hereunder to the same extent as if their names were written herein as such, and they (collectively or singly) may proceed to enforce such provisions.

(b) Liquidation, Dissolution or Bankruptcy .

(i) Upon any distribution of assets of the Obligor to creditors or upon a liquidation or dissolution or winding-up of the Obligor or in a bankruptcy, arrangement, liquidation, reorganization, insolvency, receivership or similar case or proceeding relating to the Obligor or its property or other marshalling of assets of the Obligor:

(A) the holders of Senior Indebtedness shall be entitled to receive payment in full of all Senior Indebtedness before the Holder shall be entitled to receive any payment of any amount owing in respect of the Subordinated Security (including, without limitation, principal, interest, premium, redemption or retraction amount, or dividend);

(B) until payment in full of all Senior Indebtedness, any distribution of assets of the Obligor of any kind or character to which the Holder would be entitled but for this Section 3 is hereby assigned absolutely to the holders of Senior Indebtedness (equally and ratably among the holders of Senior Indebtedness) and shall be paid by the Obligor or by any receiver, trustee in bankruptcy, liquidating trustee, agents or other Persons making such payment or distribution to the Trustee and/or other Representative on behalf of the holders of Senior Indebtedness, as their interests may appear; and

(C) in the event that, notwithstanding the foregoing, any payment or distribution of assets of the Obligor of any kind or character, whether in Cash, Property or Securities, shall be received by the Holder before all Senior Indebtedness is paid in full, such payment or distribution shall be held in trust for the benefit of and shall be paid over to the Trustee and/or other Representative on behalf of the holders of Senior Indebtedness (equally and ratably among the holders of Senior Indebtedness), as their interests may appear, for application to the payment of all Senior Indebtedness until all Senior Indebtedness shall have been paid in full after giving effect to any concurrent payment or distribution to the holders of Senior Indebtedness in respect of such Senior Indebtedness.

(ii) If (A) a bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Obligor or its property (a “Reorganization Proceeding”) is commenced and is continuing and (B) the Holder does not file proper claims or proofs of claim in the form required in a Reorganization Proceeding prior to 45 days before the expiration of the time to file such claims, then (1) upon the request of the Trustee, the Holder shall file such claims and

F-2

proofs of claim in respect of the Subordinated Security and execute and deliver such powers of attorney, assignments and proofs of claim or proxies as may be directed by the Trustee to enable it to exercise in the sole discretion of the Trustee any and all voting rights attributable to the Subordinated Security which are capable of being voted (whether by meeting, written resolution or otherwise) in a Reorganization Proceeding and enforce any and all claims upon or in respect of the Subordinated Security and to collect and receive any and all payments or distributions which may be payable or deliverable at any time upon or in respect of the Subordinated Security, and (2) whether or not the Trustee shall take the action described in clause (1) above, the Trustee shall nevertheless be deemed to have such powers of attorney as may be necessary to enable the Trustee to exercise such voting rights, file appropriate claims and proofs of claim and otherwise exercise the powers described above for and on behalf of the Holder.

(c) Relative Rights . This Section 3 defines the relative rights of the Holder and the holders of Senior Indebtedness. Nothing in this Section 3 shall:

(i) impair, as between the Obligor and the Holder, the obligation of the Obligor, which is absolute and unconditional, to make the payments required by the Subordinated Security in accordance with its terms; or

(ii) affect the relative rights of the Holder and creditors of the Obligor other than the holders of Senior Indebtedness; or

(iii) affect the relative rights of the holders of Senior Indebtedness among themselves; or

(iv) prevent the Holder from exercising its available remedies upon a default, subject to the rights of the holders of Senior Indebtedness to receive cash, property or other assets otherwise payable to the Holder.

(d) Subordination May Not Be Impaired .

(i) No right of any holder of Senior Indebtedness to enforce the subordination of indebtedness or obligation evidenced by the Subordinated Security shall in any way be prejudiced or impaired by any act or failure to act by the Obligor or by any such holder or the Trustee, or by any non-compliance by the Obligor with the terms, provisions or covenants herein, regardless of any knowledge thereof which any such holder or the Trustee may have or be otherwise charged with. Neither the subordination of the Subordinated Security as herein provided nor the rights of the holders of Senior Indebtedness with respect hereto shall be affected by any extension, renewal or modification of the terms, or the granting of any security in respect of, any Senior Indebtedness or any exercise or non-exercise of any right, power or remedy with respect thereto.

(ii) The Holder agrees that all indebtedness or obligation evidenced by the Subordinated Security will be unsecured by any Lien upon or with respect to any property of the Obligor.

(iii) The Holder agrees not to exercise any offset or counterclaim or similar right in respect of the indebtedness or obligation evidenced by the Subordinated Security except to the extent payment of such indebtedness or obligation is permitted and will not assign or otherwise dispose of the Subordinated Security or the

F-3

indebtedness or obligation which it evidences unless the assignee or acquiror, as the case may be, agrees to be bound by the terms of this Agreement.

(e) Holder Entitled to Rely . Upon any payment or distribution pursuant to this Section 3, the Holder shall be entitled to rely (i) upon any order or decree of a court of competent jurisdiction in which any proceedings of the nature referred to in Section 3(b) are pending, (ii) upon a certificate of the liquidating trustee or agent or other person in such proceedings making such payment or distribution to the Holder or its representative, if any, or (iii) upon a certificate of the Trustee and/or other Representative (if any) of the holders of Senior Indebtedness for the purpose of ascertaining the persons entitled to participate in such payment or distribution, the holders of the Senior Indebtedness and other indebtedness of the Obligor, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Section 3.

4. Enforceability . Each of the Obligor and the Holder represents and warrants that this Agreement has been duly authorized, executed and delivered by each of the Obligor and the Holder and constitutes a valid and legally binding obligation of each of the Obligor and the Holder, enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles ; and that, in the case of a Subordinated Security made or issued by Videotron or a Subsidiary Guarantor , on the date hereof, the Holder shall deliver an opinion or opinions of counsel to such effect to the Trustee for the benefit of the holders of the Senior Indebtedness under the Indenture.

5. Miscellaneous .

(a) Until payment in full of all the Senior Indebtedness, the Obligor and the Holder agree that no amendment shall be made to the Subordinated Security which would affect the rights of the holders of the Senior Indebtedness hereunder.

(b) This Agreement may not be amended or modified in any respect, nor may any of the terms or provisions hereof be waived, except by an instrument signed by the Obligor, the Holder and the Trustee and/or other Representative (if any).

(c) This Agreement shall be binding upon each of the parties hereto and their respective successors and assigns and shall inure to the benefit of the Trustee and/or other Representative (if any) and each and every holder of Senior Indebtedness and their respective successors and assigns.

(d) This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

(e) The Holder and the Obligor each hereby irrevocably agrees that any suits, actions or proceedings arising out of or in connection with this Agreement may be brought in any state or federal court sitting in The City of New York or any court in the Province of Québec and submits and attorns to the non-exclusive jurisdiction of each such court.

(f) The Holder and the Obligor will whenever and as often as reasonably requested to do so by the Trustee and/or other Representative (if any), do, execute, acknowledge and deliver any and all such other and further acts, assignments, transfers and any instruments of further assurance, approvals and consents as are necessary or proper in order to give complete effect to this Agreement.

(g) Each of the Holder and the Obligor irrevocably appoints CT Corporation System, as its authorized agent in the State of New York upon which process may be served in any such suit or proceedings, and agrees that service of process upon such agent, and written notice of said service to CT Corporation System, by the person serving the same to the addresses listed below, shall be deemed in every respect effective service of process upon the Holder or the Obligor, as applicable, in any such suit or proceeding.

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If to the Obligor:

[ ]

If to the Holder:

[ ]

Each of the Holder and the Obligor further agrees to take any and all action as may be necessary to maintain such designation and appointment of such agent in full force and effect so long as any Notes or Exchange Notes (including any Additional Notes) remain outstanding.

IN WITNESS WHEREOF, the Obligor and the Holder each have caused this Agreement to be duly executed.

	[OBLIGOR]

	By
		Name:
		Title:

	[HOLDER]

	By
		Name:
		Title:

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TABLE OF CONTENTS

Page

Table of Contents

		Page

ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE		1
Section 1.01.	Definitions	1
Section 1.02.	Other Definitions	21
Section 1.03.	Incorporation by Reference of Trust Indenture Act	22
Section 1.04.	Rules of Construction	22
ARTICLE 2. THE NOTES		23
Section 2.01.	Form and Dating	23
Section 2.02.	Execution and Authentication	23
Section 2.03.	Registrar and Paying Agent	24
Section 2.04.	Paying Agent to Hold Money in Trust	24
Section 2.05.	Holder Lists	24
Section 2.06.	Transfer and Exchange	25
Section 2.07.	Replacement Notes	35
Section 2.08.	Outstanding Notes	35
Section 2.09.	Treasury Notes	35
Section 2.10.	Temporary Notes	36
Section 2.11.	Cancellation	36
Section 2.12.	Defaulted Interest	36
Section 2.13.	CUSIP or ISIN Numbers	36
Section 2.14.	Special Interest	36
Section 2.15.	Issuance of Additional Notes	37
ARTICLE 3. REDEMPTION AND PREPAYMENT		37
Section 3.01.	Notices to Trustee	37
Section 3.02.	Selection of Notes to Be Redeemed	37
Section 3.03.	Notice of Redemption	38
Section 3.04.	Effect of Notice of Redemption	38
Section 3.05.	Deposit of Redemption Price	38
Section 3.06.	Notes Redeemed in Part	39
Section 3.07.	Optional Redemption	39
Section 3.08.	Mandatory Redemption	40
Section 3.09.	Offers To Purchase	40
ARTICLE 4. COVENANTS		42

TABLE OF CONTENTS

(continued)

		Page

Section 4.01.	Payment of Notes	42
Section 4.02.	Maintenance of Office or Agency	42
Section 4.03.	Reports	42
Section 4.04.	Compliance Certificate	43
Section 4.05.	Taxes	43
Section 4.06.	Stay, Extension and Usury Laws	43
Section 4.07.	Corporate Existence	44
Section 4.08.	Payments for Consent	44
Section 4.09.	Incurrence of Indebtedness and Issuance of Preferred Shares	44
Section 4.10.	Restricted Payments	47
Section 4.11.	Liens	49
Section 4.12.	Asset Sales	49
Section 4.13.	Dividend and Other Payment Restrictions Affecting Subsidiaries	51
Section 4.14.	Transactions with Affiliates	53
Section 4.15.	Sale and Leaseback Transactions	54
Section 4.16.	Issuances and Sales of Equity Interests in Subsidiaries	54
Section 4.17.	Designation of Restricted and Unrestricted Subsidiaries	55
Section 4.18.	Repurchase at the Option of Holders Upon a Change of Control	56
Section 4.19.	Future Guarantors	56
Section 4.20.	Additional Amounts	56
Section 4.21.	Business Activities	57
ARTICLE 5. SUCCESSORS		58
Section 5.01.	Merger, Consolidation and Sale of Assets of the Company and Subsidiary Guarantors	58
Section 5.02.	Successor Corporation Substituted	59
ARTICLE 6. DEFAULTS AND REMEDIES		59
Section 6.01.	Events of Default	59
Section 6.02.	Acceleration	61
Section 6.03.	Other Remedies	62
Section 6.04.	Waiver of Past Defaults	62
Section 6.05.	Control by Majority	62
Section 6.06.	Limitation on Suits	62
Section 6.07.	Rights of Holders to Receive Payment	63
Section 6.08.	Collection Suit by Trustee	63
Section 6.09.	Trustee May File Proofs of Claim	63

TABLE OF CONTENTS

(continued)

		Page

Section 6.10.	Priorities	63
Section 6.11.	Undertaking for Costs	64
ARTICLE 7. TRUSTEE		64
Section 7.01.	Duties of Trustee	64
Section 7.02.	Rights of Trustee	65
Section 7.03.	Individual Rights of Trustee	66
Section 7.04.	Trustee’s Disclaimer	66
Section 7.05.	Notice of Defaults	66
Section 7.06.	Reports by Trustee to Holders	66
Section 7.07.	Compensation and Indemnity	66
Section 7.08.	Replacement of Trustee	67
Section 7.09.	Successor Trustee by Merger, etc .	68
Section 7.10.	Eligibility; Disqualification	68
Section 7.11.	Preferential Collection of Claims Against Company	68
ARTICLE 8. LEGAL DEFEASANCE AND COVENANT DEFEASANCE		68
Section 8.01.	Option to Effect Legal Defeasance or Covenant Defeasance	68
Section 8.02.	Legal Defeasance and Discharge	68
Section 8.03.	Covenant Defeasance	69
Section 8.04.	Conditions to Legal or Covenant Defeasance	69
Section 8.05.	Deposited Cash and Government Securities to be Held in Trust; Other Miscellaneous Provisions	70
Section 8.06.	Repayment to Company	71
Section 8.07.	Reinstatement	71
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER		71
Section 9.01.	Without Consent of Holders of Notes	71
Section 9.02.	With Consent of Holders of Notes	72
Section 9.03.	Compliance with Trust Indenture Act	73
Section 9.04.	Revocation and Effect of Consents	74
Section 9.05.	Notation on or Exchange of Notes	74
Section 9.06.	Trustee to Sign Amendments, etc.	74
ARTICLE 10. SUBSIDIARY GUARANTEES		74
Section 10.01.	Guarantee	74
Section 10.02.	Limitation on Subsidiary Guarantor Liability	75
Section 10.03.	Execution and Delivery of Subsidiary Guarantee	76
Section 10.04.	Subsidiary Guarantors May Consolidate, etc., on Certain Terms	76

iii

TABLE OF CONTENTS

(continued)

		Page

Section 10.05.	Releases Following Sale of Assets	77
ARTICLE 11. SATISFACTION AND DISCHARGE		77
Section 11.01.	Satisfaction and Discharge	77
Section 11.02.	Deposited Cash and Government Securities to be Held in Trust; Other Miscellaneous Provisions	78
Section 11.03.	Repayment to Company	78
ARTICLE 12. MISCELLANEOUS		78
Section 12.01.	Trust Indenture Act Controls	78
Section 12.02.	Notices	79
Section 12.03.	Communication by Holders of Notes with Other Holders of Notes	80
Section 12.04.	Certificate and Opinion as to Conditions Precedent	80
Section 12.05.	Statements Required in Certificate or Opinion	80
Section 12.06.	Rules by Trustee and Agents	80
Section 12.07.	No Personal Liability of Directors, Officers, Employees and Shareholders	80
Section 12.08.	Governing Law	81
Section 12.09.	No Adverse Interpretation of Other Agreements	81
Section 12.10.	Successors	81
Section 12.11.	Severability	81
Section 12.12.	Consent to Jurisdiction and Service of Process	81
Section 12.13.	Conversion of Currency	81
Section 12.14.	Currency Equivalent	82
Section 12.15.	Counterpart Originals	82
Section 12.16.	Table of Contents, Headings, etc .	83
Section 12.17.	Qualification of this Indenture	83

EXHIBIT A:		FORM OF NOTE
EXHIBIT B:		FORM OF CERTIFICATE OF TRANSFER
EXHIBIT C:		FORM OF CERTIFICATE OF EXCHANGE
EXHIBIT D:		FORM OF CERTIFICATE FROM ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
EXHIBIT E:		FORM OF NOTATION OF GUARANTEE
EXHIBIT F:		FORM OF SUBORDINATION AGREEMENT

CROSS-REFERENCE TABLE

TIA Section Reference		Indenture Section

310(a)(1)		7.10
(a)(2)		7.10
(a)(3)		N.A.
(a)(4)		N.A.
(a)(5)		7.10
(b)		7.08, 7.10
(c)		N.A.
311(a)		7.11
(b)		7.11
(c)		N.A.
312(a)		2.05
(b)		12.03
(c)		12.03
313(a)		7.06
(b)(1)		N.A.
(b)(2)		7.06, 7.07
(c)		7.06, 12.02
(d)		7.06
314(a)		4.03, 4.04, 12.02
(b)		N.A.
(c)(1)		12.04
(c)(2)		12.04
(c)(3)		N.A.
(d)		N.A.
(e)		12.05
315(a)		7.01
(b)		7.05, 12.02
(c)		7.01
(d)		7.01
(e)		6.11
316(a) (last sentence)		2.09
(a)(1)(A)		6.05
(a)(1)(B)		6.04
(a)(2)		N.A.
(b)		6.07
317(a)(1)		6.08
(a)(2)		6.09
(b)		2.04
318(a)		12.01

N.A. means Not Applicable.

Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.

Exhibit 2.15

VIDEOTRON LTD. / VIDÉOTRON LTÉE

SUPPLEMENTAL INDENTURE

Dated as of September 23, 2008

Wells Fargo Bank, National Association

Trustee

SECOND SUPPLEMENTAL INDENTURE , dated as of September 23, 2008 (this “Supplemental Indenture” ), by and among Videotron Ltd. / Vidéotron Ltée, a company continued under the laws of the Province of Québec (the “Company” ), 9193-2962 Québec Inc., a wholly-owned subsidiary of the Company incorporated under the laws of the Province of Québec (the “Additional Subsidiary Guarantor” ) and Wells Fargo Bank, National Association, as trustee (the “Trustee” ), to the Indenture, dated as of April 15, 2008 (as supplemented by a supplemental indenture dated as of April 28, 2008 (the “First Supplemental Indenture” ), by and among the Company, the person listed as an additional subsidiary guarantor on the signature page to the First Supplemental Indenture (the “First Additional Subsidiary Guarantor” ) and the Trustee, as trustee, the “Indenture” ), by and among the Company, each person listed as a guarantor on the signature pages to the Indenture (collectively referred to as the “Original Subsidiary Guarantors” ) and the Trustee.

WHEREAS, the Company, the Original Subsidiary Guarantors and the Trustee entered into the Indenture governing the Company’s 9 1 / 8 % Senior Notes due April 15, 2018 (the “Notes” );

WHEREAS, pursuant to the First Supplemental Indenture, the First Additional Subsidiary Guarantor provided for such a Subsidiary Guarantee;

WHEREAS, all things necessary have been done to make this Second Supplemental Indenture a valid agreement of the Company, the Additional Subsidiary Guarantor and the Trustee, in accordance with its terms.

NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:

For and in consideration of the premises contained herein, the parties hereto mutually covenant and agree as follows:

1. Terms used in this Second Supplemental Indenture that are not defined herein shall have the meanings set forth in the Indenture.

3. This Second Supplemental Indenture shall be construed as supplemental to the Indenture and shall form a part thereof, and the Indenture is hereby incorporated by reference herein and, as supplemented, modified and restated hereby, is hereby ratified, approved and confirmed.

4. This Second Supplemental Indenture shall be effective as of the date hereof. On and after the date hereof, each reference in the Indenture to “this Indenture,” “hereunder,” “hereof,” or “herein” shall mean and be a reference to the Indenture as supplemented by this Second Supplemental Indenture unless the context otherwise requires.

5. Except as provided below, in the event of a conflict between the terms and conditions of the Indenture and the terms and conditions of this Second Supplemental Indenture, the terms and conditions of this Second Supplemental Indenture shall prevail.

6. If any provision of this Second Supplemental Indenture limits, qualifies or conflicts with another provision of the Indenture that is required to be included by the Trust Indenture Act of 1939, as amended (the “Act” ), as in force at the date this Second Supplemental Indenture is executed, the provision required by said Act shall control.

7. This Second Supplemental Indenture shall be governed and construed in accordance with the laws of the State of New York.

8. This Second Supplemental Indenture may be signed in any number of counterparts with the same effect as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this Second Supplemental Indenture.

9. The recitals contained in this Second Supplemental Indenture shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Second Supplemental Indenture.

[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed as of the day and year first above written.

COMPANY:

VIDEOTRON LTD. / VIDÉOTRON LTÉE

By: /s/ Jean-Francois Pruneau
Name: Jean-Francois Pruneau
Title: Treasurer


ADDITIONAL SUBSIDIARY GUARANTOR:

9193-2962 QUÉBEC INC.

By: /s/ Jean-Francois Pruneau
Name: Jean-Francois Pruneau
Title: Authorized Signatory


TRUSTEE:

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: Julie Salovitch-Miller
Name: Julie Salovitch-Miller
Title: Vice President

Supplemental Indenture (9193-2962 Québec Inc. Guarantee)

Exhibit 4.1

VIDÉOTRON LTÉE, as Borrower

-and-

RBC DOMINION SECURITIES INC., as Lead Arranger and Bookrunner

-and-

BANK OF AMERICA, N.A., CANADA BRANCH

BMO NESBITT BURNS INC.

THE TORONTO-DOMINION BANK

THE BANK OF NOVA SCOTIA

as Co-Arrangers

-and-

THE FINANCIAL INSTITUTIONS NAMED
ON THE SIGNATURE PAGES HERETO

as Lenders

ROYAL BANK OF CANADA, as Administrative Agent

as of

November 28, 2000, as amended as of April 7, 2008

$450,000,000

CREDIT AGREEMENT

(as amended by a First Amending Agreement dated as of January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated December 12, 2001 and accepted by the Lenders as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004, an Eighth Amending Agreement dated as of March 6, 2008 and a Ninth Amending Agreement dated as of April 7, 2008)

AMENDED AND RESTATED CREDIT AGREEMENT entered into in the City of Montreal, Province of Quebec, as of November 28, 2000, as amended by a First Amending Agreement dated as of January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated December 12, 2001 and accepted by the Lenders as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004, and an Eighth Amending Agreement dated as of March 6, 2008,

AMONG:		VIDÉOTRON LTÉE , a company constituted in accordance with the laws of Quebec, having its registered office at 300 Viger Street East, 6 th floor, in the City of Montreal, Province of Quebec (hereinafter called the “ Borrower ”)

		PARTY OF THE FIRST PART

AND:		THE FINANCIAL INSTITUTIONS NAMED ON THE SIGNATURE PAGE HEREOF OR FROM TIME TO TIME PARTIES HERETO (the “ Lenders ”)

		PARTIES OF THE SECOND PART

AND:		ROYAL BANK OF CANADA, AS ADMINISTRATIVE AGENT FOR THE LENDERS, a Canadian bank, having a place of business at 200 Bay Street, 12 th floor, South Tower, Royal Bank Plaza, in the City of Toronto, Province of Ontario (hereinafter called the “ Agent ”)

		PARTY OF THE THIRD PART

WHEREAS the Borrower wishes to borrow certain amounts from the Lenders and the Lenders have agreed to lend such amounts to the Borrower, subject to and in accordance with the provisions hereof;

NOW THEREFORE, THE PARTIES HERETO HAVE AGREED AS FOLLOWS:

1.1 Definitions

The following words and expressions, when used in this Agreement or in any agreement supplementary hereto, unless the contrary is stipulated, have the following meaning:

		1
		(1+ (Bankers’ Acceptance Discount Rate × Designated Period (in days)÷365))

(a) to a member of the VL Group by an Affiliate of the Borrower in circumstances where, immediately prior to the issuance of such preferred shares, an Affiliate of such member of the VL Group has loaned on an unsecured basis to such member of the VL Group, or an Affiliate of such member of the VL Group has subscribed for preferred shares of such member of the VL Group in an amount equal to, the requisite subscription price for such preferred shares;

(b) by a member of the VL Group to one of its Affiliates in circumstances where, immediately prior to or immediately after, as the case may be, the issuance of such preferred shares, such member of the VL Group has loaned an amount equal to the proceeds of such issuance to an Affiliate on an unsecured basis; or

(c) by a member of the VL Group to one of its Affiliates in circumstances where, immediately after the issuance of such preferred shares, such member of the VL Group has used all of the proceeds of such issuance to subscribe for preferred shares issued by an Affiliate;

in each case on terms whereby:

(i) the aggregate redemption amount applicable to the preferred shares issued to or by such member of the VL Group is identical:

(A) in the case of (a) above, to the principal amount of the loan made or the aggregate redemption amount of the preferred shares subscribed for by such Affiliate prior to the issuance thereof;

(B) in the case of (b) above, to the principal amount of the loan made to such Affiliate with the proceeds of the issuance thereof; or

(C) in the case of (c) above, to the aggregate redemption amount of the preferred shares issued by such Affiliate with the proceeds of the issuance thereof;

(ii) the dividend payment date applicable to the preferred shares issued to or by such member of the VL Group will:

(A) in the case of (a) above, be immediately prior to the interest payment date relevant to the loan made or the dividend payment date on the preferred shares subscribed for by such Affiliate immediately prior to the issuance thereof;

(B) in the case of (b) above, be immediately after the interest payment date relevant to the loan made to such Affiliate with the proceeds of the issuance thereof; or

(C) in the case of (c) above, be immediately after the dividend payment date on the preferred shares issued by such Affiliate with the proceeds of the issuance thereof;

(iii) the amount of dividends provided for on any payment date in the share conditions attaching to the preferred shares issued:

(A) to a member of the VL Group in the case of (a) above, will be equal to or in excess of the amount of interest payable in respect of the loan made or the amount of dividends provided for in respect of the preferred shares subscribed for by such Affiliate prior to the issuance thereof;

(B) by a member of the VL Group in the case of (b) above, will be equal to or less than the amount of interest payable in respect of the loan made to such Affiliate with the proceeds of the issuance thereof; or

(C) by a member of the VL Group in the case of (c) above, will be equal to the amount of dividends in respect of the preferred shares issued by such Affiliate with the proceeds of the issuance thereof.

Provided, for greater certainty, that in all cases, (I) the redemption of any preferred shares by a member of the VL Group, (II) the repayment of any Back-to-Back Debt by a member of the VL Group, (III) the payment of any dividends by a member of the VL Group in respect of its preferred shares, and (IV) the payment of any interest on Back-to-Back Debt of a member of the VL Group, may, in each case, be made by a member of the VL Group solely by delivering the relevant Back-to-Back Securities to the Affiliate in question, or by paying to the Affiliate an amount in cash not in excess of the amount already received in cash from such Affiliate;

(A) in the case of paragraph (a), the BA Schedule I Reference Lender; and

(B) in the case of paragraph (b), the BA Schedule I Reference Lender plus 10 basis points (.10%);

but shall not include Debt under the Back-to-Back Securities. In addition, any Debt denominated in US$ which is validly and effectively hedged through the use of one or more Derivative Instruments will be calculated at the exchange rate applicable to such US$ Debt under the applicable Derivative Instrument;

provided, however, that no amount will be so deducted if such amount has already been deducted from the VL Group’s EBITDA;

Each change resulting from a change in the Leverage Ratio shall be effective with respect to all outstanding Loans retroactively from the first day of each fiscal quarter of the Borrower, and shall be based on the VL Group’s financial statements and Compliance Certificates required by subsections 12.15.1 and 12.15.2, as applicable, and the Leverage Ratio derived from such financial statements. Thus, the financial statements and Compliance Certificates which shall be delivered 60 days after quarter-end and 75 days after year-end (based on unaudited results and subject to readjustment upon delivery of a second Compliance Certificate in accordance with the provisions of subsection 12.15.2(b)) will be used to calculate the Leverage Ratio applicable from the first day of the quarter in which such financial statements and Compliance Certificates were to be delivered. For example, the financial statements and Compliance Certificates to be delivered in respect of the quarter ending May 31 of any year of the Term shall be delivered by July 30 of that year, and shall be used to calculate the Leverage Ratio for the period from June 1 of that year to August 31 of that year. If, as a result of an increase in the Leverage Ratio, the Margin has increased, the Agent will advise the Borrower and the Lenders and the Borrower will pay all additional amounts that may be due to the Lenders within 2 Business Days of being advised of the amount due. If, as a result of a reduction in the Leverage Ratio, the Margin has been reduced, the Agent shall advise the Borrower and the Lenders and the amounts owed to the Borrower (a) will be deducted from the Stamping Fees otherwise payable in the case of a BA Advance, on the next Rollover Date of the relevant BA Advance, or (b) in the case of Prime Rate Advances, will be deducted from the interest otherwise payable by the Borrower on the next interest payment date contemplated by Section 5.2, or (c) in the case of

Letters of Credit, will be deducted from the LC Fees otherwise payable by the Borrower on the next LC Fee payment date contemplated by Section 4.3.2, and (d) if no interest or Stamping Fees are payable during that period, the Lenders shall remit the necessary amounts to the Agent for payment to the Borrower;

1.2 Interpretation

1.3 Currency

Unless the contrary is indicated, all amounts referred to herein are expressed in Canadian Dollars.

1.4 Generally Accepted Accounting Principles

Unless the Lenders shall otherwise expressly agree or unless otherwise expressly provided herein (for example, in connection with the definition of “Consolidated”), all of the terms of this Agreement which are defined under the rules constituting Generally Accepted Accounting Principles shall be interpreted, and all financial statements and reports to be prepared hereunder shall be prepared, in accordance with Generally Accepted Accounting Principles in effect from time to time, and with respect to the financial ratios, those in effect as of October 8, 2003.

1.5 Division and Titles

The division of this Agreement into Articles, Sections and subsections and the insertion of titles are for convenience of reference only and shall not affect the meaning or interpretation of this Agreement.

2.1 Credit Facility

Subject to the provisions hereof, and in particular, to the provisions of Article 3, each Lender agrees to make available to the Borrower, individually and not jointly and severally or solidarily, its Commitment in the Credit, which Credit consists of the Revolving Facility in a maximum amount equal to $575,000,000 minus the maximum amount that can be borrowed under the Cash Management Facilities, which form part of the Revolving Facility.

2.2 The Revolving Facility

All Advances under the Revolving Facility shall be in Canadian Dollars alone and may be repaid and re-borrowed by the Borrower at all times during the Term.

2.3 Increase in Revolving Facility

3.1 Purpose of the Advances

All Advances made by the Lenders to the Borrower under the Revolving Facility in accordance with the provisions hereof from and after the Eighth Amendment Closing Date shall be used by the Borrower for general corporate purposes, including, without limitation, to issue Letters of Credit solely in connection with the Spectrum Auction and Purchase and

to pay dividends to QMI from time to time, subject to and in accordance with the terms and conditions of this Agreement.

4.1 Notice of Borrowing - Direct Advances

Subject to the applicable provisions of this Agreement, on any Business Day during the Disbursement Period, the Borrower shall be entitled to request Advances under the Revolving Facility, on one or more occasions, up to the maximum amount of the Credit, by way of Prime Rate Advances in minimum amounts of $1,000,000 and whole multiples thereof, provided that at least one (1) Business Day prior to the day on which any Prime Rate Advance is required (other than an Advance under the Cash Management Facilities, which shall be made in accordance with the provisions of the agreements pertaining thereto referred to in Section 4.3), the Borrower shall have provided to the Agent an irrevocable telephone notice at or before 10:00 A.M. on any Business Day, followed by the immediate delivery of a written Notice of Borrowing. Notices of Borrowing in respect of BA Advances shall be given in accordance with the provisions of Section 6.1.

In the event that some of the Revolving Facility Lenders are Foreign Lenders who cannot make Prime Rate Advances or BA Advances, prior to giving a Notice of Borrowing to the Agent as provided above or in Section 6.1, the Borrower shall give notice to the Agent that it wishes the Foreign Lenders to make a Libor Advance, the whole in accordance with Section 4.2. In such event, the Advance to be made by all Lenders shall be made on the last day of the longest applicable notice period.

4.2 LIBOR Advances and Conversions

Subject to the applicable provisions of this Agreement, on any Business Day during the Disbursement Period, upon an irrevocable telephone notice to the Agent given prior to 10:00 A.M., at least three Banking Days prior to the date of a proposed Libor Advance or a Rollover Date, followed by the immediate delivery of a written Notice of Borrowing, the Borrower may request that a Libor Advance be made by a Foreign Lender or that a Libor Advance by a Foreign Lender or any part thereof be converted into a new Libor Advance, in circumstances where the Foreign Lender cannot provide Bankers’ Acceptances. The Agent shall determine the LIBOR which will be in effect on the date of the Advance or the Rollover Date, as the case may be (which in such case must be a Banking Day), with respect to the Selected Amount or to each of the Selected Amounts, as the case may be, having a maturity of 10 to 180 days (subject to availability) from the date of the Advance or the Rollover Date, as the case may be. However, if the Borrower has not delivered a notice to the Agent in a timely manner in accordance with the provisions of this Section 4.2, the Borrower shall be deemed to have chosen to have the interest on the amount of such Advance calculated on the Prime Rate Basis.

4.3 Letters of Credit for Spectrum Auction and Purchase

The Issuing Lender shall not be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice, however transmitted, in connection with any Letter of Credit, except for errors or omissions that result directly from the intentional or gross fault of the Issuing Lender, as determined by a final judgment of a court of competent jurisdiction.

In furtherance and extension and not in limitation of the specific provisions of this Section 4.3, (A) any action taken or omitted by the Issuing Lender or any of its respective correspondents under or in connection with any of the Letters of Credit, if taken or omitted in good faith and without gross or intentional fault, as determined by a final judgment of a court of competent jurisdiction, shall be binding upon the Borrower and shall not put the Issuing Lender or its respective correspondents under any resulting liability to the Borrower and (B) the Issuing Lender may, without gross or intentional fault as determined by a final judgment of a court of competent jurisdiction, accept documents that appear on their face to be in substantial compliance with the terms of a Letter of Credit, without responsibility for further investigation, regardless of any notice or information to the contrary (other than an injunction granted by a court of competent jurisdiction during the period for which such injunction is enforced), and may make payment upon presentation of documents that appear on their face to be in substantial compliance with the terms of such Letter of Credit,

provided that the Issuing Lender shall have the right, in its sole discretion, to decline to accept such documents and to make such payment if such documents are not in strict compliance with the terms of such Letter of Credit.

4.4 Cash Management Facilities

Subject to the terms and conditions of this Agreement, the Lender that provides the Cash Management Facilities (the “ Cash Management Lender ”) shall make Advances to the Borrower in accordance with the terms and conditions of the agreements governing the Cash Management Facilities, the purpose of which shall be to provide the Borrower with a deemed Prime Rate Advance in connection with any negative balance in a consolidation account, and shall issue letters of credit subject to the Borrower executing the Cash Management Lender’s standard documentation with respect thereto. The fee for each such letter of credit shall be equal to the then applicable Stamping Fee. The Borrower and each of the Lenders agrees that any amounts due to the Cash Management Lender under the Cash

Management Facilities shall be deemed to form part of the Loan under the Revolving Facility and shall be secured by the Security. For greater certainty, only the net Loan under the Cash Management Facilities (including outstanding letters of credit) will be treated as Advances hereunder at the end of any particular day. The Cash Management Lender shall advise the Agent of any outstanding Advances upon the request of the Agent.

4.5 Operation of Accounts

The Agent shall maintain in its books at the Agency Branch a record of the Loan, including the Bankers’ Acceptances issued by the Borrower, attesting as to the total of the Borrower’s indebtedness to the Lenders in accordance with the provisions hereof and with the provisions of the Security Documents. These accounts or registers shall constitute, in the absence of manifest error, prima facie proof of the total amount of the indebtedness of the Borrower to the Lenders in accordance with the provisions hereof and of the Security Documents, of the date of any Advance made to the Borrower and of the total of all amounts paid by the Borrower from time to time with respect to principal and interest owing on the Loan and the fees and other sums exigible in accordance with the provisions hereof or of the Security Documents.

4.6 Apportionment of Advances

The amount of each Advance will be apportioned among the Lenders by the Agent by reference to the Commitment of each Lender, as such Commitment shall be immediately prior to the making of any Advance, subject to the provisions of Section 6.9 hereof with respect to BA Advances. If any amount is not in fact made available to the Agent by a Lender, the Agent shall be entitled to recover such amount (together with interest thereon at the rate determined by the Agent as being its cost of funds in the circumstances) on demand from such Lender or, if such Lender fails to reimburse the Agent for such amount on demand, from the Borrower.

4.7 Limitations on Advances

The undrawn Credit available under the Revolving Facility shall cease to be available at the expiry of the Disbursement Period.

4.8 Notices Irrevocable

Any notice given to the Agent in accordance with Articles 4 or 6 may not be revoked or withdrawn.

4.9 Market for Bankers’ Acceptances and Libor Advances

If at any time or from time to time: (a) there no longer exists a market for Bankers’ Acceptances or, (b) as a result of market conditions, (i) there exists no appropriate or reasonable method to establish LIBOR, for a Selected Amount or a Designated Period, or (ii) Canadian Dollar deposits are not available to the Foreign Lenders in such market in the ordinary course of business in amounts sufficient to permit them to make the Libor

Advance, for a Selected Amount or a Designated Period, such Lenders shall so advise the Agent and, subject to the provisions of Section 4.12 hereof with regard to the Foreign Lenders, any such Lenders shall not be obliged to accept drafts of the Borrower presented to such Lenders pursuant to the provisions of this Agreement nor to honour any notices of borrowing in connection with any Libor Advances, and the Borrower’s option to request BA Advances or Libor Advances, as the case may be, shall thereupon be suspended upon notice by the Agent to the Borrower.

4.10 Suspension of BA Advance and Libor Advance Option

If a notice has been given by the Agent in accordance with Section 4.9 and except as provided in the next sentence of this Section, the BA Advance or the Libor Advance, or any part thereof, as the case may be, shall not be made (whether as an Advance, a conversion or an extension) by the Lenders and the right of the Borrower to choose that Advances be made or, once made, be converted or extended into the BA Advance or the Libor Advance, as the case may be, shall be suspended until such time as the Agent has determined that the circumstances having given rise to such suspension no longer exist, in respect of which determination the Agent shall advise the Borrower within a reasonable delay. If sufficient Canadian Dollar funds are not available to the Foreign Lenders, the Foreign Lenders shall be relieved from their obligation to make an Advance until such time as such funds become available in sufficient amounts, but they shall comply with the provisions of Section 4.12 hereof.

4.11 Limits on BA Advances, Letters of Credit and Libor Advances

Nothing in this Agreement shall be interpreted as authorizing the Borrower to issue Bankers’ Acceptances or borrow by way of Libor Advances for a Designated Period expiring, nor to cause to be issued Letters of Credit maturing, on a date which results in a situation where the Credit cannot be reduced as required by this Agreement, or on a date which is after the expiry of the Term (or, in the case of a Letter of Credit, on a date which is less than 5 Business Days before the expiry of the Term).

4.12 Specific Clause with Regard to Foreign Lenders

In the event of a suspension of the Borrower’s right to request Advances (including conversions and extensions) from one or more Foreign Lenders under Sections 4.9 and 4.10 hereof (each an “ Affected Lender ”), each Affected Lender shall, concurrently with the notice described in Section 4.9, seek alternative sources of funding Cdn. $ Advances and, if sufficient funds are obtained, shall notify the Borrower as to when such funds will be available for Advances. On the date indicated in such notice, the Affected Lender shall be deemed to have made an Advance with interest payable on the Prime Rate Basis.

If within 5 Business Days following the notice described in Section 4.8, there remain one or more Affected Lenders who have not been deemed to have made an Advance on the Prime Rate Basis under the preceding paragraph, such Lender (an “ Incapable Lender ”) shall provide an additional notice to the Agent and the Borrower of such fact and the following provisions shall apply:

5. INTEREST AND FEES

5.1 Interest on the Prime Rate Basis

The principal amount of the Loan which at any time and from time to time remains outstanding and in respect of which the Borrower has chosen (subject to the provisions of Section 4.1 with regard to Cdn. $ Libor Advances by Foreign Lenders) or, in accordance with the provisions hereof, is obliged to pay interest on the Prime Rate Basis, shall bear interest, calculated daily, on the daily balance of such Loan, from the date of each Advance up to and including the day preceding the date of repayment thereof in full at the annual rate (calculated based on a 365 or 366 day year, as the case may be) applicable to each of such days which corresponds to the Prime Rate at the close of business on each of such days, plus the Margin.

5.2 Payment of Interest on the Prime Rate Basis

The interest payable in accordance with Section 5.1 and calculated in the manner described therein shall be payable to the Agent monthly, in arrears, on the last day of each month or on such other date (limited to once per month) as the Agent may determine and advise the Borrower from time to time, the first payment of which shall be exigible on the last day of the month in which the first Prime Rate Advance was made.

5.3 Interest on the Libor Basis

The principal amount of the Libor Advances which at any time and from time to time remains outstanding shall bear interest, calculated daily, on the daily balance of such Libor Advances, from each Rollover Date, at the annual rate (calculated based on a 360-day year) applicable to each of such days which corresponds to the LIBOR applicable to each Selected Amount, plus the Margin, and shall be effective as and from each Rollover Date up to and including the date prior to the next Rollover Date.

5.4 Payment of Interest on the Libor Basis

The interest payable in accordance with the provisions of Section 5.3 and calculated in the manner hereinabove set out on the amount outstanding from time to time is payable to the Agent, in arrears,

5.5 Limits to the Determination of LIBOR

Nothing herein contained shall be interpreted as authorizing the Borrower, with respect to the determination of LIBOR, to choose a Selected Amount with respect to each Designated Period of less than Cdn. $1,000,000 or a greater amount other than in whole multiples of Cdn. $1,000,000.

5.6 Fixing of LIBOR

LIBOR shall be transmitted to the Borrower at approximately 11:00 A.M., two Banking Days prior to:

5.7 Hedging

The Borrower shall enter into agreements with one or more Lenders providing for, at all times during the Term, foreign exchange protection to the Borrower with respect to 50% of the Debt under the HYD Offering (and any Additional Offering if in US$), by way of Derivative Instruments acceptable to the Agent, with an amortization schedule coincidental with the amortization of the Debt under the HYD Offering and covering the full term of the HYD Offering (and any Additional Offering if in US$).

The Borrower agrees that any amounts due to the Agent or the Lenders under any Derivative Instruments of the nature described in this Section 5.7 shall be deemed to form part of the Loan and shall be secured by the Security.

5.8 Interest on the Loan

Where no specific provision with respect to interest on an outstanding portion of the Loan is contained in this Agreement, including with respect to Cdn. $ Libor Advances by Foreign

Lenders which cannot be rolled over due to the provisions of Sections 4.10 and 4.11, the interest on such portion of the Loan shall be calculated and payable on the Prime Rate Basis.

5.9 Arrears of Interest

Any arrears of interest or principal shall bear interest at a rate that is two percent (2%) per annum higher than the rate of interest payable in respect of the relevant principal amount of the Loan and shall be calculated and exigible on the same basis.

5.10 Maximum Interest Rate

The amount of the interest or fees exigible in applying this agreement shall not exceed the maximum rate permitted by Law. Where the amount of such interest or such fees is greater than such maximum rate, the amount shall be reduced to the highest rate which may be recovered in accordance with the applicable provisions of Law.

5.11 Fees

The Borrower shall pay the following fees (the “ Fees ”) to the Agent:

5.12 Interest Act

6. BANKERS’ ACCEPTANCES

6.1 Advances by Bankers’ Acceptances and Conversions into Bankers’ Acceptances

completed and executed by its authorized signatories in sufficient quantity for the Advance requested and in appropriate denominations to facilitate the sale of the Bankers’ Acceptances in the financial markets. No Lender shall be responsible or liable for its failure to accept a Bankers’ Acceptance hereunder if such failure is due,

in whole or in part, to the failure of the Borrower to give appropriate instructions to the Agent on a timely basis, nor shall the Agent or any Lender be liable for any damage, loss or other claim arising by reason of any loss or improper use of any such instrument except a loss or improper use arising by reason of the gross negligence or wilful misconduct of the Agent, such Lender, or their respective employees. In order to facilitate issuances of Bankers’ Acceptances pursuant hereto, in accordance with the instructions given from time to time by the Borrower, the Borrower hereby authorizes each Lender, and for this purpose appoints each Lender its lawful attorney, to complete and sign Bankers’ Acceptances on behalf of the Borrower, in handwritten or facsimile or mechanical signature or otherwise, and once so completed, signed and endorsed, and following acceptance of them as Bankers’ Acceptances, to purchase, discount or negotiate such Bankers’ Acceptances in accordance with the provisions of this Article 6, and to provide the Available Proceeds (as defined in subsection 6.2.4 (d)) to the Agent in accordance with the provisions hereof. Drafts so completed, signed, endorsed and negotiated on behalf of the Borrower by any Lender shall bind the Borrower as fully and effectively as if so performed by an authorized officer of the Borrower. Each Lender shall maintain a record with respect to such instruments (i) received by it hereunder, (ii) voided by it for any reason, (iii) accepted by it hereunder and (iv) cancelled at their respective maturities. Each Lender agrees to provide such records to the Borrower promptly upon request and, at the request of the Borrower, to cancel such instruments which have been so completed and executed and which are held by such Lender and have not yet been issued hereunder.

6.2 Acceptance Procedure

With respect to any BA Advance:

(b) For each Lender which is a Non-BA Lender, (i) the principal amount of the Discount Notes to be issued to such Lender, and (ii) the Designated Period of such Discount Notes.

(a) the Bankers’ Acceptance Discount Rate;

(b) the amount of the Stamping Fee applicable to those Bankers’ Acceptances to be accepted by such Lender on the Acceptance Date, calculated by multiplying the appropriate percentage set out in the definition of “Stamping Fee” by the face amount of each Bankers’ Acceptance (taking into account the number of days in the Designated Period), any such Lender being authorized by the Borrower to collect the Stamping Fee out of the BA Proceeds of those Bankers’ Acceptances;

(d) the amount obtained (the “ Available Proceeds ”) by subtracting the Stamping Fee mentioned in subsection 6.2.4(b) from the BA Proceeds mentioned in subsection 6.2.4(c).

6.3 Purchase of Bankers’ Acceptances and Discount Notes

Before giving value to the Borrower, the Lenders or the sub-participants (other than Foreign Lenders who cannot make BA Advances) which:

6.4 Maturity Date of Bankers’ Acceptances

Subject to the applicable notice provisions, at or prior to the maturity date of each Bankers’ Acceptance, the Borrower shall:

6.5 Deemed Conversions on the Maturity Date

If the Borrower does not deliver to the Agent one or more of the notices contemplated by subsections 6.4.1 or 6.4.2 or does not give the notice and make the deposit contemplated by subsection 6.4.3, the Borrower shall be deemed to have requested that the part of the BA Advance then outstanding which is reaching maturity be converted into a Prime Rate Advance.

6.6 Conversion and Extension Mechanism

If under the conditions

6.7 Amounts given to the Lenders do not constitute a prepayment

All amounts debited by the Agent from the Borrower’s account in accordance with the provisions of subsection 6.6.2 shall not constitute a prepayment in accordance with the provisions of Section 8.3.

6.8 Prepayment of Bankers’ Acceptances

Notwithstanding any provision hereof, the Borrower may not prepay any Bankers’ Acceptance other than on its maturity date; however, this provision shall not prevent the Borrower from acquiring, in its discretion but subject to the other provisions of this Agreement, any Bankers’ Acceptance in circulation from time to time.

6.9 Apportionment Amongst the Lenders

The Agent is authorized by the Borrower and each Lender to allocate amongst the Lenders (other than Foreign Lenders who cannot make BA Advances) the Bankers’ Acceptances to be issued and purchased in such manner and amounts as the Agent may, in its sole discretion, but acting reasonably, consider necessary, so as to ensure that no Lender is required to accept and purchase a Bankers’ Acceptance for a fraction of $100,000, and in such event, the Lenders’ respective Commitments in any such Bankers’ Acceptances and repayments thereof shall be altered accordingly. Further, the Agent is authorized by the Borrower and each Lender to cause the proportionate share of one or more Lender’s Advances (calculated based on its Commitment) to be exceeded by no more than $100,000 each as a result of such allocations provided that the principal amount of outstanding Advances, including Bankers’ Acceptances, shall not thereby exceed the maximum amount of the respective Commitment of each Lender. Any resulting amount by which the requested face amount of any such Bankers’ Acceptance shall have been so reduced shall be advanced, converted or continued, as the case may be, as a Prime Rate Advance, to be made contemporaneously with the BA Advance.

6.10 Cash Deposits

Each Lender may, in its discretion, at any time, in the absence of any demand by the Borrower to such effect, grant an Advance to the Borrower, the amount of which shall be equivalent to the face value of all Bankers’ Acceptances then in circulation which have been accepted, which Advance shall not bear interest. The amount of the Advance shall not be taken into account in order to calculate the amount of the Credit used pursuant hereto. The Agent shall retain the amount of the Advance in a non-interest bearing cash collateral account as security, for the benefit of the Borrower, which amount may be entirely set-off against the amount of the Advance and the amount of the Bankers’ Acceptances in circulation which such Lender has accepted and may be imputed, in the Lender’s discretion, to the payment of the Bankers’ Acceptances at their maturity. The Borrower shall sign and remit as security with regard thereto all appropriate documents which the Lenders might judge necessary or desirable, specifically including an assignment of the credit balance of the deposit account held as security.

6.11 Days of Grace

The Borrower shall not claim from the Lenders any days of grace for the payment at maturity of any Bankers’ Acceptances presented and accepted by the Lenders pursuant to the provisions of this Agreement. Further, the Borrower waives any defence to payment which might otherwise exist if for any reason a Bankers’ Acceptance shall be held by any Lender in its own right at the maturity thereof.

6.12 Obligations Absolute

The obligations of the Borrower with respect to Bankers’ Acceptances shall be unconditional and irrevocable and shall be paid strictly in accordance with the provisions of this Agreement under all circumstances, including the following circumstances:

6.13 Depository Bills and Notes Act

Bankers’ Acceptances may be issued in the form of a depository bill and deposited with a clearing house, both terms as defined in the Depository Bills and Notes Act . The Agent and the Borrower shall agree on the procedures to be followed, acting reasonably. The Lenders are also authorized to issue depository bills as replacements for previously issued Bankers’ Acceptances, on the same terms as those replaced, and deposit them with a clearing house against cancellation of the previously issued Bankers’ Acceptances.

7. ILLEGALITY, INCREASED COSTS AND INDEMNIFICATION

7.1 Illegality, Increased Costs

If a Lender, acting reasonably, determines (which determination shall be attested to by a certificate submitted to the Borrower by the Lender with a copy to the Agent and which shall be final and binding between the parties hereto in the absence of manifest error) that (a) the adoption by a governmental or international authority (including the Bank for International Settlements (the “ BIS ”)) of a law, directive, requirement or guideline, whether or not having the force of law, (b) any modification to a law, directive or guideline, whether or not having the force of law, or to the interpretation or application of same by a tribunal or governmental or international authority (including the BIS) or other body charged with such interpretation or application, or (c) any quashing by a tribunal or other governmental or

international authority or body (including the BIS) of an interpretation of any law, directive, requirement or guideline, whether or not having the force of law:

7.2 Indemnity

The Borrower shall indemnify each Lender against and hold each Lender, as well as its directors, officers and employees, harmless from any loss or expense, including without limitation any loss or expense arising from interest or fees payable by such Lender to lenders of funds obtained by it in order to make or maintain any Advance and any loss or expense incurred in liquidating or re-employing deposits from which such funds were obtained, which such Lender may sustain or incur as a consequence of any (a) default by the Borrower in the payment when due of the amount of or interest on any Loan or in the payment when due of any other amount hereunder, (b) default by the Borrower in obtaining an Advance after the Borrower has given notice hereunder that it desires to obtain such Advance, (c) default by the Borrower in making any voluntary reduction of the outstanding amount of any Loan after the Borrower has given notice hereunder that it desires to make such reduction, and (d) the payment of any Bankers’ Acceptance or Libor Advance otherwise than on the maturity date thereof (including without limitation any such payment required pursuant to Section 8.1 or upon acceleration pursuant to Section 14.2). A certificate of the Agent providing reasonable particulars of the calculation of any such loss or expense shall be conclusive and binding in the absence of manifest error. If any Lender becomes entitled to claim any amount pursuant to this Section 7.2, it shall promptly notify the Borrower of the event by reason of which it has become so entitled and reasonable particulars of the related loss or expense, provided that the failure to do so promptly shall not prejudice the Lenders’ right to claim hereunder.

Without prejudice to the survival or termination of any other agreement of the Borrower under this Agreement, the obligations of the Borrower under this Section 7.2 shall survive the payment of principal and interest on all Loans and the termination of the Credit.

8. PAYMENT, REPAYMENT AND PREPAYMENT

8.1 Repayment of the Loan

The Borrower hereby agrees to repay the amount of the Loan outstanding under the Revolving Facility on the last day of the Term.

8.2 Amount and Apportionment of Mandatory Repayments

The Borrower hereby undertakes to make Mandatory Repayments equal to the sum of:

The Borrower shall advise the Agent of its intention to make any such Mandatory Repayment by notice in writing substantially in the form of Schedule “B-1”, at least 5 and not more than 20 days before the Mandatory Repayment is due, and shall pay the amount of such Mandatory Repayment to the Agent when it is due. All proceeds of each Mandatory Repayment shall be applied to repay and permanently reduce the Revolving Facility..

No such Mandatory Repayment may be made on a date that would require a Libor Advance or BA Advance to be prepaid, except in accordance with the provisions of Section 8.4.

8.3 Voluntary Repayment and Prepayment of the Loan or Cancellation of the Credit

On any Business Day during the Term, after having given notice to the Agent of one (1) Business Day with respect to the repayment of Prime Rate Advances and two (2) Business Days with respect to BA Advances, substantially in the form of Schedule “B-1”, the Borrower may repay in minimum amounts of $1,000,000 or in whole multiples of such amount, all or part of the principal amount of the Loan under the Revolving Facility, provided that in respect of a BA Advance, no repayment shall be made on a date other than a maturity date of the Bankers’ Acceptances outstanding at that time, with, in each case, all interest accrued and unpaid on the amounts so prepaid. In respect of Cdn. $ Libor Advances by Foreign Lenders, no repayment may be made on a day other than a Rollover Date, save as provided in Sections 7.1, 7.2 and 8.4.

On any Business Day during the Term, after having given notice to the Agent at least ten (10) days prior to the proposed prepayment, substantially in the form of Schedule “B-1”, the Borrower may repay or prepay in minimum amounts of $10,000,000, or in whole multiples of such amounts, all or part of the principal amount of the Loan, provided that in respect of the Libor Advances, no repayment may be made on a day other than a Rollover Date, save as provided in Sections 7.1, 7.2 and 8.4, and in respect of a BA Advance, no prepayment shall be made on a date other than a maturity date of the Bankers’ Acceptances outstanding at that time, with, in each case, all interest accrued and unpaid on the amounts so prepaid. Notwithstanding the foregoing and in the case of voluntary repayments or prepayments under the Revolving Facility other than Cdn. $ Libor Advances by Foreign Lenders, accrued and unpaid interest on the amounts repaid or prepaid need not be paid at the time of the repayment or prepayment, but shall be paid in accordance with the provisions of Section 5.2 hereof.

In addition, the Borrower may, upon the same notice, cancel any portion of the Credit that has not been drawn by the Borrower. No Facility Fee shall be payable in respect of any portion of the Credit so cancelled as and from the effective date of its cancellation. The Borrower shall not be permitted to draw Advances in respect of any portion of the Credit so cancelled.

8.4 Payment of Losses Resulting From a Prepayment or a Mandatory Repayment

If a prepayment or Mandatory Repayment to be made would require the repayment of outstanding Bankers’ Acceptances prior to their maturity, or the repayment of a Libor Advance on a day other than a Rollover Date, the Borrower shall provide to the Agent cash collateral in an amount equal to the face amount of such Bankers’ Acceptances or the principal amount of such Libor Advance, as the case may be, which cash collateral shall be held by the Agent in an interest bearing account and used to repay same at maturity or on the next Rollover Date, as the case may be. However, in the case where the prepayment or Mandatory Repayment would require the prepayment of a Libor Advance, the Borrower may elect to prepay same and pay to the Agent for the Lenders the amount of the losses, costs and expenses suffered or incurred by the Lenders with respect thereto which are referred to in Section 7.2.

8.5 Currency of Payments

All payments, repayments, prepayments or Mandatory Repayments, as the case may be:

8.6 Payments by the Borrower to the Agent

All payments to be made by the Borrower in connection with this Agreement shall be made in funds having same day value to the Agent, at the Agency Branch, or at any other office or account in Toronto or Montreal designated by the Agent. Any such payment shall be made on the date upon which such payment is due, in accordance with the terms hereof, no later than 11:00 A.M.

8.7 Payment on a Business Day

Each time a payment, repayment, prepayment or Mandatory Repayment is due on a day that is not a Business Day, it shall be made on the following Business Day.

8.8 Payments by the Lenders to the Agent

Any amounts payable to the Agent by a Lender shall be paid in funds having same day value to the Agent by the Lenders on a Business Day at the Agency Branch.

8.9 Payments by the Agent to the Borrower

Any payment received by the Agent for the account of the Borrower shall be paid in funds having same day value to the Borrower on the date of receipt, or if such date is not a Business Day, on the next Business Day, at the Branch.

8.10 Netting

On the date of any Advance or on a Rollover Date (a “ Transaction Date ”), the Agent shall be entitled to net amounts payable on such date by the Agent to a Lender against amounts payable in the same currency on such date by such Lender to the Agent, for the account of the Borrower. Similarly, on any Transaction Date, the Borrower hereby authorizes each Lender to net amounts payable in one currency on such date by such Lender to the Agent, for the account of the Borrower, against amounts payable in the same currency on such date by the Borrower to such Lender in accordance with the Agent’s calculations made in accordance with the provisions of this Agreement.

8.11 Application of Payments

8.12 No Set-Off or Counterclaim by Borrower

All payments by the Borrower shall be made free and clear of and without any deduction for or on account of any set-off or counterclaim.

8.13 Debit Authorization

The Agent is hereby authorized to debit the Borrower’s and the Guarantors’ account or accounts maintained from time to time at the Branch or elsewhere, and to set off and compensate against any and all accounts, credits and balances maintained at any time by the Borrower or the Guarantors for the amount of any interest or any other amounts due and owing hereunder from time to time payable by the Borrower, in order to obtain payment thereof.

8.14 Withholding Taxes

9.1 Security for Advances Prior to the Phase II Date

As general and continuing security for the performance by the Borrower of its obligations to the Lenders prior to the Phase II Date hereunder (including under the Cash Management Facilities) and under the Security Documents, and of the Borrower’s obligation to repay the Loan, including all amounts owing by the Borrower to the Lenders in principal, interest and accessories hereunder and under any agreement pertaining to Derivative Obligations, including the Negative Value of Derivative Instruments entered into with a Lender, as such agreements are, from time to time, amended, restated, amended and restated, extended or renewed, the Borrower shall:

9.2 Security for Advances Following the Phase II Date

As general and continuing security for the performance by the Borrower of its obligations to the Lenders on and after the Phase II Date hereunder (including under the Cash

Management Facilities) and under the Security Documents, and of the Borrower’s obligation to repay the Loan, including all amounts owing by the Borrower to the Lenders in principal, interest and accessories hereunder and under any agreement pertaining to Derivative Obligations, including the Negative Value of Derivative Instruments entered into with a Lender, as such agreements are, from time to time, amended, restated, amended and restated, extended or renewed, the Borrower shall:

9.3 Limitations on Guarantees and Security for Advances

The liability of each Guarantor governed by the Companies Act (Quebec) under its Guarantee (other than each of the Initial VL Group Guarantors, the liability of whom is unlimited) (each an “ Applicable Guarantor ”) shall be limited as follows, but only to the extent that the provisions of Section 123.66 of the Companies Act (Quebec) apply thereto :

9.4 Further Limitations on Guarantees and Security for Advances

Notwithstanding any other provision hereof to the contrary, the liability of CF Cable TV Inc. and each of its Subsidiaries (each a “ Relevant Guarantor ”) shall be limited as follows:

The relevant amounts on the Phase II Date, as determined by the directors of the Relevant Guarantor, will be set forth in a certificate in the form set out in Schedule “K”, to be delivered on such date . For the purposes hereof, the directors of each Relevant Guarantor

shall, not less frequently than quarterly, determine such amounts as of the end of each financial quarter and the Borrower shall deliver or cause to be delivered to the Agent, as part of its Compliance Certificate with respect to such financial quarter, a summary of such increases, if any, supported by a certificate of the chief financial officer of each Relevant Guarantor setting forth such amounts and reasonable details of the calculations thereof.

10.1 Initial Advance under the Revolving Facility and Term Facility A-1

The obligation of the Lenders to make an initial Advance under the Revolving Facility and under Term Facility A-1 is conditional upon the fulfilment of each of the conditions set out in this Section 10.1 and in Section 10.3 to the entire satisfaction of the Agent and the Lenders:

10.2 Initial Advance under the Revolving Facility After the Ninth Amendment Closing Date

The obligation of the Lenders to make the initial Advance under the Revolving Facility after the Ninth Amendment Closing Date is conditional upon the fulfilment of each of the conditions set out in this Section 10.2 and in Section 10.3 to the entire satisfaction of the Agent and the Lenders:

10.3 Conditions Precedent to any Advance

The obligation of the Lenders to make any Advance under the Credit is conditional upon each of the following conditions having been satisfied:

10.4 Waiver of Conditions Precedent

The conditions set out in Sections 10.1, 10.2 and 10.3 are solely for the benefit of the Lenders, and may be waived by the Agent with the unanimous consent of the Lenders, without prejudice to the right of the Agent to assert any such condition in connection with any subsequently requested Advance.

10.5 Release of Quebecor Media Guarantee

The parties agree that the Quebecor Media Guarantee has become a limited recourse guarantee, such that the recourse of the Agent is limited to the pledge of the shares executed by GVL pursuant to subsection 9.1.2 of this Credit Agreement, which was thereafter assumed by Quebecor Media Inc.

11.1 Incorporation

Each member of the VL Group is a corporation duly incorporated and organized, validly existing and in good standing under the Laws of its jurisdiction of incorporation and of all jurisdictions in which it carries on business or is otherwise required to be so qualified. Each member of the VL Group has the capacity and power, whether corporate or otherwise, to hold its assets and carry on the business presently carried on by it or which it proposes to carry on hereafter in each jurisdiction where such business is carried on.

11.2 Authorization

The Borrower and each member of the VL Group which is a party to any Security Document has the power and has taken all necessary steps under the Laws in order to be authorized to borrow hereunder, to provide the Security, as the case may be, and to execute and deliver and perform its obligations under this Agreement and each of the Security Documents to which it is a party, as the case may be, in accordance with the terms and conditions thereof and to complete the transactions contemplated in the Security Documents and herein, as the case may be. This Agreement has been duly executed and delivered by duly authorized officers of the Borrower and is, and each of the Security Documents to which the Borrower and each other member of the VL Group is a party is, and when executed and delivered in accordance with the terms hereof, shall be, a legal, valid and binding obligation of the Borrower and each other member of the VL Group, respectively, enforceable in accordance with its terms.

11.3 Compliance with Laws and Contracts

The execution and delivery of and performance of the obligations under this Agreement and each of the Security Documents by the Borrower and each other member of the VL Group, as the case may be, in accordance with their respective terms and the completion of the transactions contemplated therein and herein by the Borrower and each other member of the VL Group, as the case may be, do not require any consents or approvals, do not violate any Laws, do not conflict with, violate or constitute a breach under the documents of incorporation or by-laws of any member of the VL Group or under any agreements, contracts or deeds to which any member of the VL Group is a party or binding upon it or its assets and do not result in or require the creation or imposition of any Charge whatsoever on the assets of any member of the VL Group, whether presently owned or hereafter acquired, save for the Permitted Charges.

11.4 Current Business

The VL Group operates businesses in the cable and telecommunications industry, including on-line internet services, telephony, and the sale and rental of videocassettes, or anything related or ancillary thereto

11.5 Financial Statements

The Consolidated financial statements provided from time to time hereunder are prepared in accordance with GAAP applied on a consistent basis throughout the periods specified (except as noted thereon) and are an accurate representation of the financial position of the VL Group as of the respective dates specified and the results of their operations and cash flows for the respective periods specified.

11.6 Contingent Liabilities and Indebtedness

Neither the Borrower nor any other member of the VL Group has (a) any material Contingent Obligations or contingent liabilities known to it which are not disclosed or referred to in the most recent financial statements delivered to the Agent in accordance with the provisions of Section 12.15 or otherwise disclosed to the Agent in writing, or (b) incurred any Indebtedness which is not disclosed in or reflected in such financial statements, or otherwise disclosed to the Agent in writing, other than Contingent Obligations, contingent liabilities or Indebtedness incurred in the ordinary course of business and Debt permitted hereunder.

11.7 Title to Assets

Each member of the VL Group has good, valid and marketable title to all of its properties and assets, free and clear of any Charges other than Permitted Charges. All of the immovable property (including any cable network) owned by the VL Group as of the Sixth Amendment Closing Date is listed in Schedule “I”. All premises occupied by any member of the VL Group as of the Sixth Amendment Closing Date containing material assets belonging to such members of the VL Group are also listed in Schedule “I”. All of the movable property of the VL Group as of the Sixth Amendment Closing Date is located in the province of Quebec and in Ontario, New Brunswick and Prince Edward Island. Each member of the VL Group has rights sufficient for it to use all the Licences, licences, intellectual property and patents, patent applications, trade marks, trade mark applications, tradenames, service marks, copyrights, industrial designs, technology and other similar intellectual property rights reasonably necessary for the conduct of its business. To the knowledge of the Borrower, neither it nor any member of the VL Group is infringing or is alleged to be infringing the intellectual property rights of any other Person.

11.8 Litigation

There are no actions, suits or legal proceedings instituted or pending or, to the knowledge of each member of the VL Group, threatened, against any of them or their property before any

court or arbitrator or any governmental body or instituted by any governmental body which could reasonably be expected to result in a Material Adverse Change.

11.9 Taxes

Each member of the VL Group has filed within the prescribed delays all federal, provincial or other tax returns which it is required by Law to file and all taxes, assessments and other duties levied by the various governmental authorities with respect to each member of the VL Group have been paid when due, except to the extent that (a) payment thereof is being contested in good faith by such member of the VL Group in accordance with the appropriate procedures, for which adequate reserves have been established in the books of the relevant member of the VL Group, and (b) the outcome of such contestation would not reasonably be expected to result in a Material Adverse Change.

11.10 Insurance

Each member of the VL Group has contracted for the insurance coverage described in Section 12.6.

11.11 No Adverse Change

No Material Adverse Change has occurred since August 31, 2000.

11.12 Regulatory Approvals

No member of the VL Group is required to obtain any consent, approval, authorization, permit, Licence or licence from, nor to effect any filing or registration with, any federal, provincial or other regulatory authority in connection with the execution, delivery or performance, in accordance with their respective terms, of this Agreement or the Security Documents, any borrowings hereunder and the granting of the Security, save with respect to the due registration of any Security Documents that remain to be registered after the Sixth Amendment Closing Date.

11.13 Compliance with Laws and Licences

Each member of the VL Group is in full compliance in all material respects with all requirements of applicable Laws and with all of the conditions attaching to its permits, authorizations, Licences, licences, certificates and approvals, including without limitation its articles of incorporation and by-laws.

11.14 Pension and Employment Liabilities

Except for a deficit not exceeding $2,000,000 in respect of the pension plan for executives of the Borrower, no member of the VL Group has any unfunded pension liabilities, whether valued on a going concern or a wind-up basis, and all obligations (including wages, salaries, commissions and vacation pay) to current employees and to former employees have been paid in full or duly provided for.

11.15 Priority

The Security and Charges created, evidenced or constituted by or under the Security Documents bind each member of the VL Group which is a party thereto, are valid and subject to no Charge, other than the Permitted Charges, and are enforceable, as security for the performance of the obligations secured thereunder, in accordance with their respective terms, against the members of the VL Group which are parties thereto.

11.16 Complete and Accurate Information

All of the information, reports and other documents and all data (other than forecasts), as well as the amendments thereto, provided to the Agent by or on behalf of the VL Group were, at the time same were provided, and are at the date hereof, complete, true and accurate in all material respects. All forecasts provided to the Agent were prepared in good faith and all assumptions used therein were reasonable.

11.17 Share Capital

On the Sixth Amendment Closing Date, all of the shares of the Borrower and each of the Guarantors (other than Quebecor Media Inc.) are owned, directly or indirectly, by Quebecor Media Inc., free and clear of any Charges, other than Permitted Charges; following the Sixth Amendment Closing Date, no Change of Control has occurred and the shares of the Borrower and each of the Guarantors (other than Quebecor Media Inc.) owned, directly or indirectly, by Quebecor Media Inc. are owned free and clear of any Charges, other than Permitted Charges.

11.18 Absence of Default

There exists no Default or Event of Default hereunder.

11.19 Agreements with Third Parties

Each member of the VL Group is in compliance in all material respects with each and every one of its obligations under agreements with third parties to which it is a party or by which it is bound, the breach of which could be expected to result in a Material Adverse Change.

11.20 Environment

11.21 Survival of Representations and Warranties

All of the representations and warranties made hereunder are true and correct at the Closing Date, shall be true and correct at the date of any Advance hereunder (except where qualified in this Article 11 as being made as at a particular date), shall survive the execution and delivery of this Agreement, any investigation by or on behalf of the Lenders or the making of any Advance hereunder, and none of same are nor shall be waived, except in writing.

For so long as the Loan remains outstanding and unpaid, or the Borrower is entitled to borrow hereunder (whether or not the conditions precedent to such borrowing have been or may be satisfied) and unless the Agent shall otherwise agree in writing, the Borrower, for itself and each member of the VL Group and with respect to itself and each member of the VL Group, agrees as follows:

12.1 Preservation of Juridical Personality

It shall do or cause to be done all things necessary to preserve and maintain its corporate existence in full force and effect, except as permitted under Sections 13.1 and 13.3.

12.2 Preservation of Licences

It shall maintain in effect and obtain, where necessary, all such authorizations, approvals, Licences, licences or consents of such governmental agencies, whether federal, provincial or local, which may be or become necessary or required for each member of the VL Group

to carry on its businesses and to satisfy its obligations hereunder and under the Security Documents.

12.3 Compliance with Applicable Laws

It shall conduct its business in a proper and efficient manner and shall keep or cause to be kept appropriate books and records of account, in compliance with the Law, and shall record or cause to be recorded faithfully and accurately all transactions with respect to its business in accordance with GAAP applied on a consistent basis, and shall comply with all requirements of Law and with all the conditions attaching to its permits, authorizations, Licences, licences, certificates and approvals in all material respects.

12.4 Maintenance of Assets

It shall maintain or cause to be maintained in good operating condition all of its assets used or useful in the conduct of its business, as would a prudent owner of similar property, whether same are held under lease or under any agreement providing for the retention of ownership, and shall from time to time make or cause to be made thereto all necessary and appropriate repairs, renewals, replacements, additions, improvements and other works except as permitted under Section 13.3.

12.5 Business

It shall not substantially change the nature of its business activities from its Core Business.

12.6 Insurance

It shall maintain insurance coverage with responsible insurers, in amounts and against risks normally insured by owners of similar businesses or assets in areas which are generally similar to those in which the members of the VL Group are engaged. By no later than the Phase II Date, all such policies of insurance will contain a standard “mortgage clause” acceptable to the Agent providing that no such policy may be cancelled without the insurer providing not less than 30 days’ prior written notice to the Agent. The insurance policies confirming the insurance required hereunder shall not contain any co-insurance provisions except to the extent such co-insurance provisions would normally appear in policies covering other Persons engaged in similar businesses and owning similar properties as the VL Group, and consistent with prudent business practices.

If any proceeds of such insurance become payable at any time, the member of the VL Group entitled to receive same, subject to the rights of the Agent on behalf of the Lenders, shall be entitled to receive such proceeds up to an amount of $50,000,000 in the aggregate; any proceeds in excess of such amount shall, if requested by the Borrower, be held by the Agent for reinvestment by the Borrower or the relevant Guarantor in capital assets in the Core Business within a period of 12 months from the date of receipt and otherwise shall be paid to the Agent for the benefit of the Lenders as a Mandatory Repayment in accordance with the provisions of Section 8.2.

12.7 Payment of Taxes and Duties

It shall pay all taxes, assessments and other governmental duties which are imposed on it or on its income or profits or its assets, when due and payable, provided that no such tax, assessment or duty need be paid if (a) it is being contested in good faith by appropriate proceedings promptly initiated and diligently conducted, and (b) such reserves or other appropriate provision, if any, as shall be required by GAAP shall have been made therefor, and (c) the outcome of such contestation would not reasonably be expected to result in a Material Adverse Change.

12.8 Access and Inspection

It shall allow the employees and representatives of the Agent, during normal business hours, to have access to and inspect the assets of the members of the VL Group, to inspect and take extracts from or copies of the books and records of the members of the VL Group and to discuss the business, assets, liabilities, financial position, operating results or business prospects of the members of the VL Group with the principal officers of the members of the VL Group and, after obtaining the approval of the Borrower which shall not be unreasonably withheld, with the auditors of the Borrower.

12.9 Maintenance of Account

It shall maintain operating accounts at the Branch or other branches of the Agent at all times during the Term. In addition, the Lenders shall have the right to provide all of the auxiliary non-credit banking services to the Borrower, at fees acceptable to the relevant Lender and the Borrower, acting reasonably.

12.10 Performance of Obligations

It shall perform all obligations in the ordinary course of business, except to the extent that the non-fulfilment of same would not reasonably be expected to result in a Material Adverse Change, and except where the same are being contested in good faith, if the outcome of such contestation would not reasonably be expected to result in a Material Adverse Change. Notwithstanding the foregoing contained in this Section 12.10, it shall punctually pay all amounts due or to become due under this Agreement.

12.11 Maintenance of Ratios

At the end of each quarter during the Term commencing February 28, 2001, on a rolling four-quarter basis, the VL Group shall maintain the following ratios, provided that (a) the first test as at February 28, 2001, shall be calculated by extrapolating from the relevant results for that quarter; (b) the second test effective May 31, 2001 shall be calculated by extrapolating from the relevant results for that quarter and the preceding quarter; (c) the third test effective August 31, 2001 shall be calculated by extrapolating from the relevant results for that quarter and the 2 preceding quarters and (d) the fourth and all subsequent tests shall be calculated in respect of the preceding four quarters:

Quarter Ending		Maximum Leverage Ratio
August 31, 2001
December 31, 2001		5.0:1
March 31, 2002
June 30, 2002
September 30, 2002

December 31, 2002
March 31, 2003		4.5:1
June 30, 2003

September 30, 2003
December 31, 2003		5.0:1
March 31, 2004
June 30, 2004

September 30, 2004
December 31, 2004		4.75:1
March 31, 2005
June 30, 2005

Thereafter		4.5:1

Quarter Ending		Minimum Interest Coverage Ratio
August 31, 2001
December 31, 2001		1.75:1

March 31, 2002
June 30, 2002		2.00:1
September 30, 2002
December 31, 2002

March 31, 2003
June 30, 2003
September 30, 2003		2.50:1
December 31, 2003

March 31, 2004
and thereafter		3.00:1

For greater certainty and without limiting any provision of this Agreement, the Borrower acknowledges that the failure to respect any of the foregoing financial ratios at any time during the Term constitutes a material breach of this Agreement.

12.12 Mandatory Repayments

It shall pay to the Lenders any amounts required to be paid in accordance with Section 8.2.

12.13 Maintenance of Security

It shall take all necessary steps to preserve and maintain in effect the rights of the Agent and the Lenders, as well as any collateral agent designated by the Agent, pursuant to the Security Documents, together with any renewals thereof or additional documents creating Charges that may be required from time to time. In addition, if any new Subsidiary of any member of the VL Group is created or Acquired, or if a Person otherwise becomes a member of the VL Group, such Subsidiary will provide Security of the nature described in Article 9.

12.14 Payment of Legal Fees and Other Expenses

Whether the transactions contemplated by this Agreement are concluded or not and whether or not any part of the Credit is actually advanced, in whole or in part, the Borrower shall pay all reasonable costs relating to the Credit, including in particular:

All amounts due to the Agent and the Lenders pursuant hereto shall bear interest on the Prime Rate Basis from the date of their disbursement by the Lenders or from the date of their undertaking until the Borrower has repaid same in full, with interest on unpaid interest, as in the case of the Prime Rate Advances, taking into account such modifications as may be necessary. The obligations of the Borrower under this Section 12.14 shall subsist notwithstanding the full repayment of the Loan under the provisions hereof.

12.15 Financial Reporting

agrees to provide or cause to be provided to the Agent, with sufficient copies for the Agent and each Lender, and so undertakes:

Within 60 days after the end of each financial quarter of each financial year of the Borrower (other than the last quarter):

12.16 Notice of Certain Events

The Borrower agrees to use its best efforts to obtain the consent, waiver or amendment to the Inter-Creditor Agreement required by the Lenders on the Sixth Amendment Closing Date from the holders of the CF Cable Notes.

All information, reports, statements and other documents and data provided to the Agent or the Lenders, whether pursuant to this Article or any other provisions of this Agreement shall, at the time same shall be provided, be true, complete and accurate in all material respects to the extent necessary to provide the Lenders with a true and accurate understanding of their effect.

The Borrower shall cause Spectrum Co. to transfer to a member of the VL Group that has provided unlimited Guarantees and Security to the Agent for the benefit of the Agent and the Lenders, all of the licences and rights it obtains in the Spectrum Auction and Purchase in respect of the Province of Quebec (and for any other area to the extent that the licences and rights for such area were acquired using a Letter of Credit issued hereunder or were otherwise paid for by a member of the VL Group) as soon as reasonably possible after any Letter of Credit issued in support of the said Spectrum Auction and Purchase is presented for payment or payment is otherwise made to acquire such licences. The Borrower shall take all steps required by the Agent to ensure that the transferred assets are subject to the Security.

For so long as the Loan or any other amounts payable hereunder to the Lender remain outstanding and unpaid, or the Borrower is entitled to borrow hereunder (whether or not the conditions precedent to such borrowing have been or may be satisfied), the Borrower, for itself and each member of the VL Group and with respect to itself and each member of the VL Group agrees that it shall not do any of the following:

Liquidate or dissolve or take any steps to amalgamate, consolidate or effect any restructuring or corporate or capital reorganization, or change its head or registered office,

except where (i) (a) the surviving entity of any such amalgamation or merger assumes all of the obligations hereunder and (b) the transaction in question is between a member of the VL Group and its wholly-owned Subsidiaries or is among wholly-owned Subsidiaries of the same member of the VL Group; or (ii) in all other cases, the transaction in question, in the sole opinion of the Lenders, acting reasonably, does not have a detrimental effect on the financial condition of the VL Group or on the position of the Lenders and their Security under the Security Documents or otherwise. Notwithstanding the foregoing, no member of the VL Group may become a Subsidiary of (i) CF Cable TV Inc. until the CF Cable Notes have been repaid in full, or (ii) a Person who is a non-resident of Canada within the meaning of the Income Tax Act (Canada), without the prior written consent of the Lenders. For greater certainty, the Lenders hereby consent to the Merger pursuant to this Section13.1 (ii), subject to compliance with the conditions precedent set out in Sections 10.2 and 10.3, and subject to the following:

Create, assume, enter into or permit to subsist, directly or indirectly, any Charge on the property of any member of the VL Group, other than Permitted Charges.

The VL Group shall not permit an Asset Disposition of all or any part of their property or assets (whether presently held or subsequently acquired), other than sales at fair market value, and, in such case, only if (a) at the time of the proposed Asset Disposition, there is no Default or Event of Default hereunder and the proposed Asset Disposition will not cause such a Default or Event of Default, (b) the Net Proceeds of such Asset Disposition are dealt with in accordance with the provisions of Section 8.2, and (c) the amount of (A) EBITDA generated during the preceding 12 months by the assets comprised in any such Asset Disposition, plus (B) the aggregate 12-month trailing EBITDA generated by all other assets comprised in all previous Asset Dispositions made during the Term (calculated as of the date of the applicable Asset Disposition), does not exceed 15% of the VL Group’s EBITDA for the 12 months ending on the last day of the month immediately preceding the date of the proposed Asset Disposition; provided that the VL Group shall be permitted to make (i) dispositions of inventory in the ordinary course of business, (ii) dispositions of machinery, equipment, spare parts and materials, appliances or vehicles, if same are no longer necessary or useful to the operation of the business or have become obsolete, worn out, surplus, damaged or unusable, as well as the non-material assets listed in Schedule “I” consisting of surplus real estate of the VL Group, which are excluded from the Security and not subject to any Charge thereunder, (iii) exchanges of assets between members of the VL Group that have provided unlimited Guarantees and Security to the Agent for the Lenders. In the event of any such permitted Asset Disposition to a Person other than a member of the VL Group, the Security on the assets so disposed of shall be discharged by the Agent without any requirement to obtain the consent of the Lenders. In addition, any member of the VL Group (other than VTL until it has provided Security on all of its assets) shall be permitted to dispose of Back-to-Back Preferred Shares in order to repay Back-to-Back Debt, and shall also be permitted to dispose of property as part of a Tax Benefit Transaction, provided that (A) no Default or Event of Default exists at the time and (B) disposing of such Back-to-Back Preferred Shares or property as part of a Tax Benefit Transaction will not cause a Default or an Event of Default.

Neither the Borrower nor any of the Guarantors (other than Quebecor Media Inc.) shall: (a) return any capital to its shareholders or purchase, redeem, repurchase or otherwise acquire, directly or indirectly, for consideration, any shares of any class of its capital stock now or subsequently issued, or any other equity security issued by it of any nature (including warrants and options), (b) declare, pay or set aside for payment any dividend or distribution whatsoever in respect of any share of the capital stock of the Borrower or any of the Initial VL Group Guarantors (provided that (x) a dividend or other distribution in an amount of approximately $150,000,000 paid by the Borrower to GVL to permit GVL to repay certain Debt to the Borrower (the “ GVL Distribution ”), (y) distributions arising under Back-to-Back Transactions and Tax Benefit Transactions, and (z) distributions consisting of (1) a quarterly payment equal to (aa) 100% of Excess Cash Flow if the Leverage Ratio, calculated on a pro forma basis after taking into account the payment proposed, is greater than 3.5:1 but less than or equal to 4.0:1, or (bb) 50% of Excess Cash Flow if the Leverage Ratio, calculated on a pro forma basis after taking into account the payment proposed, is more than 4.0:1, and (2) a maximum of $50,000,000 net during the Term (provided that no Advance for such purpose shall be made if the amount of the Credit available under the Revolving Facility, after the disbursement of such Advance, would be less than $50,000,000), by way of loans, dividends, return of capital or share repurchases will be permitted under this paragraph (b) without complying with the provisions of paragraphs (i) and (ii) below), or (c) set aside any funds for any of the purposes proscribed in paragraphs (a) or (b). However, transactions of the nature described in paragraphs (a), (b) and (c) will be permitted (i) if all amounts so paid under such provisions are paid to the Borrower or to a Guarantor that has provided an unlimited Guarantee and the Security to the Agent on behalf of the Lenders, or (ii) if the Leverage Ratio, calculated on a pro forma basis after taking into account the payment proposed, is less than or equal to 3.5:1; provided that, with respect to any of the transactions described in paragraphs (a), (b) or (c), (A) no Default or Event of Default exists at the time and (B) making the payment of such amount will not cause a Default or Event of Default.

Without the consent of the Majority Lenders, no Subsidiary of the Borrower or of any Guarantor shall assume, enter into or otherwise become bound by any agreement or undertaking (including any undertaking in the HYD Offering or any Additional Offering) that would reasonably be expected to prevent such Person from declaring or paying dividends or inter-company payments or distributions of any kind to the Borrower, except as contained (a) herein, (b) in the CF Cable Notes, until repayment of same, or (c) in the Quebecor Media Facility.

Issue any shares of its capital stock to which are attached voting rights or allow any such shares to be transferred, assigned or otherwise alienated, unless the proceeds thereof are used in accordance with Section 8.2, or such shares are pledged in favour of the Agent on

behalf of the Lenders under the share pledge agreements contemplated by subsection 9.1.2 or 9.2.3.

Make any Acquisition, in any manner whatsoever, directly or indirectly, other than an Acquisition required for the purpose of carrying on its business in the ordinary course, or permit any Subsidiary or Subsidiaries to be constituted otherwise than in accordance with the provisions of Section 13.11, except that (A) the members of the VL Group shall be permitted to make Acquisitions in the Core Business and to create Subsidiaries if: (a) no Default or Event of Default exists at the time, (b) paying the purchase price in respect of such Acquisition will not cause a Default or Event of Default, and (c) any Person which is Acquired or created as a Subsidiary becomes a member of the VL Group and provides the Security contemplated by Article 9, and (B) any member of the VL Group shall be permitted to acquire Back-to-Back Securities in an amount not exceeding the amount of the corresponding Back-to-Back Securities, and shall also be permitted to acquire property as part of a Tax Benefit Transaction, provided that (A) no Default or Event of Default exists at the time and (B) acquiring such Back-to-Back Preferred Shares or property as part of a Tax Benefit Transaction will not cause a Default or an Event of Default.

Incur or assume Debt, provide Guarantees or render itself liable in any manner whatsoever, directly or indirectly, for any Indebtedness or obligation whatsoever of another Person, except (a) hereunder for the purposes set forth in Section 3.1; (b) under the CF Cable Notes, limited to the amount outstanding thereunder at the Closing Date, or any Debt incurred on the refinancing of the CF Cable Notes by a member of the VL Group, which refinancing shall be only on an unsecured basis and for an amount not in excess of US$100,000,000; (c) that a member of the VL Group may provide financial assistance to another member of the VL Group that has provided an unlimited Guarantee and the Security to the Agent on behalf of the Lenders; (d) under the Cash Management Agreements; (e) in connection with the Acquisition of Consortium Câble-Axion Digitel Inc., in respect of which not more than $20,000,000 will be due; (f) in connection with the Borrower’s existing commercial paper program which will be terminated on or before December 31, 2000; (g) in connection with Debt incurred or assumed that is secured by Permitted Charges, and within the limits applicable thereto; (h) in connection with Back-to-Back Transactions and Tax Benefit Transactions (including by way of unsecured daylight loans); (i) in connection with the HYD Offering; (j) that the Borrower may incur or assume Debt by way of Additional Offerings, and that the members of the VL Group may provide unsecured Guarantees in respect of obligations of the Borrower under any such Debt outstanding at any time, to the extent that the Borrower complies with the applicable Leverage Ratio calculated on a pro forma basis; (k) the Borrower may borrow Subordinated Debt from Quebecor Media Inc. in an initial principal amount of up to $150,000,000, with interest at a rate not exceeding the three month bankers’ acceptance rate quoted on Reuter’s Services, page CDOR, as at approximately 10:00 a.m. on such day plus 1.5% per annum (together with interest accrued thereon or paid in kind, the “ QMI Subordinated Debt ”); (l) in connection with an unsecured cash management credit facility limited to a maximum amount of $10,000,000,

provided that the aggregate amount of such cash management facility and the Cash Management Facility shall never exceed $15,000,000; (m) additional unsecured Debt of up to $50,000,000; (n) any unsecured daylight loan in order to permit the VL Group to purchase from Spectrum Co. any licences granted as part of the Spectrum Auction and Purchase, which daylight loan will be repaid immediately following such sale by (i) Spectrum Co. using the proceeds of the sale to repurchase the preferred shares or other equity interests held in it by the VL Group, and (ii) the VL Group using such proceeds to repay the daylight loan; and (o) in connection with other Subordinated Debt; provided that, with respect to any of the matters described in paragraphs (c) to (n) above inclusive, (A) no Default or Event of Default exists at the time, (B) incurring or assuming such Debt (including by way of providing such Guarantee) will not cause a Default or Event of Default, and (C) on a pro forma basis, the incurrence or assumption of such Debt would not reasonably be expected to cause the Borrower to breach any of its covenants under Section 12.11 hereof.

Make any loan or advance to any party other than (a) as contemplated by Sections 13.4 and 13.7, or (b) to another member of the VL Group that has provided an unlimited Guarantee and the Security to the Agent on behalf of the Lenders and has fully guaranteed the obligations of the Borrower hereunder, or (c) by way of Back-to-Back Transactions or Tax Benefit Transactions, or (d) under the Cash Management Facilities. Notwithstanding the foregoing, the VL Group shall be entitled to provide financial assistance to their customers in the ordinary course of the Core Business by way of subsidizing consumer equipment purchases and leases and similar transactions.

Repay any Debt the repayment of which is subordinated to the rights of the Lenders, or pay any interest due to the creditor of any such Debt, other than (a) interest due in respect of Subordinated Debt (including the QMI Subordinated Debt), provided (for greater certainty) that no Default has occurred or will occur as a result of such payment, and (b) any amount due under or in connection with the QMI Subordinated Debt, provided that the amount so repaid, together with the amounts distributed by the Borrower in accordance with Section 13.4, do not in the aggregate exceed the amounts permitted to be distributed by the Borrower under Section 13.4, and (c) in respect of Back-to-Back Securities or Back-to-Back Transactions. In addition, the Borrower may agree to the conversion of the QMI Subordinated Debt into equity, provided that any new shares resulting from such conversion are pledged to the Agent on behalf of the Lenders.

Prior to the Phase II Date, permit any member of the VL Group to cease being wholly-owned, or create or acquire any Subsidiaries other than wholly-owned Subsidiaries; provided that Télé-Câble Charlevoix Inc. and Société d’Édition et de Transcodage T.E. Ltée. need not be wholly-owned. On and after the Phase II Date, permit any Change in Control of the Borrower and the Initial VL Group Guarantors. In addition, no transaction

shall be entered into by any member of the VL Group with any Associate of any member of the VL Group except on fair market terms and conditions as would be contracted by Persons dealing at arms’ length, provided that this last sentence shall not apply to the transactions expressly permitted by paragraph (h) of Section 13.8; provided, however, for greater certainty, that to the extent payments made in connection with or in respect of the Back-to-Back Transactions are made to any Affiliates of the Borrower that are not members of the VL Group, all corresponding payments required to be paid by such Affiliates pursuant to the related Back-to-Back Securities are received, immediately prior to, concurrently with or immediately subsequent to any such payments, by all applicable members of the VL Group, and each such payment by a member of the VL Group shall be conditional upon receipt of an equal or greater amount from such non-member of the VL Group that is an Affiliate. Finally, payment of a management fee or other similar expense by the Borrower to its direct or indirect parent company shall be permitted for bona fide services (including reimbursement for expenses incurred in connection with, or allocation of corporate expenses in relation to, providing such services) provided to, and directly related to the operations of, the VL Group, in an aggregate annual amount not to exceed 1.25% of consolidated revenues (being gross revenues of the VL Group calculated in accordance with GAAP, less any amounts derived from Subsidiaries that are not members of the VL Group, and save that any portion of such gross revenues derived from a Person that is not a Subsidiary of the Borrower accounted for by the equity method of accounting shall be included in such calculation only to the extent of the amount of dividends or distributions actually paid to a member of the VL Group by such Person) in any twelve-month period.

Enter into any Derivative Instruments other than for the purposes of hedging interest rate, commodity or foreign exchange exposure, and not for the purpose of speculation.

The occurrence of any of the following events shall constitute an Event of Default unless remedied within the prescribed delays or renounced to in writing:

If an Event of Default occurs under subsection 14.1.4, the Loans shall immediately become due and exigible, without presentation, demand, protest or other notice of any nature, to which the Borrower hereby expressly renounces. If any other Event of Default occurs, the Agent may, at its option, and shall if required to do so by the Lenders, declare immediately due and exigible, without presentation, demand, protest or other notice of any nature, to which the Borrower hereby expressly renounces, notwithstanding any provision to the contrary effect in this Agreement or in the Security Documents:

the Credit shall cease and as and from such time shall be cancelled, and the Lenders may exercise all of their rights and recourses under the provisions of this Agreement and of the Security Documents. For greater certainty, from and after the occurrence of any Default or Event of Default, the Lenders shall not be obliged to make any further Advances under the Credit.

If the Borrower files a notice of intention to file a proposal, or files a proposal under the Bankruptcy and Insolvency Act, or if the Borrower obtains the permission of the court to file a Plan of Arrangement under the Companies’ Creditors Arrangements Act, and if a stay of proceedings is obtained or ordered under the provisions of either of those statutes, without prejudice to the Lenders’ rights to contest such stay of proceedings, the Borrower covenants and agrees to continue to pay interest on all amounts due to the Lenders in accordance with the provisions hereof. In this regard, the Borrower acknowledges that permitting the Borrower to continue to use the proceeds of the Loan constitutes valuable consideration provided after the filing of any such proceeding in the same way that permitting the Borrower to use leased premises constitutes such valuable consideration.

Except where otherwise expressly provided herein, no notice or demand of any nature is required to be given to the Borrower by the Agent in order to put the Borrower in default, the latter being in default by the simple lapse of time granted to execute an obligation or by the simple occurrence of a Default.

If an Event of Default occurs, and within the limits contemplated by Section 12.14, the Agent may impute to the account of the Lenders and pay to other persons reasonable sums for services rendered with respect to the realization, recovery, sale, transfer, delivery and obtention of payment with respect to the Security and may deduct the amount of such costs and payments from the proceeds which it receives therefrom. The balance of such proceeds may be held by the Agent in the place of such Security and, when the Agent decides it is opportune, may be applied to the account of the part of the indebtedness of the Borrower to the Lenders which the Agent deems preferable, without prejudice to the rights of the Lenders against the Borrower for any loss of profit.

The Agent may grant delays, take security or renounce thereto, accept compromises, grant acquittances and releases and otherwise negotiate with the Borrower as it deems advisable without in any way diminishing the liability of the Borrower or prejudicing the rights of the Lenders with respect to the Security.

Subject to the provisions hereof, the Agent may apply the proceeds of realization of the property contemplated by the Security Documents and of any credit or compensating balance in reduction of the part of the Loan (principal, interest or accessories and/or the Negative Value of Derivative Instruments originally entered into with a Lender) which the Agent judges appropriate. If any Lender is owed money by the Borrower as a result of Derivative Obligations, and, in particular, as a result of the Negative Value of Derivative Instruments, the claim of such Lender shall rank pari passu with the other amounts comprising the Loan.

If for the purpose of obtaining judgment in any court or for any other purpose hereunder, it is necessary to convert an amount due, advanced or to be advanced hereunder from the currency in which it is due (the “ First Currency ”) into another currency (the “ Second Currency ”) the rate of exchange used shall be that at which, in accordance with normal banking procedures, the Agent could purchase, in the Canadian money market or the Canadian exchange market, as the case may be, the First Currency with the Second Currency on the date on which the judgment is rendered, the sum is exigible or advanced or to be advanced, as the case may be. The Borrower agrees that its obligations in respect of any First Currency due from it to the Lenders in accordance with the provisions hereof shall, notwithstanding any judgment rendered or payment made in the Second Currency, be discharged by a payment made to the Agent on account thereof in the Second Currency only to the extent that, on the Business Day following receipt of such payment in the Second Currency, the Agent may, in accordance with normal banking procedures, purchase on the Canadian money market or the Canadian foreign exchange market, as the case may be, the First Currency with the amount of the Second Currency so paid or which a judgment rendered exigible; and if the amount of the First Currency which may be so purchased is less than the amount originally due in the First Currency, the Borrower agrees as a separate and independent obligation and notwithstanding any such payment or judgment to indemnify the Lenders against such deficiency.

If, in their discretion, the Lenders or the Agent choose or, pursuant to the terms of this Agreement, are obliged to choose the equivalent in Canadian Dollars of any securities or amounts expressed in US Dollars or the equivalent in US Dollars of any securities or amounts expressed in Canadian Dollars, the Agent, in accordance with the conversion rules as stipulated in Section 15.1

may, using the spot rate of the Agent on such date, determine the equivalent in Canadian Dollars or in US Dollars, as the case may be, of any security or amount expressed in the other currency pursuant to the terms hereof. Immediately following such determination, the Agent shall inform the Borrower of the conclusion which the Lenders have reached.

The rights of the Borrower under the provisions hereof are purely personal and may not be transferred or assigned, and the Borrower may not transfer or assign any of its obligations, such assignment being null and of no effect opposite the Lenders and rendering any balance outstanding of the amounts referred to in Section 14.2 immediately due and exigible at the option of the Lenders and further releasing the Lenders from any obligation to make any further Advances under the provisions hereof.

If a Lender wishes to assign or transfer all or any of its rights, benefits and obligations hereunder in accordance with Section 16.2, then such assignment or transfer shall be effected by the execution and delivery of a duly completed and executed Transfer Agreement by such Lender to the Agent together with a transfer fee of $3,500 (other than in connection with the initial syndication of the Credit), at least 5 Business Days prior to the effective date of such transfer, whereupon, to the extent that in such Transfer Agreement such Lender seeks to assign or transfer its rights and obligations hereunder:

The Agent shall promptly deliver an executed copy of any Transfer Agreement to each party thereto.

A Lender may, at its own cost, grant one or more sub-participations in its rights, benefits and obligations hereunder, provided that, notwithstanding any such sub-participation, such Lender shall remain, insofar as the Borrower and the Agent is concerned, as the Lender responsible hereunder, and the Borrower shall not be obliged to recognize any such sub-participant as having the rights against it which it would have if it had been a party hereto.

Notwithstanding anything contained in this Article:

Except where otherwise specified herein, all notices, requests, demands or other communications between the parties hereto shall be in writing and shall be deemed to have been duly given or made to the party to whom such notice, request, demand or other communication is given or permitted to be given or made hereunder, when delivered to the party (by certified mail, postage prepaid, or by facsimile or by physical delivery) to the address of such party and to the attention indicated under the signature of such party or to any other address which the parties hereto may subsequently communicate to each other in writing. Notwithstanding the foregoing, any notice shall be deemed to have been received by the party to whom it is addressed (a) upon receipt if sent by mail and (b) if telecopied before 3:00 p.m. on a Business Day, on that day and if telecopied after 3:00 p.m. on a Business Day, on the Business Day next following the date of transmission. If normal postal or telecopier service is interrupted by strike, work slow-down, fortuitous event or other cause, the party sending the notice shall use such services which have not been interrupted or shall deliver such notice by messenger in order to ensure its prompt receipt by the other party.

The rights and recourses of the Lenders under this Agreement and the Security Documents are cumulative and do not exclude any other rights and recourses which the Lenders might have, and no omission or delay on the part of the Lenders in the exercise of any right shall have the effect of operating as a waiver of such right, and the partial or sole exercise of a right or power will not prevent the Lenders from exercising thereafter any other right or power. The provisions of this Agreement may only be amended or waived by an instrument in writing (and not orally) in each case signed by the Agent with the approval of the requisite majority of Lenders.

In the absence of any manifest error, any determinations to be made by the Lenders in accordance with the provisions hereof, when made, are final and irrevocable for all parties.

The entire agreement between the parties is expressed herein, and no variation or modification of its terms shall be valid unless expressed in writing and signed by the parties. All previous agreements, promises, proposals, representations, understandings and negotiations between the parties hereto which relate in any way to the subject matter of this Agreement are hereby deemed to be null other than those contained in a letter by the Borrower to the Agent dated December 21, 2005 and confirmed by the Agent on March 1, 2006, and a letter by the Borrower to the Agent dated February 28, 2006 and confirmed by the Agent on the same date.

In addition to the other rights now or hereafter conferred by law and those described in subsection 6.6.2 and Section 8.13, and without limiting such rights, if a Default or Event of Default should occur, each Lender and the Agent is hereby authorized by the Borrower, at any time and from time to time, subject to the obligation to give notice to the Borrower subsequently and within a reasonable delay, to indemnify, compensate, use and allocate any deposit (general or special, term or demand, including, without limitation, any debt evidenced by certificates of deposit, whether or not matured) and any other debt at any time held or due by the Lenders to the Borrower or to its credit or its account, with respect to and on account of any obligation and indebtedness of the Borrower to the Lenders in accordance with the provisions hereof or the Security Documents, including, without limitation, the accounts of any nature or kind which flow from or relate to this Agreement or the Security Documents, whether or not the Agent has made demand under the terms hereof or has declared the amounts referred to in Section 14.2 as exigible in accordance with the provisions of that Section and even if such obligation and Debt or either of them is a future or unmatured Debt.

This Agreement shall be binding upon and enure to the benefit of each party hereto and its successors and permitted assigns.

This Agreement may be signed in any number of counterparts, each of which shall be deemed to constitute an original, but all of the separate counterparts shall constitute one single document.

This Agreement, its interpretation and its application shall be governed by the Laws of the Province of Quebec and the Laws of Canada applicable therein.

Each provision of this Agreement is separate and distinct from the others, such that any decision of a court or tribunal to the effect that any provision of this Agreement is null or unenforceable shall in no way affect the validity of the other provisions of this Agreement or the enforceability thereof. Any provision of this agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable Laws, the Borrower hereby waives any provision of any Laws which renders any provision hereof prohibited or unenforceable in any respect.

The Borrower covenants and agrees on its own behalf and on behalf of each member of the VL Group that, at the request of the Agent, the Borrower and each other member of the VL Group will at any time and from time to time execute and deliver such further and other documents and instruments and do all acts and things as the Agent in its absolute discretion requires in order to evidence the indebtedness of the Borrower under this Agreement or otherwise, including under any Derivative Instruments, and to confirm and perfect, and maintain perfection of, the Security.

Each party hereto acknowledges and declares that it has entered into this Agreement freely and of its own will. In particular, each party hereto acknowledges that this Agreement was freely negotiated by the Borrower and the Lenders in good faith, that this Agreement does not constitute a contract of adhesion, that there was no exploitation of the Borrower by the Lenders, and that there is no serious disproportion between the consideration provided by the Lenders and that provided by the Borrower.

Each Lender shall be solely responsible for the performance of its own obligations hereunder. Accordingly, no Lender is in any way jointly and severally or solidarily responsible for the performance of the obligations of any other Lender.

The Borrower agrees to indemnify and defend each of the Agent, each Lender, and their respective directors, officers, agents and employees from, and hold each of them harmless against, any and all losses, liabilities, claims, damages or expenses of any kind which at any time or from time to time may be asserted against or incurred or paid by any of them for or in connection with, arising directly or indirectly from or relating to: (i) the participation of the Agent or of any of the Lenders in the transactions contemplated by this Agreement, (ii) any Advance or the use or proposed use of the proceeds therefrom (including any refusal by

the Issuing Lender to honor 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) the role of the Agent or the Lenders in any investigation, litigation or other proceeding brought or threatened relating to the Credit, (iv) the presence on or under or the release or migration from any property or into the environment of any hazardous material, and/or (v) the compliance with or enforcement of any of their rights or obligations hereunder, including without limitation:

The parties acknowledge that they have required that the present agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto be drawn up in English. Les parties reconnaissent avoir exigé la rédaction en anglais de la présente convention ainsi que de tous documents exécutés, avis donnés et procédures judiciaires intentées, directement ou indirectement, relativement ou à la suite de la présente convention.

Notwithstanding the provisions of subsection 16.2.1 hereof, each of the Borrower, the Agent and the Lenders agrees that:

Neither the Agent nor the Borrower shall accept or be bound by any assignment or transfer where the effect of the purported assignment or transfer would be to create Commitments of Foreign Lenders in excess of the limits mentioned above. “ Arrangers ” shall mean RBC Dominion Securities Inc., Bank of America, N.A., Canada Branch, BMO Nesbitt Burns Inc., The Toronto-Dominion Bank and their respective successors and assignees.

Notwithstanding any other provision of this Agreement to the contrary, any Foreign Lender governed by the applicable Laws of the United States of America may at any time assign all or a portion of its rights under this Agreement and all other documents ancillary thereto (including the Security Documents) to a Federal Reserve Bank. No such assignment shall relieve the assigning Foreign Lender from its obligations under this Agreement or such other documents.

18.1 Authorization of Agent

18.2 Agent’s Responsibility

18.3 Rights of Agent as Lender

With respect to its Commitment in the Loan, the Agent in its capacity as a Lender shall have the same rights and powers hereunder as any other Lender and may exercise the same as though it were not acting as the Agent and the term “Lender” shall, unless the context otherwise indicates, include the Agent in its capacity as a Lender. The Agent may (without having to account therefor to any Lender) accept deposits from, lend money to and generally engage in any kind of banking or other business with the Borrower as if it were not acting as the Agent and may accept fees and other consideration from the Borrower for customary services in connection with this Agreement and the Loan and otherwise without having to account for the same to the Lenders.

18.4 Indemnity

Each Lender agrees to indemnify the Agent, to the extent not otherwise reimbursed by the Borrower, rateably in accordance with its respective Commitments, for any and all liabilities, obligations, losses, damages, penalties, actions, judgements, suits, costs, expenses or disbursements of any kind and nature whatsoever which may be imposed on, incurred by or asserted against, the Agent in any way relating to or arising out of this

Agreement, the Security Documents or any other documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby (excluding, unless a Default or Event of Default is apprehended or has occurred and is continuing, normal administrative costs and expenses incidental to the performance of its agency duties hereunder) or the enforcement of any of the terms hereof or of any such other documents, provided that no Lender shall be liable for any of the foregoing to the extent they arise from the Agent’s gross negligence or wilful misconduct.

18.5 Notice by Agent to Lenders

As soon as practicable after its receipt thereof, the Agent will forward to each Lender a copy of each report, notice or other document required by this Agreement to be delivered to the Agent for such Lender.

18.6 Protection of Agent

18.7 Notice by Lenders to Agent

Each Lender shall endeavour to use its best efforts to notify the Agent of the occurrence of any Default or Event of Default forthwith upon becoming aware of such event, but no Lender shall be liable if it fails to give such notice to the Agent.

18.8 Sharing Among the Lenders

Each Lender agrees that as amongst themselves, except as otherwise provided for by the provisions of this Agreement, all amounts received by the Agent, in its capacity as agent of the Lenders pursuant to this Agreement or any other document contemplated hereby (whether received by voluntary payment, by the exercise of the right of set-off or compensation or by counterclaim, cross-claim, separate action or as proceeds of realization of any security, other than agency fees), and all amounts received by any Lender in relation to this Agreement shall be shared by each Lender pro rata , in accordance with their respective Commitment and each Lender undertakes to do all such things as may be reasonably required to give full effect to this Section 18.8. If any amount which is so shared is later recovered from the Lender who originally received it, each other Lender shall restore its proportionate share of such amount to such Lender, without interest.

As a necessary consequence of the foregoing, each Lender shall share, in a percentage equal to its Commitment (and, for the purposes of this Section, a Lender that holds a Derivative Instrument creating Deriviative Obligations shall have a Commitment that is deemed to be in an amount equal to (a) its Commitment otherwise calculated, plus (b) the Negative Value of Derivative Instruments entered into by such Lender that created Derivative Obligations), any losses incurred as a result of any Default or Event of Default by the Borrower, and shall pay to the Agent, within two (2) Business Days following a request by the Agent, any amount required to ensure that such Lender bears its pro rata share of such losses, if any, including any amounts required to be paid to any Lender in respect of any Bankers’ Acceptances and, for greater certainty, amounts forming part of the Cash Management Facilities (which form part of the Revolving Facility). Such obligation to share losses shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (1) any set-off, compensation, counterclaim, recoupment, defence or

other right which such Lender may have against the Agent, the Borrower or any other Person for any reason whatsoever; (2) the occurrence or continuance of any Default or Event of Default; (3) any adverse change in the condition (financial or otherwise) of the Borrower or any other Person; (4) any breach of this Agreement by the Borrower or any other Person; or (5) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If any Lender does not make available the amount required hereunder, the Agent shall be entitled to recover such amount on demand from such Lender, together with interest thereon at the Prime Rate from the date of non-payment until such amount is paid in full.

18.9 Derivative Obligations

(a) are governed by an ISDA Master Agreement; and

(b) provide that bankruptcy or insolvency constitutes an event of default thereunder.

18.10 Procedure with respect to Advances

Subject to the provisions of this Agreement, upon receipt of a Notice of Borrowing from the Borrower, the Agent shall, without delay, advise each Lender of the receipt of such notice, of the date of such Advance, of its proportionate share of the amount of each Advance and of the relevant details of the Agent’s account(s). Each Lender shall disburse its proportionate share of each Advance, taking into account its Commitment, and shall make it available to the Agent (no later than 10:00 A.M.) on the date of the Advance fixed by the Borrower, by depositing its proportionate share of the Advance in the Agent’s account in Canadian Dollars or US Dollars, as the case may be. Once the Borrower has fulfilled the conditions stipulated in this Agreement, the Agent will make such amounts available to the Borrower on the date of the Advance, at the Branch, and, in the absence of other arrangements made in writing between the Agent and the Borrower, by transferring or causing to be transferred an equivalent amount in the case of a direct Advance, and the Available Proceeds (as defined in subsection 6.2.4 (d)) in the case of Banker’s Acceptances, in accordance with the instructions of the Borrower which appear in the Notice of Borrowing with respect to each Advance; however, the obligation of the Agent with respect hereto is limited to taking the steps judged commercially reasonable in order to follow such instructions, and once undertaken, such steps shall constitute conclusive evidence that the

amounts have been disbursed in accordance with the applicable provisions. The Agent shall not be liable for damages, claims or costs imputed to the Borrower and resulting from the fact that the amount of an Advance did not arrive at its agreed-upon destination.

18.11 Accounts kept by each Lender

Each Lender shall keep in its books, in respect of its Commitment, accounts for the Libor Advances (if a Foreign Lender), Prime Rate Advances, Bankers’ Acceptances and other amounts payable by the Borrower under this Agreement. Each Lender shall make appropriate entries showing, as debits, the amount of the Debt of the Borrower to it in respect of the Libor Advances, Prime Rate Advances and BA Advances, as the case may be, the amount of all accrued interest and any other amount due to such Lender pursuant hereto and, as credits, each payment or repayment of principal and interest made in respect of such indebtedness as well as any other amount paid to such Lender pursuant hereto. These accounts shall constitute (in the absence of manifest error or of contradictory entries in the accounts of the Agent referred to in Section 4.4) prima facie evidence of their content against the Borrower.

The accounts which are maintained by the Agent shall constitute, except in the case of manifest error, prima facie proof of the amounts advanced and the Bankers’ Acceptances accepted by each Lender, the interest and other amounts due to them and the payments of principal, interest or others made to the Lenders.

18.12 Binding Determinations

The Agent shall proceed in good faith to make any determination which is required in order to apply this Agreement and, once made, such determination shall be final and binding upon all parties, except in the case of manifest error.

18.13 Amendment of Article 18

The provisions of this Article 18 relating to the rights and obligations of the Lenders and the Agent inter se may be amended or added to, from time to time, by the execution by the Agent and the Lenders of an instrument in writing and such instrument in writing shall validly and effectively amend or add to any or all of the provisions of this Article affecting the Lenders without requiring the execution of such instrument in writing by the Borrower.

18.14 Decisions, Amendments and Waivers of the Lenders

When the Lenders may or must consent to an action or to anything or to accomplish another act in applying this Agreement, the Agent shall request that each Lender give its consent in this regard. Subject to the provisions of Section 18.15, all decisions taken by the Lenders shall be taken as follows: a) if there are two Lenders, by unanimous consent; b) if there are three or more Lenders, by the Majority Lenders. The Agent shall confirm such consent to each Lender and to the Borrower.

18.15 Authorized Waivers, Variations and Omissions

If so authorized in writing by the Lenders, the Agent, on behalf of the Lenders, may grant waivers, consents, vary the terms of this Agreement and the Security Documents and do or omit to do all acts and things in connection herewith or therewith. Notwithstanding the foregoing, except with the prior written agreement of each of the Lenders, nothing in Section 18.14 or this Section 18.15 shall authorize (i) any extension of the date for, or alteration in the amount, currency or mode of calculation or computation of any payment of principal or interest or other amount, (ii) any increase in the Commitment of a Lender, (iii) any extension of any maturity date, (iv) any change in the terms of Article 18, (v) any change in the manner of making decisions among the Lenders including the definition of Majority Lenders, (vi) the release of the Borrower or any Guarantor, except as provided herein with respect to permitted Asset Dispositions or as contemplated in Section 13.1, (vii) the release, in whole or in part, of any of the Security Documents or the Security constituted thereby, except as provided herein with respect to permitted Asset Dispositions or as contemplated in Section 13.1, (viii) any change in or any waiver of the conditions precedent provided for in Article 10 or (ix) any amendment to this Section 18.15.

18.16 Provisions for the Benefit of Lenders Only - Power of Attorney for Quebec Purposes

Without limiting the powers of the Agent hereunder or under the Security Documents and to the extent applicable, each of the Lenders hereby acknowledges that the Agent (or a collateral agent designated by the Agent) shall, for the purposes of holding any security granted under the hypothecs described in Section 9.2.3 or granted under Section 9.2.9 hereof to secure payment of the Debentures, be the holder of an irrevocable power of attorney ( fondé de pouvoir ) (within the meaning of Article 2692 of the Civil Code of Quebec ) for all present and future Lenders and in particular for all present and future holders of the Debentures. Each of the Lenders hereby constitutes, to the extent necessary, the Agent (or such designated collateral agent) as the holder of such irrevocable power of attorney in order to hold security granted under such hypothecs to secure the Debentures. Each Assignee shall be deemed to have confirmed and ratified the constitution of the Agent as the holder of such irrevocable power of attorney by execution of the relevant Transfer Agreement. Notwithstanding the provisions of Section 32 of the An Act respecting the Special Powers of Legal Persons (Quebec), the Borrower, the Guarantors and the Lenders irrevocably agree that the Agent may acquire and be the holder of a Debenture. By executing a Debenture, the issuer of the Debenture shall be deemed to have acknowledged that the Debenture constitutes a title of indebtedness, as such term is used in Article 2692 of the Civil Code of Quebec .

18.17 Provisions for the Benefit of Lenders Only

The provisions of this Article 18 relating to the rights and obligations of the Lenders and Agent inter se shall be operative as between the Lenders and Agent only, and the Borrower shall not have any rights or obligations under or be entitled to rely for any purposes upon

such provisions. However, the provisions of subsection 18.2.3 and 18.16 shall be applicable as between the Borrower, the Guarantors (if applicable) and the Agent.

18.18 Resignation of Agent

18.19 No Novation

The parties hereto agree that the changes to the terms and conditions of the Credit Agreement and the amendments and restatement set out herein and the execution of these presents shall not constitute novation, and that all Security shall continue to apply to this Credit Agreement, as amended and restated by these presents, and all other obligations secured thereby.

19.1 Formal Date

For the purposes of convenience, this Agreement may be referred to as bearing the Formal Date of November 28, 2000 notwithstanding its actual date of signature.

IN WITNESS WHEREOF THE PARTIES HERETO HAVE SIGNED THIS AGREEMENT ON THE DATE AND AT THE PLACE FIRST HEREINABOVE MENTIONED.

VIDÉOTRON LTÉE			ROYAL BANK OF CANADA


Per:			Per:

Per:			Per:

Address: 300 Viger St. East			Address: 1 Place Ville Marie
6 th floor			4 th floor
Montreal, Quebec			Montreal, Quebec
H2X 3W4			H3B 4R8

Attention: Treasurer			Attention: Managing Director Corporate Credit

Telephone: (514) 380-1912			Telephone: 878-7214
Fax: (514) 380-1983			Fax: (514) 878-7220


THE TORONTO-DOMINION BANK			BANK OF MONTREAL


Per:			Per:

Per:			Per:

Address: Corporate and Investment Banking			Address: Loan Products Group
500 St. Jacques, 9 th floor			Investment and Corporate Banking
Montreal, Quebec			1 First Canadian Place, 4 th floor
H2Y 1S1			Toronto, Ontario M5X 1H3

Attention: Manager			Attention: Vice-President

Tel: (514) 289-0102			Tel: (416) 359-6873
Fax: (514) 289-0788			Fax: (416) 359-7796

BANK OF AMERICA, N.A.			ROYAL BANK OF CANADA, as Agent
CANADA BRANCH


Per:			Per:

			Per:

Address: Global Corporate and Investment			Address: 200 Bay Street, 12 th floor
Banking			South Tower, Royal Bank Plaza
200 Front St. West, Suite 2700			Toronto, Ontario
Toronto, Ontario			M5J 2W7
M5V 3L2

Attention : Vice-President			Attention :
Tel: (416) 349-5352			Tel: (416) 842-3901
Fax: (416) 349-4283			Fax: (416) 842-4023


CANADIAN IMPERIAL BANK OF			THE BANK OF NOVA SCOTIA
COMMERCE

Per:			Per:

Per:			Per:

Address: 161 Bay Street, 8 th Floor			Address: P.O. Box 4085, Station A
BCE Place			40 King St. West, Scotia Plaza
Toronto, Ontario			62 nd floor
M5J 2S8			Toronto, Ontario, M5W 2X6

Attention: Director			Attention: Director

Telephone: (416) 594-8246			Telephone: (416) 933-1873
Fax: (416) 956-3816			Fax: (416) 866-2010

CITIBANK N.A., CANADIAN BRANCH				CREDIT SUISSE FIRST BOSTON,
				TORONTO BRANCH

Per:				Per:

Per:				Per:

Address: Citibank Place				Address: One First Canadian Place
123 Front Street West, Suite 1900				Suite 3000, P.O. Box 301
Toronto, Ontario				Toronto, Ontario
M5J 2M3				M5X 1C9

Attention: Manager				Attention: Director

Tel: (416) 947-4171				Telephone: (416) 352-4527
Fax: (416) 947-5802				Fax: (416) 352-4576


CAISSE CENTRALE DESJARDINS				BANK OF TOKYO-MITSUBISHI
				(CANADA)

Per:				Per:

Per:				Per:

Address: 1 Complexe Desjardins				Address: 600 de la Gauchetière West
Suite 2822				Suite 2780
Montreal, Quebec				Montreal, Quebec
H5B 1B3				H3B 4L8


Attention:				Attention:

Telephone: (514) 281-7791				Telephone: (514) 875-9261
Fax: (514) 281-7083				Fax: (514) 875-9392

100

LAURENTIAN BANK OF CANADA				NATIONAL BANK OF CANADA


Per:				Per:

Per:				Per:


Address: 1981 McGill College Avenue				Address: 1155 Metcalfe
Suite 1980				5 th floor
Montreal, Quebec				Montreal, Quebec
H3A 3K3				H3B 4B9

Attention:				Attention: Vice President

Telephone: (514) 284-4500, # 4732				Telephone: (514) 390-7508
Fax: (514) 284-4551				Fax: (514) 390-7860


HSBC BANK CANADA

Per:

Per:

Address:

2001 McGill College Avenue, Suite 300
Montreal, Quebec, Canada, H3A 1G1

Attention: Global Relationship Manager, Corporate
& Institutional Banking

Telephone: ( 514) 286-5332
Fax: (514) 286-5330

[Société Générale?]

101

SCHEDULE “A” - LIST OF LENDERS AND COMMITMENTS

The Revolving Facility

Cash Management Facilities — The Toronto-Dominion Bank (“ TD ”) - $15,000,000.

Balance of Revolving Facility:

Lender	Commitment ($)		Commitment (%)
Royal Bank of Canada
The Bank of Nova Scotia
The Toronto-Dominion Bank
Bank of America N.A., Canada Branch
Citibank N.A., Canadian Branch
Bank of Montreal
Canadian Imperial Bank of Commerce
National Bank of Canada
Caisse centrale Desjardins
Laurentian Bank of Canada
HSBC Bank Canada
Sumitomo Mitsui Banking Corporation of Canada

Total	$	575,000,000	100	%

TABLE OF CONTENTS

1.	INTERPRETATION		1
	1.1	Definitions	1
	1.2	Interpretation	25
	1.3	Currency	26
	1.4	Generally Accepted Accounting Principles	26
	1.5	Division and Titles	26
2.	THE CREDIT		26
	2.1	Credit Facility	26
	2.2	The Revolving Facility	26
	2.3	Increase in Revolving Facility	26
3.	PURPOSE		28
	3.1	Purpose of the Advances	28
4.	ADVANCES, CONVERSIONS AND OPERATION OF ACCOUNTS		29
	4.1	Notice of Borrowing - Direct Advances	29
	4.2	LIBOR Advances and Conversions	29
	4.3	Letters of Credit for Spectrum Auction and Purchase	30
	4.4	Cash Management Facilities	33
	4.5	Operation of Accounts	34
	4.6	Apportionment of Advances	34
	4.7	Limitations on Advances	34
	4.8	Notices Irrevocable	34
	4.9	Market for Bankers’ Acceptances and Libor Advances	34
	4.10	Suspension of BA Advance and Libor Advance Option	35
	4.11	Limits on BA Advances, Letters of Credit and Libor Advances	35
	4.12	Specific Clause with Regard to Foreign Lenders	35
5.	INTEREST AND FEES		36
	5.1	Interest on the Prime Rate Basis	36
	5.2	Payment of Interest on the Prime Rate Basis	36
	5.3	Interest on the Libor Basis	36
	5.4	Payment of Interest on the Libor Basis	37
	5.5	Limits to the Determination of LIBOR	37
	5.6	Fixing of LIBOR	37
	5.7	Hedging	37
	5.8	Interest on the Loan	37
	5.9	Arrears of Interest	38
	5.10	Maximum Interest Rate	38
	5.11	Fees	38
	5.12	Interest Act	38
6.	BANKERS’ ACCEPTANCES		39
	6.1	Advances by Bankers’ Acceptances and Conversions into Bankers’ Acceptances	39
	6.2	Acceptance Procedure	40
	6.3	Purchase of Bankers’ Acceptances and Discount Notes	41
	6.4	Maturity Date of Bankers’ Acceptances	41
	6.5	Deemed Conversions on the Maturity Date	42
	6.6	Conversion and Extension Mechanism	42
	6.7	Amounts given to the Lenders do not constitute a prepayment	43
	6.8	Prepayment of Bankers’ Acceptances	43
	6.9	Apportionment Amongst the Lenders	43

	6.10	Cash Deposits	43
	6.11	Days of Grace	44
	6.12	Obligations Absolute	44
	6.13	Depository Bills and Notes Act	44
7.	ILLEGALITY, INCREASED COSTS AND INDEMNIFICATION		44
	7.1	Illegality, Increased Costs	44
	7.2	Indemnity	46
8.	PAYMENT, REPAYMENT AND PREPAYMENT		46
	8.1	Repayment of the Loan	46
	8.2	Amount and Apportionment of Mandatory Repayments	46
	8.3	Voluntary Repayment and Prepayment of the Loan or Cancellation of the Credit	47
	8.4	Payment of Losses Resulting From a Prepayment or a Mandatory Repayment	48
	8.5	Currency of Payments	48
	8.6	Payments by the Borrower to the Agent	48
	8.7	Payment on a Business Day	49
	8.8	Payments by the Lenders to the Agent	49
	8.9	Payments by the Agent to the Borrower	49
	8.10	Netting	49
	8.11	Application of Payments	49
	8.12	No Set-Off or Counterclaim by Borrower	50
	8.13	Debit Authorization	50
	8.14	Withholding Taxes	50
9.	SECURITY		51
	9.1	Security for Advances Prior to the Phase II Date	51
	9.2	Security for Advances Following the Phase II Date	51
	9.3	Limitations on Guarantees and Security for Advances	54
	9.4	Further Limitations on Guarantees and Security for Advances	55
10.	CONDITIONS PRECEDENT		56
	10.1	Initial Advance under the Revolving Facility and Term Facility A-1	56
	10.2	Initial Advance under the Revolving Facility After the Ninth Amendment Closing Date	58
	10.3	Conditions Precedent to any Advance	59
	10.4	Waiver of Conditions Precedent	59
	10.5	Release of Quebecor Media Guarantee	59
11.	REPRESENTATIONS AND WARRANTIES		60
	11.1	Incorporation	60
	11.2	Authorization	60
	11.3	Compliance with Laws and Contracts	60
	11.4	Current Business	61
	11.5	Financial Statements	61
	11.6	Contingent Liabilities and Indebtedness	61
	11.7	Title to Assets	61
	11.8	Litigation	61
	11.9	Taxes	62
	11.10	Insurance	62
	11.11	No Adverse Change	62
	11.12	Regulatory Approvals	62
	11.13	Compliance with Laws and Licences	62
	11.14	Pension and Employment Liabilities	62

	11.15	Priority	63
	11.16	Complete and Accurate Information	63
	11.17	Share Capital	63
	11.18	Absence of Default	63
	11.19	Agreements with Third Parties	63
	11.20	Environment	63
	11.21	Survival of Representations and Warranties	64
12.	COVENANTS		64
	12.1	Preservation of Juridical Personality	64
	12.2	Preservation of Licences	64
	12.3	Compliance with Applicable Laws	65
	12.4	Maintenance of Assets	65
	12.5	Business	65
	12.6	Insurance	65
	12.7	Payment of Taxes and Duties	66
	12.8	Access and Inspection	66
	12.9	Maintenance of Account	66
	12.10	Performance of Obligations	66
	12.11	Maintenance of Ratios	66
	12.12	Mandatory Repayments	68
	12.13	Maintenance of Security	68
	12.14	Payment of Legal Fees and Other Expenses	68
	12.15	Financial Reporting	68
	12.16	Notice of Certain Events	70
	12.17	CF Cable Inter-Creditor Agreement	71
	12.18	Accuracy of Reports	71
	12.19	Transfer of Licences from Spectrum Co. to the VL Group	71
13.	NEGATIVE COVENANTS		71
	13.1	Liquidation and Amalgamation	71
	13.2	Charges	73
	13.3	Asset Dispositions	73
	13.4	Preservation of Capital	74
	13.5	Restrictions on Subsidiaries	74
	13.6	Issuance and Transfer of Shares	74
	13.7	Acquisitions	75
	13.8	Debt and Guarantees	75
	13.9	Financial Assistance by the VL Group	76
	13.10	Subordinated Debt	76
	13.11	Members of the VL Group, Related Party Transactions	76
	13.12	Derivative Instruments	77
14.	EVENTS OF DEFAULT AND REALIZATION		77
	14.1	Event of Default	77
	14.2	Remedies	79
	14.3	Bankruptcy and Insolvency	80
	14.4	Notice	80
	14.5	Costs	80
	14.6	Relations with the Borrower	81
	14.7	Application of Proceeds	81
15.	JUDGMENT CURRENCY		81

iii

	15.1	Rules of Conversion	81
	15.2	Determination of an Equivalent Currency	82
16.	ASSIGNMENT		82
	16.1	Assignment by the Borrower	82
	16.2	Assignments and Transfers by the Lenders	82
	16.3	Transfer Agreement	83
	16.4	Notice	84
	16.5	Sub-Participations	84
	16.6	General	84
17.	MISCELLANEOUS		85
	17.1	Notices	85
	17.2	Amendment and Waiver	85
	17.3	Determinations Final	85
	17.4	Entire Agreement	86
	17.5	Indemnification and Compensation	86
	17.6	Benefit of Agreement	86
	17.7	Counterparts	86
	17.8	Applicable Law	86
	17.9	Severability	87
	17.10	Further Assurances	87
	17.11	Good Faith and Fair Consideration	87
	17.12	Responsibility of the Lenders	87
	17.13	Indemnity	87
	17.14	Language	88
	17.15	Foreign Lenders	88
18.	THE AGENT AND THE LENDERS		89
	18.1	Authorization of Agent	89
	18.2	Agent’s Responsibility	90
	18.3	Rights of Agent as Lender	91
	18.4	Indemnity	91
	18.5	Notice by Agent to Lenders	92
	18.6	Protection of Agent	92
	18.7	Notice by Lenders to Agent	93
	18.8	Sharing Among the Lenders	93
	18.9	Derivative Obligations	94
	18.10	Procedure with respect to Advances	94
	18.11	Accounts kept by each Lender	95
	18.12	Binding Determinations	95
	18.13	Amendment of Article 18	95
	18.14	Decisions, Amendments and Waivers of the Lenders	95
	18.15	Authorized Waivers, Variations and Omissions	96
	18.16	Provisions for the Benefit of Lenders Only - Power of Attorney for Quebec Purposes	96
	18.17	Provisions for the Benefit of Lenders Only	96
	18.18	Resignation of Agent	97
	18.19	No Novation	97
19.	FORMAL DATE		97
	19.1	Formal Date	97
[Previously delivered]

		SCHEDULE “I” – PROPERTY OF THE VL GROUP
	No
Adresse de l'immeuble
3 .	Subordination . The indebtedness represented by the Subordinated Notes shall be subordinated as follows:
	(g) Holder Entitled to Rely .
	Upon any payment or distribution pursuant to this Section 3, the Holder shall be entitled to rely (i) upon any order or decree of a court of competent jurisdiction in which any proceedings of the nature referred to in Section 3(b) are pending, (ii) upon a certificate if the liquidating trustee or agent or other person in such proceedings making such payment or distribution to the Holder or its representative, if any, or (iii) upon a certificate of the Agent or any representative (if any) of the holders of Senior Indebtedness for the purpose of ascertaining the persons entitled to participate in such payment or distribution, the holders of the Senior Indebtedness and other indebtedness of the Obligor, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Section 3.
	4. Enforceability . Each of the Obligor and the Holder represents and warrants that this Agreement has been duly authorized, executed and delivered by each of the Obligor and the Holder and constitutes a valid and legally binding obligation of each of the Obligor and the Holder, enforceable in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles; and on the date hereof, the Holder shall deliver an opinion or opinions of counsel to such effect to the Agent for the benefit of the Lenders.
	5. Miscellaneous.

Exhibit 4.2

NINTH AMENDING AGREEMENT to the Credit Agreement dated as of November 28, 2000, as amended by a First Amending Agreement dated January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004, and an Eighth Amending Agreement dated as of March 6, 2008, entered into in the City of Montreal, Province of Quebec, as of April 7, 2008,

AMONG:	VIDÉOTRON LTÉE , a company constituted in accordance with the laws of Quebec, having its registered office at 300 Viger Street East, 6 th floor, in the City of Montreal, Province of Quebec (hereinafter called the “ Borrower ”)

	PARTY OF THE FIRST PART

AND:	THE LENDERS, AS DEFINED IN THE CREDIT AGREEMENT (the “ Lenders ”)

	PARTIES OF THE SECOND PART

AND:	ROYAL BANK OF CANADA, AS ADMINISTRATIVE AGENT FOR THE LENDERS , a Canadian bank, having a place of business at 200 Bay Street, 12th floor, South Tower, Royal Bank Plaza, in the City of Toronto, Province of Ontario (hereinafter called the “ Agent ”)

	PARTY OF THE THIRD PART

WHEREAS the parties hereto are parties to a Credit Agreement dated as of November 28, 2000, as amended by a First Amending Agreement dated January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004 and an Eighth Amending Agreement dated as of March 6, 2008 (as so amended and amended and restated, the “ Credit Agreement ”);

WHEREAS the Borrower has requested certain amendments to the Credit Agreement to extend the Term, increase the aggregate Commitments of the Lenders and provide for the possibility of future increases; and

WHEREAS the Lenders have unanimously agreed with the Borrower to the amendments contemplated hereby, and as such, the Lenders have complied with the provisions of Section 18.14 and 18.15 of the Credit Agreement, as evidenced by the signature of each Lender and of the Agent on this Agreement;

NOW THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

I. INTERPRETATION

All of the words and expressions which are capitalized herein shall have the meanings ascribed to them in the Credit Agreement unless otherwise indicated herein.

II. AMENDMENTS

1. Subsection 1.1.2 of the Credit Agreement is amended to clarify certain elements relating to the term of, and conditions applicable to, any Additional Offering. The subsection is accordingly deleted and replaced by the following:

“1.1.2 “ Additional Offering ” means an Offering of unsecured Debt incurred or issued by the Borrower having a maturity date (meaning the date on which repayment can be required by the lender, not the date of any initial maturity leading to an automatic conversion or replacement) expiring after the expiry of the Term, the terms and conditions of which Offering (including any automatic conversion or replacement as aforesaid and excluding, for greater certainty, (a) pricing, and (b) the right to require a replacement via an unsecured term loan or an offering of unsecured high yield Debt in an amount equal to the Additional Offering being replaced (“ AO Replacement Debt ”)) are no more favourable to the Persons providing such Debt, in all material respects, than the provisions hereof; for greater certainty, for the purposes of paragraph (j) of Section 13.8, any such AO Replacement Debt will not be considered a new incurrence of Debt;”.

2. A new subsection 1.1.73 is hereby added to the Credit Agreement as follows. All other subsections are renumbered accordingly:

“1.1.73 “ Joinder Agreement ” means an agreement substantially in the form of Schedule “O”;”.

3. A new subsection 1.1.91 is hereby added to the Credit Agreement as follows. All other subsections are renumbered accordingly:

“1.1.91 “ Ninth Amendment Closing Date ” means April 7, 2008;”.

4. Subsection 1.1.121 of the Credit Agreement (definition of “ Term ”) is amended by deleting the date “November 18, 2009”, and replacing it with “April 6, 2012”. Consequently, subsection 1.1.121 now provides as follows:

“1.1.121 “ Term ” means the period commencing on the Closing Date and terminating, with respect to the Revolving Facility, on April 6, 2012;”.

5. Section 2.1 of the Credit Agreement is amended by replacing the number “$450,000,000” with the number “$575,000,000”. Consequently, Section 2.1 now provides as follows:

“2.1 Credit Facility

6. A new Section 2.3 is added as follows:

“2.3 Increase in Revolving Facility

2.3.1 The Borrower may, on one or more occasions during the portion of the Term of the Revolving Facility commencing on the Ninth Amendment Closing Date and terminating April 6, 2009, by written notice to the Agent (an “ Increase Notice ”), elect to request an increase to the existing Commitments (any such increase, the “ New Lender Commitments ”), by adding one or more Lenders (each, a “ New Lender ”) or having an existing Lender increase its Commitment (an “ Increased Commitment ”) in accordance with the provisions of this Section.

2.3.2 The aggregate amount of any such New Lender Commitments and Increased Commitments shall not exceed $75,000,000 and shall not be less than $25,000,000 per New Lender (or such lesser amount as may be approved by the Agent). Such Increase Notice shall specify (a) the date (the “ Increased Amount Date ”) on which the Borrower proposes that the New Lender Commitments and/or Increased Commitments shall be effective, which shall be a date not less than 10 Business Days after the date on which such notice is delivered to the Agent, (b) the amount of the increase in the Revolving Facility, (c) the identity of each New Lender, and/or of each existing Lender that is prepared to provide an Increased Commitment, and

(d) the proposed allocation of such New Lender Commitments to each New Lender and/or the amount of each Increased Commitment. Such New Lender Commitments and/or Increased Commitments shall become effective as of the Increased Amount Date; provided that (1) no Default or Event of Default shall exist on the Increased Amount Date before or after giving effect to such New Lender Commitments and/or Increased Commitments; (2) the Borrower shall be in compliance with each of the covenants set forth in Section 12.11 as of the last day of the most recently ended fiscal quarter after taking into account such New Lender Commitments and/or Increased Commitments, on a pro forma basis; (3) the New Lender Commitments shall be effected pursuant to one or more Joinder Agreements executed and delivered by the Borrower, each New Lender and the Agent, and each of which shall be recorded in the register maintained by the Agent in respect of Assignments; (4) Increased Commitments shall be effected in accordance with the last sentence of subsection 2.3.6; and (5) the Borrower shall deliver or cause to be delivered any legal opinions or other documents reasonably requested by the Agent in connection with any such transaction.

2.3.3 On the Increased Amount Date, subject to the satisfaction of the foregoing terms and conditions, (a) each of the Revolving Facility Lenders shall assign to each of the New Lenders or applicable existing Lenders, who shall purchase same, at the principal amount thereof (together with accrued interest), such interests in the Loan outstanding on the Increased Amount Date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Loan under the Revolving Facility will be held by existing Revolving Facility Lenders and New Lenders ratably in accordance with their Commitments after giving effect to the addition of such New Lender Commitments and/or Increased Commitments to the Commitments, (b) each New Lender Commitment shall be deemed for all purposes a Commitment and each Advance made thereunder (a “ New Advance ”) shall be deemed, for all purposes, an Advance under the Revolving Facility and (c) each New Lender shall become a Lender with respect to the New Lender Commitment and all matters relating thereto.

2.3.4 The Agent shall notify the Lenders, promptly upon receipt, of the Borrower’s Increase Notice, including the Increased Amount Date, any Increased Commitments, and the New Lender Commitments and New Lenders in respect thereof, as well as the effect of same as contemplated by the preceding paragraph.

2.3.5 The terms and provisions of the New Advances shall be identical to the Advances under the Revolving Facility. Each Joinder Agreement may,

without the consent of any other Revolving Facility Lenders, effect such amendments to this Agreement and the Security Documents as may be necessary or appropriate, in the opinion of the Agent, to give effect to the provisions of this Section 2.3.

2.3.6 If on April 6, 2009, the Credit is less than $650,0000,000, from that date until the expiry of the Term, the Borrower may, on one additional occasion, again send an Increase Notice to the Agent. The Agent shall provide a copy of the Increase Notice to the Lenders, and the Lenders shall, within 10 Business Days following receipt thereof, advise the Agent of their decision whether or not to provide any Increased Commitments. Any Lender approached to provide all or a portion of the Increased Commitments may elect or decline, in its sole discretion, to provide an Increased Commitment. If any Lender does not respond to the Increase Notice, it will be deemed to have elected not to provide an Increased Commitment. Schedule “A” will be amended by the Agent to reflect any Increased Commitments made by Lenders, without requiring the signature of each Lender.

2.3.7 If, after the Borrower has availed itself of the procedures set out in subsection 2.3.6, the Credit remains less than $650,000,000, the Borrower may again, on one occasion, attempt to obtain New Lender Commitments for the remaining balance subject to complying with the provisions of subsections 2.3.1 to 2.3.5.”.

7. Section 10.2 of the Credit Agreement is deleted and replaced by the following, to take into account the conditions precedent contemplated by this Ninth Amending Agreement:

“10.2 Initial Advance under the Revolving Facility After the Ninth Amendment Closing Date

10.2.1 certified copies of all of the constating documents, borrowing by-laws and resolutions of the Borrower, each other member of the VL Group and Spectrum Co. (if the Borrower elects to use Spectrum Co. to act as bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase) not previously provided to the Agent shall have been provided to the Agent;

9. A new Schedule “O”, entitled “Joinder Agreement”, is attached.

III. EFFECTIVE DATE AND CONDITIONS

1. This Ninth Amending Agreement shall become effective as of April 7, 2008 (the “ Effective Date ”), subject to the fulfilment of all conditions precedent set out herein and in the amended Section 10.2 above.

2. On the Effective Date, the Credit Agreement shall be modified by the foregoing amendments. The parties hereto agree that the changes to the Credit Agreement set out herein and the execution hereof shall not constitute novation and all the Security shall continue to apply to the Credit Agreement, as amended hereby, and all other obligations secured thereby. Without limiting the generality of the foregoing and to the extent necessary, (i) the Lenders and the Agent reserve all of their rights under each of the Security Documents, and (ii) each of the Borrower and the Guarantors obligates itself again in respect of all present and future obligations under, inter alia , the Credit Agreement, as amended hereby.

3. The Borrower shall pay all fees and costs, including (a) the fees referred to in the Borrower’s request letter dated February 15, 2008, and (b) legal fees associated with this Agreement incurred by the Agent as contemplated and restricted by the provisions of Section 12.14 of the Credit Agreement.

IV. MISCELLANEOUS

1. All of the provisions of the Credit Agreement that are not amended hereby shall remain in full force and effect.

2. This Agreement shall be governed by and construed in accordance with the Laws of the Province of Quebec.

3. The parties acknowledge that they have required that the present agreement, as well as all documents, notices and legal proceedings entered into, given or instituted pursuant hereto or relating directly or indirectly hereto be drawn up in English. Les parties reconnaissent avoir exigé la rédaction en anglais de la présente convention ainsi que de tous documents exécutés, avis donnés et procédures judiciaires intentées, directement ou indirectement, relativement ou à la suite de la présente convention.

IN WITNESS WHEREOF THE PARTIES HERETO HAVE SIGNED THIS AGREEMENT ON THE DATE AND AT THE PLACE FIRST HEREINABOVE MENTIONED.

VIDÉOTRON LTÉE

Per:	/s/ JEAN-FRANÇOIS PRUNEAU

ROYAL BANK OF CANADA, as Agent for the Lenders

Per:	/ s/ ANN HURLEY
	Manager, Agency

ROYAL BANK OF CANADA		THE TORONTO-DOMINION BANK

Per:	/s/ ROD SMITH	Per:	/s/ (ILLEGIBLE)
	Authorized Signatory

		Per:	/s/ (ILLEGIBLE)


BANK OF MONTREAL		BANK OF AMERICA, N.A., Canada Branch

Per:	/s/ (ILLEGIBLE)	Per:	/s/ MEDINA SALES DE ANDRADE
			Vice President


CANADIAN IMPERIAL BANK OF COMMERCE		THE BANK OF NOVA SCOTIA

Per:	/s/ (ILLEGIBLE)	Per:	/s/ ROB KING
			Managing Director

Per:	/s/ (ILLEGIBLE)	Per:	/s/ BRADLEY WALKER
			Associate Director

CITIBANK, N.A., Canadian Branch		CAISSE CENTRALE DESJARDINS

Per:	/s/ (ILLEGIBLE)	Per:	/s/ (ILLEGIBLE)


		Per:	/s/ (ILLEGIBLE)

LAURENTIAN BANK OF CANADA		NATIONAL BANK OF CANADA

Per:	/s/ (ILLEGIBLE)	Per:	/s/ (ILLEGIBLE)


Per:	/s/ (ILLEGIBLE)	Per:	/s/ (ILLEGIBLE)

HSBC BANK CANADA

Per:	/s/ (ILLEGIBLE)


Per:	/s/ (ILLEGIBLE)

SUMITOMO MITSUI BANKING CORPORATION OF CANADA

Per:	/s/ E.R. LANGLEY
	Senior Vice President

The undersigned acknowledge having taken cognizance of the provisions of the foregoing Ninth Amending Agreement and agree that the Guarantees and Security executed by them (A) remain enforceable against them in accordance with their terms, and (B) continue to guarantee or secure, as applicable, all of the obligations of the Persons specified in such Guarantees and Security Documents in connection with the Credit Agreement as defined above, and as amended hereby:

LE SUPERCLUB VIDÉOTRON LTÉE		GROUPE DE DIVERTISSEMENT SUPERCLUB INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU	Per:	/s/ JEAN-FRANÇOIS PRUNEAU


CF CABLE TV INC.		SUPERCLUB PROPERTIES INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU	Per:	/s/ JEAN-FRANÇOIS PRUNEAU

SUPERCLUB VIDÉOTRON CANADA INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU

The undersigned acknowledges having taken cognizance of the provisions of the foregoing Ninth Amending Agreement and agrees that the pledge of the shares of the Borrower executed by the undersigned as of July 6, 2006 in favour of the Agent (A) remains enforceable against it in accordance with its terms, and (B) continues to secure all of the obligations of the Persons specified in such Security Document in connection with the Credit Agreement, as defined above, and as amended hereby:

QUEBECOR MEDIA INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU

SCHEDULE “A” - LIST OF LENDERS AND COMMITMENTS

The Revolving Facility

Cash Management Facilities — The Toronto-Dominion Bank (“ TD ”) - $15,000,000.

Balance of Revolving Facility:

Lender	Commitment ($)		Commitment (%)
Royal Bank of Canada
The Bank of Nova Scotia
The Toronto-Dominion Bank
Bank of America N.A., Canada Branch
Citibank N.A., Canadian Branch
Bank of Montreal
Canadian Imperial Bank of Commerce
National Bank of Canada
Caisse centrale Desjardins
Laurentian Bank of Canada
HSBC Bank Canada
Sumitomo Mitsui Banking Corporation of Canada

Total	$	575,000,000	100	%

SCHEDULE “O” — JOINDER AGREEMENT

JOINDER AGREEMENT

THIS JOINDER AGREEMENT , dated as of , 200 (this “ Agreement ”), by and among [NEW LENDERS] (each a “ New Lender ” and collectively the “ New Lenders ”), VIDÉOTRON LTÉE (the “ Borrower ”), the several banks and other financial institutions or entities from time to time parties thereto, Royal Bank of Canada, as Agent (in such capacity, the “ Agent ”).

RECITALS:

WHEREAS reference is hereby made to the Credit Agreement dated as of November 28, 2000, as amended by a First Amending Agreement dated January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, a Seventh Amending Agreement dated as of November 19, 2004, an Eighth Amending Agreement dated as of March 6, 2008, and a Ninth Amending Agreement dated as of April 7, 2008 (as it may be further amended, restated, supplemented or otherwise modified from time to time, the “ Credit Agreement ”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among the Lenders party thereto from time to time and the Agent; and

WHEREAS subject to the terms and conditions of the Credit Agreement, the Borrower may increase the existing Commitments by obtaining New Lender Commitments and entering into one or more Joinder Agreements with the New Lenders.

NOW, THEREFORE , in consideration of the premises and agreements, provisions and covenants herein contained, the parties hereto agree as follows:

Each New Lender party hereto hereby agrees to commit to provide its respective New Lender Commitment as set forth on Schedule A annexed hereto, on the terms and subject to the conditions set forth below:

Each New Lender (i) confirms that it has received a copy of the Credit Agreement and the Security Documents, together with copies of the financial statements referred to therein and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Joinder Agreement (this “ Agreement ” ); (ii) agrees that it will, independently and without reliance upon the Agent 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; (iii) appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement and the Security Documents as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (iv) acknowledges and accepts that such New Lender and the Agent are solidary creditors of

the Borrower and the Guarantors in respect of all amounts, liabilities and other obligations, present and future, of the Borrower and the Guarantors to each of them under the Credit Agreement and the Derivative Instruments as contemplated by Section 18.1.2 of the Credit Agreement and in accordance with Article 1541 of the Civil Code of Quebec; and (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.

Each New Lender hereby agrees to make its Commitment on the following terms and conditions:

1. New Lenders . Each New Lender acknowledges and agrees that upon its execution of this Agreement, such New Lender shall become a “Lender” under, and for all purposes of, the Credit Agreement and the Security Documents, and shall be subject to and bound by the terms thereof, and shall perform all the obligations of and shall have all rights of a Lender thereunder.

2. Credit Agreement Governs. Except as set forth in this Agreement, New Advances shall otherwise be subject to the provisions of the Credit Agreement and the Security Documents.

3. The Borrower’s Certifications . By its execution of this Agreement, each of the undersigned officers, to the best of his or her knowledge, and the Borrower hereby certify that:

i. The representations and warranties contained in the Credit Agreement and the Security Documents are true and correct in all material respects on and as of the date hereof to the same extent as though made on and as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties were true and correct in all material respects on and as of such earlier date;

ii. No event has occurred and is continuing or would result from the addition of the Commitments from the New Lenders as contemplated hereby that would constitute a Default or an Event of Default;

iii. The Borrower has performed in all material respects all agreements and satisfied all conditions required to be performed or satisfied by it under the Credit Agreement on or before the date hereof; and

iv. After giving effect to this Joinder Agreement and the aggregate new Commitments, the Borrower is (and will be on a pro forma basis) in compliance with the financial tests described in Section 12.11 of the Credit Agreement.

4. The Borrower’s Covenants . By its execution of this Agreement, the Borrower hereby covenants that:

i. The Borrower shall make all payments required pursuant to the Credit

Agreement in connection with the New Lender Commitments, including the payment of any fees in respect of such New Lender Commitment; and

ii. The Borrower shall deliver or cause to be delivered the legal opinions and documents required pursuant to subsection 2.3.2 of the Credit Agreement.

5. Notice . For purposes of the Credit Agreement, the initial notice address of each New Lender shall be as set forth below its signature below.

6. Recording of the New Loans . Upon execution and delivery hereof, the Agent will record the New Advances made by New Lenders in the register maintained by it for such purposes.

7. Amendment, Modification and Waiver . This Agreement may not be amended, modified or waived except by an instrument or instruments in writing signed and delivered on behalf of each of the parties hereto.

8. Entire Agreement . This Agreement, the Credit Agreement and the Security Documents constitute the entire agreement among the parties with respect to the subject matter hereof and thereof and supersede all other prior agreements and understandings, both written and verbal, among the parties or any of them with respect to the subject matter hereof.

9. Governing Law . This Agreement and the rights and obligations of the parties hereunder shall be governed by, and shall be construed and enforced in accordance with, the laws of the province of Quebec.

10. Severability . Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as would be enforceable.

12. Counterparts . This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement.

[Remainder of page intentionally left blank]

iii

IN WITNESS WHEREOF , each of the undersigned has caused its duly authorized officer to execute and deliver this Joinder Agreement as of [ , ].

	[NAME OF NEW LENDER]


	By:
	Name:
	Title:

	Notice Address:


	Attention:
	Telephone:
	Facsimile:


	VIDÉOTRON LTÉE


	By:
	Name:
	Title:


	By:
	Name:
	Title:

ROYAL BANK OF CANADA as Agent


By:
Name:
Title:

Exhibit 4.3

EIGHTH AMENDING AGREEMENT to the Credit Agreement dated as of November 28, 2000, as amended by a First Amending Agreement dated January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, and a Seventh Amending Agreement dated as of November 19, 2004, entered into in the City of Montreal, Province of Quebec, as of March 6, 2008,

AMONG:		VIDÉOTRON LTÉE , a company constituted in accordance with the laws of Quebec, having its registered office at 300 Viger Street East, 6 th floor, in the City of Montreal, Province of Quebec (hereinafter called the “ Borrower ”)

		PARTY OF THE FIRST PART

	AND:	THE LENDERS, AS DEFINED IN THE CREDIT AGREEMENT (the “ Lenders ”)

		PARTIES OF THE SECOND PART

	AND:	ROYAL BANK OF CANADA, AS ADMINISTRATIVE AGENT FOR THE LENDERS , a Canadian bank, having a place of business at 200 Bay Street, 12th floor, South Tower, Royal Bank Plaza, in the City of Toronto, Province of Ontario (hereinafter called the “ Agent ”)

		PARTY OF THE THIRD PART

WHEREAS the parties hereto are parties to a Credit Agreement dated as of November 28, 2000, as amended by a First Amending Agreement dated January 5, 2001, a Second Amending Agreement dated as of June 29, 2001, a Third Amending Agreement dated as of December 21, 2001, a Fourth Amending Agreement dated as of December 23, 2002, a Fifth Amending Agreement dated as of March 24, 2003, a Sixth Amending Agreement dated as of October 8, 2003, and a Seventh Amending Agreement dated as of November 19, 2004, creating an Amended and Restated Credit Agreement (as so amended and amended and restated, the “ Credit Agreement ”);

WHEREAS the Borrower has requested certain amendments to the Credit Agreement to provide it with greater flexibility and, in particular, to allow the Borrower to cause to be issued Letters of Credit in connection with the upcoming Canadian Auction for Spectrum Licences for Advanced Wireless Services and other Spectrum in the 2 GHz Range of up to $350,000,000, and to make certain amendments to pricing and to other covenants; and

WHEREAS the requisite majority of the Lenders has agreed with the Borrower to the amendments contemplated hereby, and as such, the Lenders have complied with the provisions of Section 18.14 of the Credit Agreement, as evidenced by the signature of each Lender and of the Agent on this Agreement;

NOW THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

Leverage Ratio	Facility Fees	Prime Rate plus	Stamping Fees or Cdn$ Libor plus or LC Fee

which is after the expiry of the Term (or, in the case of a Letter of Credit, on a date which is less than 5 Business Days before the expiry of the Term).”.

“9.2.10 if the Borrower elects to use Spectrum Co. as the bidder on behalf of the Borrower and others in the Spectrum Auction and Purchase, execute and cause to be executed by the Borrower and any of its Subsidiaries holding shares or other equity interests in Spectrum Co., from the date on which any of same are acquired, an agreement pledging such shares and equity interests to the Agent on behalf of the Lenders by way of a first-ranking pledge (subject only to Permitted Charges), which agreement shall be substantially in the form of the Share Pledge.”.

The obligation of the Lenders to make the initial Advance under the Revolving Facility after the Eighth Amendment Closing Date is conditional upon the fulfilment of each of the conditions set out in this Section 10.2 and in Section 10.3 to the entire satisfaction of the Agent and the Lenders:

19. Section 11.4 is deleted and replaced by the following:

“11.4 Current Business

20. Section 12.13 is amended to remove the reference to providing quarterly Compliance Certificates containing an updated amount of certain Guarantees. Consequently, Section 12.13 now provides as follows:

“12.13 Maintenance of Security

21. A new Section 12.19 is added as follows:

“12.19 Transfer of Licences from Spectrum Co. to the VL Group

22. Section 13.4 is amended to correct a typographical error, by adding the following expression immediately before the expression “, or (c)”:

“ will be permitted under this paragraph (b) without complying with the provisions of paragraphs (i) and (ii) below)”.

23. Section 13.8 is amended to permit specific unsecured daylight loans and to add a basket of permitted unsecured Debt. Section 13.8 accordingly provides as follows:

“13.8 Debt and Guarantees

exists at the time, (B) incurring or assuming such Debt (including by way of providing such Guarantee) will not cause a Default or Event of Default, and (C) on a pro forma basis, the incurrence or assumption of such Debt would not reasonably be expected to cause the Borrower to breach any of its covenants under Section 12.11 hereof.”.

24. Subsection 16.2.1 is amended to require the consent of the Issuing Lender. Consequently, the subsection now provides as follows:

“16.2.1 Each Lender may, at its own cost, assign or transfer to a Person entitled to lend money in Canada or any other Person consented to by the Borrower, the Agent and the Issuing Lender, or, to the extent permitted under Section 17.15, to a Foreign Lender (the “ Assignee ”) in accordance with this Article 16 up to 100% of its rights, benefits and obligations hereunder (provided that its aggregate retained Commitment, if any, under the Revolving Facility is not less than $5,000,000) with the prior consent of the Borrower, which shall not be unreasonably withheld or delayed. The Borrower may not refuse to consent to an assignment or transfer on the sole grounds that the Assignee is a Foreign Lender, provided the provisions of Section 17.15 are respected. After the occurrence of a Default, any Lender may transfer all or any part of its rights, benefits and obligations hereunder to any Person, without the consent of the Borrower, but upon notice to the Agent and the Borrower and subject to the consent of the Issuing Lender.”.

25. Section 17.4 is deleted and replaced by the following:

“17.4 Entire Agreement

26. The first paragraph of Section 17.13 is deleted and replaced as follows:

“The Borrower agrees to indemnify and defend each of the Agent, each Lender, and their respective directors, officers, agents and employees from, and hold each of them harmless against, any and all losses, liabilities, claims, damages or expenses of any kind which at any time or from time to time may be asserted against or incurred or paid by any of them for or in connection with, arising directly or indirectly from or relating to: (i) the participation of the Agent or of any of the Lenders in the transactions

contemplated by this Agreement, (ii) any Advance or the use or proposed use of the proceeds therefrom (including any refusal by the Issuing Lender to honor 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) the role of the Agent or the Lenders in any investigation, litigation or other proceeding brought or threatened relating to the Credit, (iv) the presence on or under or the release or migration from any property or into the environment of any hazardous material, and/or (v) the compliance with or enforcement of any of their rights or obligations hereunder, including without limitation:”.

27. The first paragraphs of Schedule “J” (prior to the signature line entitled “Name and Title”) are deleted and replaced by the following:

“ We have reviewed the Credit Agreement originally dated as of November 28, 2000 entered into among VIDÉOTRON LTÉE, Royal Bank of Canada, as Agent and the Lenders (as defined in the Credit Agreement, as amended and restated on November 19, 2004, and as modified, supplemented, amended or amended and restated from time to time, the “ Credit Agreement ”) and hereby certify that:

(i) with the exceptions listed below (if any), as of the date of this certificate, the Borrower has complied with all the terms and conditions of the Credit Agreement; and

(iii) no Default has occurred and is continuing and no Event of Default has occurred or exists under the Credit Agreement [ or, if a Default or Event of Default exists, set out the details and proposed solutions ].

We attach a Compliance Certificate demonstrating the Borrower’s compliance with the financial covenants listed in subsections 12.11.1, 12.11.2 and 12.11.3 of the Credit Agreement for the latest period required under subsection {12.15.1 - quarterly} {12.15.2 - annual} {choose one} .”.

In addition, the portion at the end of the Schedule entitled “List of increases in any limited Guarantees”, and the titles below it, are deleted.

28. A new Schedule “M” is attached, replacing the former Schedule “M”.

III. EFFECTIVE DATE AND CONDITIONS

1. This Eighth Amending Agreement shall become effective as of March 6, 2008 (the “ Effective Date ”), subject to the fulfilment of all conditions precedent set out herein and in the amended Section 10.2 above.

3. The Borrower shall pay all fees and costs, including legal fees associated with this Agreement incurred by the Agent as contemplated and restricted by the provisions of Section 12.14 of the Credit Agreement.

4. The Borrower shall provide the opinion of its counsel, in form and substance acceptable to the Agent and the Lenders’ counsel, with respect to the power, capacity, and authority of the Borrower and each of the Guarantors to enter into or intervene in this Eighth Amending Agreement and to perform its obligations hereunder, with respect to the enforceability of this Eighth Amending Agreement in accordance with its terms; as well as, prior to the initial Advance by way of Letter of Credit under the Credit Agreement, with respect to the pledge of Spectrum Co.’s shares (if any), and with respect to the continued enforceability (unaffected hereby) of all of the Security. The Borrower shall also provide any opinions that the Agent may reasonably require in connection with Section 12.19 of the Credit Agreement.

IV. MISCELLANEOUS

1. All of the provisions of the Credit Agreement that are not amended hereby shall remain in full force and effect.

2. This Agreement shall be governed by and construed in accordance with the Laws of the Province of Quebec.

IN WITNESS WHEREOF THE PARTIES HERETO HAVE SIGNED THIS AGREEMENT ON THE DATE AND AT THE PLACE FIRST HEREINABOVE MENTIONED.

VIDÉOTRON LTÉE		ROYAL BANK OF CANADA, as Agent for the Lenders

Per:	/s/ JEAN-FRANÇOIS PRUNEAU	Per:	/s/ ANN MURLEY
			Manager, Agency


ROYAL BANK OF CANADA		THE TORONTO-DOMINION BANK

Per:	/s/ (ILLEGIBLE)	Per:	/s/ (ILLEGIBLE)


		Per:	/s/ (ILLEGIBLE)


BANK OF MONTREAL		BANK OF AMERICA, N.A., Canada Branch

Per:	/s/ (ILLEGIBLE)	Per:	/s/ NELSON LAM
			Vice President


CANADIAN IMPERIAL BANK OF COMMERCE		THE BANK OF NOVA SCOTIA

Per:	/s/ (ILLEGIBLE)	Per:	/s/ ROB KING
			Managing Director

Per:	/s/ (ILLEGIBLE)	Per:	/s/ BRADLEY WALKER
			Associate Director

CITIBANK, N.A., Canadian Branch		CREDIT SUISSE, Toronto Branch

Per:		Per:


Per:		Per:


CAISSE CENTRALE DESJARDINS		BANK OF TOKYO-MITSUBISHI UFJ (CANADA)

Per:	/s/ (ILLEGIBLE)	Per:


Per:	/s/ (ILLEGIBLE)	Per:


LAURENTIAN BANK OF CANADA		NATIONAL BANK OF CANADA

Per:	/s/ (ILLEGIBLE)	Per:	/s/ (ILLEGIBLE)


Per:	/s/ (ILLEGIBLE)	Per:	/s/ (ILLEGIBLE)


HSBC BANK CANADA		SOCIÉTÉ GÉNÉRALE (CANADA)

Per:	/s/ (ILLEGIBLE)	Per:


Per:	/s/ (ILLEGIBLE)	Per:

The undersigned acknowledge having taken cognizance of the provisions of the foregoing Eighth Amending Agreement and agree that the Guarantees and Security executed by them (A) remain enforceable against them in accordance with their terms, and (B) continue to guarantee or secure, as applicable, all of the obligations of the Persons specified in such Guarantees and Security Documents in connection with the Credit Agreement as defined above, and as amended hereby:

LE SUPERCLUB VIDÉOTRON LTÉE		GROUPE DE DIVERTISSEMENT SUPERCLUB INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU	Per:	/s/ JEAN-FRANÇOIS PRUNEAU


CF CABLE TV INC.		SUPERCLUB PROPERTIES INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU	Per:	/s/ JEAN-FRANÇOIS PRUNEAU


SUPERCLUB VIDÉOTRON CANADA INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU

The undersigned acknowledges having taken cognizance of the provisions of the foregoing Eighth Amending Agreement and agrees that the pledge of the shares of the Borrower executed by the undersigned as of July 6, 2006 in favour of the Agent (A) remains enforceable against it in accordance with its terms, and (B) continues to secure all of the obligations of the Persons specified in such Security Document in connection with the Credit Agreement, as defined above, and as amended hereby:

QUEBECOR MEDIA INC.

Per:	/s/ JEAN-FRANÇOIS PRUNEAU

SCHEDULE “M”

MEMBERS OF THE VL GROUP AS AT THE

EIGHTH AMENDMENT CLOSING DATE

VIDÉOTRON LTÉE

LE SUPERCLUB VIDÉOTRON LTÉE

LES PROPRIÉTÉS SUPERCLUB INC./SUPERCLUB PROPERTIES INC.

SUPERCLUB VIDÉOTRON CANADA INC.

GROUPE DE DIVERTISSEMENT SUPERCLUB INC.

SETTE INC.

CF CÂBLE TV INC./CF CABLE TV INC.

GUARANTORS AS AT THE EIGHTH AMENDMENT CLOSING DATE

LE SUPERCLUB VIDÉOTRON LTÉE

LES PROPRIÉTÉS SUPERCLUB INC./SUPERCLUB PROPERTIES INC.

SUPERCLUB VIDÉOTRON CANADA INC.

GROUPE DE DIVERTISSEMENT SUPERCLUB INC.

CF CÂBLE TV INC./CF CABLE TV INC.

QUEBECOR MEDIA INC., under a limited recourse guarantee (limited to a pledge of the shares of the Borrower).

Exhibit 4.10

between

VIDEOTRON LTD.

(As Borrower)

and

QUEBECOR MÉDIA INC.

(As Lender)

TABLE OF CONTENTS

1.	INTERPRETATION		1

	1.1	DEFINITIONS	1
	1.2	HEADINGS	3
	1.3	REFERENCES	3
	1.4	PREAMBLE	3

2.	THE SUBORDINATED LOAN		3

	2.1	SUBORDINATED LOAN	3
	2.2	INTEREST	4
	2.3	PAYMENT OF PRINCIPAL AND INTEREST	4
	2.4	RANKING	4
	2.5	OPTIONAL PREPAYMENT	4
	2.6	AUTOMATIC PAYMENT DEFERRAL	4
	2.7	INTEREST ON OVERDUE PAYMENTS	5
	2.8	MANNER OF PAYMENT	5
	2.9	APPLICATION OF PAYMENTS	5

3.	REPRESENTATIONS AND WARRANTIES		6

	3.1	REPRESENTATIONS AND WARRANTIES	6

4.	COVENANTS		7

	4.1	AFFIRMATIVE COVENANTS	7

5.	EVENTS OF DEFAULT		8

	5.1	EVENTS OF DEFAULT	8
	5.2	PERFORMANCE BY THE LENDER	9
	5.3	REMEDIES UPON EVENT OF DEFAULT	9

6.	MISCELLANEOUS		9

	6.1	WAIVER	9
	6.2	SEVERABILITY	9
	6.3	BINDING EFFECT AND ASSIGNMENT	10
	6.4	ENTIRETY	10
	6.5	INDEMNITY	10
	6.6	REMEDIES CUMULATIVE	10
	6.7	TERM OF AGREEMENT	11
	6.8	ADDRESS FOR NOTICE	11
	6.9	GOVERNING LAW AND JURISDICTION	12
	6.10	INCONSISTENT PROVISIONS	12
	6.11	COUNTERPARTS	12
	6.12	DEFAULT BY LAPSE OF TIME	12
	6.13	LANGUAGE	12

SCHEDULE A PROMISSORY NOTE			14

SUBORDINATED LOAN AGREEMENT dated as of January 3, 2007:

BETWEEN:		VIDEOTRON LTD. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Borrower ”);

AND:		QUEBECOR MÉDIA INC. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Lender ”);

WHEREAS the Borrower has requested that the Lender provide the Borrower with a subordinated loan in the principal amount of one billion dollars ($1,000,000,000) and the Lender has agreed to provide such subordinated loan to the Borrower, upon the terms and subject to the conditions hereinafter set forth;

THE PARTIES HEREBY AGREE AS FOLLOWS:

1. INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires, the following terms shall have the meanings respectively ascribed to them in this Section 1.1:

“ Agreement ” means the present subordinated loan agreement between the Borrower and the Lender dated as of January 3, 2007 (as same may be amended, restated or otherwise modified from time to time);

“ Business Day ” means a day, other than a Saturday or a Sunday, on which banks in Montreal, Quebec are open for business in that city;

“ Class B Preferred Shares ” means 1,000,000 Class B Preferred Shares of the capital stock of 9101-0835 Québec Inc. issued to and registered in the name of the Borrower;

“ Closing Date ” means January 3, 2007, at which time the Subordinated Loan shall be advanced to the Borrower, in its entirety, by the Lender;

“ Default ” means any of the events specified in Section 5.1, regardless of whether there shall have occurred any passage of time or giving of notice or both that would be necessary in order to constitute such event an Event of Default;

“ Dollars ”, and “ $ ” means the lawful currency of Canada;

“ Event of Default ” has the meaning ascribed to that term in Section 5.1;

“ Interest Installment ” means the amount of interest due in respect of each Interest Period and payable on the Interest Payment Date;

“ Interest Payment Date ” means June 20 and December 20 of each year, provided that the first Interest Payment Date shall be on June 20, 2007 and the last Interest Payment Date shall be on the Principal Payment Date (to the extent any amounts in interest then remain unpaid);

“ Interest Period ” means each of the six-month period ending on June 20 and December 20 of each year; except for the first Interest Period, which shall begin on January 3, 2007 and end on June 20, 2007, and the last Interest Period which shall end on the Principal Payment Date.

“ Loan Documents ” means this Agreement and the Promissory Note, all as amended, supplemented, restated or replaced from time to time;

“ Maturity Date ” means January 3, 2022;

“ Obligations ” means:

(i) the prompt payment, as and when due and payable, of all amounts in principal, interest fees, costs or otherwise now or hereafter owing by the Borrower to the Lender under, or pursuant to, the Loan Documents; and

(ii) the strict performance and observance by the Borrower of all agreements, warranties, representations, covenants and conditions of the Borrower made under, or pursuant to, the Loan Documents.

“ Person ” means any individual, company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or Governmental Authority;

“ Principal Installment ” means the payment of principal due on the Principal Payment Date;

“ Principal Payment Date ” means, in respect of the principal payment due hereunder, at the latest the Maturity Date, to the extent any amounts in principal of the Subordinated Loan then remain unpaid;

“ Promissory Note ” means the promissory note remitted by the Borrower to the Lender pursuant to Section 2.1 herein, substantially in the form of Schedule A attached hereto; and

“ Subordinated Loan ” shall have the meaning ascribed to it in Section 2.1.

1.2 Headings

The headings of the Articles, Sections, Subsections or Paragraphs herein are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

1.3 References

Unless the context otherwise requires or unless otherwise provided, all references to Articles, Sections, Subsections, Paragraphs and Schedules are to Articles, Sections, Subsections, Paragraphs and Schedules to, this Agreement. The words “hereto”, “herein”, “hereof”, “hereunder” and similar expressions mean and refer to this Agreement.

1.4 Preamble

Unless the context otherwise requires, the preamble forms an integral part hereof.

2. THE SUBORDINATED LOAN

2.1 Subordinated Loan

Relying on each of the representations and warranties set out in Article 3 and subject to the terms and conditions herein contained, the Lender agrees to make available, on the Closing Date, to the Borrower, by way of a single advance of one billion dollars ($1,000,000,000), a subordinated loan in the amount of one billion dollars ($1,000,000,000) upon receipt of the Promissory Note for the amount of such subordinated loan duly executed by the Borrower in favour of the Lender (the “ Subordinated Loan ”).

2.2 Interest

The Subordinated Loan shall bear interest on the unpaid principal amount of the Subordinated Loan from and after the Closing Date to the Borrower until the Subordinated Loan is repaid in full to the Lender at an annual interest rate equal to 10.50% (the “ Interest Rate ”). The interest shall accrue daily and shall be payable in arrears on a bi-annual basis in accordance with Section 2.3.

2.3 Payment of Principal and Interest

Subject to the terms and conditions of this Agreement, the Borrower shall repay the Subordinated Loan and accrued interest thereon to the Lender by way of thirty one (31) Interest Installments and one Principal Installment, the Interest Installment to become due and payable on each Interest Payment Date, and the Principal Installment to become due and payable on the Principal Payment Date. On the Maturity Date, all amounts remaining unpaid with respect to the Subordinated Loan, including principal, interest and costs shall become due and payable.

2.4 Ranking

The Obligations of the Borrower hereunder are subordinated in right of payment to the prior payment in full of all existing and future senior indebtedness of the Borrower. The holders of all such senior indebtedness of the Borrower will be entitled to receive payment in full of all amounts due on or in respect of all other existing and future senior indebtedness of the Borrower before the Lender is entitled to receive or retain payment of principal hereunder or as permitted by the terms of such senior indebtedness.

2.5 Optional Prepayment

The Borrower may, without penalty, prepay the Subordinated Loan outstanding with accrued interest thereon, provided however that no amounts are then outstanding under the senior indebtedness of the Borrower or as permitted by the terms of such senior indebtedness.

Any amount prepaid by the Borrower pursuant to this Section 2.5 may not be re-borrowed under this Agreement and shall constitute a permanent reduction of the Subordinated Loan.

2.6 Automatic Payment Deferral

Notwithstanding any other provisions herein, the Borrower shall have no obligation to make any payment becoming due and payable hereunder until the Borrower is reasonably satisfied that it will concurrently receive a corresponding capital or dividend payment under the Class B Preferred Shares.

2.7 Interest on Overdue Payments

In the event that any amount of principal of, or interest on, the Subordinated Loan is not paid by the Borrower in full when due (whether at stated maturity, by acceleration or otherwise), the Borrower shall pay, on demand, interest on such unpaid amount, from the date such amount becomes due until the date such amount is paid in full, at the rate determined in Section 2.2 plus 2.0%. If any other amount payable by the Borrower under any Loan Document is not paid in full when due, the Borrower shall pay, on demand, interest on such unpaid amount from the date such amount becomes due until the date such amount is paid in full at an annual interest rate determined in Section 2.2 plus 2.0 %.

2.8 Manner of Payment

All payments of principal of, and interest on, the Subordinated Loan shall be made by the Borrower to the Lender, before 11:00 a.m., Montreal time, on the due date thereof in immediately available funds at the registered office of the Lender located at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8, or at such other place as the Lender may designate in writing. Any payment received after 11:00 a.m., Montreal time, shall be deemed to have been received on the next succeeding Business Day. If the principal of or interest on the Subordinated Loan, or any other amount payable by the Borrower under this Agreement, becomes due and payable on a day that is not a Business Day, the payment date or the maturity date thereof shall be the next following Business Day.

2.9 Application of Payments

2.9.1 All payments made by the Borrower pursuant to this Agreement shall be applied in each instance in the following order:

(1) first, to the amount of interest due and payable on the Subordinated Loan;

(2) second, to the amount due and payable as principal of the Subordinated Loan; and

(3) third, to any other amount due and payable pursuant to the Loan Documents.

2.9.2 Following the occurrence of an Event of Default which is continuing or following the Maturity Date, the Borrower hereby irrevocably waives the right to direct the application of any and all such payments received from or on behalf of the Borrower, and the Borrower hereby irrevocably agrees that the Lender shall have the continuing exclusive right to apply any and all such payments against

the Borrower’s obligations under the Loan Documents as the Lender may deem advisable.

3. REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties

The Borrower represents and warrants to the Lender that:

3.1.1 Incorporation and Good Standing . The Borrower is a company duly incorporated and validly existing under the laws of its jurisdiction of incorporation and is qualified to carry on its activities in each jurisdiction in which it carries on its activities.

3.1.2 Authorization and Capacity . The Borrower has the capacity and authority to enter into the Loan Documents and it has taken all measures and actions necessary to authorize the Borrower to execute and deliver the Loan Documents and to perform the obligations resulting from the Loan Documents. The Borrower also has the power to own its assets and to carry on the activities it now carries on.

3.1.3 No Conflicts or Consents . Neither the execution and delivery of the Loan Documents, nor the consummation of any of the transactions therein contemplated, nor compliance with the terms and provisions thereof, shall contravene or conflict with any provision of law, statute or regulation to which the Borrower is subject or any judgment, license, order or permit applicable to the Borrower or any agreement or instrument to which the Borrower is a party or by which the Borrower is bound.

3.1.4 No Default . The Borrower is not in breach of or in default under, and no event or omission has occurred which, with the giving of notice or lapse of time or otherwise, might constitute a breach of, or default under, any material agreement or instrument to which the Borrower is a party or by which the Borrower is bound.

3.1.5 Survival of Representations and Warranties . All representations and warranties by the Borrower made in the Loan Documents shall survive delivery of the Loan Documents and the disbursement of the Subordinated Loan and any investigation at any time made by or on behalf of the Lender shall not diminish or otherwise affect the Lender’s right to rely thereon.

4. COVENANTS

4.1 Affirmative Covenants

The Borrower covenants and agrees with the Lender as follows:

4.1.1 Payment and Performance of Obligations . The Borrower shall duly and punctually pay all amounts, comply with all covenants and perform all other obligations on its part required to be paid, complied with or performed under the terms of the Loan Documents.

4.1.2 Maintenance of Existence . The Borrower shall preserve and maintain its existence, licenses, rights, permits and privileges and all authorizations, consents, approvals, orders, licenses, permits, exemptions from or registrations or qualifications with any court or governmental authority that are necessary or materially valuable in the operation of its business.

4.1.3 Compliance with Applicable Laws . The Borrower shall comply and cause its property and assets to comply with all applicable laws in all material respects.

4.1.4 Certain Notices . The Borrower shall promptly give written notice to the Lender of the occurrence of any Default or Event of Default or of any action, claim, delegation, proceeding or dispute affecting the Borrower which might have a material adverse effect on it, its property or its financial condition and the Borrower shall provide to the Lender, from time to time, with all reasonable information requested by the Lender concerning the status of any such action, claim, litigation, proceeding or dispute.

4.1.5 Further Assurances . The Borrower shall make, execute or endorse, and acknowledge and deliver or file all such documents, and take any and all such other action, as the Lender may, from time to time, deem reasonably necessary or proper in connection with any of the Loan Documents or the obligations of the Borrower thereunder.

4.1.6 Other Information . The Borrower shall promptly furnish to the Lender such other information respecting its operations, properties, business, condition (financial or otherwise) or prospects, as the Lender may from time to time reasonably request.

5. EVENTS OF DEFAULT

5.1 Events of Default

Each of the following events shall constitute an “ Event of Default ” under this Agreement:

5.1.1 Payment of Principal and Interest . The Borrower failing to pay when due and payable the principal of, or, and except as provided herein, any interest on, the Subordinated Loan, or within five (5) days of such payment becoming due and the payable hereunder, any other payment required under Loan Documents.

5.1.2 Performance of Obligations . The Borrower committing a breach of, or defaulting in the due and prompt performance or observance of any of its covenants or obligations contained in the Loan Documents (other than a payment obligation as set forth in Subsection 5.1.1) which, if capable of being remedied or cured, is not remedied or cured within thirty (30) days from the earlier of (i) the Borrower becoming aware of such breach or default and (ii) notice in writing having been given by the Lender to the Borrower specifying such breach or default and requiring the Borrower to remedy or cure such breach or default or to cause such breach or default to be remedied or cured.

5.1.3 Other Indebtedness . The Borrower is in default under its senior indebtedness or any other indebtedness in excess of $10,000,000 and, in each case, the creditors thereof have accelerated such indebtedness.

5.1.4 Insolvency . The Borrower (i) admits in writing its inability to pay its debts as they become due, (ii) files, or consents by answer or otherwise to the filing against it of, a petition for relief, reorganization or arrangement or any other petition in bankruptcy or for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to it or any substantial part of its assets or (v) takes corporate action for the purpose of the foregoing.

5.1.5 Dissolution, Winding-up, Liquidation. A court or other governmental authority of competent jurisdiction enters an order (i) appointing a custodian, receiver, trustee or other officer with similar powers with respect to the Borrower or any substantial part of its assets, (ii) for relief or approving a petition for relief, reorganization or any other petition in bankruptcy or for liquidation of the Borrower or to take

advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction or (iii) for the dissolution, winding-up or liquidation of the Borrower, or any such petition shall be filed against the Borrower and not be dismissed within ninety (90) days.

5.2 Performance by the Lender

If the Borrower fails to perform any covenant, obligation, or agreement contained in any of the Loan Documents, the Lender may perform or attempt to perform such covenant, obligation or agreement on behalf of the Borrower. In such event, the Borrower shall, at the request of the Lender, pay on demand any amount expended by the Lender in such performance or attempted performance to the Lender, together with interest thereon at the annual interest rate applicable to the Subordinated Loan from the date of such expenditure until paid. Notwithstanding the foregoing, the Lender shall not assume any liability or responsibility for the performance of any covenant, obligation or agreement of the Borrower under any of the Loan Documents or control over the management and affairs of the Borrower.

5.3 Remedies Upon Event of Default

If an Event of Default shall have occurred and be continuing, the Lender may, in addition to any other rights or recourse it may have at law or under the Loan Documents, declare the principal of, and all interest then accrued on, the Subordinated Loan and all other obligations of the Borrower to be forthwith due and payable, whereupon the same shall forthwith become due and payable and/or exercise and enforce any of the Lender’s rights and remedies under the Loan Documents.

6. MISCELLANEOUS

6.1 Waiver

No failure to exercise, and no delay in exercising, on the part of the Lender, any right or remedy under the Loan Documents shall operate as a waiver thereof. No waiver of any provision of any Loan Document, nor consent to departure therefrom, shall be effective unless in writing and no such consent or waiver shall extend beyond the specific instance and purpose for which given.

6.2 Severability

If any provision of any Loan Document is held to be illegal, invalid or unenforceable under present or future laws during the term of this Agreement, such provision shall be fully severable; such Loan Document shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part of such Loan Document; and the remaining provisions of such Loan Document shall remain in full force and

effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from such Loan Document.

6.3 Binding Effect and Assignment

The Loan Documents shall be binding upon and ensure to the benefit of the Borrower and the Lender and their respective successors, assigns and legal representatives; provided, however, that the Borrower shall not, without the prior written consent of the Lender, assign any rights or obligations thereunder or any interest therein. For greater certainty, the transfer of the Borrower’s rights and obligations pursuant to the merger or amalgamation of the Borrower with another Person shall be deemed not to constitute an assignment for the purposes of this provision. The Lender may sell, assign or transfer all or any portion of the Lender’s rights and obligations under the Loan Documents to any Person.

6.4 Entirety

The Loan Documents embody the entire agreement between the parties and supersede all prior agreements and understandings, if any, relating to the subject matter hereof and thereof.

6.5 Indemnity

The Borrower shall indemnify and hold harmless the Lender and its representatives (each, an “ Indemnified Person ”) from and against any and all suits, actions, proceedings, claims, damages, losses, liabilities and expenses (including, without limitation, counsel’s fees and disbursements and other costs of investigation or defense, including those incurred upon any appeal) which may be instituted or asserted against or incurred by any Indemnified Person as the result or arising out of credit having been extended, suspended or terminated under any Loan Document and the administration of such credit and in connection with or arising out of the transactions contemplated under any Loan Document and any actions or failures to act in connection therewith and any legal costs and expenses arising out of or incurred in connection with disputes between or among any parties to any Loan Document (collectively, “ Indemnified Liabilities ”); provided, that the Borrower shall not be liable for any indemnification to an Indemnified Person to the extent that any such suit, action, proceeding, claim, damage, loss, liability or expense results solely from that Indemnified Person’s gross negligence or willful misconduct, as finally determined by a court of competent jurisdiction.

6.6 Remedies Cumulative

The rights and remedies under the Loan Documents are cumulative and not exclusive of any rights or remedies which the Lender would otherwise have.

6.7 Term of Agreement

The term of this Agreement is until the payment in full of all the obligations of the Borrower pursuant to the Loan Documents.

6.8 Address for Notice

Any notice or other communication required or permitted to be given under the Loan Documents shall be in writing and, except as otherwise provided herein, shall be personally delivered or transmitted by telecopier to the party for whom it is intended at the address of such party set out below or to such other address as such party may designate to the other party by notice in writing delivered in accordance with this Section 6.8:

(1) If to the Borrower:

Videotron Ltd.

612 Saint-Jacques Street

Montreal, Quebec

H3C 4M8

Attention: Executive Vice President, Finance and Operations and Chief Financial Officer

Telecopier: (514) 380-9068

(2) If to the Lender:

Quebecor Média Inc.

612 Saint-Jacques Street

Montreal, Quebec

H3C 4M8

Attention: Treasurer

Telecopier: (514) 380-1983

Any such notice or communication sent as aforesaid shall be deemed to have been received by the party to whom it is addressed (i) upon receipt, if personally delivered and (ii) if telecopied before 3:00 p.m. on a Business Day, on that day and if telecopied after 3:00 p.m. on a Business Day or if telecopied on a day other than a Business Day, on the Business Day next following the date of transmission; provided, however, that in the event normal courier service or telecopier service shall be interrupted by strike, force majeure or other cause, then the party sending the notice or communication, shall utilize any other mode of communication which shall ensure prompt receipt of such notice or communication by the other party or parties.

6.9 Governing Law and Jurisdiction

The Loan Documents and all matters arising under the Loan Documents shall be governed by, and construed in accordance with, the laws in force in the Province of Quebec and the laws of Canada applicable herein. The parties submit to the exclusive jurisdiction of the courts of the Province of Quebec any matter arising out of or in connection with the Loan Documents.

6.10 Inconsistent Provisions

In the event of any inconsistency between the provisions of this Agreement and the provisions of the Promissory Note, the provisions of this Agreement shall prevail to the extent of the inconsistency.

6.11 Counterparts

This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same agreement, and any of the parties hereto may execute this Agreement by signing any such counterpart.

6.12 Default by Lapse of Time

The Borrower shall be put in default to perform its obligations hereunder by the mere lapse of time for performing such obligations without the necessity of any demand or notice of default.

6.13 Language

The Borrower and the Lender confirm that they have requested that this Agreement and all documents and notices contemplated thereby be drawn up in the English language. L’Emprunteur et le Prêteur confirment avoir requis que cette convention et tous les documents et avis qui y sont envisagés soient rédigés en langue anglaise.

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.

QUEBECOR MÉDIA INC.


per:	/s/ Serge Gouin
Name:			Serge Gouin
Title:			Chairman of the Board


per:		/s/ Jean-François Pruneau
Name:			Jean-François Pruneau
Title:			Treasurer

VIDEOTRON LTD.


per:		/s/ Serge Gouin
Name:			Serge Gouin
Title:			Chairman of the Board


per:		/s/ Jean-François Pruneau
Name:			Jean-François Pruneau
Title:			Treasurer

FOR VALUE RECEIVED , Videotron Ltd. , a company duly incorporated under the laws of Quebec (including any successor thereto) (the “ Borrower ”), hereby promises to pay to Quebecor Média Inc. , a company duly incorporated under the laws of Quebec and any successor thereto (the “ Lender ”), at the registered office of the Lender located in the City of Montreal, Province of Quebec, the principal sum of one billion dollars ($1,000,000,000) in the lawful currency of Canada, on the 3 rd day of January, 2022, and pay interest from the date hereof on the said sum or the amount thereof from time to time remaining unpaid, in the same currency and at the same place, at a rate calculated and payable in accordance with the terms and conditions of the Agreement (as such term is defined herein below).

This promissory note is issued pursuant to Section 2.1 of the Agreement between the Borrower and the Lender dated as of January 3, 2007 (the “ Agreement ”). Reference is hereby made to the Agreement, the terms and conditions of which govern this promissory note. In the event of any conflict or inconsistency between the provisions of the Agreement and those of this promissory note, the provisions of the said Agreement shall prevail.

The Borrower hereby waives presentment for payment, notice of non-payment, protest and notice of protest and other notices of any kind in the enforcement of this promissory note.

SIGNED this 3 rd day of January, 2007.

	VIDEOTRON LTD.


	per:
	Name:		Serge Gouin
	Title:		Chairman of the Board


	per:
	Name:		Jean-François Pruneau
	Title:		Treasurer


	QUEBECOR MÉDIA INC.


	per:
	Name:		Serge Gouin
	Title:		Chairman of the Board


	per:
	Name:		Jean-François Pruneau
	Title:		Treasurer

between

VIDEOTRON LTD.

(As Borrower)

and

QUEBECOR MÉDIA INC.

(As Lender)

TABLE OF CONTENTS

1.	INTERPRETATION		1

	1.1	DEFINITIONS	1
	1.2	HEADINGS	3
	1.3	REFERENCES	3
	1.4	PREAMBLE	3

2.	THE SUBORDINATED LOAN		3

	2.1	SUBORDINATED LOAN	3
	2.2	INTEREST	4
	2.3	PAYMENT OF PRINCIPAL AND INTEREST	4
	2.4	RANKING	4
	2.5	OPTIONAL PREPAYMENT	4
	2.6	AUTOMATIC PAYMENT DEFERRAL	4
	2.7	INTEREST ON OVERDUE PAYMENTS	5
	2.8	MANNER OF PAYMENT	5
	2.9	APPLICATION OF PAYMENTS	5

3.	REPRESENTATIONS AND WARRANTIES		6

	3.1	REPRESENTATIONS AND WARRANTIES	6

4.	COVENANTS		7

	4.1	AFFIRMATIVE COVENANTS	7

5.	EVENTS OF DEFAULT		8

	5.1	EVENTS OF DEFAULT	8
	5.2	PERFORMANCE BY THE LENDER	9
	5.3	REMEDIES UPON EVENT OF DEFAULT	9

6.	MISCELLANEOUS		9

	6.1	WAIVER	9
	6.2	SEVERABILITY	9
	6.3	BINDING EFFECT AND ASSIGNMENT	10
	6.4	ENTIRETY	10
	6.5	INDEMNITY	10
	6.6	REMEDIES CUMULATIVE	10
	6.7	TERM OF AGREEMENT	11
	6.8	ADDRESS FOR NOTICE	11
	6.9	GOVERNING LAW AND JURISDICTION	12
	6.10	INCONSISTENT PROVISIONS	12
	6.11	COUNTERPARTS	12
	6.12	DEFAULT BY LAPSE OF TIME	12
	6.13	LANGUAGE	12

SCHEDULE A PROMISSORY NOTE			14

SUBORDINATED LOAN AGREEMENT dated as of May 31, 2007:

BETWEEN:	VIDEOTRON LTD. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

	(the “ Borrower ”);

AND:	QUEBECOR MÉDIA INC. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

	(the “ Lender ”);

WHEREAS the Borrower has requested that the Lender provide the Borrower with a subordinated loan in the principal amount of eight hundred seventy million dollars ($870,000,000) and the Lender has agreed to provide such subordinated loan to the Borrower, upon the terms and subject to the conditions hereinafter set forth;

THE PARTIES HEREBY AGREE AS FOLLOWS:

1. INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires, the following terms shall have the meanings respectively ascribed to them in this Section 1.1:

“ Agreement ” means the present subordinated loan agreement between the Borrower and the Lender dated as of May 31, 2007 (as same may be amended, restated or otherwise modified from time to time);

“ Business Day ” means a day, other than a Saturday or a Sunday, on which banks in Montreal, Quebec are open for business in that city;

“ Class B Preferred Shares ” means 870,000 Class B Preferred Shares of the capital stock of 9101-0835 Québec Inc. issued to and registered in the name of the Borrower;

“ Closing Date ” means May 31, 2007, at which time the Subordinated Loan shall be advanced to the Borrower, in its entirety, by the Lender;

“ Dollars ”, and “ $ ” means the lawful currency of Canada;

“ Event of Default ” has the meaning ascribed to that term in Section 5.1;

“ Interest Installment ” means the amount of interest due in respect of each Interest Period and payable on the Interest Payment Date;

“ Interest Period ” means each of the six-month period ending on June 20 and December 20 of each year; except for the first Interest Period, which shall begin on May 31, 2007 and end on June 20, 2007, and the last Interest Period which shall end on the Principal Payment Date.

“ Loan Documents ” means this Agreement and the Promissory Note, all as amended, supplemented, restated or replaced from time to time;

“ Maturity Date ” means May 31, 2022;

“ Obligations ” means:

(ii) the strict performance and observance by the Borrower of all agreements, warranties, representations, covenants and conditions of the Borrower made under, or pursuant to, the Loan Documents.

“ Person ” means any individual, company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or Governmental Authority;

“ Principal Installment ” means the payment of principal due on the Principal Payment Date;

“ Promissory Note ” means the promissory note remitted by the Borrower to the Lender pursuant to Section 2.1 herein, substantially in the form of Schedule A attached hereto; and

“ Subordinated Loan ” shall have the meaning ascribed to it in Section 2.1.

1.2 Headings

The headings of the Articles, Sections, Subsections or Paragraphs herein are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

1.3 References

1.4 Preamble

Unless the context otherwise requires, the preamble forms an integral part hereof.

2. THE SUBORDINATED LOAN

2.1 Subordinated Loan

Relying on each of the representations and warranties set out in Article 3 and subject to the terms and conditions herein contained, the Lender agrees to make available, on the Closing Date, to the Borrower, by way of a single advance of eight hundred seventy million dollars ($870,000,000), a subordinated loan in the amount of eight hundred seventy million dollars ($870,000,000) upon receipt of the Promissory Note for the amount of such subordinated loan duly executed by the Borrower in favour of the Lender (the “ Subordinated Loan ”).

2.2 Interest

2.3 Payment of Principal and Interest

2.4 Ranking

2.5 Optional Prepayment

Any amount prepaid by the Borrower pursuant to this Section 2.5 may not be re-borrowed under this Agreement and shall constitute a permanent reduction of the Subordinated Loan.

2.6 Automatic Payment Deferral

2.7 Interest on Overdue Payments

2.8 Manner of Payment

2.9 Application of Payments

2.9.1 All payments made by the Borrower pursuant to this Agreement shall be applied in each instance in the following order:

(1) first, to the amount of interest due and payable on the Subordinated Loan;

(2) second, to the amount due and payable as principal of the Subordinated Loan; and

(3) third, to any other amount due and payable pursuant to the Loan Documents.

the Borrower’s obligations under the Loan Documents as the Lender may deem advisable.

3. REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties

The Borrower represents and warrants to the Lender that:

4. COVENANTS

4.1 Affirmative Covenants

The Borrower covenants and agrees with the Lender as follows:

4.1.3 Compliance with Applicable Laws . The Borrower shall comply and cause its property and assets to comply with all applicable laws in all material respects.

5. EVENTS OF DEFAULT

5.1 Events of Default

Each of the following events shall constitute an “ Event of Default ” under this Agreement:

5.2 Performance by the Lender

5.3 Remedies Upon Event of Default

6. MISCELLANEOUS

6.1 Waiver

6.2 Severability

effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from such Loan Document.

6.3 Binding Effect and Assignment

6.4 Entirety

The Loan Documents embody the entire agreement between the parties and supersede all prior agreements and understandings, if any, relating to the subject matter hereof and thereof.

6.5 Indemnity

6.6 Remedies Cumulative

The rights and remedies under the Loan Documents are cumulative and not exclusive of any rights or remedies which the Lender would otherwise have.

6.7 Term of Agreement

The term of this Agreement is until the payment in full of all the obligations of the Borrower pursuant to the Loan Documents.

6.8 Address for Notice

(1)	If to the Borrower:

	Videotron Ltd.
	612 Saint-Jacques Street
	Montreal, Quebec
	H3C 4M8
	Attention: Executive Vice President, Finance and Operations and Chief Financial Officer

	Telecopier: (514) 380-9068

(2)	If to the Lender:

	Quebecor Média Inc.
	612 Saint-Jacques Street
	Montreal, Quebec
	H3C 4M8
	Attention: Treasurer

	Telecopier: (514) 380-1983

6.9 Governing Law and Jurisdiction

6.10 Inconsistent Provisions

6.11 Counterparts

6.12 Default by Lapse of Time

The Borrower shall be put in default to perform its obligations hereunder by the mere lapse of time for performing such obligations without the necessity of any demand or notice of default.

6.13 Language

The Borrower and the Lender confirm that they have requested that this Agreement and all documents and notices contemplated therein be drawn up in the English language. L’Emprunteur et le Prêteur confirment avoir requis que cette convention et tous les documents et avis auxquels la convention fait référence soient rédigés en langue anglaise.

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.

QUEBECOR MÉDIA INC.


per:	/s/ Louis Morin
Name:		Louis Morin
Title:		Vice-President and Chief Financial Officer

per:	/s/ Jean-François Pruneau
Name:					Jean-François Pruneau
Title:					Treasurer

VIDEOTRON LTD.


per:		/s/ Yvan Gingras
Name:				Yvan Gingras
Title:				Executive Vice-President, Finance and Operations and Chief Financial Officer


per:		/s/ Jean-François Pruneau
Name:			Jean-François Pruneau
Title:			Treasurer

FOR VALUE RECEIVED , Videotron Ltd. , a company duly incorporated under the laws of Quebec (including any successor thereto) (the “ Borrower ”), hereby promises to pay to Quebecor Média Inc. , a company duly incorporated under the laws of Quebec and any successor thereto (the “ Lender ”), at the registered office of the Lender located in the City of Montreal, Province of Quebec, the principal sum of eight hundred seventy million dollars ($870,000,000) in the lawful currency of Canada, on the 31 st day of May, 2022, and pay interest from the date hereof on the said sum or the amount thereof from time to time remaining unpaid, in the same currency and at the same place, at a rate calculated and payable in accordance with the terms and conditions of the Agreement (as such term is defined herein below).

This promissory note is issued pursuant to Section 2.1 of the Agreement between the Borrower and the Lender dated as of May 31, 2007 (the “ Agreement ”). Reference is hereby made to the Agreement, the terms and conditions of which govern this promissory note. In the event of any conflict or inconsistency between the provisions of the Agreement and those of this promissory note, the provisions of the said Agreement shall prevail.

The Borrower hereby waives presentment for payment, notice of non-payment, protest and notice of protest and other notices of any kind in the enforcement of this promissory note.

SIGNED this 31 st day of May, 2007.

	VIDEOTRON LTD.

	per:
	Name:			Yvan Gingras
	Title:			Executive Vice-President, Finance
	and Operations and Chief Financial Officer

	per:
	Name:			Jean-François Pruneau
	Title:			Treasurer


	QUEBECOR MÉDIA INC.

	per:
	N ame:			Louis Morin
	Title:			Vice-President and Chief Financial
	Officer

	per:
	Name:			Jean-François Pruneau
	Title:			Treasurer

between

CF CABLE TV INC.

(As Borrower)

and

QUEBECOR MÉDIA INC.

(As Lender)

TABLE OF CONTENTS

1.	INTERPRETATION		1

	1.1	DEFINITIONS	1
	1.2	HEADINGS	3
	1.3	REFERENCES	3
	1.4	PREAMBLE	3

2.	THE SUBORDINATED LOAN		3

	2.1	SUBORDINATED LOAN	3
	2.2	INTEREST	4
	2.3	PAYMENT OF PRINCIPAL AND INTEREST	4
	2.4	RANKING	4
	2.5	OPTIONAL PREPAYMENT	4
	2.6	AUTOMATIC PAYMENT DEFERRAL	4
	2.7	INTEREST ON OVERDUE PAYMENTS	5
	2.8	MANNER OF PAYMENT	5
	2.9	APPLICATION OF PAYMENTS	5

3.	REPRESENTATIONS AND WARRANTIES		6

	3.1	REPRESENTATIONS AND WARRANTIES	6

4.	COVENANTS		7

	4.1	AFFIRMATIVE COVENANTS	7

5.	EVENTS OF DEFAULT		8

	5.1	EVENTS OF DEFAULT	8
	5.2	PERFORMANCE BY THE LENDER	9
	5.3	REMEDIES UPON EVENT OF DEFAULT	9

6.	MISCELLANEOUS		9

	6.1	WAIVER	9
	6.2	SEVERABILITY	9
	6.3	BINDING EFFECT AND ASSIGNMENT	10
	6.4	ENTIRETY	10
	6.5	INDEMNITY	10
	6.6	REMEDIES CUMULATIVE	10
	6.7	TERM OF AGREEMENT	11
	6.8	ADDRESS FOR NOTICE	11
	6.9	GOVERNING LAW AND JURISDICTION	12
	6.10	INCONSISTENT PROVISIONS	12
	6.11	COUNTERPARTS	12
	6.12	DEFAULT BY LAPSE OF TIME	12
	6.13	LANGUAGE	12

SCHEDULE A PROMISSORY NOTE			14

SUBORDINATED LOAN AGREEMENT dated as of May 31, 2007:

BETWEEN:		CF CABLE TV INC. , a company incorporated under the laws of Canada, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Borrower ”);

AND:		QUEBECOR MÉDIA INC. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Lender ”);

WHEREAS the Borrower has requested that the Lender provide the Borrower with a subordinated loan in the principal amount of one hundred twenty-five million dollars ($125,000,000) and the Lender has agreed to provide such subordinated loan to the Borrower, upon the terms and subject to the conditions hereinafter set forth;

THE PARTIES HEREBY AGREE AS FOLLOWS:

1. INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires, the following terms shall have the meanings respectively ascribed to them in this Section 1.1:

“ Business Day ” means a day, other than a Saturday or a Sunday, on which banks in Montreal, Quebec are open for business in that city;

“ Class B Preferred Shares ” means 125,000 Class B Preferred Shares of the capital stock of 9101-0835 Québec Inc. issued to and registered in the name of the Borrower;

“ Closing Date ” means May 31, 2007, at which time the Subordinated Loan shall be advanced to the Borrower, in its entirety, by the Lender;

“ Dollars ”, and “ $ ” means the lawful currency of Canada;

“ Event of Default ” has the meaning ascribed to that term in Section 5.1;

“ Interest Installment ” means the amount of interest due in respect of each Interest Period and payable on the Interest Payment Date;

“ Loan Documents ” means this Agreement and the Promissory Note, all as amended, supplemented, restated or replaced from time to time;

“ Maturity Date ” means May 31, 2022;

“ Obligations ” means:

(ii) the strict performance and observance by the Borrower of all agreements, warranties, representations, covenants and conditions of the Borrower made under, or pursuant to, the Loan Documents.

“ Person ” means any individual, company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or Governmental Authority;

“ Principal Installment ” means the payment of principal due on the Principal Payment Date;

“ Promissory Note ” means the promissory note remitted by the Borrower to the Lender pursuant to Section 2.1 herein, substantially in the form of Schedule A attached hereto; and

“ Subordinated Loan ” shall have the meaning ascribed to it in Section 2.1.

1.2 Headings

The headings of the Articles, Sections, Subsections or Paragraphs herein are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

1.3 R eferences

1.4 Preamble

Unless the context otherwise requires, the preamble forms an integral part hereof.

2. THE SUBORDINATED LOAN

2.1 Subordinated Loan

Relying on each of the representations and warranties set out in Article 3 and subject to the terms and conditions herein contained, the Lender agrees to make available, on the Closing Date, to the Borrower, by way of a single advance of one hundred twenty-five million dollars ($125,000,000), a subordinated loan in the amount of one hundred twenty-five million dollars ($125,000,000) upon receipt of the Promissory Note for the amount of such subordinated loan duly executed by the Borrower in favour of the Lender (the “ Subordinated Loan ”).

2.2 Interest

2.3 Payment of Principal and Interest

2.4 Ranking

2.5 Optional Prepayment

Any amount prepaid by the Borrower pursuant to this Section 2.5 may not be re-borrowed under this Agreement and shall constitute a permanent reduction of the Subordinated Loan.

2.6 Automatic Payment Deferral

2.7 Interest on Overdue Payments

2.8 Manner of Payment

2.9 Application of Payments

2.9.1 All payments made by the Borrower pursuant to this Agreement shall be applied in each instance in the following order:

(1) first, to the amount of interest due and payable on the Subordinated Loan;

(2) second, to the amount due and payable as principal of the Subordinated Loan; and

(3) third, to any other amount due and payable pursuant to the Loan Documents.

the Borrower’s obligations under the Loan Documents as the Lender may deem advisable.

3. REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties

The Borrower represents and warrants to the Lender that:

4. COVENANTS

4.1 Affirmative Covenants

The Borrower covenants and agrees with the Lender as follows:

4.1.3 Compliance with Applicable Laws . The Borrower shall comply and cause its property and assets to comply with all applicable laws in all material respects.

5. EVENTS OF DEFAULT

5.1 Events of Default

Each of the following events shall constitute an “ Event of Default ” under this Agreement:

5.2 Performance by the Lender

5.3 Remedies Upon Event of Default

6. MISCELLANEOUS

6.1 Waiver

6.2 Severability

effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from such Loan Document.

6.3 Binding Effect and Assignment

6.4 Entirety

The Loan Documents embody the entire agreement between the parties and supersede all prior agreements and understandings, if any, relating to the subject matter hereof and thereof.

6.5 Indemnity

6.6 Remedies Cumulative

The rights and remedies under the Loan Documents are cumulative and not exclusive of any rights or remedies which the Lender would otherwise have.

6.7 Term of Agreement

The term of this Agreement is until the payment in full of all the obligations of the Borrower pursuant to the Loan Documents.

6.8 Address for Notice

(1) If to the Borrower:

CF Cable TV Inc.
612 Saint-Jacques Street
Montreal, Quebec
H3C 4M8
Attention: Executive Vice President, Finance and Operations and Chief Financial Officer

Telecopier: (514) 380-9068

(2) If to the Lender:

Quebecor Média Inc.

612 Saint-Jacques Street
Montreal, Quebec
H3C 4M8
Attention: Treasurer

Telecopier: (514) 380-1983

6.9 Governing Law and Jurisdiction

6.10 Inconsistent Provisions

6.11 Counterparts

6.12 Default by Lapse of Time

The Borrower shall be put in default to perform its obligations hereunder by the mere lapse of time for performing such obligations without the necessity of any demand or notice of default.

6.13 Language

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.

QUEBECOR MÉDIA INC.

per:	/s/ Louis Morin
Name:		Louis Morin
Title:		Vice-President and Chief Financial Officer

per:	/s/ Jean-François Pruneau
Name:		Jean-François Pruneau
Title:		Treasurer

CF CABLE TV INC.

per:	/s/ Yvan Gingras
Name:		Yvan Gingras
Title:		Executive Vice-President, Finance and Operations and Chief Financial Officer

per:	/s/ Jean-François Pruneau
Name:		Jean-François Pruneau
Title:		Treasurer

FOR VALUE RECEIVED , CF Cable TV Inc. , a company duly incorporated under the laws of Canada (including any successor thereto) (the “ Borrower ”), hereby promises to pay to Quebecor Média Inc. , a company duly incorporated under the laws of Quebec and any successor thereto (the “ Lender ”), at the registered office of the Lender located in the City of Montreal, Province of Quebec, the principal sum of one hundred twenty-five million dollars ($125,000,000) in the lawful currency of Canada, on the 31 st day of May, 2022, and pay interest from the date hereof on the said sum or the amount thereof from time to time remaining unpaid, in the same currency and at the same place, at a rate calculated and payable in accordance with the terms and conditions of the Agreement (as such term is defined herein below).

The Borrower hereby waives presentment for payment, notice of non-payment, protest and notice of protest and other notices of any kind in the enforcement of this promissory note.

SIGNED this 31 st day of May, 2007.

	CF CABLE TV INC.

	per:
	Name:		Yvan Gingras
	Title:		Executive Vice-President, Finance and
	Operations and Chief Financial Officer


	per:
	Name:		Jean-François Pruneau
	Title:		Treasurer


	QUEBECOR MÉDIA INC.

	per:
	N ame:		Louis Morin
	Title:		Vice-President and Chief Financial Officer

	per:
	Name:		Jean-François Pruneau
	Title:		Treasurer

between

VIDEOTRON LTD.

(As Borrower)

and

QUEBECOR MEDIA INC.

(As Lender)

TABLE OF CONTENTS

1.	INTERPRETATION		1

	1.1	DEFINITIONS	1
	1.2	HEADINGS	3
	1.3	REFERENCES	3
	1.4	PREAMBLE	3

2.	THE SUBORDINATED LOAN		3

	2.1	SUBORDINATED LOAN	3
	2.2	INTEREST	4
	2.3	PAYMENT OF PRINCIPAL AND INTEREST	4
	2.4	RANKING	4
	2.5	OPTIONAL PREPAYMENT	4
	2.6	AUTOMATIC PAYMENT DEFERRAL	4
	2.7	INTEREST ON OVERDUE PAYMENTS	5
	2.8	MANNER OF PAYMENT	5
	2.9	APPLICATION OF PAYMENTS	5

3.	REPRESENTATIONS AND WARRANTIES		6

	3.1	REPRESENTATIONS AND WARRANTIES	6

4.	COVENANTS		7

	4.1	AFFIRMATIVE COVENANTS	7

5.	EVENTS OF DEFAULT		8

	5.1	EVENTS OF DEFAULT	8
	5.2	PERFORMANCE BY THE LENDER	9
	5.3	REMEDIES UPON EVENT OF DEFAULT	9

6.	MISCELLANEOUS		9

	6.1	WAIVER	9
	6.2	SEVERABILITY	9
	6.3	BINDING EFFECT AND ASSIGNMENT	10
	6.4	ENTIRETY	10
	6.5	INDEMNITY	10
	6.6	REMEDIES CUMULATIVE	10
	6.7	TERM OF AGREEMENT	11
	6.8	ADDRESS FOR NOTICE	11
	6.9	GOVERNING LAW AND JURISDICTION	12
	6.10	INCONSISTENT PROVISIONS	12
	6.11	COUNTERPARTS	12
	6.12	DEFAULT BY LAPSE OF TIME	12
	6.13	LANGUAGE	12

SCHEDULE A PROMISSORY NOTE			14

SUBORDINATED LOAN AGREEMENT dated as of January 4, 2008:

BETWEEN:		VIDEOTRON LTD. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Borrower ”);

AND:		QUEBECOR MEDIA INC. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Lender ”);

WHEREAS the Borrower has requested that the Lender provide the Borrower with a subordinated loan in the principal amount of four hundred and fifteen million dollars ($415,000,000) and the Lender has agreed to provide such subordinated loan to the Borrower, upon the terms and subject to the conditions hereinafter set forth;

THE PARTIES HEREBY AGREE AS FOLLOWS:

1. INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires, the following terms shall have the meanings respectively ascribed to them in this Section 1.1:

“ Agreement ” means the present subordinated loan agreement between the Borrower and the Lender dated as of January 4, 2008 (as same may be amended, restated or otherwise modified from time to time);

“ Business Day ” means a day, other than a Saturday or a Sunday, on which banks in Montreal, Quebec are open for business in that city;

“ Class B Preferred Shares ” means 415,000 Class B Preferred Shares of the capital stock of 9101-0835 Québec Inc. issued to and registered in the name of the Borrower;

“ Closing Date ” means January 4, 2008, at which time the Subordinated Loan shall be advanced to the Borrower, in its entirety, by the Lender;

“ Dollars ”, and “ $ ” means the lawful currency of Canada;

“ Event of Default ” has the meaning ascribed to that term in Section 5.1;

“ Interest Installment ” means the amount of interest due in respect of each Interest Period and payable on the Interest Payment Date;

“ Interest Payment Date ” means June 20 and December 20 of each year, provided that the first Interest Payment Date shall be on June 20, 2008 and the last Interest Payment Date shall be on the Principal Payment Date (to the extent any amounts in interest then remain unpaid);

“ Interest Period ” means each of the six-month period ending on June 20 and December 20 of each year; except for the first Interest Period, which shall begin on January 4, 2008 and end on June 20, 2008, and the last Interest Period which shall end on the Principal Payment Date.

“ Loan Documents ” means this Agreement and the Promissory Note, all as amended, supplemented, restated or replaced from time to time;

“ Maturity Date ” means January 4, 2023;

“ Obligations ” means:

(ii) the strict performance and observance by the Borrower of all agreements, warranties, representations, covenants and conditions of the Borrower made under, or pursuant to, the Loan Documents.

“ Person ” means any individual, company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or Governmental Authority;

“ Principal Installment ” means the payment of principal due on the Principal Payment Date;

“ Promissory Note ” means the promissory note remitted by the Borrower to the Lender pursuant to Section 2.1 herein, substantially in the form of Schedule A attached hereto; and

“ Subordinated Loan ” shall have the meaning ascribed to it in Section 2.1.

1.2 Headings

The headings of the Articles, Sections, Subsections or Paragraphs herein are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

1.3 References

1.4 Preamble

Unless the context otherwise requires, the preamble forms an integral part hereof.

2. THE SUBORDINATED LOAN

2.1 Subordinated Loan

Relying on each of the representations and warranties set out in Article 3 and subject to the terms and conditions herein contained, the Lender agrees to make available, on the Closing Date, to the Borrower, by way of a single advance of four hundred and fifteen million dollars ($415,000,000), a subordinated loan in the amount of four hundred and fifteen million dollars ($415,000,000) upon receipt of the Promissory Note for the amount of such subordinated loan duly executed by the Borrower in favour of the Lender (the “ Subordinated Loan ”).

2.2 Interest

2.3 Payment of Principal and Interest

2.4 Ranking

2.5 Optional Prepayment

Any amount prepaid by the Borrower pursuant to this Section 2.5 may not be re-borrowed under this Agreement and shall constitute a permanent reduction of the Subordinated Loan.

2.6 Automatic Payment Deferral

2.7 Interest on Overdue Payments

2.8 Manner of Payment

2.9 Application of Payments

2.9.1 All payments made by the Borrower pursuant to this Agreement shall be applied in each instance in the following order:

(1) first, to the amount of interest due and payable on the Subordinated Loan;

(2) second, to the amount due and payable as principal of the Subordinated Loan; and

(3) third, to any other amount due and payable pursuant to the Loan Documents.

the Borrower’s obligations under the Loan Documents as the Lender may deem advisable.

3. REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties

The Borrower represents and warrants to the Lender that:

4. COVENANTS

4.1 Affirmative Covenants

The Borrower covenants and agrees with the Lender as follows:

4.1.3 Compliance with Applicable Laws . The Borrower shall comply and cause its property and assets to comply with all applicable laws in all material respects.

5. EVENTS OF DEFAULT

5.1 Events of Default

Each of the following events shall constitute an “ Event of Default ” under this Agreement:

5.2 Performance by the Lender

5.3 Remedies Upon Event of Default

6. MISCELLANEOUS

6.1 Waiver

6.2 Severability

effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from such Loan Document.

6.3 Binding Effect and Assignment

6.4 Entirety

The Loan Documents embody the entire agreement between the parties and supersede all prior agreements and understandings, if any, relating to the subject matter hereof and thereof.

6.5 Indemnity

6.6 Remedies Cumulative

The rights and remedies under the Loan Documents are cumulative and not exclusive of any rights or remedies which the Lender would otherwise have.

6.7 Term of Agreement

The term of this Agreement is until the payment in full of all the obligations of the Borrower pursuant to the Loan Documents.

6.8 Address for Notice

(1)	If to the Borrower:

	Videotron Ltd.
	612 Saint-Jacques Street
	Montreal, Quebec
	H3C 4M8
	Attention: Executive Vice President, Finance and Operations and Chief Financial Officer

	Telecopier: (514) 380-9068

(2)	If to the Lender:

	Quebecor Media Inc.
	612 Saint-Jacques Street
	Montreal, Quebec
	H3C 4M8
:	Attention: Treasurer

	Telecopier: (514) 380-1983

6.9 Governing Law and Jurisdiction

6.10 Inconsistent Provisions

6.11 Counterparts

6.12 Default by Lapse of Time

The Borrower shall be put in default to perform its obligations hereunder by the mere lapse of time for performing such obligations without the necessity of any demand or notice of default.

6.13 Language

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.

QUEBECOR MEDIA INC.


per:	/s/ Louis Morin
Name: Louis Morin
Title:		Vice-President and Chief Financial Officer

per:	/s/ Jean-François Pruneau
Name:				Jean-François Pruneau
Title:				Treasurer

VIDEOTRON LTD.


per:	/s/ Yvan Gingras
Name:			Yvan Gingras
Title:			Executive Vice-President, Finance and Operations and Chief Financial Officer


per:		/s/ Jean-François Pruneau
Name:			Jean-François Pruneau
Title:			Treasurer

FOR VALUE RECEIVED , Videotron Ltd. , a company duly incorporated under the laws of Quebec (including any successor thereto) (the “ Borrower ”), hereby promises to pay to Quebecor Media Inc. , a company duly incorporated under the laws of Quebec and any successor thereto (the “ Lender ”), at the registered office of the Lender located in the City of Montreal, Province of Quebec, the principal sum of four hundred and fifteen million dollars ($415,000,000) in the lawful currency of Canada, on the 4 th day of January, 2023, and pay interest from the date hereof on the said sum or the amount thereof from time to time remaining unpaid, in the same currency and at the same place, at a rate calculated and payable in accordance with the terms and conditions of the Agreement (as such term is defined herein below).

This promissory note is issued pursuant to Section 2.1 of the Agreement between the Borrower and the Lender dated as of January 4, 2008 (the “ Agreement ”). Reference is hereby made to the Agreement, the terms and conditions of which govern this promissory note. In the event of any conflict or inconsistency between the provisions of the Agreement and those of this promissory note, the provisions of the said Agreement shall prevail.

The Borrower hereby waives presentment for payment, notice of non-payment, protest and notice of protest and other notices of any kind in the enforcement of this promissory note.

SIGNED this 4th day of January, 2008.

VIDEOTRON LTD.

per:
Name:		Yvan Gingras
Title:		Executive Vice-President, Finance and Operations and Chief Financial Officer

per:
Name:	Jean-François Pruneau
Title:	Treasurer

QUEBECOR MEDIA INC.

per:
N ame:	Louis Morin
Title:	Vice-President and Chief Financial Officer

per:
Name:	Jean-François Pruneau
Title:	Treasurer

Exhibit 4.14

between

CF CABLE TV INC.

(As Borrower)

and

QUEBECOR MEDIA INC.

(As Lender)

TABLE OF CONTENTS

1.	INTERPRETATION		1

	1.1	DEFINITIONS	1
	1.2	HEADINGS	3
	1.3	REFERENCES	3
	1.4	PREAMBLE	3

2.	THE SUBORDINATED LOAN		3

	2.1	SUBORDINATED LOAN	3
	2.2	INTEREST	4
	2.3	PAYMENT OF PRINCIPAL AND INTEREST	4
	2.4	RANKING	4
	2.5	OPTIONAL PREPAYMENT	4
	2.6	AUTOMATIC PAYMENT DEFERRAL	4
	2.7	INTEREST ON OVERDUE PAYMENTS	5
	2.8	MANNER OF PAYMENT	5
	2.9	APPLICATION OF PAYMENTS	5

3.	REPRESENTATIONS AND WARRANTIES		6

	3.1	REPRESENTATIONS AND WARRANTIES	6

4.	COVENANTS		7

	4.1	AFFIRMATIVE COVENANTS	7

5.	EVENTS OF DEFAULT		8

	5.1	EVENTS OF DEFAULT	8
	5.2	PERFORMANCE BY THE LENDER	9
	5.3	REMEDIES UPON EVENT OF DEFAULT	9

6.	MISCELLANEOUS		9

	6.1	WAIVER	9
	6.2	SEVERABILITY	9
	6.3	BINDING EFFECT AND ASSIGNMENT	10
	6.4	ENTIRETY	10
	6.5	INDEMNITY	10
	6.6	REMEDIES CUMULATIVE	10
	6.7	TERM OF AGREEMENT	11
	6.8	ADDRESS FOR NOTICE	11
	6.9	GOVERNING LAW AND JURISDICTION	12
	6.10	INCONSISTENT PROVISIONS	12
	6.11	COUNTERPARTS	12
	6.12	DEFAULT BY LAPSE OF TIME	12
	6.13	LANGUAGE	12

SCHEDULE A PROMISSORY NOTE			14

SUBORDINATED LOAN AGREEMENT dated as of January 4, 2008:

BETWEEN:		CF CABLE TV INC. , a company incorporated under the laws of Canada, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Borrower ”);

AND:		QUEBECOR MEDIA INC. , a company incorporated under the laws of Quebec, with its registered office at 612 Saint-Jacques Street, Montreal, province of Quebec, H3C 4M8,

		(the “ Lender ”);

WHEREAS the Borrower has requested that the Lender provide the Borrower with a subordinated loan in the principal amount of one hundred and seventy million dollars ($170,000,000) and the Lender has agreed to provide such subordinated loan to the Borrower, upon the terms and subject to the conditions hereinafter set forth;

THE PARTIES HEREBY AGREE AS FOLLOWS:

1. INTERPRETATION

1.1 Definitions

In this Agreement, unless the context otherwise requires, the following terms shall have the meanings respectively ascribed to them in this Section 1.1:

“ Business Day ” means a day, other than a Saturday or a Sunday, on which banks in Montreal, Quebec are open for business in that city;

“ Class B Preferred Shares ” means 170,000 Class B Preferred Shares of the capital stock of 9101-0835 Québec Inc. issued to and registered in the name of the Borrower;

“ Closing Date ” means January 4, 2008, at which time the Subordinated Loan shall be advanced to the Borrower, in its entirety, by the Lender;

“ Dollars ”, and “ $ ” means the lawful currency of Canada;

“ Event of Default ” has the meaning ascribed to that term in Section 5.1;

“ Interest Installment ” means the amount of interest due in respect of each Interest Period and payable on the Interest Payment Date;

“ Loan Documents ” means this Agreement and the Promissory Note, all as amended, supplemented, restated or replaced from time to time;

“ Maturity Date ” means January 9, 2024;

“ Obligations ” means:

(ii) the strict performance and observance by the Borrower of all agreements, warranties, representations, covenants and conditions of the Borrower made under, or pursuant to, the Loan Documents.

“ Person ” means any individual, company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or Governmental Authority;

“ Principal Installment ” means the payment of principal due on the Principal Payment Date;

“ Promissory Note ” means the promissory note remitted by the Borrower to the Lender pursuant to Section 2.1 herein, substantially in the form of Schedule A attached hereto; and

“ Subordinated Loan ” shall have the meaning ascribed to it in Section 2.1.

1.2 Headings

The headings of the Articles, Sections, Subsections or Paragraphs herein are inserted for convenience of reference only and shall not affect the construction or interpretation of this Agreement.

1.3 References

1.4 Preamble

Unless the context otherwise requires, the preamble forms an integral part hereof.

2. THE SUBORDINATED LOAN

2.1 Subordinated Loan

Relying on each of the representations and warranties set out in Article 3 and subject to the terms and conditions herein contained, the Lender agrees to make available, on the Closing Date, to the Borrower, by way of a single advance of one hundred and seventy million dollars ($170,000,000), a subordinated loan in the amount of one hundred and seventy million dollars ($170,000,000) upon receipt of the Promissory Note for the amount of such subordinated loan duly executed by the Borrower in favour of the Lender (the “ Subordinated Loan ”).

2.2 Interest

2.3 Payment of Principal and Interest

2.4 Ranking

indebtedness of the Borrower before the Lender is entitled to receive or retain payment of principal hereunder or as permitted by the terms of such senior indebtedness.

2.5 Optional Prepayment

Any amount prepaid by the Borrower pursuant to this Section 2.5 may not be re-borrowed under this Agreement and shall constitute a permanent reduction of the Subordinated Loan.

2.6 Automatic Payment Deferral

2.7 Interest on Overdue Payments

2.8 Manner of Payment

2.9 Application of Payments

2.9.1 All payments made by the Borrower pursuant to this Agreement shall be applied in each instance in the following order:

(1) first, to the amount of interest due and payable on the Subordinated Loan;

(2) second, to the amount due and payable as principal of the Subordinated Loan; and

(3) third, to any other amount due and payable pursuant to the Loan Documents.

the Borrower’s obligations under the Loan Documents as the Lender may deem advisable.

3. REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties

The Borrower represents and warrants to the Lender that:

4. COVENANTS

4.1 Affirmative Covenants

The Borrower covenants and agrees with the Lender as follows:

4.1.3 Compliance with Applicable Laws . The Borrower shall comply and cause its property and assets to comply with all applicable laws in all material respects.

5. EVENTS OF DEFAULT

5.1 Events of Default

Each of the following events shall constitute an “ Event of Default ” under this Agreement:

5.2 Performance by the Lender

5.3 Remedies Upon Event of Default

6. MISCELLANEOUS

6.1 Waiver

6.2 Severability

effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from such Loan Document.

6.3 Binding Effect and Assignment

6.4 Entirety

The Loan Documents embody the entire agreement between the parties and supersede all prior agreements and understandings, if any, relating to the subject matter hereof and thereof.

6.5 Indemnity

6.6 Remedies Cumulative

The rights and remedies under the Loan Documents are cumulative and not exclusive of any rights or remedies which the Lender would otherwise have.

6.7 Term of Agreement

The term of this Agreement is until the payment in full of all the obligations of the Borrower pursuant to the Loan Documents.

6.8 Address for Notice

(1) If to the Borrower:

CF Cable TV Inc.
612 Saint-Jacques Street
Montreal, Quebec
H3C 4M8
Attention: Executive Vice President, Finance and Operations and Chief Financial Officer
Telecopier: (514) 380-9068

(2) If to the Lender:

Quebecor Media Inc.

612 Saint-Jacques Street
Montreal, Quebec
H3C 4M8
Attention: Treasurer
Telecopier: (514) 380-1983

6.9 Governing Law and Jurisdiction

6.10 Inconsistent Provisions

6.11 Counterparts

6.12 Default by Lapse of Time

The Borrower shall be put in default to perform its obligations hereunder by the mere lapse of time for performing such obligations without the necessity of any demand or notice of default.

6.13 Language

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed as of the date first above written.

	QUEBECOR MEDIA INC.

	per:	/s/ Louis Morin
	Name: Louis Morin
	Title: Vice-President and Chief Financial Officer

per:	/s/ Jean-François Pruneau
Name:		Jean-François Pruneau
Title:		Treasurer

CF CABLE TV INC.

per:	/s/ Yvan Gingras
Name:		Yvan Gingras
Title:		Executive Vice-President, Finance and Operations and Chief Financial Officer

per:	/s/ Jean-François Pruneau
Name:		Jean-François Pruneau
Title:		Treasurer

FOR VALUE RECEIVED , CF Cable TV Inc. , a company duly incorporated under the laws of Canada (including any successor thereto) (the “ Borrower ”), hereby promises to pay to Quebecor Media Inc. , a company duly incorporated under the laws of Quebec and any successor thereto (the “ Lender ”), at the registered office of the Lender located in the City of Montreal, Province of Quebec, the principal sum of one hundred and seventy million dollars ($170,000,000) in the lawful currency of Canada, on the 4 th of January, 2023, and pay interest from the date hereof on the said sum or the amount thereof from time to time remaining unpaid, in the same currency and at the same place, at a rate calculated and payable in accordance with the terms and conditions of the Agreement (as such term is defined herein below).

The Borrower hereby waives presentment for payment, notice of non-payment, protest and notice of protest and other notices of any kind in the enforcement of this promissory note.

SIGNED this 4 th day of January, 2008.

	CF CABLE TV INC.

	per:
	Name:			Yvan Gingras
	Title:			Executive Vice-President, Finance and Operations and Chief Financial Officer


	per:
	Name:			Jean-François Pruneau
	Title:			Treasurer


	QUEBECOR MEDIA INC.


	per:
	Name:			Louis Morin
	Title:			Vice-President and Chief Financial Officer

	per:
	Name:			Jean-François Pruneau
	Title:			Treasurer

Exhibit 7.1

Videotron Ltd.

Statement Regarding Calculation of Ratio of Earnings to Fixed Charges as Disclosed in
Videotron Ltd.’s Annual Report on Form 20-F for the Year Ended December 31, 2008

For the purpose of calculating the ratio of earnings to fixed charges disclosed in Videotron Ltd.’s Annual Report on Form 20-F for the year ended December 31, 2008, (i) earnings consist of net (loss) income plus non-controlling interest in a subsidiary, income taxes, fixed charges, amortized capitalized interest, less interest capitalized, and (ii) fixed charges consist of interest expensed and capitalized, excluding interest on QMI subordinated loans, plus amortized premiums, discounts and capitalized expenses relating to indebtedness and an estimate of the interest within rental expense.

Exhibit 8.1

List of Subsidiaries of Videotron Ltd.

Name of Subsidiary		Jurisdiction of Incorporation or Organization
CF Câble TV inc. / CF Cable TV Inc.		Canada
Le SuperClub Vidéotron ltée		Québec
Société d’édition et de Transcodage T.E. ltée		Québec
Videotron US Inc.		Delaware
9193-2962 Québec inc.		Québec

Exhibit 11.1

Code of Ethics

CODE OF ETHICS

TABLE OF CONTENTS

CONTENTS		PAGE

Scope		2
Purpose		3
Responsibility		4
Work Environment		5
Relations with Customers and Suppliers		7
Conflict of Interest		8
Company Property		10
Company Funds		11
Confidential Information		12
Insider Trading		14
Business Records		15
Relations with the Public		16
Respect of the Environment		17
Competition Behaviour		17
Legal Compliance		18
Questions and Reporting of Violations		19
Violation		20
Communication of the Code		20
Appendix 1 - ClearView Connects TM - Questions and Answers		21
Employee Declaration		24

This Code of Ethics (the “ Code ”) applies to all the directors, officers and employees (collectively the “ Employees ” or individually the “ Employee ”) of Quebecor Media Inc. (“ QMI ”) as well as to those of its subsidiaries (with the exception of TVA Group Inc. which has adopted its own code, similar to this one), its divisions and business units.

To facilitate the reading of this Code, the use of the singular shall include the plural and the use of the masculine shall include the feminine, and vice versa.

The Company’s reputation and the trust and confidence of those with whom it deals, are an integral part of its success. Quebecor Media Inc. (“ QMI ” or the “ Company ”) is committed to managing its business in accordance with a set of values that adhere to the highest standards of integrity and excellence.

Now, more than ever, corporations such as QMI must adopt certain guidelines to ensure that all employees behave in accordance with these values.

Every employee is responsible for becoming generally familiar with and following this Code, other company policies, as well as all laws, rules and regulations that apply to their position with the Company and their level of responsibility.

This Code does not describe all of the Company policies. Needless to say, each employee must also comply without restriction with all other existing Company policies.

The QMI Board of Directors, through its Audit Committee, is responsible for ensuring that a procedure is in place to denounce any violation to this Code.

The Vice President, Human Resources, along with the Vice President, Internal Audit and the Vice President and Secretary revise the Code when deemed appropriate and recommend any modification to the QMI Audit Committee. Following the approval of the said committee, the revised Code is distributed to all employees.

The Company respects and welcomes diversity among its employees, customers, and suppliers.

Discrimination

The Company is committed to equal employment opportunity without regard to race, color, religion, gender, national or ethnic origin, age, disability, and sexual orientation, provided that the person is able to perform the functions that are incumbent to his position. It is the Company’s policy to make decisions on hiring, job assignment and promotion, solely on the basis of personal qualifications, ability and performance.

The Company considers that all of its employees are equal and, as such, they must be treated and treat each other with mutual respect. The Company is committed to fight against prejudice, discrimination and harassment in all forms within its organization. Consequently, discriminating against any employee or person with whom the Company does business on the basis of race, color, religion, gender, national or ethnic origin, age, disability, sexual orientation, war veteran status or for any other reason is strictly prohibited.

Harassment

Conduct that creates a hostile, intimidating or offensive work environment, such as unwelcome advances or requests for sexual favours, inappropriate comments or jokes, intimidation, bullying or physical contact, may be forms of workplace harassment. The Company will not tolerate any form of harassment (including psychological harassment) or violence in its workplace. This type of behaviour is unacceptable since it denies the right of every person to be treated with dignity and respect.

Workplace security

The Company seeks to provide each employee with a clean, safe, and healthy workplace. To achieve that goal, all employees must understand their share of responsibility for abiding by all safety rules and practices and must take the necessary precautions to prevent professional injuries.

Drugs and alcohol

A drug and alcohol-free workplace is important for maintaining the renown and the reputation of the Company, as well as for protecting the health and safety of its employees. The use, possession, distribution or sale of illicit drugs or of alcohol on Company premises is strictly prohibited.

The Company is a customer-driven company committed to optimizing the contribution of its employees, technology and other resources in order to meet or exceed customer expectations.

Employees should always act in a professional and courteous manner in their dealings with customers and suppliers. They must maintain an honest and loyal relationship with them, in full compliance with the Company’s contractual obligations and the applicable laws and regulations.

No employee must ever make false representations, and any misunderstanding should be clarified as soon as possible.

Each employee has a duty to keep confidential any personal or business information about customers and suppliers to which the employee gains or has access to in the course of his work or otherwise in QMI, whether be it verbal, written or electronic information. Examples are customer documentation, specifications, the content of their publications or information on the customer’s company obtained in the course of doing business. In all cases, this information is strictly confidential and is of a proprietary nature belonging to the customer and can only be used to provide the services requested by the customer.

The Company expects and requires its employees to always act in its best interest. It also expects and requires its employees to be and to remain, at all times, free of any conflicting interests or relationships and to refrain from acting or being in a situation of conflict of interests.

Directors

A director who finds himself in a conflict of interest during any Board or Committee meeting of the Company must immediately declare his interest and refrain from participating in any discussion about the conflicting issue or from voting thereon.

Officers and other employees

A conflict of interest arises whenever the private interest of an employee interferes or conflicts in any way with that of the Company. In any decision taken in the course of his job, the employee must always act in an objective manner based solely on the best interest of the Company and unaffected by any consideration of personal gain for the employee or anyone personally associated with him, including friends or relatives. An employee must always refrain from helping any other business or person in securing any contract with the Company from which he can derive a personal benefit.

It is impossible to provide an exhaustive list of all situations that could give rise to real or potential conflicts of interest. For instance, a conflict of interest would exist when an employee:

1. Either for his benefit or that of any person, association or company, conducts activities during working hours that are neither directly related to nor required for his functions (except with the management’s specific request or permission) and which deprive the Company from the employee’s services or prevent that employee from devoting all efforts and attention to the Company’s affairs.

2. Holds a position within the Company whereby the employee can use his authority towards any relatives or friends and which may prevent that employee from being impartial in his decision-making process.

3. As a result of an outside third party relationship, is in a position that could:

a) make personal gain for the benefit of that employee or any relative or friend;

b) render the employee partial towards the third party contrary to the best interest of the Company;

c) place the employee in an equivocal, embarrassing or ethically questionable position towards that third party; or

d) reflect unfavourably on the integrity and honesty of the employee.

4. Takes advantage of business opportunities that belong to the Company or are discovered through the use of the Company’s resources, property, information or the employee’s position with the Company.

5. Uses the Company’s property or information, or his position held within the Company, for personal gain, including to further his interest or that of relatives or friends.

6. Accepts gifts (other than of a nominal, symbolic or promotional nature) from a supplier, client or any other person which has or may have dealings with the Company.

7. Directly or indirectly competes with the Company or has a direct or indirect interest or relationship that is actually harmful or detrimental to the Company’s best interest.

8. Engages in business or gainful activities that might be detrimental to the best interest of the Company. The term “ gainful employment” includes any professional activity, supervision or training of other persons, or consultation or advice, for any form of remuneration.

Every employee who may find himself in, or be brought into a situation of conflict of interest or the appearance thereof, should make a full written disclosure of the circumstances to his superior or to the head of the Human Resources Department.

The employees have a responsibility to protect the Company’s property and assets and to ensure their use in accordance with their intended use.

Such property includes tangible assets such as buildings, equipment, money, inventories, documents, computers, networks, systems, applications, database, communication tools, etc. Intangible assets such as inventions, ideas, patents and other forms of intellectual property, as they relate to the Company’s actual or anticipated business and which are created or conceived during or after working hours are also considered as Company property.

All possible safeguards must be taken to prevent theft, misuse, damage, loss or sabotage, carelessness and waste of the Company’s property.

Company property is to be used by employees for work and legitimate business purposes only and not for personal use. Employees should be aware that the Company may monitor the use of its property at all times including the computer and telecommunication networks and the data and communication transiting through them. Although an occasional personal use of the telephone and the Internet is allowed, no confidentiality exists for the employees. Messages, communications and the use of the Internet may be monitored by the Company. In no circumstances can an employee access sites involving games, pornography, racist or insulting subjects or words, social encounters or any site or other means offering content of such nature.

The use of electronic mail requires the same level of attention and reserve than any other written communication. Language must be appropriate and the addressees must be only those to whom the message is relevant. Confidential information must not circulate electronically without appropriate measures being taken to protect them and prevent them from losing the protection that they would otherwise have. Electronic mail favours direct communication without nuance and reserve; consequently, it must not be used to discuss matters that could lead to contentious issues or to exchange comments related to such matters. It is obviously possible to communicate electronically with the Legal Affairs Department as long as the communications addressed to this department (directly or copied) bear the mention “To the attention of the Legal Affairs Department and protected by the solicitor-client privilege.”

When an employee’s position involves the use of Company funds, it is the responsibility of the employee to exercise his good judgment, on the Company’s behalf, to ensure that the Company gets the best commercial value for every dollar spent.

Employees who incur expenses while on c ompany business can only seek reimbursement for expenses that were actually paid for goods and services and that are reasonable and pre-authorized. They are required to provide all supporting documentation and appropriate receipts with their reimbursement request.

Employees who have access to Company funds in any form are expected to be familiar with the Company’s prescribed practices and procedures pertaining thereto. “Company funds” are any monies, documents or records that have or represent financial value. Company funds include, but are not limited to, currency, checks, share certificates, notes and promissory notes, vouchers, credit, receivables, payables, money orders, expenses, reimbursements and pay checks.

It is clearly understood that Company funds are not for personal use or for business use without pre-approval.

No expenditure of Company funds will be approved unless the manager responsible for approving the expenditure is satisfied with the justification for and the amount of such expenditure. Whenever the case, such approval shall be granted in accordance with the Company’s Policy on Limits of Authority.

In the course of their employment, employees may have access to confidential information about the Company or a company of the Quebecor Group, as well as their respective customers and suppliers, and about other employees of the Company. “Confidential information” is information, either verbal or written, which is not generally known to the public and this includes, but is not limited to, information on technology, business data such as its order backlog, customer specific billing rates and financial data.

Measures must be taken to limit access to such confidential information to only those persons who “need to know” it in the performance of their duties and those privy thereto must be advised that they have the obligation to keep it confidential.

Outside parties privy to undisclosed material information concerning the Company must be advised that they cannot divulge such information to anyone without the Company’s consent. The Company may request such outside parties to sign a confidentiality and non-disclosure agreement.

It is the responsibility of each employee to act in good faith and to treat any confidential information with the utmost care. If necessary, the employees are to refer to the Disclosure Policy of Quebecor Media.

In order to prevent the misuse or inadvertent disclosure of important information, the procedures set forth below should be observed at all times:

· documents and files containing confidential information must be kept in a safe place to which access is restricted to employees who “need to know” such information in the performance of their duties;

· confidential matters should not be discussed in public places (elevators, hallways, restaurants, airplanes, taxis, or elsewhere);

· confidential documents should not be read or remain visible in public places and should not be discarded where third parties can retrieve them;

· employees must ensure that they maintain the confidentiality of information in their possession inside or outside the workplace;

· transmission of documents containing confidential information by electronic means, by fax or directly from one computer to another, should be made only where it is reasonable to believe that the transmission can be made and received under secure conditions; and

· unnecessary copying of confidential documents should be avoided and documents containing confidential information should be promptly removed from conference rooms and work areas after the meetings; extra copies should be shredded or otherwise destroyed in a safe manner.

The rules set out above apply not only to the Company’s and the Quebecor Group’s information, but also to information that belongs to a third party, such as a supplier, customer or competitor. Moreover, a new employee may not disclose any confidential information about his previous employer.

Likewise, an employee leaving the Company still remains bound by the obligation to safeguard its confidential information, even after he has left.

The Stock Exchange and Securities laws and regulations contain very strict provisions governing the use and disclosure of non-public information that may have a significant effect on the market price of a public company’s shares. Any person that contravenes those provisions may be subject to heavy fines and damages.

Since the Company is a subsidiary of Quebecor Inc., a company listed on the Toronto Stock Exchange, it is illegal for anyone to trade in shares of Quebecor Inc. and its public subsidiaries if that person is aware of important information about a company of the Quebecor Group that has not been publicly disclosed. It is also illegal for anyone to inform any person about important non-public information, other than in the normal course of business.

Therefore, the Company’s directors, officers and employees who are aware of confidential information that could have an effect on the market price of the securities of any public company of the Quebecor Group or those of a counterparty with whom there are ongoing important negotiations, are prohibited from trading in shares of the aforesaid public companies or that counterparty, until the information has been fully disclosed and a reasonable period of time has passed since the public disclosure of the information.

In addition, the directors and officers of the Company and all persons that are insiders of a public company of the Quebecor Group are prohibited from trading in its securities during certain trading blackout periods stipulated under the Policy relating to the use of privileged information of the relevant company .

When an employee is uncertain whether he may trade the securities of a public company of the Quebecor Group, that employee must refer to the Disclosure Policy of the relevant public company and/or contact the Secretary of the company.

The Company follows extremely high standards with regard to the accuracy and integrity in which its business records are maintained. These serve as a base for the management of its business, the assessment and carrying out of its obligations towards its shareholders, employees, clients and suppliers, as well as for assuring compliance with legal, fiscal and financial requirements. Consequently, employees must record information with precision and integrity, so that all business records of the Company are reliable and accurate.

Employees must maintain the Company’s business records, including its books, accounts, financial statements, transaction files and litigation files with integrity and precision, in a manner that accurately reflects its commercial activities and in compliance with the legal and regulatory requirements and with other policies of the Company.

All the financial activities must be properly recorded in the accounting records and the accounting procedures must be supported by the appropriate internal controls.

Work orders, supporting documents, invoices, pay slips and other similar data must be factually accurate, true, complete and maintained according to the Company’s current practices. Employees must not remove or destroy any file or record without the authorization of their superior. Such authorization will only be granted in accordance with the applicable laws and Company policies.

Deliberate recording of wrong data on any report, record or memorandum constitutes a dishonest act which may have a serious impact on the Company’s operations and is therefore unacceptable.

The Company wishes to maintain open and honest communications with the public, the investment community, the media and the securities regulatory authorities. To ensure that the Company complies with the law while protecting its interest and confidential issues, only the Company’s designated spokespersons are authorized to represent and deal on its behalf with the public, the investment community, the securities regulatory authorities and the media, the whole in conformity with the Disclosure Policy of Quebecor Media Inc.

Thus, employees who are not designated spokespersons must not respond, under any circumstances, to inquiries from the public, the investment community, the media, the securities regulatory authorities or others, unless specifically asked to do so by a designated spokesperson. If an employee receives such a request, whether verbal or written, the employee must forthwith direct it to one of the Company’s designated spokespersons.

An employee may not represent the Company in public in any manner whatsoever unless specifically requested to do so by the management, the Board of Directors, or a designated spokesperson. When an employee expresses a personal view in a public forum, he may not use the Company’s letterhead or its e-mail or any reference to his business address or title. In order to ensure that no material confidential information is inadvertently disclosed, employees are prohibited from participating in Internet chat rooms or newsgroup discussions on matters pertaining to the Company’s activities.

When an employee is asked to make a public presentation about his job within the Company, that employee must obtain the immediate superior’s prior approval. In case of doubt, the immediate superior must seek advice from the Company’s Communication Department.

The Company seeks to outperform its competitors fairly and honestly and to achieve competitive advantages through superior performance. Employees should always strive to deal honestly with the Company’s customers, suppliers, competitors and other employees. No one should benefit from an undue commercial advantage of anyone through manipulation, concealment, abuse of privileged information, false representation, or any other unfair dealing practice.

The employees must also respect all laws pertaining to competition. In addition, no employee may participate in discussions, agreements, projects, arrangements, whether formal or informal, with competitors or potential competitors, on issues dealing with prices, pricing rates, territories or customers to be served.

Penalties imposed for non-compliance with the laws pertaining to competition are severe. They entail heavy fines, prison sentences and damages. The penalties are equally applicable to the employees and the employer. Also, an investigation resulting from an alleged violation of the competition laws could seriously prejudice the Company.

Due to the complexity of the laws pertaining to competition, the Company recommends that its employees consult, as needed, the Company’s Legal Affairs Department on such matters.

As a general rule of conduct, all employees of the Company must, at all times, comply with all laws and regulations applicable to the Company and to the citizens in general.

In order to become familiar with and comply with the laws, rules and regulations that affect or govern their area of responsibility, employees can consult with and be guided by their manager or the Company’s Legal Affairs Department. Decisions regarding the application of such laws and regulations should not be made without the advice of the Company’s Legal Affairs Department. Similarly, an employee should avoid proceeding in a manner which, in the opinion of such Department, would be in violation of the law.

Leverage Ratio

Facility Fees

Prime Rate plus

Stamping Fees or Cdn$ Libor plus or LC Fee

If, at any time, an employee is unsure about whether an act may contravene this Code or if he has any question in connection therewith, he should seek advice from the person in charge of his Human Resources Department. Equally, any question regarding ways to address ethical matters should be brought to the attention of his manager or the person in charge of his Human Resources Department.

Employees who become aware of any behaviour in violation of this Code, other Company policies or any law, rule or regulation applicable to the Company, must promptly report such violation to their manager. If this procedure is not appropriate under the circumstances or if no satisfactory answer is obtained, employees should contact the person in charge of their Human Resources Department.

No employee should accept any instruction from their manager that contravenes this Code, other Company policies or any applicable law, rule or regulation of which they are aware and an employee should immediately report any instruction that contravenes this Code to the person in charge of their Human Resources Department or to the Vice President, Legal Affairs.

All reporting of a violation will be dealt with confidentially, within the limits imposed by law and the Company will not tolerate any kind of reprisal against any person, who in good faith, reports to the Company real or potential issues relating to violations of this Code, other Company policies or any applicable law, rule or regulation.

The Company recognizes that employees may be reluctant to report certain types of violations or infractions. It is for that reason that the Company offers a confidential toll-free telephone line and Web site operated by an independent third party. This will allow employees to anonymously report any and all complaints or all forms of suspicious acts or irregularities pertaining to accounting, internal controls, auditing matters, fraud, theft, illegal use of Company property and insider trading. In such cases, the Company hopes that its employees will report those types of violations. For more information concerning this toll-free confidential telephone line and Web site, the employees are invited to refer to Appendix 1 of this Code, which is entitled “ClearView Connects TM - Questions and Answers ” .

VIOLATION

Any violation of this Code, other Company policies or applicable rules or regulations, may result in disciplinary measures, ranging from a simple warning or reprimand, to termination of employment.

Disciplinary measures may be taken against any employee, for directly violating or enticing others to violate this Code, other Company policies or applicable laws or regulations. An employee can also be subject to disciplinary action if he fails to cooperate with an investigation relating to any such violation, knowingly falsely accuses another employee of a violation or retaliates against a person who reports a violation or suspects a violation.

Disciplinary measures will also be taken against any manager who is aware that one of his staff members is about to engage in a prohibited conduct and who fails to take preventive action. Managers may also be subject to disciplinary action if they fail to effectively supervise their staff.

Furthermore, non-compliance to laws and regulations can entail civil or criminal penalties including fines and prison sentences.

COMMUNICATION OF THE CODE

QMI’s Vice President, Human Resources, has the responsibility of ensuring that each employee of QMI receives a copy of the Code and that each new employee of QMI signs the declaration included with the Code upon receipt of his copy.

APPENDIX 1

“CLEARVIEW CONNECTS TM - QUESTIONS AND ANSWERS”

Who provides the service?

ClearView Connects TM is a telephone service and a website operated by ClearView Strategic Partners Inc. (“ClearView”), an independent third party. Employees may access the website of ClearView Connects at www.clearviewconnects.com.

Why use this service?

QMI attaches a great deal of importance to the values of honesty and integrity. All employees are encouraged to report all complaints or all forms of suspicious acts pertaining to accounting, internal controls, auditing matters, fraud, theft, illegal use of Company property and insider trading. If an employee is uncomfortable reporting this type of information through the normal chain of command, then he is able to report it anonymously, without fear of reprisal through the toll-free confidential telephone line or secure website.

Who can use this service?

All employees without distinction.

When to use this service?

You should use the ClearView Connects TM telephone service or website as soon as you notice a suspicious behaviour.

For example:

· Accounting irregularities;

· Falsification of the Company’s records;

· Fraud;

· Misuse of confidential information (Insider Trading);

· Irregularity in the handling or reporting of financial transactions;

· Significant breach of internal controls;

· Theft.

You must keep in mind that if you wait too long before reporting the incident, it becomes more difficult to investigate the matter.

How is anonymity preserved?

You will never be asked to provide your name when you call ClearView Connects TM . If you identify yourself, there can be no retaliation or reprisal. The service is offered to resolve situations of wrongdoing and not for the purpose of identifying the employee who reported it.

When you use the ClearView Connects TM website, your e-mail address is automatically encrypted to preserve your identity. ClearView has formally undertaken not to divulge any confidential information received from an employee (including his name) without that employee’s specific consent. Also, the Company has unconditionally undertaken to preserve the anonymity and confidentiality.

What happens when you use the toll-free telephone line?

When you call, a ClearView Agent with the necessary skills is automatically assigned to take the call in your language. You will have to provide forthwith the following information: the circumstances of the incident, the persons involved, and any other information (i.e. dates, time, names, places, and credible witnesses, if possible).

The ClearView Agent will ask you to identify the name of the Company, subsidiary or division where the incident you wish to report took place. In some cases, he may have to ask you to disclose the exact address. After gathering all the information pertaining to the incident, he will ask you to categorize the incident according to a pre-established list and will ask you specific questions relating to that particular category. The ClearView Agent will then provide you with a user code and login, which will be valid for a fourteen-day period only. You will have to write down that information, since ClearView will not keep any trace of it, so as to preserve your identity. If you lose that information, you will not be able to consult your incident report. The user code and login will enable you to call back ClearView and to verify the status of your report. If you call back, it is possible that the ClearView Agent will ask you to answer additional questions received from the Company’s representatives who are responsible for reviewing and analyzing the incident reports.

What happens when you use the ClearView Connects TM website?

The procedure used to report an incident on the website is similar to the telephone reporting procedure.

When you access the ClearView Connects TM website, please follow the instructions.

To begin, you will have to first enter the name of the Company, subsidiary or division where the incident you wish to report took place. You may then access the Web page dedicated to the Company. You will be able to read the Company’s welcome message and you will be invited to consult its Code of Ethics, which is posted on that Web page.

You will have to describe the incident and provide the following information: the circumstances of the incident, the persons involved, and any other information (i.e. dates, time, names, places, and credible witnesses, if possible). You will then have to categorize the incident according to a pre-established list by checking the appropriate box and answer specific questions relating to that particular category. Once you have replied to all the questions, you will be assigned a user code and a login, which will be valid for a fourteen-day period only. You will have to write down that information, since ClearView will not keep any trace of it, so as to preserve your identity. If you loose that information, you will not be able to consult your incident report. This will enable you to verify the status of your incident report which will be posted on the ClearView Connects TM website. After a preliminary review of the incident report, the Company’s representatives (who are responsible for reviewing and analyzing the incident report) will be able to add additional questions in the report, if deemed necessary.

Who may investigate?

The Vice-President, Internal Audit of QMI has the exclusive authority to investigate. Since he reports to the Audit Committee, this guarantees his independence.

How to use this confidential service?

To use the telephone service, the employees must dial 1-877-821-5801 .

The employees may access the ClearView Connects TM website at www.clearviewconnects.com .

When is the service available?

It is available 24 hours a day, 7 days a week.

Will the employees filing a complaint be informed of the results of any investigation?

No, not directly.

EMPLOYEE DECLARATION

I, the undersigned, hereby acknowledge that I have received a copy of the Code of Ethics of Quebecor Media Inc. and that I agree to comply with its provisions.



Name (in capital letters)



Service / Location



Signature



Date

The sections related to the reporting of violations apply only to those areas where it is permitted by laws and regulations.

Exhibit 12.1

Certification of the Principal Executive Officer of

Videotron Ltd.

pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Robert Dépatie, President and Chief Executive Officer of Videotron Ltd. (the “Company”), certify that:

1. I have reviewed this annual report on Form 20-F of the Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4. The Company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the Company and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5. The Company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

Date: March 6, 2009

	/s/ Robert Dépatie
	Name: Robert Dépatie
	Title: President and Chief Executive Officer

Exhibit 12.2

Certification of the Principal Financial Officer of

Videotron Ltd.

pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Marie-Josée Marsan, Vice President, Finance and Chief Financial Officer of Videotron Ltd. (the “Company”), certify that:

1. I have reviewed this annual report on Form 20-F of the Company;

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

Date: March 6, 2009

	/s/ Marie-Josée Marsan
	Name: Marie-Josée Marsan
	Title: Vice President, Finance and Chief Financial Officer

Exhibit 13.1

Certification of the Principal Executive Officer of

Videotron Ltd.

pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report of Videotron Ltd. (the “Company”) on Form 20-F for the year ending December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert Dépatie, President and Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 6, 2009


	/s/ Robert Dépatie

	Name: Robert Dépatie
	Title: President and Chief Executive Officer

The foregoing certification is being furnished solely pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code) and is not being filed as part of the Report or as a separate disclosure document.

Exhibit 13.2

Certification of the Principal Financial Officer of

Videotron Ltd.

pursuant to 18 U.S.C. Section 1350,

as adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Annual Report of Videotron Ltd. (the “Company”) on Form 20-F for the year ending December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Marie-Josée Marsan, Vice President, Finance and Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 6, 2009


	/s/ Marie-Josée Marsan

	Name: Marie-Josée Marsan
	Title: Vice President, Finance and Chief Financial Officer

Exhibit 99.1


KPM G LLP	Telephone	(514) 840-2100
Chartered Accountants	Telefax	(514) 840-2187
600 boul. de Maisonneuve Ouest	Internet	www.kpmg.ca
Suite 1500
Tour KPMG
Montréal, Québec H3A 0A3

Securities and Exchange Commission

100 F Street, N.E.

Washington, DC 20549

March 6, 2009

RE:	Commission File Number: 033-51000 - Videotron Ltd.

We were previously auditors for Videotron Ltd. and, under the date of February 29, 2008, we reported on the consolidated financial statements of Videotron Ltd. as of December 31, 2007 and 2006 and for the years ended December 31, 2007, 2006 and 2005. On May 6, 2008, we were dismissed. We have read Videotron Ltd. statements included under Item 16F of its Form 20-F dated March 6, 2009, and we agree with such statements contained in paragraphs two and three, and paragraph five as it relates to KPMG LLP. We are not in a position to agree or disagree with the following statements of the registrant contained in Item 16F:

· the appointment of their new auditors and the new auditor’s audit;

· the approval of the audit committee of the change of auditors;

· the consultation with their new auditors regarding the matters noted in paragraph 4; and

· the communication and response of their new auditors regarding the matters noted in paragraph 5.

Very truly yours,

Chartered Accountants

KPMG LLP is a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG international, a Swiss cooperative.

KPMG Canada provides services to KPMG LLP.