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                                                                   EXHIBIT 4.17



                         IN THE YEAR TWO THOUSAND AND ONE, THIS THIRTEENTH DAY
                         OF JULY.

                         BEFORE Marc DAIGNEAULT, the undersigned Notary for the
                         Province of Quebec, practicing at Montreal.

                         APPEARED:

                         STERLING PULP CHEMICALS, LTD. (hereinafter called the
                         "GRANTOR"), a corporation having a place of business at
                         302 The East Mall, Suite 200, Toronto, Ontario, M9B 6C7
                         and which is herein represented by Carl YANK, its Plant
                         Manager, hereunto duly authorized in virtue of a
                         resolution of the said corporation and a certified copy
                         or duplicate of which is annexed hereto after having
                         been signed for identification by the said
                         representative and by the undersigned Notary.

DEED OF
HYPOTHEC
                         AND:
Minute No. 201


                         CIBC MELLON TRUST COMPANY (hereinafter called the
                         "CREDITOR"), a corporation having a place of business
                         at 2001 University Street, 16th Floor, Montreal,
                         Quebec, H3A 2A6, in its capacity as holder of the power
                         of attorney (fonde de pouvoir) within the meaning of
                         Article 2692 of the Civil Code of Quebec for all
                         present and future holder or holders from time to time
                         of the Demand Debenture dated July 11, 2001 by the
                         Grantor in favour of the CIT Business Credit Canada
                         Inc., as agent for the Lenders (in such capacity, the
                         "HOLDER") (as the same may be, from time to time,
                         amended, restated, renewed, replaced or otherwise
                         modified, herein collectively referred to as the
                         "DEBENTURE") which is herein represented by Ernestine
                         Reinhold, its manager fiduciary services, hereunto duly
                         authorized as she so declares, and Pierre Tremblay, its
                         senior administrator fiduciary services, hereunto duly
                         authorized as he so declares.

                         WHICH PARTIES HAVE DECLARED AND AGREED AS FOLLOWS:

                         1. DEFINITIONS

                                  Unless it is otherwise apparent from or
                         inconsistent with the context, certain words and
                         expressions in this Deed which employ first capitals
                         and which are not otherwise defined in the text itself,
                         have the meaning ascribed thereto in Schedule I.

                         2. OBLIGATIONS SECURED

                                  The Grantor hereby acknowledges having
                         executed the Debenture pursuant to which the Grantor
                         agrees to pay certain amounts to the Holder. The
                         Grantor has agreed to secure its obligations under the
                         Debenture by way of the present hypothec. The Grantor
                         further acknowledges that the Debenture constitutes a
                         title of indebtedness of the Grantor. In this Deed, the
                         word "OBLIGATIONS" means all present and future debts
                         and liabilities, in principal, interest or otherwise,
                         of the Grantor to the Holder under the Debenture.

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                         3. HYPOTHEC

                                  As security for the full and final payment of
                         the Obligations and of the expenses, if any, incurred
                         by the Creditor to obtain payment of the Obligations or
                         to conserve the Mortgaged Property, the Grantor hereby
                         hypothecates to and in favour of the Creditor, as
                         holder of the power of attorney (fonde de pouvoir),
                         within the meaning of Article 2692 of the Civil Code of
                         Quebec, for all present and future holder or holders of
                         the Demand Debenture, to the extent of the sum of
                         seventy-five million dollars ($75,000,000) in lawful
                         money of Canada, with interest thereon at the rate of
                         TWENTY-FIVE PERCENT (25%) per annum, the following
                         property:

                         (a)      the immovable property described in Schedule
                                  II hereof, together with all present and
                                  future works, constructions and appurtenances
                                  related thereto (collectively, the "BUCKINGHAM
                                  PROPERTY").

                         (b)      all of its movable property of every nature
                                  and description, corporeal and incorporeal,
                                  present and future and wherever situate,
                                  including, but without limitation:

                                  (i)    all of its Claims, present and
                                         future, regardless of the location
                                         of the account debtors;

                                  (ii)   all of its Property in Stock, present
                                         and future;

                                  (iii)  all of its Equipment, present and
                                         future;

                                  (iv)   all of its Intellectual Property,
                                         present and future; and

                                  (v)    all of its Contractual Rights,
                                         present and future.

                         4. SPECIAL PROVISIONS RELATIVE TO THE CLAIMS

                         4.1 The Creditor authorizes the Grantor to manage and
                         collect the Claims in the ordinary course of business.
                         Such authorization may nevertheless be withdrawn at any
                         time after the occurrence and during the continuance of
                         an Event of Default (but without any obligation on the
                         part of the Creditor to establish that the Grantor has
                         been negligent or has refused to avail itself of its
                         rights), whereupon the Creditor shall be free to do in
                         its own name or in the name of the Grantor any of the
                         following, without any interference or consent on the
                         part of the Grantor and without being bound (to the
                         fullest extent permitted by law) by the rules
                         respecting the administration of the property of
                         others:

                         (a)      collect the Claims and apply such proceeds
                                  (net of all collection costs and the
                                  reasonable remuneration of the Creditor at the
                                  customary rates) in such manner as it shall
                                  deem appropriate;

                         (b)      give valid acquittances for any sums paid by
                                  third party debtors at any time after as well
                                  as before the creation of this security, and
                                  unilaterally cause, with or without
                                  consideration, the cancellation or reduction
                                  of any Encumbrance securing the Claims or any
                                  part thereof; and

                         (c)      renegotiate, terminate or novate the Claims in
                                  whole or in part upon such terms and
                                  conditions as it shall deem reasonable, take
                                  and give up security and generally exercise,
                                  but without any obligation to do so and at its
                                  entire discretion, all rights of the Grantor
                                  with respect to the Claims, it being
                                  understood that the Creditor is relieved of
                                  any obligation to inform the Grantor of any
                                  irregularity in the payment of any Claim and
                                  it shall incur no liability for any loss or
                                  damage which may result from the exercise of
                                  its rights except in the case of its own
                                  intentional or gross fault.

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                         4.2 Any amount received by the Grantor with respect to
                         the Claims after a withdrawal of authorization as
                         aforesaid shall be deemed so received as mandatary or
                         depositary of the Creditor and shall forthwith be
                         remitted to the latter without demand or notice, the
                         whole without prejudice to the recourses of the
                         Creditor against the third party debtors.

                         4.3 If any of the Claims are themselves secured by a
                         Conventional Security or any other right susceptible of
                         publication under the law, the Creditor shall have the
                         right to accomplish, at the expense of the Grantor, all
                         the formalities required to perfect against the third
                         party debtors the hypothecary rights of the Creditor
                         upon such Claims and accessories thereof.

                         4.4 After the occurrence and during the continuance of
                         an Event of Default, where the Creditor is or becomes
                         the debtor of an amount owing to the Grantor, the
                         Creditor may at any time modify unilaterally and
                         without prior notice the term of any such debt or
                         deposit, elect to pay the same and, if necessary,
                         convert to a single currency any sums or instruments
                         denominated in different currencies. The Creditor may
                         also at any time, outside the purview of this hypothec,
                         operate compensation between any of the Claims owing by
                         the Creditor to the Grantor and the Obligations hereby
                         secured. In case of the bankruptcy of the Grantor, such
                         compensation shall be deemed to have occurred
                         immediately prior to such bankruptcy.

                         4.5 To the extent that hypothecation in favour of the
                         Creditor of any Claims arising under or in connection
                         with any agreement, license, permit or quota of the
                         Grantor (each, a "RESTRICTED ASSET") is prohibited by
                         the terms thereof, the Grantor shall hold all proceeds
                         arising under or in connection with such Restricted
                         Asset as mandatary for the Creditor on the following
                         basis:

                                  (i)    prior to the occurrence of an Event of
                                         Default, the Grantor shall be entitled
                                         to receive all such proceeds; and

                                  (ii)   after the occurrence and during the
                                         continuance of an Event of Default, all
                                         rights of the Grantor to receive such
                                         proceeds shall cease, the Grantor shall
                                         at the request of the Creditor take all
                                         such actions to collect and enforce
                                         payment and other rights arising under
                                         the Restricted Asset in accordance with
                                         the instructions of the Creditor and
                                         all such proceeds arising under or in
                                         connection with the Restricted Asset
                                         shall, subject to applicable law, be
                                         immediately paid over to the Creditor.

                                  The Grantor shall not exercise any rights of
                         set-off with respect to Claims payable under or in
                         connection with any Restricted Asset and shall use its
                         best efforts to ensure that no other party to the
                         Restricted Asset shall exercise any rights of set-off
                         against the amount payable thereunder. The Grantor
                         shall use its best efforts to obtain the consent of
                         each other party to the Restricted Asset to the
                         hypothecation of the Restricted Asset to the Creditor
                         in accordance with this Deed and shall use its best
                         efforts to ensure that all agreements entered into on
                         or after the date hereof expressly permit hypothecation
                         of the benefits of such agreements as collateral
                         security to the Creditor in accordance with the terms
                         of this Deed.

                         5. EVENTS OF DEFAULT

                         Upon the occurrence of an Event of Default, the Grantor
                         shall be in default hereunder and at such time the
                         hypothecary rights hereby constituted shall become
                         enforceable

                         6. EXERCISE OF HYPOTHECARY RIGHTS

                         6.1 Upon the occurrence of an Event of Default, the
                         Grantor immediately loses the benefit of the term
                         inasmuch as it could claim any such benefit, and the
                         Lenders may forthwith terminate any commitment that it
                         had to make any advances or credit available to the
                         Grantor. The Creditor may also demand from the Grantor
                         the immediate payment of

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                         the Obligations or any part thereof and, failing
                         receipt of such payment within the specified period,
                         the Creditor may request from the Grantor the voluntary
                         surrender of the Specifically Mortgaged Property and
                         the Grantor hereby undertakes to do so. To that end,
                         the Grantor covenants not to oppose the measures
                         initiated by the Creditor for the purpose of taking
                         possession of the assets surrendered by the Grantor,
                         but to facilitate the same. The Grantor shall also
                         execute any deed or document which may be necessary or
                         useful to evidence such surrender or to give it full
                         effect.

                         6.2 The Creditor shall not be bound to exercise the
                         same hypothecary rights against all of the Mortgaged
                         Property. Whatever hypothecary rights the Creditor
                         elects to exercise, the following provisions shall
                         apply:

                         (a)      The Creditor shall have the right, at the
                                  expense of the Grantor and in order to
                                  conserve or realize upon the Mortgaged
                                  Property:

                                  (i)     to continue or terminate the use and
                                          operation of the Specifically
                                          Mortgaged Property;

                                  (ii)    to dispose of the Specifically
                                          Mortgaged Property which may perish or
                                          deteriorate rapidly;

                                  (iii)   to use any information obtained by
                                          reason of the exercise of its rights;

                                  (iv)    to perform any obligation or covenant
                                          of the Grantor; and

                                  (v)     to exercise any right with respect to
                                          the Mortgaged Property.

                         (b)      The Creditor shall not be bound to make an
                                  inventory, to take out insurance or to furnish
                                  any security.

                         (c)      The Creditor or the Holder may acquire
                                  directly or indirectly any of the Mortgaged
                                  Property.

                         (d)      The Creditor may from time to time in the
                                  course of the exercise of its rights,
                                  renounce, with or without consideration, any
                                  right of the Grantor.

                         (e)      The Creditor shall not be bound to make the
                                  Mortgaged Property productive or to conserve
                                  the same.

                         (f)      Should the Creditor at any time abandon the
                                  exercise of its rights, hypothecary or
                                  otherwise, against the Mortgaged Property, the
                                  Creditor may elect, at its option, to return
                                  to the Grantor without any representation or
                                  warranty, the Mortgaged Property which the
                                  Grantor had surrendered to the Creditor, or
                                  the remainder thereof if any, the whole
                                  without prejudice to its other rights and
                                  recourses.

                         (g)      The Creditor shall be deemed to have acted in
                                  the best interest of the Grantor and its
                                  successors if the Creditor has acted in good
                                  faith.

                         6.3 Where the Creditor exercises a right of taking in
                         payment and the Grantor, inasmuch as it has the right
                         to do so, requires that the Creditor sell the Mortgaged
                         Property upon which such recourse was exercised, the
                         Grantor acknowledges that the Creditor shall not be
                         bound to abandon the right of taking in payment unless
                         the Creditor has obtained, before the end of the period
                         allowed for surrender, (i) a satisfactory security
                         guaranteeing that the sale will be made at a
                         sufficiently high price to enable the Creditor's claim
                         to be paid in full, (ii) the full reimbursement of all
                         costs thus incurred by it, and (iii) an advance of the
                         funds needed for the sale of the said properties.

                         6.4 If the Creditor itself sells the Specifically
                         Mortgaged Property, it shall not be required to obtain
                         any prior appraisal thereof.

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                         6.5 The sale by the Creditor of the Specifically
                         Mortgaged Property may be concluded by the Creditor
                         without legal warranty or, at its option, without any
                         warranty whatsoever.

                         7. REDUCTION AND CANCELLATION

                         The Creditor may, unilaterally and in its entire
                         discretion, consent to the reduction or cancellation of
                         the security hereby constituted. However, the Creditor
                         shall not be bound to consent to any such reduction or
                         cancellation unless and until the full and final
                         payment of all amounts hereby secured has been received
                         and there is no outstanding commitment on the part of
                         the Lenders to advance further sums or extend further
                         credits to the Grantor. Any such reduction or
                         cancellation shall be at the expense of the Grantor.

                         8. GENERAL PROVISIONS

                         8.1 This Deed does not operate as a novation and the
                         hypothec hereby constituted shall be in addition to any
                         other guarantee or security which the Creditor or the
                         Holder may have from time to time.

                         8.2 The Creditor may waive any covenant in its favour
                         and any Event of Default. The Creditor may also grant
                         extensions, take and give up security, accept
                         arrangements and otherwise deal with the Grantor or
                         with any other party as the Creditor may see fit, the
                         whole without prejudice to the Obligations or to any
                         other right of the Creditor hereunder or otherwise. No
                         failure or delay on the part of the Creditor in
                         exercising any right hereunder shall operate as a
                         waiver thereof nor shall any waiver be effective unless
                         the same be in writing.

                         8.3 The Grantor shall be "en demeure" by the mere lapse
                         of time, or may be put "en demeure" by any other method
                         provided by law.

                         8.4 This hypothec is a continuous security which will
                         subsist notwithstanding any fluctuation of the amounts
                         hereby secured. The Grantor shall be deemed to obligate
                         itself again as provided in Article 2797 of the Civil
                         Code with respect to any future obligation hereby
                         secured.

                         8.5 The Creditor shall have the right, at the expense
                         of the Grantor, to perform all acts and things and to
                         execute all documents as may be necessary to ensure
                         that this hypothec remains effective and opposable to
                         third parties, including the execution and filing of
                         any document required for the renewal hereof.

                         8.6 If the term "Grantor" includes more than one
                         person, each of them shall be solidary for the
                         performance of the obligations herein stipulated.

                         8.7 Any amount received by the Creditor in the exercise
                         of its rights hereunder or under any law may, at its
                         option, be retained by it as part of the Mortgaged
                         Property, or may be applied by it towards the partial
                         payment of the Obligations, even if not yet exigible,
                         as the Creditor shall alone determine notwithstanding
                         the rules governing the application of payments.

                         8.8 The Creditor is not bound by any degree of care
                         beyond a reasonable diligence in the exercise of its
                         rights or in the performance of its duties, and it
                         shall not be liable for any loss or damage resulting
                         therefrom except as a result of its own intentional or
                         gross fault.

                         8.9 The Creditor may delegate to any other person the
                         exercise of its rights or the performance of its duties
                         hereunder and may provide such agents or mandataries
                         with any information that the Creditor may possess with
                         respect to the Grantor or the Mortgaged Property.

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                         8.10 The property or sums of money received or held by
                         the Creditor by reason of these presents may be
                         invested by the Creditor in such manner as it shall
                         deem appropriate without regard to rules governing the
                         administration of the property of others.

                         8.11 Neither the execution of this Deed of Hypothec nor
                         the fact that the Lenders may have already granted any
                         part of the credits the repayment of which are hereby
                         secured, shall be deemed to oblige the Lenders either
                         to keep such credits available or to grant further
                         credits.

                         8.12 Every divisible obligation in favour of the
                         Creditor arising out of this Deed must be performed in
                         its entirety, as if it were indivisible, by each heir
                         or legal representative of any person who shall have
                         been bound therefor.

                         8.13 The Grantor shall continue to be bound by all the
                         obligations expressed herein notwithstanding any
                         transfer of the Mortgaged Property or any part thereof.

                         8.14 Except as may be otherwise apparent from the
                         context, the word "Grantor" shall be interpreted as
                         referring to the Grantor itself as well as to any other
                         person or persons having assumed the Grantor's
                         liabilities to the Creditor.

                         8.15 Unless there is something in the context
                         inconsistent therewith, words importing the singular
                         shall include the plural and vice-versa, and words
                         importing the neuter gender shall include the masculine
                         and feminine genders and vice-versa.

                         8.16 In the event of contradiction between the
                         provisions hereof and those of the Debenture, the
                         Debenture shall prevail.

                         8.17 The schedules referred to in this Deed shall form
                         an integral part hereof.

                         8.18 This Agreement shall be governed by and
                         interpreted and construed in accordance with the laws
                         presently in force in the Province of Quebec and the
                         laws of Canada applicable therein.

                         8.19 THE GRANTOR ACKNOWLEDGES THAT IT HAS READ THIS
                         DEED, THAT IT HAS RECEIVED ADEQUATE EXPLANATION OF THE
                         NATURE AND SCOPE OF ITS OBLIGATIONS HEREUNDER AND THAT
                         IT IS SATISFIED THEREWITH.

                         8.20 The parties hereto confirm their express wish that
                         this Deed and all documents related thereto be drawn up
                         in English. Les parties aux presentes confirment leur
                         volonte expresse de voir le present Acte et tous les
                         documents s'y rattachant etre rediges en anglais.

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                                             SCHEDULE I

                                        CERTAIN DEFINITIONS


                         "CIVIL CODE" means the Civil Code of Quebec.

                         "CLAIMS" means, regardless of the debtors or the situs
                         thereof, any and all claims, customer accounts, book
                         debts, accounts receivable and any other amounts or
                         property now or hereafter owing to the Grantor, either
                         absolutely or conditionally, including all claims and
                         indemnities payable under insurance policies covering
                         the same, all deposits and credit balances with
                         financial institutions, suppliers or others, all
                         judgments, rights and accessories thereto, and the
                         benefit of all Encumbrances in support thereof and all
                         books, papers, invoices, notes and data files
                         evidencing, recording or supporting the same.

                         "CONTRACTUAL RIGHTS" means any and all rights, title
                         and interest, present and future, of the Grantor in all
                         contracts, leases, bids, offers, supply agreements,
                         permits and all other agreements of any nature and
                         description relating to the Mortgaged Property or
                         relating to the Enterprise and undertaking of the
                         Grantor.

                         "CONVENTIONAL SECURITY" means a conventional hypothec,
                         a resolutory right, a right of redemption, a
                         reservation of ownership, a trust and any security
                         device or other real right, whether or not capable of
                         registration, granted by agreement for the purpose of
                         securing the performance of an obligation.

                         "ENCUMBRANCE" means a legal cause of preference, a
                         dismemberment of the right of ownership, a special mode
                         of ownership, a restriction on the right to dispose and
                         a Conventional Security.

                         "ENTERPRISE" has the meaning ascribed thereto in
                         Article 1525 of the Civil Code.

                         "EQUIPMENT" means tangible movable property such as
                         machinery, equipment, vehicles, furniture and fixtures,
                         and all licences and other rights and records, files,
                         charts, plans, drawings, specifications, manuals,
                         documents and warranties relating thereto.

                         "EVENT OF DEFAULT" means any of the "Events of Default"
                         described in Section 10 of the Financing Agreement.

                         "FINANCING AGREEMENT" means the financing agreement to
                         be entered into by the Grantor and CIT Business Credit
                         Canada Inc., as agent and as a lender, and to be dated
                         July 11, 2001 wherein a revolving line of credit and a
                         term loan shall be made available to the Grantor.

                         "INTELLECTUAL PROPERTY" means all trade names, trade
                         marks, copyrights, designs, processes, know how,
                         goodwill, licences, franchises, permits, quotas,
                         patents and other rights of intellectual and industrial
                         property of any nature and description, and all pending
                         applications pertaining thereto.

                         "LENDERS" shall have the meaning given to such term in
                         the Debenture.

                         "MORTGAGED PROPERTY" means any and all property, rights
                         and interests, present and future, intended to be
                         charged by the hypothec created under Section 3
                         (including the Specifically Mortgaged Property), all
                         substitutions and replacements thereof, all increases,
                         additions and accessions thereto, all rights attaching
                         thereto and all proceeds in any form derived directly
                         or indirectly from any dealing with any of the
                         foregoing or the proceeds therefrom.

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                         "PROPERTY IN STOCK" means, regardless of the situs
                         thereof at any particular time, (a) all inventory of
                         raw materials, goods in process, finished products and
                         stock in trade of any nature and description, from time
                         to time located in the Province of Quebec, whether or
                         not the same is held for let or hire, leasing, resale
                         or otherwise, (b) all goods and materials used in or
                         procured for the packaging thereof, from time to time
                         located in the Province of Quebec, (c) any such
                         property held by third parties under let or hire,
                         leasing, conditional sale, franchise, licence,
                         consignment or other like contractual arrangements with
                         its lawful owner, (d) any such property sold by the
                         Grantor and later taken back for any reason, and (e)
                         all amounts and proceeds paid or payable to or for the
                         account of the Grantor as a result of the sale, lease
                         or other dealings with any of the foregoing.

                         "SPECIFICALLY MORTGAGED PROPERTY" means, at any
                         particular time, the Mortgaged Property which is
                         actually in existence.

                         "TANGIBLE PROPERTY" means any of the specifically
                         Mortgaged Property which is corporeal.


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                                            SCHEDULE II

                                   IMMOVABLE PROPERTY DESCRIPTION


                         (A) A certain emplacement located in the Town of
                         Buckingham, Province of Quebec, known and designated as
                         being composed of the following parts of lots:

                         (1) A part of lot TWELVE B (Pt 12B), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on the
                         plan prepared by Marc Fournier, Q.L.S., dated August 4,
                         1992, bearing minute number 1478-F, said point being
                         the northeast corner of lot 12B, thence over a distance
                         of one hundred and eighty-six meters and forty-four
                         hundredths of a meter (186,44m), measured in a
                         direction south six degrees, twenty-two minutes,
                         thirty-four seconds east (S06degrees 22'34"E), along
                         the dividing line between lots 11C and 12B to point
                         "42".

                         From point "42", over a distance of eighty-eight
                         hundredths of a meter (0,88m), measured in a direction
                         north eighty-two degrees, thirty-one minutes,
                         thirty-nine seconds west (N82degrees 31'39"W), to point
                         "43".

                         From point "43", in a south-westerly direction, a
                         distance of fifteen meters and eighty-four hundredths
                         of a meter (15,84m), measured along a curve having a
                         radius of two hundred and thirty-two meters and
                         twenty-three hundredths of a meter (232,23m), to point
                         "44".

                         From point "44", over a distance of two hundred and
                         eleven meters and seventy-one hundredths of a meter
                         (211,71m), measured in a direction north eighty-two
                         degrees, thirty-two minutes, fifty-two seconds west
                         (N82degrees 32'52"W), to point "45".

                         From point "45", over a distance of one hundred and
                         ninety-four meters and twenty-six hundredths of a meter
                         (194,26m), measured in a direction south five degrees,
                         forty-two minutes, fifty-one seconds east (S05degrees
                         42'51"E), to point "46".

                         From point "46", over a distance of twenty-seven meters
                         and sixty-four hundredths of a meter (27,64m), measured
                         in a direction south eighty-five degrees, twenty-one
                         minutes, thirty-four seconds west (S85degrees 21'34"W),
                         to point "47".

                         From point "47", over a distance of three hundred and
                         forty-five meters and ninety-five hundredths of a meter
                         (345,95m), measured in a direction north six degrees,
                         seventeen minutes, thirty seconds west (N06degrees
                         17'30"W), to point "2".

                         From point "2", over a distance of two hundred and
                         fifty meters and thirty hundredths of a meter
                         (250,30m), measured in a direction north eighty-five
                         degrees, fifty-six minutes, thirty-three seconds east
                         (N85degrees 56'33"E), along the dividing line between
                         lots 12A and 12B, to point "1", point of beginning.

                         The said part of lot is bounded towards the north by
                         part of lot 12A, towards the east by a part of lot 11C
                         and a part of lot 12B, towards the south by parts of
                         lot 12B and by Donaldson Road (12A-199, range 4),
                         towards the west by a part of lot 12B and contains an
                         area of forty-eight thousand three hundred and
                         fifty-six square meters and eight tenths of a square
                         meter (48 356,8m(2)).

                         (2) A part of lot ELEVEN C (Pt 11C), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on said
                         plan 1478-F, said point being the northeast corner of
                         lot 12B, thence over a distance of twelve hundredths of
                         a meter (0,12m), measured in a direction south six
                         degrees, twenty-two minutes, thirty-four seconds east
                         (S06degrees 22'34"E), to point "14", point of
                         beginning.

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                         Beginning at point "14", over a distance of one hundred
                         and twenty-six meters and fifteen hundredths of a meter
                         (126,15m), measured in a direction north eighty-seven
                         degrees, fifty-seven minutes, forty-nine seconds east
                         (N87degrees 57'49"E), to point "15".

                         From point "15", over a distance of forty meters and
                         three hundredths of a meter (40,03m), measured in a
                         direction south thirty-six degrees, one minute,
                         fifty-nine seconds east (S36degrees 01'59"E), to point
                         "16".

                         From point "16", over a distance of seventeen meters
                         and ninety-eight hundredths of a meter (17,98m),
                         measured in a direction south twenty degrees, fifty-two
                         minutes, forty seconds east (S20degrees 52'40"E), to
                         point "17".

                         From point "17", over a distance of fifteen meters and
                         sixty-five hundredths of a meter (15,65m), measured in
                         a direction south zero degrees, twelve minutes,
                         fifty-six seconds west (S00degrees 12'56"W), to point
                         "18".

                         From point "18", over a distance of twelve meters and
                         nine hundredths of a meter (12,09m), measured in a
                         direction south nineteen degrees, forty-two minutes,
                         ten seconds east (S19degrees 42'10"E), to point "19".

                         From point "19", over a distance of twenty meters and
                         eighteen hundredths of a meter (20,18m), measured in a
                         direction south twenty-five degrees, seven minutes,
                         fifty-two seconds east (S25degrees 07'52"E), to point
                         "20".

                         From point "20", over a distance of two meters and two
                         hundredths of a meter (2,02m), measured in a direction
                         south forty-four degrees, fifty-seven minutes,
                         thirty-nine seconds east (S44degrees 57'39"E), to point
                         "21".

                         From point "21", over a distance of two meters and
                         thirty-seven hundredths of a meter (2,37m), measured in
                         a direction south eight degrees, eight minutes,
                         fifty-three seconds east (S08degrees 08'53"E), to point
                         "22".

                         From point "22", over a distance of twenty-one meters
                         and thirty-two hundredths of a meter (21,32m), measured
                         in a direction south twenty-two degrees, fifty-six
                         minutes, thirty-four seconds east (S22degrees 56'34"E),
                         to point "23".

                         From point "23", over a distance of two meters and
                         forty-one hundredths of a meter (2,41m), measured in a
                         direction south seventy-six degrees, forty-seven
                         minutes, thirty-four seconds east (S76degrees 47'34"E),
                         to point "24".

                         From point "24", over a distance of four meters and
                         fifty-five hundredths of a meter (4,55m), measured in a
                         direction south thirteen degrees, nineteen minutes,
                         three seconds east (S13degrees 19'03"E), to point "25".

                         From point "25", over a distance of eleven meters and
                         sixty-seven hundredths of a meter (11,67m), measured in
                         a direction south twenty-three degrees, seven minutes,
                         forty seconds east (S23degrees 07'40"E), to point "26".

                         From point "26", over a distance of eight meters and
                         twenty-six hundredths of a meter (8,26m), measured in a
                         direction south forty-six degrees, nineteen minutes,
                         fifty-eight seconds east (S46degrees 19'58"E), to point
                         "27".

                         From point "27", over a distance of seven meters and
                         forty-eight hundredths of a meter (7,48m), measured in
                         a direction south sixty-seven degrees, forty-five
                         minutes, twenty seconds east (S67degrees 45'20"E), to
                         point "28".

                         From point "28", over a distance of nine meters and
                         sixty hundredths of a meter (9,60m), measured in a
                         direction south fifty-nine degrees, forty-four minutes,
                         fifty-eight seconds east (S59degrees 44'58"E), to point
                         "29".

<PAGE>   11

                         From point "29", over a distance of eleven meters and
                         eighty-one hundredths of a meter (11,81m), measured in
                         a direction south thirty-four degrees, twenty-four
                         minutes, thirty-five seconds east (S34degrees 24'35"E),
                         to point "30".

                         From point "30", over a distance of thirty-nine meters
                         and ninety-two hundredths of a meter (39,92m), measured
                         in a direction north sixty degrees, thirty minutes,
                         thirty-nine seconds east (N60degrees 30'39"E), to point
                         "31".

                         From point "31", over a distance of one hundred and six
                         meters and twenty-three hundredths of a meter
                         (106,23m), measured in a direction south eighty-one
                         degrees, forty-five minutes, twenty-three seconds east
                         (S81degrees 45'23"E), to point "32".

                         From point "32", over a distance of seventy-one meters
                         and thirty-four hundredths of a meter (71,34m),
                         measured in a direction south forty-one degrees,
                         twenty-two minutes, twenty-seven seconds east
                         (S41degrees 22'27"E), to point "33".

                         From point "33", over a distance of seven meters and
                         thirty-four hundredths of a meter (7,34m), measured in
                         a direction south eighty-three degrees, thirteen
                         minutes, fifty-nine seconds east (S83degrees 13'59"E),
                         to point "34".

                         From point "34", over a distance of four meters and
                         fifteen hundredths of a meter (4,15m), measured in a
                         direction south zero degrees, six minutes, forty-seven
                         seconds west (S00degrees 06'47"W), to point "35".

                         From point "35", over a distance of four meters and
                         nineteen hundredths of a meter (4,19m), measured in a
                         direction south thirty degrees, two minutes, thirty-one
                         seconds west (S30degrees 02'31"W), to point "36".

                         From point "36", over a distance of nine meters and
                         thirty-three hundredths of a meter (9,33m), measured in
                         a direction south twenty-six degrees, forty-five
                         minutes, seventeen seconds west (S26degrees 45'17"W),
                         to point "37".

                         From point "37", over a distance of five meters and
                         eight hundredths of a meter (5,08m), measured in a
                         direction south twelve degrees, forty-eight minutes,
                         fifty-two seconds west (S12degrees 48'52"W), to point
                         "38".

                         From point "38", over a distance of eight meters and
                         thirty-six hundredths of a meter (8,36m), measured in a
                         direction south fifteen degrees, fifty-three minutes,
                         five seconds west (S15degrees 53'05"W), to point "39".

                         From point "39", over a distance of ninety-five
                         hundredths of a meter (0,95m), measured in a direction
                         south twenty-three degrees, eight minutes, thirty-five
                         seconds west (S23degrees 08'35"W), to point "40".

                         From point "40", over a distance of two hundred and six
                         meters and eighty-six hundredths of a meter (206,86m),
                         measured in a direction north eighty-three degrees,
                         fourteen minutes, zero seconds west (N83degrees
                         14'00"W), to point "41".

                         From point "41", over a distance of one hundred and
                         seventy-four meters and thirteen hundredths of a meter
                         (174,13m), measured in a direction north eighty-two
                         degrees, thirty-one minutes, thirty-nine seconds west
                         (N82degrees 31'39"W), to point "42".

                         From point "42", over a distance of one hundred and
                         eighty-six meters and thirty-two hundredths of a meter
                         (186,32m), measured in a direction north six degrees,
                         twenty-two minutes, thirty-four seconds west
                         (N06degrees 22'34"W), along the dividing line between
                         lots 11C and 12B, to point "14", point of beginning.

                         Lines "34"-"35", "35"-"36", "36"-"37", "37"-"38",
                         "38"-"39", "39"-"40" are measured in a straight line
                         along the westerly and the north-westerly sides of
                         Lievre River.

<PAGE>   12

                         The said part of lot is bounded towards the north by a
                         part of lot 11C, towards the north-east by a part of
                         lot 11C, towards the east by the Lievre River and by a
                         part of lot 11C, towards the south-east by Lievre
                         River, towards the south by a part of lot 11C, towards
                         the west by a part of lot 12B, towards the north-west
                         by a part of lot 11C and contains an area of forty-six
                         thousand seven hundred and ninety-eight square meters
                         and three tenths of a square meter (46 798,3m(2)).

                         (3) A part of lot TWELVE A (Pt 12A), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on said
                         plan 1478-F, said point being the south-east corner of
                         lot 12A, thence over a distance of two hundred and
                         fifty meters and thirty hundredths of a meter
                         (250,30m), measured in a direction south eighty-five
                         degrees, fifty-six minutes, thirty-three seconds west
                         (S85degrees 56'33"W), along the dividing line between
                         lots 12A and 12B, to point "2".

                         From point "2", over a distance of ninety-one meters
                         and sixty-six hundredths of a meter (91,66m), measured
                         in a direction north six degrees, seventeen minutes,
                         thirty seconds west (N06degrees 17'30"W), to point "3".

                         From point "3", over a distance of seven meters and
                         fourteen hundredths of a meter (7,14m), measured in a
                         direction north seventy-one degrees, forty-two minutes,
                         fifty-eight seconds east (N71degrees 42'58"E), to point
                         "4".

                         From point "4", over a distance of thirty-three meters
                         and sixty-eight hundredths of a meter (33,68m),
                         measured in a direction north eighty degrees,
                         thirty-seven minutes, eighteen seconds east (N80degrees
                         37'18"E), to point "5".

                         From point "5", over a distance of twenty meters and
                         forty-six hundredths of a meter (20,46m), measured in a
                         direction north sixty-five degrees, thirty-one minutes,
                         thirty-one seconds east (N65degrees 31'31"E), to point
                         "6".

                         From point "6", over a distance of fifteen meters and
                         twenty-five hundredths of a meter (15,25m), measured in
                         a direction south eighty-five degrees, fifteen minutes,
                         thirty-six seconds east (S85degrees 15'36"E), to point
                         "7".

                         From point "7", over a distance of thirty-seven meters
                         and ninety-two hundredths of a meter (37,92m), measured
                         in a direction north seventy-three degrees, four
                         minutes, twenty-three seconds east (N73degrees
                         04'23"E), to point "8".

                         From point "8", over a distance of twenty-five meters
                         and forty-six hundredths of a meter (25,46m), measured
                         in a direction north thirty-eight degrees, eighteen
                         minutes, fifty-seven seconds east (N38degrees 18'57"E),
                         to point "9".

                         From point "9", over a distance of thirty-two meters
                         (32,00m), measured in a direction north fifty-two
                         degrees, twenty-four minutes, thirty-four seconds east
                         (N52degrees 24'34"E), to point "10".

                         From point "10", over a distance of eighty-three meters
                         and two hundredths of a meter (83,02m), measured in a
                         direction north fifty-eight degrees, thirty-two
                         minutes, forty-four seconds east (N58degrees 32'44"E),
                         to point "11".

                         From point "11", over a distance of eighteen meters and
                         fifty-four hundredths of a meter (18,54m), measured in
                         a direction north sixty-three degrees, five minutes,
                         forty seconds east (N63degrees 05'40"E), to point "12".

                         From point "12", over a distance of one hundred and
                         sixty-four meters and ninety-eight hundredths of a
                         meter (164,98m), measured in a direction south six
                         degrees, nineteen minutes, zero seconds east
                         (S06degrees 19'00"E), along the dividing line between
                         lots 12A and 11C, to point "13".

<PAGE>   13

                         From point "13", over a distance of twenty-six meters
                         and seventy-six hundredths of a meter (26,76m),
                         measured in a direction south six degrees, twenty-two
                         minutes, thirty-four seconds east (S06degrees 22'34"E),
                         along the dividing line between lots 12A and 11C, to
                         point "1", point of beginning.

                         Lines "3"-"4", "4"-"5", "5"-"6", "6"-"7", "7"-"8",
                         "8"-"9", "9"-"10", "10"-"11", "11"-"12" are measured in
                         a straight line along the south-easterly and the
                         southerly sides of a creek (part of lot 12A).

                         The said part of lot is bounded towards the north and
                         the north-west by a creek (part of lot 12A), towards
                         the east by a part of lot 11C, towards the south by a
                         part of lot 12B, towards the west by a part of lot 12A
                         and contains an area of thirty-two thousand eight
                         hundred and forty-eight square meters (32 848,0m(2)).

                         (4) A part of lot TWELVE B (Pt 12B), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on said
                         plan 1478-F, said point being situated at the
                         north-east corner of lot 12B, thence over a distance of
                         two hundred and sixty-two meters and sixty-nine
                         hundredths of a meter (262,69m), measured in a
                         direction south fifty degrees, forty-seven minutes,
                         forty-six seconds west (S50degrees 47'46"W), to point
                         "45", point of beginning.

                         Beginning at point "45", over a distance of two hundred
                         and eleven meters and seventy-one hundredths of a meter
                         (211,71m), measured in a direction south eighty-two
                         degrees, thirty-two minutes, fifty-two seconds east
                         (S82degrees 32'52"E), to point "44".

                         From point "44", in a south-westerly direction a
                         distance of one hundred and ninety-two meters and
                         fifty-five hundredths of a meter (192,55m), measured
                         along a curve having a radius of two hundred and
                         thirty-two meters and twenty-three hundredths of a
                         meter (232,23m), to point "48".

                         From point "48", over a distance of fifty-nine meters
                         and seventy-eight hundredths of a meter (59,78m),
                         measured in a direction south eighty-four degrees,
                         twenty-nine minutes, forty-five seconds west
                         (S84degrees 29'45"W), along the northerly limit of
                         Donaldson Road (12A-199), to point "49".

                         From point "49", over a distance of thirty meters and
                         forty-three hundredths of a meter (30,43m), measured in
                         a direction south eighty-five degrees, twenty-one
                         minutes, thirty-four seconds west (S85degrees 21'34"W),
                         along the northerly limit of Donaldson Road (12A-199),
                         to point "46".

                         From point "46", over a distance of one hundred and
                         ninety-four meters and twenty-six hundredths of a meter
                         (194,26m), measured in a direction north five degrees,
                         forty-two minutes, fifty-one seconds west (N05degrees
                         42'51"W), to point "45", point of beginning.

                         The said part of lot is bounded towards the north by a
                         part of lot 12B, towards the south-east by a part of
                         lot 12B, towards the south by Donaldson Road (12A-199,
                         range 4), towards the west by a part of lot 12B and
                         contains an area of twenty-four thousand two hundred
                         and twenty-nine square meters and five tenths of a
                         square meter (24 229,5m(2)).

                         The whole with all buildings, structures and other
                         accessories erected on said emplacement bearing civic
                         number 101 Donaldson Road in the said Town (postal code
                         J8L 3X3).

                         (B) All the constructions, equipment and structures and
                         their related cables and/or transmission lines
                         comprising the electrical substation, (save and except
                         for that

<PAGE>   14

                         transformer identified as TR-1T on plan 1473-F
                         hereinafter referred to and its related cables +
                         structures) owned by the Grantor as result of the
                         renunciation to the benefit of accession thereto by
                         Tenneco Canada Inc. in the Agreement of Sale registered
                         at the said Registration Division under number 229491,
                         the whole as situate in, on or under the immovable
                         property described as follows:

                         (a) A part of lot ELEVEN C (Pt 11C), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on the
                         plan prepared by Marc Fournier, Q.L.S., dated July 29,
                         1992, bearing minute number 1473-F, said point being
                         situated at the north-east corner of lot 12A-105, range
                         4, thence over a distance of forty-five meters and
                         ninety-three hundredths of a meter (45,93m), measured
                         in a direction north eighty-four degrees, thirty-six
                         minutes, sixteen seconds east (N84degrees 36'16"E),
                         along the dividing line between the Township of
                         Buckingham and the Village of Buckingham, to point "2",
                         point of beginning.

                         Beginning at point "2", over a distance of twenty-nine
                         meters and twenty-five hundredths of a meter (29,25m),
                         measured in a direction north eighty-five degrees,
                         forty-four minutes, fifty-three seconds west
                         (N85degrees 44'53"W), to point "3".

                         From point "3", over a distance of fifty-eight meters
                         and eight hundredths of a meter (58,08m), measured in a
                         direction north four degrees, twelve minutes, nine
                         seconds east (N04degrees 12'09"E), to point "4".

                         From point "4", over a distance of fifty-four meters
                         and sixty-four hundredths of a meter (54,64m), measured
                         in a direction south eighty-five degrees, forty-six
                         minutes, twenty seconds east (S85degrees 46'20"E), to
                         point "5".

                         From point "5", over a distance of twenty-seven meters
                         and sixty-seven hundredths of a meter (27,67m),
                         measured in a direction south forty-four degrees,
                         thirty-five minutes, twenty-six seconds east
                         (S44degrees 35'26"E), to point "6".

                         From point "6", over a distance of five meters and
                         fifty-eight hundredths of a meter (5,58m), measured in
                         a direction south four degrees, twenty-eight minutes,
                         forty-nine seconds west (S04degrees 28'49"W), to point
                         "7".

                         From point "7", over a distance of two meters and
                         thirty-two hundredths of a meter (2,32m), measured in a
                         direction north eighty-six degrees, one minute,
                         thirty-three seconds west (N86degrees 01'33"W), to
                         point "8".

                         From point "8", over a distance of seven meters and
                         seventy-five hundredths of a meter (7,75m), measured in
                         a direction south four degrees, five minutes,
                         fifty-nine seconds west (S04degrees 05'59"W), to point
                         "9".

                         From point "9", over a distance of nine meters and six
                         hundredths of a meter (9,06m), measured in a direction
                         south eighty-six degrees, two minutes, fifty-six
                         seconds east (S86degrees 02'56"E), to point "10".

                         From point "10", over a distance of nine meters and
                         three hundredths of a meter (9,03m), measured in a
                         direction south three degrees, fifty-one minutes, nine
                         seconds west (S03degrees 51'09"W), to point "11".

                         From point "11", over a distance of nine meters and
                         seven hundredths of a meter (9,07m), measured in a
                         direction north eighty-six degrees, twenty-six minutes,
                         ten seconds west (N86degrees 26'10"W), to point "12".

                         From point "12", over a distance of nine meters and
                         eighty-four hundredths of a meter (9,84m), measured in
                         a direction south four degrees, four minutes,
                         thirty-one seconds west (S04degrees 04'31"W), to point
                         "13".

<PAGE>   15

                         From point "13", over a distance of forty-four meters
                         and fifty-six hundredths of a meter (44,56m), measured
                         in a direction south eighty-four degrees, thirty-six
                         minutes, fifteen seconds west (S84degrees 36'15"W),
                         along the dividing line between the Township of
                         Buckingham and the Village of Buckingham to point "2",
                         point of beginning.

                         The said part of lot is bounded towards the north by
                         part of lot 11C, towards the north-east by part of lot
                         11C, towards the east by parts of lot 11C, towards the
                         south by a part of lot 551-32 (Village of Buckingham)
                         and by a part of lot 11C, range 5 (Township of
                         Buckingham), towards the west by part of lot 11C, and
                         contains an area of four thousand and thirty-three
                         square meters and four tenths of a square meter (4
                         033,4m(2)).

                         (b) A part of lot ELEVEN C (Pt 11C), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on said
                         plan 1473-F, said point being situated at the
                         north-east corner of lot 12A-105, range 4, thence over
                         a distance of fifty-four meters and thirty-two
                         hundredths of a meter (54,32m), measured in a direction
                         north seventy-two degrees, twenty-eight minutes, seven
                         seconds east (N72degrees 28'07"E), to point "19", point
                         of beginning.

                         Beginning at point "19", over distance of three meters
                         and thirty-four hundredths of a meter (3,34m), measured
                         in a direction north four degrees, twenty-eight
                         minutes, twenty-nine seconds east (N04degrees 28'29"E),
                         to point "20".

                         From point "20", over a distance of two meters and
                         seventy-one hundredths of a meter (2,71m), measured in
                         a direction south eighty-five degrees, thirty-one
                         minutes, thirty-one seconds east (S85degrees 31'31"E),
                         to point "21".

                         From point "21", over a distance of three meters and
                         thirty-four hundredths of a meter (3,34m), measured in
                         a direction south four degrees, twenty-eight minutes,
                         twenty-nine seconds west (S04degrees 28'29"W), to point
                         "22".

                         From point "22", over a distance of two meters and
                         seventy-one hundredths of a meter (2,71m), measured in
                         a direction north eighty-five degrees, thirty-one
                         minutes, thirty-one seconds west (N85degrees 31'31"W),
                         to point "19", point of beginning.

                         The said part of lot is bounded towards the north, the
                         east, the south and the west by a part of lot 11C and
                         contains an area of nine square meters and one tenth of
                         a square meter (9,1m(2)).

                         (c) A part of lot ELEVEN C (Pt 11C), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on said
                         plan 1473-F, said point being situated at the
                         north-east corner of lot 12A-105, range 4, thence over
                         a distance of ninety-four meters and sixty-one
                         hundredths of a meter (94,61m), measured in a direction
                         north sixty-seven degrees, fifty-four minutes,
                         forty-one seconds east (N67degrees 54'41"E), to point
                         "23", point of beginning.

                         Beginning at point "23", over a distance of five meters
                         and sixty hundredths of a meter (5,60m), measured in a
                         direction north four degrees, ten minutes, twenty-two
                         seconds east (N04degrees 10'22"E), to point "24".

                         From point "24", over a distance of six meters and
                         sixty-eight hundredths of a meter (6,68m), measured in
                         a direction south eighty-five degrees, forty-nine
                         minutes, fifty-six seconds east (S85degrees 49'56"E),
                         to point "6".

<PAGE>   16

                         From point "6", over a distance of five meters and
                         fifty-eight hundredths of a meter (5,58m), measured in
                         a direction south four degrees, twenty-eight minutes,
                         forty-nine seconds west (S04degrees 28'49"W), to point
                         "7".

                         From point "7", over a distance of six meters and
                         sixty-five hundredths of a meter (6,65m), measured in a
                         direction north eighty-six degrees, one minute,
                         thirty-three seconds west (N86degrees 01'33"W), to
                         point "23", point of beginning.

                         The said part of lot is bounded towards the north, the
                         east, the south and the west by a part of lot 11C and
                         contains an area of thirty-seven square meters and
                         three tenths of a square meter (37,3m(2)).

                         (d) A part of lot THIRTY-TWO of the subdivision of
                         original lot FIVE HUNDRED AND FIFTY-ONE (Pt. 551-32),
                         Village of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on said
                         plan 1473-F, said point being situated at the
                         north-east corner of lot 12A-105, range 4, thence over
                         a distance of forty-five meters and ninety-three
                         hundredths of a meter (45,93m), measured in a direction
                         north eighty-four degrees, thirty-six minutes, sixteen
                         seconds east (N84degrees 36'16"E), along the dividing
                         line between the Township of Buckingham and the Village
                         of Buckingham, to point "2", point of beginning.

                         Beginning at point "2", over a distance of forty-four
                         meters and fifty-six hundredths of a meter (44,56m),
                         measured in a direction north eighty-four degrees,
                         thirty-six minutes, fifteen seconds east (N84degrees
                         36'15"E), along the dividing line between the Township
                         of Buckingham and the Village of Buckingham, to point
                         "13".

                         From point "13", over a distance of seven meters and
                         twenty-eight hundredths of a meter (7,28m), measured in
                         a direction south four degrees, four minutes,
                         thirty-one seconds west (S04degrees 04'31"W), to point
                         "14".

                         From point "14", over a distance of fifteen meters and
                         nine hundredths of a meter (15,09m), measured in a
                         direction north eighty-five degrees, forty-two minutes,
                         two seconds west (N85degrees 42'02"W), to point "15".

                         From point "15", over a distance of four meters and
                         fifty-nine hundredths of a meter (4,59m), measured in a
                         direction south one degree, twenty-four minutes,
                         forty-five seconds west (S01degrees 24'45"W), to point
                         "16".

                         From point "16", over a distance of twenty-four meters
                         and thirty-five hundredths of a meter (24,35m),
                         measured in a direction north eighty-six degrees,
                         eleven minutes, one second west (N86degrees 11'01"W),
                         to point "17".

                         From point "17", over a distance of four meters and
                         fifty-seven hundredths of a meter (4,57m), measured in
                         a direction north four degrees, zero minutes,
                         thirty-one seconds east (N04degrees 00'31"E), to point
                         "18".

                         From point "18", over a distance of four meters and
                         seventy-three hundredths of a meter (4,73m), measured
                         in a direction north eighty-five degrees, forty-four
                         minutes, fifty-three seconds west (N85degrees 44'53"W),
                         to point "2", point of beginning.

                         The said part of lot is bounded towards the north by
                         part of lot 11C, range 5, Township of Buckingham,
                         towards the east, the south and the west by a part of
                         lot 551-32 and contains an area of two hundred and
                         sixty-nine square meters and eight tenths of a square
                         meter (269,8m(2)).

                         The area of the part of lot described under paragraph
                         B(a) includes area of the parts of lots described under
                         paragraphs B(b) and B(c).

<PAGE>   17

                         (e) A part of lot ELEVEN C (Pt-11C), Fifth Range,
                         Township of Buckingham, Registration Division of
                         Papineau, more fully described as follows:

                         Beginning at a point indicated by number "1" on the
                         plan prepared by Marc Fournier, Q.L.S., dated August 7,
                         1992, bearing minute number 1488-F , said point being
                         situated at the north-east corner of lot 12A-105, range
                         4, thence over a distance of sixty-one meters and
                         twenty hundredths of a meter (61,20m), measured in a
                         direction north eleven degrees, two minutes, twenty-six
                         seconds east (N11degrees 02'26"E), to point "2", point
                         of beginning.

                         Beginning at point "2", over a distance of fifty-two
                         meters and fifty-one hundredths of a meter (52,51m),
                         measured in a direction north three degrees, twenty-two
                         minutes, thirty-eight seconds east (N03degrees
                         22'38"E), to point "3".

                         From point "3", over a distance of thirty-four meters
                         and six hundredths of a meter (34,06m), measured in a
                         direction north three degrees, fifty-four minutes,
                         eleven seconds east (N03degrees 54'11"E), to point "4".

                         From point "4", over a distance of forty-one meters and
                         ninety-one hundredths of a meter (41,91m), measured in
                         a direction south eighty-two degrees, thirty-one
                         minutes, thirty-nine seconds east (S82degrees 31'39"E),
                         to point "5".

                         From point "5", over a distance of thirty-seven meters
                         and twenty hundredths of a meter (37,20m), measured in
                         a direction south nine degrees, nineteen minutes, two
                         seconds west (S09degrees 19'02"W), to point "6".

                         From point "6", over a distance of forty-two meters and
                         thirty-six hundredths of a meter (42,36m), measured in
                         a direction south nine degrees, fifty-eight minutes,
                         forty-seven seconds west (S09degrees 58'47"W), to point
                         "7".

                         From point "7", over a distance of twenty-four meters
                         and fifty-eight hundredths of a meter (24,58m),
                         measured in a direction north eighty-five degrees,
                         forty-six minutes, twenty seconds west (N85degrees
                         46'20"W), to point "8".

                         From point "8", over a distance of five meters (5,00m),
                         measured in a direction south four degrees, twelve
                         minutes, nine seconds west (S04degrees 12'09"W), to
                         point "9".

                         From point "9", over a distance of eight meters and
                         seventy-five hundredths of a meter (8,75m), measured in
                         a direction north eighty-five degrees, forty-six
                         minutes, twenty-one seconds west (N85degrees 46'21"W),
                         to point "2", point of beginning.

                         The said part of lot is bounded towards the north, the
                         east, the south and the west, by part of lot 11C and
                         contains an area of three thousand and eighty-eight
                         square meters and seven tenths of a square meter (3
                         088,7m(2)).

<PAGE>   18

                         WHEREOF ACTE, done and passed at Papineauville, in the
                         Province of Quebec on the date hereinabove first
                         mentioned and recorded in the office of the undersigned
                         Notary under minute number TWO HUNDRED AND ONE (201).

                         AND after the parties had declared that they had taken
                         cognizance of these presents and had exempted the said
                         Notary from reading them or causing them to be read,
                         the said duly authorized representative(s) of the
                         Grantor and of the Creditor have signed in the presence
                         of the undersigned Notary and as follows:


                         At Montreal, Province of Quebec:


                                             CIBC MELLON TRUST COMPANY



                                        per:
                                             ----------------------------------



                                        per:
                                             ----------------------------------


                         At Papineauville, Province of Quebec:



                                             STERLING PULP CHEMICALS, LTD.



                                        per:
                                             ----------------------------------



                                             ------------------------------
                                             Marc DAIGNEAULT, Notary


<PAGE>   19


                         WHEREOF ACTE, done and passed at Papineauville, in the
                         Province of Quebec on the date hereinabove first
                         mentioned and recorded in the office of the undersigned
                         Notary under minute number TWO HUNDRED AND ONE (201).

                         AND after the parties had declared that they had taken
                         cognizance of these presents and had exempted the said
                         Notary from reading them or causing them to be read,
                         the said duly authorized representative(s) of the
                         Grantor and of the Creditor have signed in the presence
                         of the undersigned Notary and as follows:


                         At Montreal, Province of Quebec:


                                             CIBC MELLON TRUST COMPANY



                                        per: (signed) Ernestine Reinhold
                                             ----------------------------------



                                        per: (signed) Pierre Tremblay
                                             ----------------------------------



                         At Papineauville, Province of Quebec:



                                             STERLING PULP CHEMICALS, LTD.



                                        per: (signed) Carl YANK
                                             ----------------------------------




                                             (signed) Marc DAIGNEAULT, Notary
                                             ----------------------------------
                                             Marc DAIGNEAULT, Notary