EXHIBIT 4.5

THIS SHAREHOLDER PROTECTION RIGHTS AGREEMENT made as of April 16, 2003.

BETWEEN:

> TRANSGLOBE ENERGY CORPORATION, a corporation
>             incorporated under The Companies Act (British Columbia) (hereinafter
>             referred to as the "Corporation")

OF THE FIRST PART

AND

> COMPUTERSHARE TRUST COMPANY OF CANADA, a trust company existing
>             under the laws of Canada (hereinafter referred to as the "Rights
>             Agent")

OF THE SECOND PART

WHEREAS the Board of Directors has determined that it is in
  the best interests of the Corporation and all of its shareholders to adopt a
  shareholder protection rights plan;

AND WHEREAS in order to implement the adoption of a shareholder
  protection rights plan the Board of Directors has:

|(a) | authorized the issuance
        and distribution of one Right in respect of each Common Share outstanding
        at the Record Time; and                                                 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                           
|(b) | authorized the issuance
        of one Right in respect of each Common Share issued after the Record Time
        and prior to the earlier of the Separation Time and the Expiration Time;

AND WHEREAS each Right entitles the holder thereof, after
  the Separation Time, to purchase securities or other assets of the Corporation
  pursuant to the terms and subject to the conditions set forth herein;

AND WHEREAS the Corporation desires to appoint the Rights
  Agent to act on behalf of the Corporation and the holders of Rights, and the
  Rights Agent is willing to so act, in connection with the issuance, transfer,
  exchange and replacement of Rights Certificates, the exercise of Rights and
  other matters referred to herein;

NOW THEREFORE, in consideration of the premises and the respective
  covenants and agreements set forth herein, the parties hereby agree as follows:

ARTICLE 1INTERPRETATION

|1.1                                                                                      | Certain Definitions                                                                                                                                                                                                                     
|---------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                         |                                                                                                                                                                                                                                         
|In this agreement, as amended or supplemented
      from time to time (the "Agreement"):
|                                                                                         |                                                                                                                                                                                                                                         
|(a)                                                                                      | "Acquiring Person"
        means, subject to Section 1.5, any Person who is the Beneficial Owner
        of 20% or more of the outstanding Voting Shares; provided, however, that
        the term "Acquiring Person" shall not include:
|                                                                                         |                                                                                                                                                                                                                                         
|                                                                                         | (i)                                                                                                                                                                                                                                     



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| | (ii)  | any Person who becomes the
        Beneficial Owner of 20% or more of the outstanding Voting Shares as a
        result of any one or any combination of: (A) Voting Share Reductions;
        (B) Permitted Bid Acquisitions; (C) Exempt Acquisitions; or (D) Pro Rata
        Acquisitions; provided that if a Person shall become the Beneficial Owner
        of 20% or more of the outstanding Voting Shares by reason of any one or
        any combination of Voting Share Reductions, Permitted Bid Acquisitions,
        Exempt Acquisitions or Pro Rata Acquisitions provided, if thereafter,
        such Person, while such Person is the Beneficial Owner of 20% or more
        of the outstanding Voting Shares, becomes the Beneficial Owner of additional
        Voting Shares which result in an increase of such Person's Beneficial
        Ownership of Voting Shares by more than 1% of the number of such Voting
        Shares outstanding as at the time of acquisition (other than pursuant
        to one or any combination of Voting Share Reduction, Permitted Bid Acquisitions,
        Exempt Acquisitions or Pro Rata Acquisitions), then, as of the date such
        Person becomes the Beneficial Owner of such additional outstanding Voting
        Shares, such Person shall be an "Acquiring Person"; or
| | ----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (iii) | an underwriter or members
        of a banking or selling group that becomes the Beneficial Owner of 20%
        or more of the outstanding Voting Shares in connection with a distribution
        of securities pursuant to a prospectus or by way of private placement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

|(b)                                                                                                                                                                               | "Affiliate", when
        used to indicate a relationship with a specified Person, means a Person
        that, directly or indirectly (including through one or more intermediaries),
        controls, is controlled by or is under common control with, such specified
        Person;
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|(c)                                                                                                                                                                               | "Associate", when used to indicate a relationship
      with a specified Person, means:                                                                                                                                                                                                  
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                  | (i)                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                  | (ii)                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|(d)                                                                                                                                                                               | A Person shall be deemed
        the "Beneficial Owner" of, and to have "Beneficial Ownership"
        of, and to "Beneficially Own":                                                                                                                                                    
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                  | (i)                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                  | (ii)                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                  | (iii)                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|provided, however, that
        a Person shall not be deemed the "Beneficial Owner" or to have
        "Beneficial Ownership" of, or to "Beneficially Own", any
        security:
|                                                                                                                                                                                  |                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                  | (iv)                                                                                                                                                                                                                                                                                     



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| |     | Person's Affiliates or Associates or
        any other Person referred to in paragraph (iii) of this definition or
        (B) such security has been deposited or tendered pursuant to any Take-over
        Bid made by such Person or by any of such Person's Affiliates or Associates
        or any other Person referred to in paragraph (iii) of this definition,
        in either case until such deposited or tendered security has been unconditionally
        accepted for payment or exchange or taken up and paid for, whichever shall
        first occur;
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (v) | because such Person, any
        of such Person's Affiliates or Associates or any other Person referred
        to in paragraph (iii) of this definition holds such security provided
        that:                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

| |      | (A) | the ordinary business of
        such Person (the "Investment Manager") includes the management
        of investment funds for others (which others, for greater certainty, may
        include and be limited to one or more employee benefit plans or pension
        plans) and such security is held in the ordinary course of such business
        in the performance of the duties of the Investment Manager for the account
        of any other Person (the "Client");                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ---- | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (B) | such Person (the "Trust
        Company") is licensed to carry on the business of a trust company
        under applicable law and, as such, acts as trustee or administrator or
        in a similar capacity in relation to the estates of deceased or incompetent
        Persons (each an "Estate Account") or in relation to other accounts
        (each an "Other Account") and holds such security in the ordinary
        course of such duties for the estate of any such deceased or incompetent
        Person or for such other accounts;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (C) | such Person is a Crown agent
        or agency (in this definition, the "Crown Agency");                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (D) | the Person is established
        by statute for purposes that include, and the ordinary business or activity
        of such Person (in this definition, a "Statutory Body") includes,
        the management of investment funds for employee benefit plans, pension
        plans, insurance plans of various public bodies and the Statutory Body
        holds such security for the purposes of its activities as such; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (E) | the person (in this definition,
        an "Administrator") is the administrator or trustee of one or more
        pension funds or plans (each, in this definition, a "Plan") registered
        under the laws of Canada or any province thereof or the corresponding
        laws of the jurisdiction by which such Plan is governed or is such a Plan
        and the Administrator or Plan holds such security for the purposes of
        its activities as such; but only if the Investment Manager, the Trust
        Company, the Crown Agent, the Statutory Body, the Administrator of the
        Plan, as the case may be, is not then making and has not announced a current
        intention to make a Take-over Bid, other than an Offer to Acquire Common
        Shares or other securities pursuant to a distribution by the Corporation
        or by means of ordinary market transactions (including prearranged trades
        entered into in the ordinary course of business of such Person) executed
        through the facilities of a stock exchange or an organized over-the-counter
        market, alone or by acting jointly or in concert with any other Person;
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (vi) |     | because such Person:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (A) | is a Client of the same Investment Manager
        as another Person whose account the Investment Manager holds such security;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (B) | has an Estate Account or an Other Account
        with the same Trust Company as another Person on whose account the Trust
        Company holds such security; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| |      |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |      | (C) | is a Plan with the same Administrator
        as another Plan on whose account the Administrator holds such security,                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             



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|    | (vii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | because such Person:                                                                                                                                                                                                                
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (A)                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (B)                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | (C)                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    | (viii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | because such Person is the
        registered holder of securities as a result of carrying on the business
        of, or acting as nominee for, a securities depositary.                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|(e) | "Board of Directors"
        means the board of directors of the Corporation or any duly constituted
        and empowered committee thereof;                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(f) | "Business Day" means
        any day other than a Saturday, Sunday or a day on which banking institutions
        in Calgary are authorized or obligated by law to close;                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(g) | "Canadian Dollar Equivalent"
        of any amount which is expressed in United States dollars means, on any
        date, the Canadian dollar equivalent of such amount determined by multiplying
        such amount by the U.S. -Canadian Exchange Rate on such date;                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(h) | "close of business"
        on any given date means the time on such date (or, if such date is not
        a Business Day, the time on the next succeeding Business Day) at which
        the Toronto office of the principal transfer agent for the Common Shares
        (or, after the Separation Time, the Toronto office of the Rights Agent)
        is closed to the public;                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(i) | "Common Shares" means
        the common shares without par value in the capital of the Corporation
        and any other shares in the capital of the Corporation into which such
        shares may be subdivided, consolidated, reclassified or changed; provided,
        however, that "common shares", when used with reference to any Person
        other than the Corporation, shall mean the class or classes of shares
        (or similar equity interest) with the greatest per share voting power
        entitled to vote generally in the election of all directors of such other
        Person;    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(j) | "Competing Permitted
        Bid" means a Take-over Bid made while another Permitted Bid is in
        existence and that satisfies all of the provisions of a Permitted Bid
        except that the condition set forth in subparagraph 1.1(ff)(ii)(A)(I)
        may provide that the Voting Shares may be taken up or paid for on a date
        which is not earlier than the later of 35 days after the date of the Take-over
        Bid or the earliest date on which Voting Shares may be taken up or paid
        for under any other Permitted Bid that is then in existence for the Voting
        Shares;
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(k) | "controlled": a corporation is "controlled"
      by another Person if:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | securities entitled to vote
        in the election of directors carrying more than 50 percent of the votes
        for the election of directors are held, directly or indirectly, by or
        on behalf of the other Person; and
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the votes carried by such
        securities are entitled, if exercised, to elect a majority of the board
        of directors of such corporation,                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                     
|    | and "control", "controls" and "controlling" shall
      be interpreted accordingly;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(l) | "Co-Rights Agent" has the meaning
      ascribed thereto in subsection 4.1(a);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       





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|(m) | "Dividend Reinvestment
        Acquisition" means an acquisition of Voting Shares pursuant to a Dividend
        Reinvestment Plan;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(n) | "Dividend Reinvestment
        Plan" means a regular dividend reinvestment or other plan of the Corporation
        made available by the Corporation to holders of its securities where such
        plan permits the holder to direct that some or all of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (iv)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | be applied to the purchase from the Corporation
      of Voting Shares;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(o) | "Election to Exercise" has the meaning
      ascribed thereto in subsection 2.2(d);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(p) | "Exempt Acquisition"
        means a share acquisition (i) in respect of which the Board of Directors
        has waived the application of Section 3.1 pursuant to the provisions of
        subsection 5.1(d) or 5.1(e), (ii) which was made on or prior to the date
        of this Agreement, or (iii) pursuant to an amalgamation, merger, plan
        of arrangement or other statutory procedure having similar effect which
        has been approved by the holders of Voting Shares by the requisite majority
        or majorities of the holders of Voting Shares at a meeting of such holders
        duly called and held for such purpose in accordance with the provisions
        of The Companies Act(British Columbia), the by-laws of the Corporation
        and any other applicable legal requirements;
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(q) | "Exercise Price"
        means the price at which a holder may purchase the securities issuable
        upon exercise of one whole Right and, until adjustment thereof in accordance
        with the terms hereof, the Exercise Price shall be equal to Fifty ($50.00)
        dollars;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(r) | "Expansion Factor" has the meaning ascribed
      thereto in subsection 2.3(a);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(s) | "Expiration Time" means the earlier of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(t) | "Flip-in Event" means a transaction in
      or pursuant to which any Person becomes an Acquiring Person;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(u) | "holder" has the meaning ascribed thereto
      in Section 2.8;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|(v) | "Independent Shareholders" means holders
      of Voting Shares other than:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          



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|    | (iv)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | any Person acting jointly or in concert with any Acquiring
      Person or any Offeror; and                                                                                                                                                                                                                                                                                                                                                                                
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (v)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | any employee benefit plan, deferred
        profit sharing plan, stock participation plan or trust for the benefit
        of employees of the Corporation or any Subsidiary of the Corporation but
        excluding in any event a plan or trust in respect of which the employee
        directs the manner in which the Voting Shares are to be voted and directs
        whether the Voting Shares be tendered to a Take-over Bid;                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(w) | "Market Price" per
        share of any securities on any date of determination shall mean the average
        of the daily closing prices per share of such securities (determined as
        described below) on each of the 20 consecutive Trading Days through and
        including the Trading Day immediately preceding such date; provided, however,
        that if an event of a type analogous to any of the events described in
        Section 2.3 shall have caused the closing price in respect of any Trading
        Day used to determine the Market Price not to be fully comparable with
        the closing price on such date of determination or, if the date of determination
        is not a Trading Day, on the immediately preceding Trading Day, each such
        closing price so used shall be appropriately adjusted in a manner analogous
        to the applicable adjustment provided for in Section 2.3 in order to make
        it fully comparable with the closing price on such date of determination
        or, if the date of determination is not a Trading Day, on the immediately
        preceding Trading Day. The closing price per share of any securities on
        any date shall be:
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the closing board lot sale price or,
        if no such sale takes place on such date, the average of the closing bid
        and asked prices, as reported by the principal Canadian stock exchange
        on which such securities are listed or admitted to trading; or                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | if for any reason none of such prices
        is available on such day or the securities are not listed or admitted
        to trading on a Canadian stock exchange, the closing board lot sale price
        or, if no such sale takes place on such date, the average of the closing
        bid and asked prices, as reported by the principal national United States
        securities exchange on which such securities are listed or admitted to
        trading; or
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | if for any reason none of such prices
        is available on such day or the securities are not listed or admitted
        to trading on a Canadian stock exchange or a national United States securities
        exchange, the last quoted price, or if not so quoted, the average of the
        high bid and low asked prices for each share of such securities in the
        over-the-counter market, as reported by any reporting system then in use;
        or    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (iv)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | if for any reason none of such prices
        is available on such day or the securities are not listed or admitted
        to trading on a Canadian stock exchange or a national United States securities
        exchange or quoted by any such reporting system, the average of the closing
        bid and asked prices as furnished by a professional market maker making
        a market in the securities;                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | provided, however, that
        if for any reason none of such prices is available on any such date, the
        closing price per share of such securities on such date shall mean the
        fair value per share of such securities on such date as determined by
        a nationally or internationally recognized Canadian investment dealer
        or investment banker with respect to the fair value per share of such
        securities. The Market Price shall be expressed in Canadian dollars and,
        if initially determined in respect of any day forming part of the 20 consecutive
        Trading Day period in United States dollars, such amount shall be translated
        into Canadian dollars at the Canadian Dollar Equivalent thereof on the
        relevant Trading Day;                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(x) | "1933 Securities Act"
        means the Securities Act of 1933of the United States, as amended,
        and the rules and regulations thereunder, as in effect on the date of
        this Agreement or as the same may be amended, re-enacted or replaced by
        any comparable or successor laws or regulations thereto;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(y) | "1934 Exchange Act"
        means the Securities Exchange Act of 1934of the United States,
        as amended, and the rules and regulations thereunder, as in effect on
        the date of this Agreement or as the same may be amended, re-enacted or
        replaced by any comparable or successor laws or regulations thereto;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

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|(z)  | "Nominee" has the
        meaning ascribed thereto in subsection 2.2(c);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(aa) | "Offer to Acquire" shall include:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(bb) | "Offeror" means a
        Person who has announced an intention to make or who has made a Take-over
        Bid (including a Permitted Bid or Competing Permitted Bid, but excluding
        an Offer to Acquire made by a Investment Manager, Trust Company, Crown
        Agency, Statutory Body, Administrator or Plan referred to clause 1.1(d)(v)
        of the definition of Beneficial Owner pursuant to a distribution by the
        Corporation or by means of ordinary market transactions (including pre-arranged
        trades entered into in the ordinary course of business of such Person)
        in the circumstances contemplated in clause 1.1(d)(v)), but only so long
        as the Take-over Bid so announced or made has not been withdrawn or terminated
        or has not expired;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(cc) | "Offeror's Securities" means the Voting
      Shares Beneficially Owned by an Offeror on the date of an Offer to Acquire;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(dd) | "ordinary course dividends"
        means cash dividends paid in any fiscal year of the Corporation to the
        extent that such cash dividends, in the aggregate, do not exceed the greatest
        of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(cc) | "Permitted Bid" means
        a Take-over Bid made by an Offeror by way of a Take-over bid circular
        which also complies with the following additional provisions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  



Page 7 of 36

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | (E)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | if the condition set forth
        in subparagraph (ii)(A)(II) is satisfied, the Offeror will make a public
        announcement of that fact and the Take-over Bid will remain open for deposits
        and tenders of Voting Shares for not less than ten Business Days from
        the date of such public announcement;
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                              
|     | provided that if a Take-over
        Bid constitutes a Competing Permitted Bid, the term "Permitted Bid" shall
        also mean the Competing Permitted Bid;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                              
|(ff) | "Permitted Bid Acquisition"
        means an acquisition made pursuant to a Permitted Bid or a Competing Permitted
        Bid;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                              
|(gg) | "Permitted Lock-up Agreement"
        means an agreement between an Offeror and another Person (the "Locked-up
        Person") whereby the Locked-up Person agrees to deposit or tender the
        Voting Shares held by the Locked-up Person to the Offeror's Take-over
        Bid that is a Permitted Bid (the "Lock-up Bid") whereby the agreement:                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | permits the Locked-up Person
        to withdraw the Voting Shares from the agreement in order to tender or
        deposit the Voting Shares to another Take-over Bid, or to support another
        transaction, that provides for a consideration for each Voting Share that
        is higher than the consideration contained in or proposed to be contained
        in the Lock-up Bid and is made for at least the same number of Voting
        Shares as the Lock-up Bid; or                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | (A) permits the Locked-up
        Person to withdraw the Voting Shares from the agreement in order to tender
        or deposit the Voting Shares to another Take-over Bid, or to support another
        transaction, that provides for a consideration for each Voting Share that
        exceeds by as much as or more than a specified amount (the "Specified
        Amount") the consideration for each Voting Share contained in or proposed
        to be contained in the Lock-up Bid and is made for at least the same number
        of Voting Shares as the Lock-up Bid and (B) does not by its terms provide
        for a Specified Amount that is greater than 7% of the consideration for
        each Voting Share contained in or proposed to be contained in the Lock-up
        Bid;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     | and, for greater certainty,
        the Lock-up Agreement may (1) contain a right of first refusal in favour
        of the Offeror or (2) require a period of delay to give the Offeror an
        opportunity to match or exceed the consideration offered in another Take-over
        Bid or transaction or (3) contain other similar limitations on a Locked-up
        Person's right to withdraw Voting Shares from the Lock-up Agreement and
        not tender such Voting Shares to the Lock-up Bid, so long as the limitation
        does not preclude the exercise by the Locked-up Person of the right to
        withdraw Voting Shares in sufficient time to tender to the other Take-over
        Bid or participate in the other transaction; and
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | does not provide for the payment by the Locked-up Person,
      in the event that the Locked-up Person fails to deposit or tender Voting
      Shares to the Lock-up Bid or withdraws the Voting Shares in order to tender
      to another Take-over Bid or participate in another transaction, of any "break-up"
      fees, "top-up" fees, penalties, expense reimbursement or other amounts that
      exceed in the aggregate the greater of:                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | (A)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | the cash equivalent of 2.5% of the consideration
        that the Locked-up Person would have received under the Lock-up Bid; and                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | (B)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 50% of the amount by which the consideration payable
        to the Locked-up Person under another Take-over Bid or transaction exceeds
        the consideration such Locked-up Person would have received under the
        Lock-up Bid; and                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                              
|     | (iv)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | is disclosed to the public, including
        the Corporation, by making copies thereof available not later than the
        date on which the Lock-up Bid has been publicly announced (or, if the
        Lock-up Bid has been publicly announced prior to the date on which the
        Lock-up Agreement is entered into, not later than such date);                                                                                                                                                                                                                                                                                                                                                                                                                                                 



Page 8 of 36

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|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(hh) | "Person" shall include
        any individual, firm, partnership, association, trust, trustee, executor,
        administrator, legal personal representative, body corporate, corporation,
        unincorporated organization, syndicate or other entity;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(ii) | "Pro Rata Acquisition"
        means an acquisition by a Person of Beneficial Ownership of Voting Shares
        as a result of: a Dividend Reinvestment Acquisition; a stock dividend,
        a stock split or other event pursuant to which a Person becomes Beneficial
        Owner of Voting Shares on the same pro rata basis as all other holders
        of Voting Shares; the acquisition or exercise by such Person of rights
        to purchase Voting Shares distributed to such Person in the course of
        a distribution to all holders of Voting Shares pursuant to a rights offering
        or pursuant to a prospectus; or a distribution of Voting Shares or securities
        convertible into or exchangeable for Voting Shares (and the conversion
        or exchange of such convertible or exchangeable securities), made pursuant
        to a prospectus or a distribution by way of a private placement; provided
        that the Person does not thereby acquire a greater percentage of such
        Voting Shares, or securities convertible into or exchangeable for Voting
        Shares, so offered than the Person's percentage of Voting Shares Beneficially
        Owned immediately prior to such acquisition;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(jj) | "Record Time" means
        5:00 p.m. (Calgary time) on May 29, 2003;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(kk) | "Redemption Price" has the meaning ascribed
      thereto in subsection 5.1(a);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(ll) | "Right" means a right
        to purchase a Common Share, upon the terms and subject to the conditions
        set forth in this Agreement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(mm) | "Rights Certificate"
        has the meaning ascribed thereto in subsection 2.2(c) and shall be in
        substantially the form of Exhibit A to this Agreement;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(nn) | "Rights Register" has the meaning ascribed
      thereto in subsection 2.6(a);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(oo) | "Securities Act(Alberta)"
        shall mean the Securities Act, R.S.A. 2000, c. S-4, as amended,
        and the regulations thereunder, as in effect on the date of this Agreement
        or as the same may be amended, re-enacted or replaced by any comparable
        or successor laws or regulations thereto;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(pp) | "Securities Act(Ontario)"
        shall mean the Securities Act, R.S.O. 1990, c. S.5, as amended,
        and the regulations thereunder, as in effect on the date of this Agreement
        or as the same may be amended, re-enacted or replaced by any comparable
        or successor laws or regulations thereto;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|(qq) | "Separation Time"
        means the close of business on the tenth Trading Day after the earlier
        of:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | the Stock Acquisition Date; and                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                        
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | the date of the commencement
        of or first public announcement of the intent of any Person (other than
        the Corporation or any Subsidiary of the Corporation) to commence a Take-over
        Bid (other than a Permitted Bid or Competing Permitted Bid);
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                        
|     | or such later time as may be determined by the
      Board of Directors, provided that:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | (A)                                                                                                                                                                                                                                                                     | if any Take-over Bid referred to in
        paragraph (ii) of this definition expires, or is cancelled, terminated
        or otherwise withdrawn prior to the Separation Time, such Take-over Bid
        shall be deemed, for the purposes of this definition, never to have been
        made; and
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | (B)                                                                                                                                                                                                                                                                     | if the Board of Directors determines
        pursuant to subsection 5.1(d) or (e) to waive the application of Section
        3.1 to a Flip-in Event, the Separation Time in respect of such Flip-in
        Event shall be deemed never to have occurred;                                           



Page 9 of 36

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|(rr) | "Stock Acquisition Date"
        means the first date of public announcement (which, for purposes of this
        definition, shall include, without limitation, a report filed pursuant
        to the provisions of the Securities Act(British Columbia), Section
        101 of the Securities Act(Ontario) or Section 13(d) of the 1934
        Exchange Act) by the Corporation or an Acquiring Person indicating
        that a Person has become an Acquiring Person;                                                                                                                                                                                 
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(ss) | "Subsidiary": a corporation shall be deemed
      to be a Subsidiary of another corporation if:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(tt) | "Take-over Bid" means
        an Offer to Acquire Voting Shares or other securities if, assuming the
        Voting Shares or other securities subject to the Offer to Acquire are
        acquired at the date of the Offer to Acquire by the Person making the
        Offer to Acquire, such Voting Shares (including all Voting Shares that
        may be acquired upon exercise of all rights of conversion, exchange or
        purchase attaching to the other securities) together with the Offeror's
        Securities would constitute in the aggregate 20% or more of the outstanding
        Voting Shares at the date of the Offer to Acquire;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(uu) | "Termination Time"
        means the time at which the right to exercise Rights shall terminate pursuant
        to Section 5.1;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(vv) | "The Companies Act(British Columbia)" means The Companies Act(British
        Columbia), as amended from time to time, and the regulations made thereunder,
        as in effect on the date of this Agreement or as the same may be amended,
        re-enacted or replaced by any comparable or successor laws or regulations
        thereto;                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(ww) | "Trading Day", when
        used with respect to any securities, means a day on which the principal
        Canadian stock exchange or U.S. securities exchange on which such securities
        are listed or admitted to trading is open for the transaction of business
        or, if the securities are not listed or admitted to trading on any Canadian
        stock exchange or U.S. securities exchange, a Business Day;                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(xx) | "U.S. - Canadian Exchange Rate" means,
      on any date:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(yy) | "U.S. Dollar Equivalent"
        of any amount which is expressed in Canadian dollars means, on any date,
        the United States dollar equivalent of such amount determined by multiplying
        such amount by the Canadian-U.S. Exchange Rate in effect on such date;                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|(zz) | "Voting Shares" means the Common Shares
      and any other shares of capital stock or voting interests of the Corporation
      entitled to vote generally in the election of all directors; and                                                                                                                                                                                                                                                                                                                                                                                                                                                            



Page 10 of 36

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|(aaa)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | "Voting Share Reduction" means an acquisition
        or redemption by the Corporation or a Subsidiary of the Corporation of
        Voting Shares which, by reducing the number of Voting Shares outstanding
        or which may be voted, increases the proportionate number of Voting Shares
        Beneficially Owned by any Person.                                                                
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|1.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|All sums of money which are referred to
        in this Agreement are expressed in lawful money of Canada, unless otherwise
        specified.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|1.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|The division of this Agreement
        into Articles, Sections, subsections, paragraphs and subparagraphs and
        the insertion of headings, subheadings and a table of contents are for
        convenience of reference only and shall not affect the construction or
        interpretation of this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|1.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|References to "this Agreement",
        "hereto", "herein", "hereby", "hereunder", "hereof" and similar expressions
        refer to this Agreement, as amended or supplemented from time to time,
        and not to any particular Article, Section, subsection, paragraph, subparagraph
        or other provision hereof and include any and every instrument supplemental
        or ancillary hereto. Unless the context otherwise requires, references
        in this Agreement to an Article, Section, subsection, paragraph, subparagraph
        or Exhibit by number, letter or otherwise refer to the Article, Section,
        subsection, paragraph, subparagraph or Exhibit, respectively, bearing
        that designation in this Agreement.                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|1.5                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|For the purposes of determining
        whether a Person is an Acquiring Person and interpreting the definition
        of "Acquiring Person", a Person shall not be and shall not be deemed to
        be an Acquiring Person if such Person (a "Grandfathered Person"):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | is the Beneficial Owner
        of more than 20% of the outstanding Voting Shares determined as at the
        Record Time; or                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | becomes the Beneficial Owner
        of more than 20% of the outstanding Voting Shares after the Record Time
        and such Person's Beneficial Ownership of Voting Shares does not exceed
        the number of Voting Shares Beneficially Owned by such Person immediately
        prior to the Record Time by more than 1% of the issued and outstanding
        Voting Shares as at the Record Time,
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|provided, however, that
        this exception shall not be, and shall cease to be, applicable to a Grandfathered
        Person in the event that such Grandfathered Person shall after the Record
        Time become the Beneficial Owner of additional Voting Shares constituting
        more than 1% of the outstanding Voting Shares otherwise than pursuant
        to one or more Permitted Bid Acquisitions, Exempt Acquisitions, Pro Rata
        Acquisitions or the issuance or exercise of stock options granted by the
        Corporation, if applicable to such Person, provided further, however,
        that such Grandfathered Person shall not become an Acquiring Person as
        a result of one or more Voting Share Reductions; and provided further
        that, if this exception shall cease to be applicable to a Grandfathered
        Person as aforesaid, such a Grandfathered Person shall be and shall be
        deemed to be an Acquiring Person as at and from the time that this exception
        shall not be so applicable.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|1.6                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                           
|For purposes of this Agreement:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         



Page 11 of 36

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|    |                                                                                                                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(a) | in determining the percentage of outstanding
        Voting Shares Beneficially Owned by any Person, unissued Voting Shares
        as to which such Person is deemed the Beneficial Owner shall be deemed
        outstanding; and
|    |                                                                                                                                                                                                                                    
|(b) | the percentage of outstanding Voting
        Shares Beneficially Owned by any Person shall be and be deemed be the
        product determined by the formula:                                                                      
|    |                                                                                                                                                                                                                                    

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 100    | x                                        | A   |                                                                                                   
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------ | ---------------------------------------- | --- | --------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          | B   |                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | where: |                                          |     |                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          | A = | the number of votes for the election of all directors
      generally attaching to the outstanding
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          |     | Voting Shares Beneficially Owned by such Person;
      and                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          |     |                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          | B = | the number of votes for the election of all directors
      generally attaching to all outstanding
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          |     | Voting Shares.                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                          |     |                                                                                                   
|1.7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |        | Acting Jointly or in Concert            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                         
|For purposes of this Agreement, a Person
        is acting jointly or in concert with every other Person who is a party
        to any agreement, commitment or understanding, whether formal or informal
        and whether or not in writing, with the first mentioned Person for the
        purpose of acquiring or offering to acquire Voting Shares (other than
        pursuant to an agreement contemplated by paragraph 1.1(d)(iv) hereof,
        or customary agreements with and between underwriters and/or banking group
        and/or selling group members with respect to a distribution of securities
        pursuant to a prospectus or by way of private placement and other than
        pursuant to pledges of securities in the ordinary course of business).                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                         
|1.8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |        | Generally Accepted Accounting Principles
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                         
|Wherever in this Agreement reference
        is made to generally accepted accounting principles, such reference shall
        be deemed to be the recommendations at the relevant time of the Canadian
        Institute of Chartered Accountants, or any successor institute, applicable
        on a consolidated basis (unless otherwise specifically provided herein
        to be applicable on an unconsolidated basis) as at the date on which a
        calculation is made or required to be made in accordance with generally
        accepted accounting principles. Where the character or amount of any asset
        or liability or item of revenue or expense is required to be determined,
        or any consolidation or other accounting computation is required to be
        made for the purpose of this Agreement or any document, such determination
        or calculation shall, to the extent applicable and except as otherwise
        specified herein or as otherwise agreed in writing by the parties, be
        made in accordance with generally accepted accounting principles applied
        on a consistent basis.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                         
|ARTICLE 2THE RIGHTS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                         
|2.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |        | Legend on Common Share Certificates     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |        |                                         
|Certificates representing Common Shares
        issued after the Record Time but prior to the earlier of the Separation
        Time and the Expiration Time shall evidence, in addition to the Common
        Shares, one Right for each Common Share evidenced thereby and shall have
        impressed on, printed on, written on or otherwise affixed to them the
        following legend:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

> Until the Separation Time (as defined in the Rights Agreement
>       referred to below), this certificate also evidences and entitles the holder
>       hereof to certain Rights as set forth in a Shareholder Protection Rights
>       Agreement made as of April 16, 2003 (the "Rights Agreement"), between TransGlobe
>       Energy Corporation (the "Corporation") and Computershare Trust Company of
>       Canada, as rights agent, as amended from time to time, the terms of which
>       are hereby incorporated herein by reference and a copy of which may be inspected
>       during normal business hours at the

Page 12 of 36

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> principal office of the Corporation. Under certain circumstances,
>       as set out in the Rights Agreement, the Rights may be amended, redeemed,
>       may expire, may become null and void or may be evidenced by separate certificates
>       and no longer evidenced by this certificate. The Corporation will mail or
>       arrange for the mailing of a copy of the Rights Agreement to the holder
>       of this certificate without charge as soon as practicable after the receipt
>       of a written request therefor.

Certificates representing Common Shares that are issued and
  outstanding at the Record Time shall also evidence one Right for each Common
  Share evidenced thereby, notwithstanding the absence of the foregoing legend,
  until the earlier of the Separation Time and the Expiration Time.

|2.2 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Initial Exercise Price; Exercise of Rights; Detachment
      of Rights                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(a) | Subject to adjustment as
        herein set forth, each Right will entitle the holder thereof, from and
        after the Separation Time and prior to the Expiration Time, to purchase,
        for the Exercise Price, one Common Share. Notwithstanding any other provision
        of this Agreement, any Rights held by the Corporation or any of its Subsidiaries
        shall be void.                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(b) | Until the Separation Time:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Rights shall not be exercisable and no Right may be exercised;
      and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | each Right will be evidenced by the
        certificate for the associated Common Share and will be transferable only
        together with, and will be transferred by a transfer of, such associated
        Common Share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(c) | From and after the Separation Time and prior
      to the Expiration Time:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | the Rights shall be exercisable; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the registration and transfer of the Rights shall be separate
      from and independent of Common Shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Promptly following the Separation Time, the Corporation
      will prepare and the Rights Agent will mail or arrange to be mailed to each
      holder of record of Rights as of the Separation Time (other than an Acquiring
      Person and, in respect of any Rights Beneficially Owned by such Acquiring
      Person which are not held of record by such Acquiring Person, the holder
      of record of such Rights (a "Nominee")), at such holder's address as shown
      by the records of the Corporation (the Corporation hereby agreeing to furnish
      copies of such records to the Rights Agent for this purpose):
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | (A)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | a rights certificate ("Rights Certificate")
        representing the number of Rights held by such holder at the Separation
        Time and having such markers of identification or designation and such
        legends, summaries or endorsements printed thereon as the Corporation
        may deem appropriate and as are not inconsistent with the provisions of
        this Agreement, or as may be required to comply with any law, rule, regulation
        or judicial or administrative order or with any rule or regulation of
        any self-regulatory organization, stock exchange or quotation system on
        which the Rights may from time to time be listed or traded, or to conform
        to usage; and
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | (B)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | a disclosure statement describing the Rights;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | provided that a Nominee
        shall be sent the materials provided for in paragraphs (A) and (B) above
        in respect of all Common Shares held of record by it which are not Beneficially
        Owned by an Acquiring Person. In order for the Corporation to determine
        whether any Person is holding Voting Shares which are Beneficially Owned
        by another Person, the Corporation may require such first-mentioned Person
        to furnish such information and documentation as the Corporation deems
        necessary or appropriate to make such determination.                                     



Page 13 of 36

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|(d) | Rights may be exercised
        in whole or in part on any Business Day after the Separation Time and
        prior to the Expiration Time by submitting to the Rights Agent at its
        principal office in the city of Toronto the Rights Certificate evidencing
        such Rights together with:                                                                                                                                                                                    
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(e) | Upon receipt of a Rights Certificate,
        which is accompanied by a completed Election to Exercise that does not
        indicate that such Right is null and void as provided by subsection 3.1(b)
        and payment as set forth in subsection 2.2(d), the Rights Agent (unless
        otherwise instructed by the Corporation if the Corporation is of the opinion
        that the Rights cannot be exercised in accordance with this Agreement)
        will thereupon promptly:
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (iv)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (v)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(f) | If the holder of any Rights
        shall exercise less than all the Rights evidenced by such holder's Rights
        Certificate, a new Rights Certificate evidencing the Rights remaining
        unexercised (subject to Section 5.5) will be issued by the Rights Agent
        to such holder or to such holder's duly authorized assigns.                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(g) | The Corporation covenants and agrees that
        it will:                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             



Page 14 of 36

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|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                | (iii)                                                                                                                                                                                                                                                                                                                                               | use reasonable effects to
        cause all securities issued upon exercise of Rights to be listed on the
        stock exchanges on which the Common Shares were traded immediately prior
        to the Stock Acquisition Date;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (iv)                                                                                                                                                                                                                                                                                                                                                | cause to be reserved and
        kept available out of its authorized and unissued classes of securities,
        the number of securities that, as provided in this Agreement, will from
        time to time be sufficient to permit the exercise in full of all outstanding
        Rights;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (v)                                                                                                                                                                                                                                                                                                                                                 | pay when due and payable
        any and all Canadian and, if applicable, United States, federal, provincial
        and state transfer taxes and charges (not including any income or capital
        taxes of the holder or exercising holder or any liability of the Corporation
        to withhold tax) which may be payable in respect of the original issuance
        or delivery of the Rights Certificates or certificates for Common Shares,
        provided that the Corporation shall not be required to pay any transfer
        tax or charge which may be payable in respect of any transfer involved
        in the transfer or delivery of Rights Certificates or the issuance or
        delivery of certificates for securities in a name other than that of the
        holder of the Rights being transferred or exercised; and
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (vi)                                                                                                                                                                                                                                                                                                                                                | after the Separation Time
        not take (or permit any Subsidiary to take) any action if at the time
        such action is taken it is reasonably foreseeable that such action will
        diminish substantially or otherwise eliminate the benefits intended to
        be afforded by the Rights.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|2.3                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                     | Adjustments to Exercise Price; Number of Rights                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|The Exercise Price, the
        number and kind of securities subject to purchase upon exercise of each
        Right and the number of Rights outstanding are subject to adjustment from
        time to time as provided in this Section 2.3.
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(a)                                                                                                                                                                                                                                             | If the Corporation shall at any time after the
      Record Time and prior to the Expiration Time:                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (i)                                                                                                                                                                                                                                                                                                                                                 | declare or pay a dividend on its Common
        Shares payable in Common Shares (or other securities exchangeable for
        or convertible into or giving a right to acquire Common Shares) other
        than pursuant to any optional stock dividend program;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (ii)                                                                                                                                                                                                                                                                                                                                                | subdivide or change the outstanding Common Shares into a
      greater number of Common Shares;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (iii)                                                                                                                                                                                                                                                                                                                                               | combine or change the outstanding Common Shares into a smaller
      number of Common Shares; or                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | (iv)                                                                                                                                                                                                                                                                                                                                                | issue any Common Shares (or other securities
        exchangeable for or convertible into or giving a right to acquire Common
        Shares) in respect of, in lieu of or in exchange for existing Common Shares;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                | except as otherwise provided
        in this Section 2.3, the Exercise Price and the number of Rights outstanding,
        or, if the payment or effective date therefor shall occur after the Separation
        Time, the securities purchasable upon exercise of Rights shall be adjusted
        as of the payment or effective date such that:

| |  | (A) | if the Exercise Price and number of Rights outstanding
      are to be adjusted;
| |  | --- | --------------------------------------------------------------------------------
| |  |     |                                                                                 
| |  |     | (I)                                                                             
| |  |     |                                                                                 
| |  |     | (II)                                                                            

Page 15 of 36

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | and the adjusted number of Rights will
        be deemed to be distributed among the Common Shares with respect to which
        the original Rights were associated (if they remain outstanding) and the
        shares issued in respect of such dividend, subdivision, change, combination
        or issuance, so that each such Common Share (or other capital stock) will
        have exactly one Right associated with it; and
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                | (B)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | if the securities purchasable upon exercise
        of Rights are to be adjusted, the securities purchasable upon exercise
        of each Right after such adjustment will be the securities that a holder
        of the securities purchasable upon exercise of one Right immediately prior
        to such dividend, subdivision, change, combination or issuance would hold
        thereafter as a result thereof.              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    | If after the Record Time and prior to the Expiration
      Time the Corporation shall issue any securities other than Common Shares
      in a transaction of a type described in paragraphs 2.3(a)(i) or (iv), such
      securities shall be treated herein as nearly equivalent to Common Shares
      as may be practicable and appropriate under the circumstances and the Corporation
      and the Rights Agent agree to amend this Agreement in order to effect such
      treatment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(b) | If the Corporation shall
        at any time after the Record Time and prior to the Separation Time fix
        a record date for the issuance of rights, options or warrants to all holders
        of Common Shares entitling them (for a period expiring within 45 calendar
        days after such record date) to subscribe for or purchase Common Shares
        (or securities convertible into or exchangeable for or carrying a right
        to purchase Common Shares) at a price per Common Share (or, if a security
        convertible into or exchangeable for or carrying a right to purchase or
        subscribe for Common Shares having a conversion, exchange or exercise
        price, including the price required to be paid to purchase such convertible
        or exchangeable security or right per share) less than the Market Price
        per Common Share on such record date, the Exercise Price to be in effect
        after such record date shall be adjusted to that price determined by multiplying
        the Exercise Price in effect immediately prior to such record date by
        a fraction:
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | the numerator of which shall
        be the number of Common Shares outstanding on such record date, plus the
        number of Common Shares that the aggregate offering price of the total
        number of Common Shares so to be offered (and/or the aggregate initial
        conversion, exchange or exercise price of the convertible or exchangeable
        securities or rights so to be offered, including the price required to
        be paid to purchase such convertible or exchangeable securities or rights)
        would purchase at such Market Price per Common Share; and
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | the denominator of which shall be the number
      of Common Shares outstanding on such record date, plus the number of additional
      Common Shares to be offered for subscription or purchase (or into which
      the convertible or exchangeable securities or rights so to be offered are
      initially convertible, exchangeable or exercisable).                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | If such subscription price
        may be paid by delivery of consideration, part or all of which may be
        in a form other than cash, the value of such consideration shall be as
        determined in good faith by the Board of Directors, whose determination
        shall be described in a statement filed with the Rights Agent and shall
        be binding on the Rights Agent and the holders of the Rights. Such adjustment
        shall be made successively whenever such a record date is fixed, and in
        the event that such rights or warrants are not so issued, the Exercise
        Price shall be adjusted to be the Exercise Price which would then be in
        effect if such record date had not been fixed.                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | For purposes of this Agreement,
        the granting of the right to purchase Common Shares (whether from treasury
        shares or otherwise) pursuant to any dividend or interest reinvestment
        plan and/or any Common Share purchase plan providing for the reinvestment
        of dividends or interest payable on securities of the Corporation and/or
        the investment of periodic optional payments and/or employee benefit,
        stock option or similar plans (so long as such right to purchase is in
        no case evidenced by the delivery of rights or warrants) shall not be
        deemed to constitute an issue of rights or warrants by the Corporation;
        provided, however, that, in the case of any Dividend Reinvestment Plan,
        the right to purchase Common Shares is at a                                                                                                                                                                                                                                                                                                           



Page 16 of 36

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|    | price per share of not less
        than 90 percent of the current market price per share (determined as provided
        in such plans) of the Common Shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(c) | If the Corporation shall
        at any time after the Record Time and prior to the Separation Time fix
        a record date for a distribution to all holders of Common Shares (including
        any such distribution made in connection with a merger or amalgamation
        in which the Corporation is the continuing corporation) of evidences of
        indebtedness, cash (other than an ordinary course dividend or a dividend
        referred to in paragraph 2.3(a)(i)), assets or rights or warrants (excluding
        those referred to in subsection 2.3(b)), the Exercise Price to be in effect
        after such record date shall be determined by multiplying the Exercise
        Price in effect immediately prior to such record date by a fraction:                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | Such adjustments shall be
        made successively whenever such a record date is fixed, and in the event
        that such a distribution is not so made, the Exercise Price shall be adjusted
        to be the Exercise Price which would have been in effect if such record
        date had not been fixed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(d) | Each adjustment made pursuant to this Section
      2.3 shall be made as of                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(e) | Notwithstanding anything
        herein to the contrary, no adjustment in the Exercise Price shall be required
        unless such adjustment would require an increase or decrease of at least
        one percent in the Exercise Price; provided, however, that any adjustments
        which by reason of this subsection 2.3(e) are not required to be made
        shall be carried forward and taken into account in any subsequent adjustment.
        All calculations under this Section 2.3 shall be made to the nearest cent
        or to the nearest hundredth of a share. Notwithstanding the first sentence
        of this subsection 2.3(e), any adjustment required by this Section 2.3
        shall be made no later than the earlier of (i) three years from the date
        of the transaction which mandates such adjustment and (ii) the Termination
        Date. Whenever an adjustment to the Exercise Price is made pursuant to
        this Section 2.3, the Corporation shall:
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(f) | If the Corporation shall
        at any time after the Record Time and prior to the Separation Time issue
        any shares of capital stock (other than Common Shares), or rights or warrants
        to subscribe for or purchase any such capital stock, or securities convertible
        into or exchangeable for any such capital stock, in a transaction referred
        to in paragraph (a)(i) or (a)(iv) above, if the Board of Directors acting
        in good faith determines that the adjustments contemplated by subsections
        (a), (b) and (c) above in connection with such transaction will not appropriately
        protect the interests of the holders of Rights, the Board of Directors
        may determine what other adjustments to the Exercise Price, number of
        Rights and/or securities purchasable upon exercise of                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

Page 17 of 36

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | Rights would be appropriate
        and, notwithstanding subsections (a), (b) and (c) above, but subject to
        the prior consent of the holders of Common Shares or Rights obtained in
        accordance with section 5.4, such adjustments, rather than the adjustments
        contemplated by subsections (a), (b) and (c) above, shall be made. The
        Corporation and the Rights Agent shall amend this Agreement as appropriate
        to provide for such adjustments.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Each Right originally issued
        by the Corporation subsequent to any adjustment made to the Exercise Price
        hereunder shall evidence the right to purchase, at the adjusted Exercise
        Price, the number of Common Shares purchasable from time to time hereunder
        upon exercise of a Right, all subject to further adjustment as provided
        herein.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Irrespective of any adjustment
        or change in the Exercise Price or the number of Common Shares issuable
        upon the exercise of the Rights, the Rights Certificates theretofore and
        thereafter issued may continue to express the Exercise Price per Common
        Share and the number of Common Shares which were expressed in the initial
        Rights Certificates issued hereunder.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | In any case in which this
        Section 2.3 shall require that an adjustment in the Exercise Price be
        made effective as of a record date for a specified event, the Corporation
        may elect to defer until the occurrence of such event the issuance to
        the holder of any Right exercised after such record date the number of
        Common Shares and other securities of the Corporation, if any, issuable
        upon such exercise over and above the number of Common Shares and other
        securities of the Corporation, if any, issuable upon such exercise on
        the basis of the Exercise Price in effect prior to such adjustment; provided,
        however, that the Corporation shall deliver to such holder an appropriate
        instrument evidencing such holder's right to receive such additional shares
        (fractional or otherwise) or securities upon the occurrence of the event
        requiring such adjustment.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(j)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Notwithstanding anything
        in this Section 2.3 to the contrary, the Corporation shall be entitled
        to make such reductions in the Exercise Price, in addition to those adjustments
        expressly required by this Section 2.3, as and to the extent that the
        Board of Directors shall in good faith determine to be advisable in order
        that an (i) consolidation or subdivision of the Common Shares, (ii) issuance
        wholly or in part for cash or Common Shares or securities that by their
        terms are convertible into or exchangeable for Common Shares, (iii) stock
        dividends or (iv) issuance of rights, options or warrants referred to
        in this Section 2.3, hereafter made by the Corporation to holders of its
        Common Shares shall not be taxable to such shareholders.                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(k)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | The Corporation covenants
        and agrees that, after the Separation Time, it will not, except as permitted
        by Section 5.1 or Section 5.4, take (or permit any Subsidiary of the Corporation
        to take) any action if at the time such action is taken it is reasonably
        foreseeable that such action will diminish substantially or otherwise
        eliminate the benefits intended to be afforded by the Rights.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(l)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | If an event occurs which
        would require an adjustment under both this Section 2.3 and Section 3.1,
        the adjustment provided for in this Section 2.3 shall be in addition to
        and shall be made prior to, any adjustment required pursuant to Section
        3.1.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(m)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | If the Corporation shall
        at any time after the Record Time and prior to the earlier of the Separation
        Time and the Expiration Time issue any Common Shares otherwise than in
        a transaction referred to in subsection 2.3(a) each such Common Share
        so issued shall automatically have one new Right associated with it, which
        Right shall be evidenced by the certificate representing such share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|2.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Each Person in whose name
        any certificate for Common Shares or other securities, property or assets,
        if applicable, is issued upon the exercise of Rights shall for all purposes
        be deemed to have become the holder of record of the Common Shares or
        other securities, property or assets, if applicable, represented thereby
        on, and such certificate shall be dated, the date upon which the Rights
        Certificate evidencing such Rights was duly surrendered (together with
        a duly completed Election to Exercise) and payment of the Exercise Price
        for such Rights (and any applicable



Page 18 of 36

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|transfer taxes and other
        governmental charges payable by the exercising holder hereunder) was made;
        provided, however, that if the date of such surrender and payment is a
        date upon which the Common Share transfer books of the Corporation are
        closed, such Person shall be deemed to have become the record holder of
        such Common Shares or other securities, property or assets on, and such
        certificate shall be dated, the next succeeding Business Day on which
        the Common Share transfer books of the Corporation are open.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2.5                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2.6                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         



Page 19 of 36

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|2.7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Mutilated, Destroyed, Lost and Stolen Rights Certificates                                                                                                               
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | If any mutilated Rights
        Certificate is surrendered to the Rights Agent prior to the Expiration
        Time, the Corporation shall execute and the Rights Agent shall countersign
        and deliver in exchange therefor a new Rights Certificate evidencing the
        same number of Rights as did the Rights Certificate so surrendered.                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | If there shall be delivered to the Corporation
      and the Rights Agent prior to the Expiration Time:                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | evidence to their reasonable satisfaction of the destruction,
      loss or theft of any Rights Certificate; and                                                        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | such security or indemnity as may be
        reasonably required by each of them in their sole discretion to save each
        of them and any of their agents harmless,
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | then, in the absence of
        notice to the Corporation or the Rights Agent that such Rights Certificate
        has been acquired by a bona fidepurchaser, the Corporation shall
        execute and upon the Corporation's request the Rights Agent shall countersign
        and deliver, in lieu of any such destroyed, lost or stolen Rights Certificate,
        a new Rights Certificate evidencing the same number of Rights as did the
        Rights Certificate so destroyed, lost or stolen.  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | As a condition to the issuance
        of any new Rights Certificate under this Section 2.7, the Corporation
        may require the payment of a sum sufficient to cover any tax or other
        governmental charge that may be imposed in relation thereto and any other
        expenses (including the fees and expenses of the Rights Agent) connected
        therewith.                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|(d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Every new Rights Certificate
        issued pursuant to this Section 2.7 in lieu of any destroyed, lost or
        stolen Rights Certificate shall evidence the contractual obligation of
        the Corporation, whether or not the destroyed, lost or stolen Rights Certificate
        shall be at any time enforceable by anyone, and shall be entitled to all
        the benefits of this Agreement equally and proportionately with any and
        all other Rights duly issued by the Corporation.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|2.8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Persons Deemed Owners                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|The Corporation, the Rights Agent and any agent
      of the Corporation or the Rights Agent may deem and treat the Person in
      whose name a Rights Certificate (or, prior to the Separation Time, the associated
      Common Share certificate) is registered as the absolute owner thereof and
      the Rights evidenced thereby for all purposes whatsoever. As used in this
      Agreement, unless the context otherwise requires, the term "holder" of any
      Rights shall mean the registered holder of such Rights (or, prior to the
      Separation Time, the associated Common Shares).                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|2.9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Delivery and Cancellation of Certificates                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|All Rights Certificates
        surrendered upon exercise or for redemption, registration of transfer
        or exchange shall, if surrendered to any Person other than the Rights
        Agent, be delivered to the Rights Agent and, in any case, shall be promptly
        cancelled by the Rights Agent. The Corporation may at any time deliver
        to the Rights Agent for cancellation any Rights Certificates previously
        countersigned and delivered hereunder which the Corporation may have acquired
        in any manner whatsoever, and all Rights Certificates so delivered shall
        be promptly cancelled by the Rights Agent. No Rights Certificate shall
        be countersigned in lieu of or in exchange for any Rights Certificates
        cancelled as provided in this Section 2.9, except as expressly permitted
        by this Agreement. The Rights Agent shall destroy all cancelled Rights
        Certificates and deliver a certificate of destruction to the Corporation
        on request.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|2.10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | Agreement of Rights Holders                                                                                                                                             
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                         
|Every holder of Rights,
        by accepting the same, consents and agrees with the Corporation and the
        Rights Agent and with every other holder of Rights:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             



Page 20 of 36

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | to be bound by and subject
        to the provisions of this Agreement, as amended from time to time in accordance
        with the terms hereof, in respect of all Rights held;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | that, prior to the Separation
        Time, each Right will be transferable only together with, and will be
        transferred by a transfer of, the associated Common Share;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | that after the Separation
        Time, the Rights Certificate will be transferable only upon registration
        of the transfer on the Rights Register as provided herein;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | that, prior to due presentment
        of a Rights Certificate (or, prior to the Separation Time, the associated
        Common Share certificate) for registration of transfer, the Corporation,
        the Rights Agent and any agent of the Corporation or the Rights Agent
        may deem and treat the person in whose name the Rights Certificate (or,
        prior to the Separation Time, the associated Common Share certificate)
        is registered as the absolute owner thereof and of the Rights evidenced
        thereby (notwithstanding any notations of ownership or writing on such
        Rights Certificate or the associated Common Share certificate made by
        anyone other than the Corporation or the Rights Agent) for all purposes
        whatsoever, and neither the Corporation nor the Rights Agent shall be
        affected by any notice to the contrary;
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | that such holder of Rights
        has waived his right to receive any fractional Rights or any fractional
        shares upon exercise of a Right (except as provided herein);                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | that, in accordance with
        the provisions of Section 5.4, without the approval of any holder of Rights
        or Voting Shares and upon the sole authority of the Board of Directors
        acting in good faith, this Agreement may be supplemented or amended from
        time to time pursuant to and as provided herein; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | that notwithstanding anything
        in this Agreement to the contrary, neither the Corporation nor the Rights
        Agent shall have any liability to any holder of a Right or any other Person
        as a result of its inability to perform any of its obligations under this
        Agreement by reasons of any preliminary or permanent injunction or other
        order, decree or ruling issued by a court of competent jurisdiction or
        by a governmental, regulatory or administrative agency or commission,
        or any statute, rule, regulation or executive order promulgated or enacted
        by any governmental authority, prohibiting or otherwise restraining performance
        of such obligation.                                                                                                                                                               
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|2.11                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Rights Certificate Holder not Deemed a Shareholder
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|No holder, as such, of any
        Rights or Rights Certificate shall be entitled to vote, receive dividends
        or be deemed for any purpose whatsoever the holder of any Common Share
        or any other share or security of the Corporation which may at any time
        be issuable on the exercise of the Rights represented thereby, nor shall
        anything contained herein or in any Rights Certificate be construed or
        deemed or confer upon the holder of any Right or Rights Certificate, as
        such, any of the rights, titles, benefits or privileges of a holder of
        Common Shares or any other shares or securities of the Corporation or
        any right to vote at any meeting of shareholders of the Corporation whether
        for the election of directors or otherwise or upon any matter submitted
        to holders of shares of the Corporation at any meeting thereof, or to
        give or withhold consent to any action of the Corporation, or to receive
        notice of any meeting or other action affecting any holder of Common Shares
        or any other shares or securities of the Corporation except as expressly
        provided herein, or to receive dividends, distributions or subscription
        rights, or otherwise, until the Right or Rights evidenced by Rights Certificates
        shall have been duly exercised in accordance with the terms and provisions
        hereof.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|ARTICLE 3 ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|3.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | Flip-in Event                                     
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                   
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          | Subject to subsections 3.1(b),
        5.1(d) and 5.1(e), if prior to the Expiration Time a Flip-in Event occurs,
        each Right shall constitute, effective at the close of business on the
        tenth Trading Day after the Stock Acquisition Date, the right to purchase
        from the Corporation, upon payment of the Exercise Price and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  





Page 21 of 36

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|    | otherwise exercising such
        Right in accordance with the terms hereof, that number of Common Shares
        having an aggregate Market Price on the date of consummation or occurrence
        of such Flip-in Event equal to twice the Exercise Price for an amount
        in cash equal to the Exercise Price (such Right to be appropriately adjusted
        in a manner analogous to the applicable adjustment provided for in Section
        2.3 in event that after the Stock Acquisition Date an event of a type
        analogous to any of the events described in Section 2.3 has occurred).                                                                                                                                                                                                                                                                                                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(b) | Notwithstanding anything in this Agreement
        to the contrary, upon the occurrence of any Flip-in Event, any Rights
        that are or were Beneficially Owned on or after the earlier of the Separation
        Time and the Stock Acquisition Date by:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | shall become null and void
        without any further action, and any holder of such Rights (including any
        transferee of, or other successor to, such Rights, whether directly or
        indirectly) shall not have any right whatsoever to exercise such Rights
        under any provision of this Agreement and shall not have thereafter any
        right whatsoever with respect to such Rights, whether under any provision
        of this Agreement or otherwise. The holder of any Rights represented by
        a Rights Certificate which is submitted to the Rights Agent upon exercise
        or for registration of transfer or exchange which does not contain the
        necessary certifications set forth in the Rights Certificate establishing
        that such Rights are not void under this subsection 3.1(b) shall be deemed
        to be an Acquiring Person for the purposes of this subsection 3.1(b) and
        such Rights shall become null and void.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|(c) | Any Rights Certificate that
        represents Rights Beneficially Owned by a Person described in either paragraph
        3.1(b)(i) or (ii) or transferred to any Nominee of any such Person, and
        any Rights Certificate issued upon transfer, exchange, replacement or
        adjustment of any other Rights Certificate referred to in this sentence,
        shall contain the following legend:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

> The Rights represented by this Rights Certificate were
>         Beneficially Owned by a Person who was an Acquiring Person or an Affiliate
>         or an Associate of an Acquiring Person (as such terms are defined in the
>         Rights Agreement) or a Person acting jointly or in concert with any of
>         them. This Rights Certificate and the Rights represented hereby are void
>         in the circumstances specified in subsection 3.1(b) of the Rights Agreement.

|    | provided that the Rights
        Agent shall not be under any responsibility to ascertain the existence
        of facts that would require the imposition of such legend but shall be
        required to impose such legend only if instructed to do so in writing
        by the Corporation or if a holder fails to certify upon transfer or exchange
        in the space provided on the Rights Certificate that such holder is not
        a Person described in either paragraph 3.1(b)(i) or (ii).                                                                       
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(d) | From and after the Separation
        Time, the Corporation shall do all such acts and things as shall be necessary
        and within its power to ensure compliance with the provisions of this
        Section 3.1, including without limitation, all such acts and things as
        may be required to satisfy the requirements of The Companies Act(British
        Columbia) and the Securities Act(British Columbia) and any other
        applicable laws in respect of the issue of Common Shares upon the exercise
        of Rights in accordance with this Agreement.



Page 22 of 36

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|3.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Fiduciary Duties of the Board of Directors
      of the Corporation
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|For clarification it is understood that nothing
        contained in this Article 3 shall be considered to affect the obligations
        of the Board of Directors to exercise its fiduciary duties. Without limiting
        the generality of the foregoing, nothing contained herein shall be construed
        to suggest or imply that the Board of Directors shall not be entitled
        to recommend that holders of the Voting Shares reject or accept any Take-over
        Bid or take any other action (including, without limitation, the commencement,
        prosecution, defence or settlement of any litigation and the submission
        of additional or alternative Take-over Bids or other proposals to the
        shareholders of the Corporation with respect to any Take-over Bid or otherwise
        that the Board of Directors believes is necessary or appropriate in the
        exercise of its fiduciary duties).
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|ARTICLE 4
      THE RIGHTS AGENT                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|4.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | General                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | The Corporation hereby appoints
        the Rights Agent to act as agent for the Corporation in accordance with
        the terms and conditions hereof, and the Rights Agent hereby accepts such
        appointment. The Corporation may from time to time appoint such co-Rights
        Agents ("Co-Rights Agents") as it may deem necessary or desirable, subject
        to the approval of the Rights Agent. In the event the Corporation appoints
        one or more Co-Rights Agents, the respective duties of the Rights Agents
        and the Co-Rights Agents shall be as the Corporation may determine with
        the approval of the Rights Agent and the Co-Rights Agent. The Corporation
        agrees to pay to the Rights Agent reasonable compensation for all services
        rendered by it hereunder and, from time to time, on demand of the Rights
        Agent, its reasonable expenses and counsel fees and other disbursements
        incurred in the administration and execution of this Agreement and the
        exercise and performance of its duties hereunder, including the reasonable
        fees and disbursements of any expert retained by the Rights Agent. The
        Corporation also agrees to indemnify the Rights Agent, its officers, directors,
        employees and agents for, and to hold them harmless against, any loss,
        liability, costs, claims, actions, damages or expenses, incurred without
        negligence, bad faith or wilful default on the part of the Rights Agent,
        for anything done or suffered or omitted by the Rights Agent in connection
        with the acceptance, execution and administration of this Agreement and
        the performance of its duties hereunder, including the costs and expenses
        of defending against any claim of liability, which right to indemnification
        will survive the termination of this Agreement or the resignation or removal
        of the Rights Agent.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | The Rights Agent shall be
        protected and shall incur no liability for or in respect of any action
        taken, suffered or omitted by it in connection with its acceptance, execution
        and administration of this Agreement in reliance upon any certificate
        for Voting Shares or Common Shares, or any Rights Certificate or certificate
        for other securities of the Corporation, instrument of assignment or transfer,
        power of attorney, endorsement, affidavit, letter, notice, direction,
        consent, certificate, statement, or other paper or document believed by
        it to be genuine and to be signed, executed and, where necessary, verified
        or acknowledged, by the proper Person or Persons.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | The Corporation shall inform
        the Rights Agent in a reasonably timely manner of events which may materially
        affect the administration of this Agreement by the Rights Agent and at
        any time upon request, shall provide to the Rights Agent an incumbency
        certificate with respect to the then current directors of the Corporation,
        provided that failure to inform the Rights Agent of any such event, or
        any defect therein, shall not affect the validity of any action taken
        hereunder in relation to such events.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|4.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Merger or Amalgamation or Change of Name of Rights Agent           
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    
|(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | Any corporation into which the Rights Agent or
      any successor Rights Agent may be merged or amalgamated or with which it
      may be consolidated, or any corporation resulting from any merger, amalgamation,
      statutory arrangement or consolidation to which the Rights Agent or any
      successor Rights Agent is a party, or any corporation succeeding to the
      shareholder or stockholder services business of the Rights Agent or any
      successor Rights Agent, will be the successor to the Rights Agent under
      this Agreement without the execution or filing of any paper or any further
      act on the part of any of the parties                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                    

Page 23 of 36

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|                                                                                                                                                                                                                                                                      | hereto, provided that such
        corporation would be eligible for appointment as a successor Rights Agent
        under the provisions of Section 4.4. In case at the time each successor
        Rights Agent succeeds to the agency created by this Agreement any of the
        Rights Certificates have been countersigned but not delivered, any such
        successor Rights Agent may adopt the countersignature of the predecessor
        Rights Agent and deliver such Rights Certificates so countersigned; and
        in case at that time any of the Rights Certificates have not been countersigned,
        any successor Rights Agent may countersign such Rights Certificates either
        in the name of the predecessor Rights Agent or in the name of the successor
        Rights Agent; and in all such cases such Rights Certificates will have
        the full force provided in the Rights Certificates and in this Agreement.                                                                                                                         
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(b)                                                                                                                                                                                                                                                                   | If at any time the name
        of the Rights Agent is changed and at such time any of the Rights Certificates
        shall have been countersigned but not delivered, the Rights Agent may
        adopt the countersignature under its prior name and deliver Rights Certificates
        so countersigned; and in case at that time any of the Rights Certificate
        shall not have been countersigned, the Rights Agent may countersign such
        Rights Certificates either in its prior name or in its changed name; and
        in all such cases such Rights Certificates shall have the full force provided
        in the Rights Certificates and in this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|4.3                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|The Rights Agent undertakes
        the duties and obligations imposed by this Agreement upon the following
        terms and conditions, by all of which the Corporation and the holders
        of Right Certificates, by their acceptance thereof, shall be bound:
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(a)                                                                                                                                                                                                                                                                   | the Rights Agent may retain
        and consult with legal counsel (who may be legal counsel for the Corporation)
        and the opinion of such counsel will be full and complete authorization
        and protection to the Rights Agent as to any action taken, suffered or
        omitted by it in good faith and in accordance with such opinion; the Rights
        Agent may also, with the approval of the Corporation (such approval not
        to be unreasonably withheld), consult with such other experts as the Rights
        Agent shall consider necessary or appropriate to properly carry out the
        duties and obligations imposed under this Agreement and the Rights Agent
        shall be entitled to act and rely in good faith on the advice of any such
        expert;                                                                                                                                                                                                                                                                             
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(b)                                                                                                                                                                                                                                                                   | whenever in the performance
        of its duties under this Agreement the Rights Agent deems it necessary
        or desirable that any fact or matter be proved or established by the Corporation
        prior to taking or suffering any action hereunder, such fact or matter
        (unless other evidence in respect thereof be herein specifically prescribed)
        may be deemed to be conclusively proved and established by a certificate
        signed by a Person believed by the Rights Agent to be the Chairman of
        the Board, the President or any Vice President, the Secretary or Assistant
        Secretary of the Corporation and delivered to the Rights Agent; and such
        certificate will be full authorization to the Rights Agent for any action
        taken or suffered in good faith by it under the provisions of this Agreement
        in reliance upon such certificate;                                                                                                                                                            
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(c)                                                                                                                                                                                                                                                                   | the Rights Agent will be liable hereunder only
      for its own negligence, bad faith or wilful default;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(d)                                                                                                                                                                                                                                                                   | the Rights Agent will not
        be liable for or by reason of any of the statements of fact or recitals
        contained in this Agreement or in the certificates for Voting Shares or
        Common Shares or the Rights Certificates (except its countersignature
        thereof) or be required to verify the same, but all such statements and
        recitals are and will be deemed to have been made by the Corporation only;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(e)                                                                                                                                                                                                                                                                   | the Rights Agent will not
        be under any responsibility in respect of the validity of this Agreement
        or the authorization, execution and delivery hereof (except the due authorization,
        execution and delivery hereof by the Rights Agent) or in respect of the
        validity or execution of any Common Share certificate or Rights Certificate
        (except its countersignature thereof); nor will it be responsible for
        any breach by the Corporation of any covenant or condition contained in
        this Agreement or in any Rights Certificate; nor will it be responsible
        for any change in the exercisability of the Rights (including the Rights
        becoming void pursuant to subsection 3.1(b)) or any adjustment required
        under the provisions of Section 2.3 or be responsible for the manner,
        method or amount of any such adjustment or the ascertaining of the existence
        of facts that would require any such adjustment (except with respect to
        the exercise of Rights after receipt



Page 24 of 36

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | of the certificate contemplated
        by Section 2.3 describing any such adjustment); nor will it by any act
        hereunder be deemed to make any representation or warranty as to the authorization
        of any Common Shares to be issued pursuant to this Agreement or any Rights
        or as to whether any Common Shares will, when issued, be duly and validly
        authorized, executed, issued and delivered and fully paid and non-assessable;                                                                                                                                                                                
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(f)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the Corporation agrees that
        it will perform, execute, acknowledge and deliver or cause to be performed,
        executed, acknowledged and delivered all such further and other acts,
        instruments and assurances as may reasonably be required by the Rights
        Agent for the carrying out or performing by the Rights Agent of the provisions
        of this Agreement;                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(g)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the Rights Agent is hereby
        authorized and directed to accept written instructions with respect to
        the performance of its duties hereunder from any person believed by the
        Rights Agent to be the Chairman of the Board, President, a Vice President,
        the Secretary or the Assistant Secretary or any Assistant Secretary of
        the Corporation, and to apply to such individual for advice or instructions
        in connection with its duties, and it shall not be liable for any action
        taken or suffered by it in good faith in reliance upon instructions of
        any such individual;        
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | the Rights Agent and any
        shareholder or stockholder, director, officer or employee of the Rights
        Agent may buy, sell or deal in Common Shares, Rights or other securities
        of the Corporation or become pecuniarily interested in any transaction
        in which the Corporation may be interested, or contract with or lend money
        to the Corporation or otherwise act as fully and freely as though it were
        not Rights Agent under this Agreement. Nothing herein shall preclude the
        Rights Agent from acting in any other capacity for the Corporation or
        for any other legal entity; and
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | the Rights Agent may execute and exercise
        any of the rights or powers hereby vested in it or perform any duty hereunder
        either itself or by or through its attorneys or agents, and the Rights
        Agent will not be answerable or accountable for any act, default, neglect
        or misconduct of any such attorneys or agents or for any loss to the Corporation
        resulting from any such act, default, neglect or misconduct, provided
        reasonable care was exercised in the selection and continued employment
        thereof.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|4.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | Change of Rights Agent                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|The Rights Agent may resign
        and be discharged from its duties under this Agreement upon 60 days' notice
        (or such lesser notice as is acceptable to the Corporation) in writing
        delivered or mailed to the Corporation and to each transfer agent of Common
        Shares by registered or certified mail and to the holders of the Rights
        in accordance with Section 5.9. The Corporation may remove the Rights
        Agent upon 30 days' notice in writing, mailed to the Rights Agent and
        to each transfer agent of the Common Shares by registered or certified
        mail and to the holders of the Rights in accordance with Section 5.9.
        If the Rights Agent should resign or be removed or otherwise become incapable
        of acting, the Corporation will appoint a successor to the Right Agent.
        If the Corporation fails to make such appointment within a period of 30
        days after such removal or after it has been notified in writing of such
        resignation or incapacity by the resigning or incapacitated Rights Agent
        then the resigning Rights Agent (at the Corporation's expense) or the
        holder of any Rights may apply to any court of competent jurisdiction
        for the appointment of a new Rights Agent. Any successor Rights Agent,
        whether appointed by the Corporation or by such a court, shall be a corporation
        incorporated under the laws of Canada or a province thereof authorized
        to carry on the business of a trust company. After appointment, the successor
        Rights Agent will be vested with the same powers, rights, duties and responsibilities
        as if it had been originally named as Rights Agent without further act
        or deed; but upon payment of its outstanding fees and expenses the predecessor
        Rights Agent shall deliver and transfer to the successor Rights Agent
        any property at the time held by it hereunder, and execute and deliver
        any further assurance, conveyance, act or deed necessary for the purpose.
        Not later than the effective date of any such appointment, the Corporation
        will file notice thereof in writing with the predecessor Rights Agent
        and each transfer agent of the Common Shares and give notice thereof to
        the holders of the Rights in accordance with Section 5.9. Failure to give
        any notice provided for in this Section 4.4, however, or any defect therein,
        shall not affect the legality or validity of
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

Page 25 of 36

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|the resignation or removal
        of the Rights Agent or the appointment of the successor Rights Agent,
        as the case may be.
|------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                    
|ARTICLE 5MISCELLANEOUS                                                                                                              
|                                                                                                                                    
|5.1                                                                                                                                 
|                                                                                                                                    
|(a)                                                                                                                                 
|                                                                                                                                    
|(b)                                                                                                                                 
|                                                                                                                                    
|(c)                                                                                                                                 
|                                                                                                                                    
|(d)                                                                                                                                 
|                                                                                                                                    
|(e)                                                                                                                                 
|                                                                                                                                    
|(f)                                                                                                                                 
|                                                                                                                                    
|(g)                                                                                                                                 



Page 26 of 36

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|(h)                                                                                                                                                                                                                                                                                                                                                                                                                                                                | Upon the Rights being redeemed
        pursuant to subsection 5.1(g), all the provisions of this Agreement shall
        continue to apply as if the Separation Time had not occurred and Rights
        Certificates representing the number of Rights held by each holder of
        record of Common Shares as of the Separation Time had not been mailed
        to each such holder and for all purposes of this Agreement the Separation
        Time shall be deemed not to have occurred.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|5.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|No Person shall have any
        rights whatsoever pursuant to or arising out of this Agreement or in respect
        of any Right after the Expiration Time, except the Rights Agent as specified
        in subsections 4.1(a) and (b).                                                                                                                                                                                                                         
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|5.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Notwithstanding any of the
        provisions of this Agreement or of the Rights to the contrary, the Corporation
        may, at its option, issue new Rights Certificates evidencing Rights in
        such form as may be approved by the Board of Directors to reflect any
        adjustment or change in the number or kind or class of shares purchasable
        upon exercise of Rights made in accordance with the provisions of this
        Agreement.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|5.4                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

|(a) | Without the approval of
        any holders of Voting Shares or Rights, the Corporation may make amendments
        or supplements to this Agreement to correct any clerical or typographical
        error or which are required to maintain the validity of the Agreement
        as a result of any change in any applicable legislation, regulations or
        rules thereunder. The Corporation may in addition supplement or amend
        this Agreement without the approval of any holders of Rights or Voting
        Shares in order to make any changes which the Board of Directors acting
        in good faith may deem necessary or desirable. Notwithstanding anything
        in this Section 5.4 to the contrary, no supplement or amendment shall
        be made to the provisions of Article 4 except with the written concurrence
        of the Rights Agent to such change, supplement or amendment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|(b) | Subject to subsection 5.4(a),
        the Corporation may, with the prior consent of the holders of Shares obtained
        as set forth below, at any time before the Separation Time, amend, vary,
        rescind, supplement any of the provisions of this Agreement and the Rights
        (whether or not such action would materially adversely affect the interests
        of the holders of Rights generally). Such consent shall be deemed to have
        been given if the action requiring such approval is approved by the affirmative
        vote of a majority of the votes cast by Independent Shareholders represented
        in person or by proxy at the Special Meeting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|(c) | The Corporation may, with
        the prior consent of the holders of Rights obtained as set forth below,
        at any time after the Stock Acquisition Date amend, vary or rescind any
        of the provisions of this Agreement and the Rights (whether or not such
        action would materially adversely affect the interests of the holders
        of Rights generally),provided that no such amendment, variation or deletion
        shall be made to the provisions of Article 4 except with the written concurrence
        of the Rights Agent thereto. Such consent shall be deemed to have been
        given if such amendment, variation or deletion is authorized by the affirmative
        votes of the holders of Rights present or represented at and entitled
        to vote at a meeting of the holders and representing a majority of the
        votes cast in respect thereof.
      Any such amendment shall be effective from the date
        of the resolution of the Board of Directors adopting such amendment, until
        it is confirmed or rejected or until it ceases to be effective (as described
        in the next sentence) and, where such amendment is confirmed, it continues
        in effect in the form so confirmed. If such amendment is rejected by the
        shareholders or the holders of Rights or is not submitted to the shareholders
        or holders of Rights as required, then such amendment shall cease to be
        effective from and after the termination of the meeting at which it was
        rejected or to which it should have been but was not submitted (being
        a meeting of the holders of Rights to be called for on a date not later
        than immediately following the next meeting of shareholders of the Corporation)
        or from and after the date of the meeting of holders of Rights that should
        have been but was not held, and no subsequent resolution of the Board
        of Directors to

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|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    | amend this Agreement to
        substantially the same effect shall be effective until confirmed by the
        shareholders or holders of Rights, as the case may be.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(d) | Any approval of the holders
        of Rights shall be deemed to have been given if the action requiring such
        approval is authorized by the affirmative votes of the holders of Rights
        present or represented and entitled to vote at a meeting of the holders
        of Rights and representing a majority of the votes cast in respect thereof.
        For the purposes hereof, each outstanding Right (other than Rights which
        are void pursuant to the provisions hereof) shall be entitled to one vote,
        and the procedures for the calling, holding and conduct of the meeting
        shall be those, as nearly as may be, which are provided in the Corporation's
        by-laws and The Companies Act(British Columbia) with respect to
        meetings of shareholders of the Corporation.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(e) | Any amendments or supplements
        made by the Corporation to this Agreement pursuant to Subsection 5.4(a)
        (other than an amendment or supplement to correct any clerical or typographical
        error or which are required to maintain the validity of the Agreement
        as a result of any change in any applicable legislation, regulations or
        rules thereunder) after this Agreement has been ratified and approved
        by the holders of Shares in accordance with the requirements of The Toronto
        Stock Exchange shall:                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | if made before the Separation Time,
        be submitted to the Shareholders of the Corporation at the next meeting
        of Shareholders and the Shareholders may, by the majority referred to
        in subsection 5.4(b) confirm or reject such amendment;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | if made after the Separation Time, be
        submitted to the holders of Rights at a meeting to be called for on a
        date not later than immediately following the next meeting of Shareholders
        of the Corporation and the holders of Rights may, by resolution passed
        by the majority referred to in Subsection 5.4(d) confirm or reject such
        amendment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | Any such amendment shall be effective
        from the date of the resolution of the Board of Directors adopting such
        amendment, until it is confirmed or rejected or until it ceases to be
        effective (as described in the next sentence) and, where such amendment
        is confirmed, it continues in effect in the form so confirmed. If such
        amendment is rejected by the Shareholders or the holders of Rights or
        is not submitted to the Shareholders or holders of Rights as required,
        then such amendment shall cease to be effective from and after the termination
        of the meeting at which it was rejected or to which it should have been
        but was not submitted or from and after the date of the meeting of holders
        of Rights that should have been but was not held, and no subsequent resolution
        of the Board of Directors to amend this Agreement to substantially the
        same effect shall be effective until confirmed by the Shareholders or
        holders of Rights as the case may be.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(f) | The Corporation shall be
        required to provide the Rights Agent with notice in writing of any such
        amendment, variation or rescission to this Agreement and/or the Rights
        as referred to in this Section 5.4 within five days of effecting such
        amendment, variation or rescission.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|5.5 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Fractional Rights and Fractional Shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|(a) | The Corporation shall not
        be required to issue fractions of Rights or to distribute Rights Certificates
        which evidence fractional Rights. In lieu of such fractional Rights, there
        shall be paid to the registered holders of the Rights Certificates with
        regard to which such fractional Rights would otherwise be issuable an
        amount in cash equal to the same fraction of the Market Price of a whole
        Right determined on the date on which such fractional Right would otherwise
        be issuable.                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(b) | The Corporation shall not
        be required to issue fractions of Common Shares upon exercise of the Rights
        or to distribute certificates which evidence fractional Common Shares.
        Fractions of Common Shares may, at the election of the Corporation, be
        evidenced by scrip certificates or in lieu of issuing fractional Common
        Shares, the Corporation shall pay to the registered holders of Rights
        Certificates, at the time such Rights are exercised as herein provided,
        an amount in cash equal to the same fraction of the Market Price of one
        Common Share at the date of such exercise.                                                                                                                                                                           

Page 28 of 36

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|(c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | The Rights Agent shall have
        no obligation to make any payments in lieu of issuing fractions of Rights
        or Common Shares pursuant to paragraph (a) or (b), respectively, unless
        and until the Corporation shall have provided to the Rights Agent the
        amount of cash to be paid in lieu of issuing such fractional Rights or
        Common Shares, as the case may be.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|5.6                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|Subject to the terms of
        this Agreement, all rights of action in respect of this Agreement, other
        than rights of action vested solely in the Rights Agent, are vested in
        the respective registered holders of the Rights; and any registered holder
        of any Rights, without the consent of the Rights Agent or of the registered
        holder of any other Rights, may, on such holder's own behalf and for such
        holder's own benefit and the benefit of other holders of Rights, enforce,
        and may institute and maintain any suit, action or proceeding against
        the Corporation to enforce such holder's right to exercise such holder's
        Rights in the manner provided in such holder's Rights Certificate and
        in this Agreement. Without limiting the foregoing or any remedies available
        to the holders of Rights, it is specifically acknowledged that the holders
        of Rights would not have an adequate remedy at law for any breach of this
        Agreement and will be entitled to specific performance of the obligations
        under, and injunctive relief against actual or threatened violations of
        the obligations of any person subject to, this Agreement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|5.7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|Any obligation of the Corporation
        or action or event contemplated by this Agreement shall be subject to
        the receipt of any requisite approval or consent from any governmental
        or regulatory authority, and, without limitation, necessary approval of
        the Toronto Stock Exchange shall be obtained, such as to the issuance
        of Common Shares upon the exercise of Rights under subsection 2.2(d).
        Notwithstanding any provision of this Agreement, any amendment to this
        Agreement will be subject to the prior written consent of the Toronto
        Stock Exchange.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|5.8                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|If in the opinion of the
        Board of Directors (who may rely upon the advice of counsel) any action
        or event contemplated by this Agreement would require compliance by the
        Corporation with the securities laws or comparable legislation of a jurisdiction
        outside Canada or the United States, the Board of Directors acting in
        good faith shall take such actions as it may deem appropriate to ensure
        that such compliance is not required, including, without limitation, establishing
        procedures for the issuance to a Canadian or the United States resident
        trustee of Rights or securities issuable on exercise of Rights, the holding
        thereof in trust for the Persons entitled thereto (but reserving to the
        trustee or to the trustee and the Corporation, as the Corporation may
        determine, absolute investment discretion with respect thereto) and the
        sale thereof and remittance of proceeds of such sale, if any, to the Persons
        entitled thereto. In no event shall the Corporation or the Rights Agent
        be required to issue or deliver Rights or securities issuable on exercise
        of Rights to Persons who are citizens, residents or nationals of any jurisdiction
        other than Canada or the United States, in which such issue or delivery
        would be unlawful without registration of the relevant Persons or securities
        for such purposes. Notwithstanding the foregoing, to the extent that the
        issuance or delivery of the Rights or securities issuable on exercise
        of Rights to Persons who are citizens, residents or nationals of any such
        jurisdiction in which such issue or delivery would be so unlawful, such
        Rights or securities shall be issued and delivered to such Persons to
        the extent the same may be so issued and delivered in reliance upon applicable
        exemptions from registration requirements in such jurisdictions.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|5.9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                                                                                                                                                                                                                                                                                                                                                                                      
|Any notice or demand authorized
        or required by this Agreement to be given or made by the Rights Agent
        or by the holder of any Rights to or on the Corporation shall be sufficiently
        given or made if delivered or sent by first-class mail, postage prepaid,
        addressed (until another address is filed in writing with the Rights Agent)
        as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    





Page 29 of 36

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TransGlobe Energy Corporation
    2900, 330  5th Avenue S.W.
    Calgary, Alberta
    T2P 0L4 Fax: (403) 264-9898
    Attention: Ross G. Clarkson


Any such notice or demand shall be deemed to have been received
  if delivered, on the date of delivery, or if sent by prepaid first class mail,
  on the fifth Business Day after mailing thereof, except in the case of interruption
  of regular mail service, in which case such notice shall be delivered.

Any notice or demand authorized or required by this Agreement
  to be given or made by the Corporation or by the holder of any Rights to or
  on the Rights Agent shall be sufficiently given or made if delivered or sent
  by first-class mail, postage prepaid, addressed (until another address is filed
  in writing with the Corporation) as follows:

Computershare Trust Company of Canada
    Suite 600, 530  8th Avenue S.W.
    Calgary, Alberta
    T2P 3S8 Fax: (403) 267-6529 
    Attention: Manager of Stock and Bond Transfer Department


Any such notice or demand shall be deemed to have been received
  if delivered, on the date of delivery, or if sent by prepaid first class mail,
  on the fifth Business Day after mailing thereof, except in the case of interruption
  of regular mail service, in which case such notice shall be delivered.

Any notice or demand authorized or required by this Agreement
  to be given or made by the Corporation or the Rights Agent to or on the holder
  of any Rights shall be sufficiently given or made if delivered or sent by first-class
  mail, postage prepaid, addressed to such holder at the address of such holder
  as it appears upon the register of the Rights Agent or, prior to the Separation
  Time, on the register of the Corporation for its Common Shares. Any notice which
  is mailed in the manner herein provided shall be deemed given, whether or not
  the holder receives the notice. In the event of any interruption of mail service,
  such notice required or permitted to be given hereunder will be deemed to be
  sufficiently given by advertisement of such notice in daily newspapers published
  in each of the cities of Calgary and Toronto.

|5.10 |  | Costs of Enforcement
|---- |  | --------------------

The Corporation agrees that if the Corporation or any other
  Person the securities of which are purchasable upon exercise of Rights fails
  to fulfil any of its obligations pursuant to this Agreement, then the Corporation
  or such Person will reimburse the holder of any Rights for the costs and expenses
  (including legal fees) incurred by such holder in actions to enforce his rights
  pursuant to any Rights or this Agreement.

|5.11 |  | Successors
|---- |  | ----------

All the covenants and provisions of this Agreement by or for
  the benefit of the Corporation or the Rights Agent shall bind and inure to the
  benefit of their respective successors and assigns hereunder.

|5.12 |  | Benefits of this Agreement
|---- |  | --------------------------

Nothing in this Agreement shall be construed to give to any
  Person other than the Corporation, the Rights Agent and the holders of the Rights
  any legal or equitable right, remedy or claim under this Agreement; but this
  Agreement shall be for the sole and exclusive benefit of the Corporation, the
  Rights Agent and the holders of the Rights.

Page 30 of 36

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|5.13 |  | Governing Law
|---- |  | -------------

This Agreement and each Right issued hereunder shall be deemed
  to be a contract made under the laws of the Province of Alberta and for
  all purposes shall be governed by and construed in accordance with the laws
  of such province applicable to contracts to be made and performed entirely within
  such province.

|5.14 |  | Severability
|---- |  | ------------

If any Section, subsection, paragraph, subparagraph or other
  provision hereof or the application hereof to any circumstances or any right
  hereunder shall, in any jurisdiction and to any extent, be invalid or unenforceable,
  such Section, subsection, paragraph, subparagraph or other provision or such
  right shall be ineffective only as to such jurisdiction and to the extent of
  such invalidity or unenforceability in such jurisdiction without invalidating
  or rendering unenforceable or ineffective the remaining Sections, subsections,
  paragraphs, subparagraphs and other provisions hereof or rights hereunder in
  such jurisdiction or the application of such Section, subsection, paragraph,
  subparagraph or other provision or rights hereunder in any other jurisdiction
  or to circumstances other than those as to which it is specifically held invalid
  or unenforceable.

|5.15 |  | Effective Date
|---- |  | --------------

This Agreement is effective and in full force and effect in accordance with
  its terms from the date hereof.

|5.16 |  | Determinations and Actions by the Board of
      Directors
|---- |  | ----------------------------------------------------------

All actions, calculations and determinations (including, for
  purposes of Clause (ii) below, all omissions with respect to the foregoing)
  which are done or made by the Board of Directors in good faith, shall: (i) be
  final, conclusive and binding on the Corporation, the Rights Agent, the holders
  of the Rights and all other parties; and (ii) not subject the Board of Directors
  to any liability to the holders of the Rights.

|5.17 |  | Time of the Essence
|---- |  | -------------------

Time shall be of the essence in this Agreement.

|5.18 |  | Execution in Counterparts
|---- |  | -------------------------

This Agreement may be executed in any number of counterparts and each of such
  counterparts shall for all purposes be deemed to be an original, and all such
  counterparts shall together constitute one and the same instrument.

|5.19 |  | Language
|---- |  | --------

Les parties aux présentes ont exigé que la présente
  convention ainsi que tous les documents et avis qui s'y rattachent et/ou que
  en découlent soient redigés en langue anglaise. The parties hereto
  have required that this Agreement and all documents and notices related thereto
  and/or resulting therefrom be drawn up in English.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
  executed as of the date first above written.

| | TRANSGLOBE ENERGY CORPORATION                  
| | -----------------------------------------------
| |                                                
| | By: ___________________________________________
| |                                                
| | By: ___________________________________________
| |                                                
| | COMPUTERSHARE TRUST COMPANY OF                 
| | CANADA                                         
| |                                                
| | By: ___________________________________________
| |                                                
| | By: ___________________________________________

Page 31 of 36

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EXHIBIT A 
  [Form of Rights Certificate]

|Certificate No. | _______________________ Rights
|--------------- | ------------------------------

> THE RIGHTS ARE SUBJECT TO TERMINATION ON THE TERMS SET
>       FORTH IN THE SHAREHOLDER PROTECTION RIGHTS PLAN AGREEMENT. UNDER CERTAIN
>       CIRCUMSTANCES (SPECIFIED IN SECTION 3.1(b) OF THE SHAREHOLDER PROTECTION
>       RIGHTS PLAN AGREEMENT), RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON
>       OR TRANSFEREES OF AN ACQUIRING PERSON OR ITS AFFILIATES OR ASSOCIATES (AS
>       SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY PERSON ACTING JOINTLY
>       OR IN CONCERT WITH ANY OF THEM MAY BECOME VOID.

Rights Certificate

This certifies that _______________________________________
  , or its registered assigns, is the registered holder of the number of Rights
  set forth above, each of which entitles the registered holder thereof, subject
  to the terms, provisions and conditions of the Shareholder Protection Rights
  Plan Agreement dated as of the 16th day of April, 2003 (the "Rights Agreement")
  between TransGlobe Energy Corporation, a corporation incorporated under The
  Companies Act(British Columbia) (the "Corporation") and Computershare Trust
  Company of Canada, a trust company, as rights agent (the "Rights Agent") (which
  term shall include any successor Rights Agent under the Rights Agreement), to
  purchase from the Corporation at any time after the Separation Time (as such
  term is defined in the Rights Agreement) and prior to the Expiration Time (as
  such term is defined in the Rights Agreement), one fully paid common share of
  the Corporation (a "Common Share") at the Exercise Price referred to below,
  upon presentation and surrender of this Rights Certificate together with the
  Form of Election to Exercise duly executed and submitted to the Rights Agent
  at its principal office in the city of Toronto. Until adjustment thereof in
  certain events as provided in the Rights Agreement, the Exercise Price is Fifty
  ($50.00) dollars.

In certain circumstances described in the Rights Agreement,
  each Right evidenced hereby may entitle the registered holder thereof to purchase
  or receive securities of an entity other than the Corporation, assets, debt,
  equity or other securities or property or assets of the Corporation, or more
  or less than one Common Share (or a combination thereof), all as provided in
  the Rights Agreement.

The Rights Certificate is subject to all of the terms, provisions
  and conditions of the Rights Agreement which terms, provisions and conditions
  are hereby incorporated herein by reference and made a part thereof and to which
  Rights Agreement reference is hereby made for a full description of the rights,
  limitations of rights, obligations, duties and immunities thereunder of the
  Rights Agent, the Corporation and the holders of the Rights Certificates. Copies
  of the Rights Agreement are on file at the principal office of the Corporation
  and are available upon written request.

The Rights Certificate, with or without other Rights Certificates,
  upon surrender at any of the offices of the Rights Agent designated for such
  purpose, may be exchanged for another Rights Certificate or Rights Certificates
  of like tenor and the date evidencing an aggregate number of Rights equal to
  the aggregate number of Rights evidenced by the Rights Certificate or Rights
  Certificates surrendered. If this Rights Certificate shall be exercised in part,
  the registered holder shall be entitled to receive, upon surrender hereof, another
  Rights Certificate or Rights Certificates for the number of whole Rights now
  exercised. No fractional Common Shares will be issued upon the exercise of any
  Rights evidenced hereby, but in lieu thereof a cash payment will be made as
  provided in the Rights Agreement.

Subject to the provisions of the Rights Agreement, the Rights
  evidenced by this Certificate may be redeemed by the Corporation at a redemption
  price of $0.00001 per Right, subject to adjustment in certain events, under
  certain circumstances at its option.

No holder of this Rights Certificate, as such, shall be entitled
  to vote or receive dividends or be deemed for any purpose the holder of Common
  Shares or of any other securities which may at any time be issuable upon the

Page 32 of 36

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exercise hereof, nor shall anything contained in the Rights
  Agreement or herein be construed to confer upon the holder hereof, as such,
  any of the rights of a shareholder of the Corporation or any right to vote for
  the election of directors or upon any matter submitted to shareholders at any
  meeting thereof, or to give or withhold consent to any corporate action, or
  to receive notice of meetings or other actions affecting shareholders (except
  as provided in the Rights Agreement), or to receive dividends or subscription
  rights, or otherwise, until the Rights evidenced by this Rights Certificate
  shall have been exercised as provided in the Rights Agreement.

The Rights Certificate shall not be valid or obligatory for
  any purpose until it shall have been countersigned by the Rights Agent.

WITNESS the facsimile signature of the proper officers of
  the Corporation and its corporate seal.

|DATE: **____________________________** | TRANSGLOBE ENERGY CORPORATION                  
|-------------------------------------- | -----------------------------------------------
|                                       |                                                
|                                       | By: ___________________________________________
|                                       |                                                
|                                       | By: ___________________________________________

Countersigned:

COMPUTERSHARE TRUST COMPANY
  OF CANADA

By: ___________________________________________
       Authorized Signature





Page 33 of 36

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FORM OF ASSIGNMENT

(To be executed by the registered holder if such holder desires to transfer
  the Rights Certificates)

FOR VALUE RECEIVED ________________________ hereby sells,
  assigns and transfers unto

_________________________________________________________________________________________________

_________________________________________________________________________________________________
  (please print name and address of transferee)

the Rights represented by this Rights Certificate, together
  with all right, title and interest therein, and does hereby irrevocably constitute
  and appoint _________________________________ attorney, to transfer the within
  Rights Certificate on the books of the within-named Corporation, with full power
  of substitution.

|DATE: **____________________________** | ______________________________________________
|-------------------------------------- | ----------------------------------------------
|                                       | Signature                                     



|Signature Guarantee: | (Signature must correspond
        to name as written upon the face of this Rights Certificate in every particular,
        without alteration or enlargement or any change whatsoever)
|-------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Note: Signature must be guaranteed by a major Canadian
  trust company, a Schedule I Canadian chartered bank, or a member of a recognized
  Medallion Guarantee program.

___________________________________________________________________________________
  
  (To be completed by the assignor if true)

The undersigned hereby represents, for the benefit of all
  holders of Rights and Common Shares, that the Rights evidenced by this Rights
  Certificate are not, and, to the knowledge of the undersigned, have never been,
  Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof
  or by any Person acting jointly or in concert therewith. Capitalized terms shall
  have the meaning ascribed thereto in the Rights Agreement.



_________________________________________
    (please print name of Signatory)


Page 34 of 36

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(To be attached to each Rights Certificate)

FORM OF ELECTION TO EXERCISE

TO:
  The undersigned hereby irrevocably elects to exercise ______________________________________
  whole Rights represented by the Rights Certificate to purchase the Common Shares
  issuable upon the exercise of such Rights and requests that certificates for
  such shares be issued in the name of:

______________________________________________________________________

______________________________________________________________________

______________________________________________________________________
                                                                                 Address

______________________________________________________________________
         Social Insurance, Social Security or Other Taxpayer Identification Number



|DATE: **____________________________** | ______________________________________________
|-------------------------------------- | ----------------------------------------------
|                                       | Signature                                     

|Signature Guarantee: | (Signature must correspond
        to name as written upon the face of this Rights Certificate in every particular,
        without alteration or enlargement or any change whatsoever)
|-------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Note: Signature must be guaranteed by a major Canadian trust
  company, a Schedule I Canadian chartered bank, or a member of a recognized Medallion
  Guarantee program.

__________________________________________________________________
  
  (To be completed by exercisor if true)

The undersigned hereby represents, for the benefit of all
  holders of Rights and Common Shares, that the Rights evidenced by this Rights
  Certificate are not, and, to the knowledge of the undersigned, have never been,
  Beneficially Owned by an Acquiring Person or an Affiliate or Associate thereof
  or by any Person acting jointly or in concert therewith. Capitalized terms shall
  have the meaning ascribed thereto in the Rights Agreement.

_________________________________________
    (please print name of Signatory)


Page 35 of 36

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NOTICE

In the event the Certificate set forth above in the applicable
  Forms of Assignment or Election is not completed, the Corporation will deem
  the Beneficial Owner of the Rights evidenced by this Rights Certificate to be
  an Acquiring Person or an Affiliate or Associate thereof and, in the case of
  an Assignment, will affix a legend to that effect on any Rights Certificates
  issued in exchange for this Rights Certificate. Capitalized terms shall have
  the meaning ascribed thereto in the Rights Agreement.



Page 36 of 36

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