EXHIBIT 10.45



                               PURCHASE AGREEMENT

                                     BETWEEN

                           DATA BUSINESS FORMS LIMITED

                                       AND

                                 DALE A. HODGSON

                                       AND

                               408446 ALBERTA INC.

                                       AND

                             SUNDOG PRINTING LIMITED






                       made effective as of March 1, 1999





<PAGE>



<TABLE>

                                TABLE OF CONTENTS
                                                                                                           PAGE NO.
<S>     <C>
ARTICLE 1      INTERPRETATION
         1.1               Definitions............................................................................2
         1.2               Headings...............................................................................7
         1.3               Extended Meanings......................................................................7
         1.4               Currency...............................................................................7
         1.5               Accounting Principles..................................................................7
         1.6               Schedules..............................................................................8
         1.7               Best of Knowledge......................................................................9

ARTICLE 2      DISCLOSURE
         2.1               Disclosure.............................................................................9

ARTICLE 3     PURCHASE AND SALE OF THE SHARES AND ASSIGNMENT OF THE SHAREHOLDERS' LOANS
         3.1               Purchase and Sale of Shares............................................................9
         3.2               Assignment of Shareholders' Loans.....................................................10

ARTICLE 4     REPRESENTATIONS AND WARRANTIES
         4.1               Vendors' Representations and Warranties...............................................11
         4.2               Hodgson's Representations and Warranties..............................................38

ARTICLE 5     PURCHASERS REPRESENTATIONS AND WARRANTIES
         5.1               Purchasers Representations............................................................41

ARTICLE 6     COVENANTS
         6.1               Taxes.................................................................................42
         6.2               Accounts Receivable...................................................................43
         6.3               Related Party Agreements..............................................................43
         6.4               Cooperation...........................................................................43
         6.5               Access to Information; Confidentiality; Public Disclosure.............................44
         6.6               Conduct of Business Pending Closing...................................................45
         6.7               Prohibited Activities.................................................................45
         6.8               Exclusivity...........................................................................47
         6.9               Notification of Certain Matters.......................................................48

ARTICLE 7     CONDITIONS
         7.1               Conditions for the Benefit of the Purchaser...........................................48
         7.2               Conditions for the Benefit of the Vendor, the Company and 408446......................50
         7.3               Conditions for the Benefit of the Vendor, Purchaser,
                           Company and 40844.....................................................................51



ARTICLE 8     INDEMNIFICATION
         8.1               General Indemnification by the Vendor.................................................52
         8.2               Limitation and Expiration.............................................................53
         8.3               Indemnification Procedures............................................................54
         8.4               General Indemnification by the Purchaser..............................................56
         8.5               Survival of Representations, Warranties and Covenants.................................56
         8.6               Remedies Cumulative...................................................................56
         8.7               Right to Set Off......................................................................57

ARTICLE 9     NON-COMPETITION
         9.1               Prohibited Activities.................................................................57
         9.2               Confidentiality.......................................................................58
         9.3               Damages...............................................................................58
         9.4               Reasonable Restraint..................................................................59
         9.5               Severability; Reformation.............................................................59
         9.6               Independent Covenant..................................................................59
         9.7               Materiality...........................................................................59

ARTICLE 10    CLOSING
         10.1              Closing...............................................................................60
         10.2              Deliveries at Funding Time............................................................60
         10.3              Purchaser Post-Closing Obligations....................................................61
         10.4              Johnson Contract......................................................................62

ARTICLE 11        GENERAL
         11.1              Termination...........................................................................62
         11.2              Effect of Termination.................................................................63
         11.3              Successors and Assigns................................................................63
         11.4              Entire Agreement; Amendment; Waiver...................................................63
         11.5              Counterparts..........................................................................63
         11.6              Brokers and Agents....................................................................64
         11.7              Expenses..............................................................................64
         11.8              Specific Performance; Remedies........................................................64
         11.9              Notices...............................................................................64
         11.10             Governing Law.........................................................................66
         11.11             Severability..........................................................................67
         11.12             Absence of Third Party Beneficiary Rights.............................................67
         11.13             Mutual Drafting.......................................................................67
         11.14             Further Representations...............................................................67
         11.15             Further Assurances....................................................................68
</TABLE>





<PAGE>



                               PURCHASE AGREEMENT


                  THIS AGREEMENT made as of the 1st day of March, 1999.

BETWEEN:

                  DATA  BUSINESS  FORMS  LIMITED,  a  Corporation  governed  by
                  the laws of Ontario (hereinafter referred to as the
                  "Purchaser")

                                                               OF THE FIRST PART

                                     - and -

                  DALE A. HODGSON, an individual residing in the City of
                  Calgary,  in the Province of Alberta (hereinafter referred to
                  as  the "Vendor" or "Hodgson")

                                                              OF THE SECOND PART

                                     - and -

                  SUNDOG PRINTING LIMITED, a corporation governed  by  the  laws
                  of  Alberta (hereinafter referred to as the "Company")

                                                               OF THE THIRD PART

                                     - and -

                  408446 ALBERTA INC., a corporation governed by the laws of
                  Alberta (hereinafter referred to as "408446")

                                                              OF THE FOURTH PART


                  WHEREAS the Vendor is the beneficial and registered owner of
all of the 408446 Shares;

                  AND WHEREAS the Vendor is the beneficial and registered owner
of 29 Class A common shares in the capital of the Company;

                  AND WHEREAS 408446 is the beneficial and registered owner of
160 Class A common shares in the capital of the Company;

                  AND WHEREAS, at the Funding Time, the sole assets held by
408446 will be common shares in the capital of the Company;


<PAGE>



                  AND WHEREAS 408446, Vendor and 517244 in the aggregate own all
of the issued and outstanding shares of the Company;

                  AND WHEREAS Hodgson desires to sell his shareholder loans, his
common shares in the capital of the Company and the 408446 Shares to the
Purchaser and pursuant to the "Remenda Agreement", Ray Remenda, the sole
shareholder of 517244, desires to sell all of his shares in 517244 and his
shareholder loans and the Purchaser desires to purchase same such that the
Purchaser becomes the sole direct and indirect shareholder of the Company;

                  NOW THEREFORE, in consideration of the premises and of the
representations, warranties, covenants and agreements herein contained, the
parties hereto, intending to be legally bound, agree as follows:

                                    ARTICLE 1
                                 INTERPRETATION

 1.1              DEFINITIONS

                  In this Agreement, including any recitals and schedules
hereto, unless something in the subject matter or context is inconsistent
therewith:

         (a)      "408446"  means 408446 Alberta Inc., a body  corporate
                  incorporated  under the laws of the Province of Alberta;

         (b)      "517244" means 517244 Alberta Ltd, a body corporate
                  incorporated  under the laws of the Province of Alberta;

         (c)      "1999 Bonus" has the meaning set forth in Section 7.3(d)
                  hereof;

         (d)      "408446 Shares" means 106 Class A Common Shares in the capital
                  of 408446 owned by Hodgson;

         (e)      "408446 Shareholder Loan" means the amount of $563,912
                  advanced by Vendor to 408446 by way of a shareholder's loan
                  and remaining unpaid as at the Funding Time;

         (f)      "Account Receivable" has the meaning set forth in Section
                  4.1(p);

         (g)      "Affiliates" has the meaning set forth in the BUSINESS
                  CORPORATIONS ACT (Alberta) or the BUSINESS CORPORATIONS ACT
                  (Ontario), as the case may be;

         (h)      "Agreement" means this agreement and all amendments made
                  hereto by written agreement between the Vendor, 408446,
                  Company and the Purchaser;

         (i)      "Balance Sheet Date" means July 31, 1998;

         (j)      "Benefit Plan" has the meaning set out in Section
                  4.1(aa)(i)(A);

         (k)      "Closing" means the consummation of the transactions
                  contemplated by this Agreement.

         (l)      "Company"  means  Sundog Printing  Limited,  a body  corporate
                  incorporated  under the laws of the Province of Alberta;

         (m)      "Company Financial Statements" has the meaning set out in
                  Section 4.1(l) hereof;

         (n)      "Confidential Information" has the meaning set out in Section
                  9.2 hereof;

         (o)      "Copyright" means any Canadian or foreign copyright owned by
                  the Company as of the date of this Agreement, including any
                  registration of copyrights, in Canada or in any foreign
                  county, as well as any application for a Canadian or foreign
                  copyright registration made by the Company;

         (p)      "Effective Date" means March 1, 1999;

         (q)      "ETA" shall mean Part IX of the EXCISE TAX ACT (Canada), as
                  now in effect;

         (r)      "Funding Date" means  March 31, 1999 or such other date as may
                  be agreed to between the Vendor and the Purchaser;

         (s)      "Funding Time" means 4:00 p.m. (Calgary Time) on the Funding
                  Date;

         (t)      "Governmental Authority" has the meaning set out in Section
                  4.1(y)(i)(F) hereof;

         (u)      "Hodgson" or "Vendor" means Dale A. Hodgson,  an individual
                  residing in the City of Calgary, in the Province of Alberta;

         (v)      "Hodgson Employment Contract" means that certain employment
                  contract entered into between the Company and Hodgson as set
                  forth and described in Schedule 1.1(t) hereof;

         (w)      "Hodgson  Insurance"  means the  policies  set forth in
                  Schedule  1.1(u)  insofar as they relate to Hodgson;

         (x)      "Hodgson  Shares"  means 29 Class A Common  Voting  Shares in
                  the  capital of the  Company  owned by Hodgson;

         (y)      "Income Statement" has the meaning set out in Section 4.1(l)
                  hereof;

         (z)      "Income Tax Act" means the INCOME TAX ACT (Canada), as
                  amended;

         (aa)     "Indemnified Party" has the meaning set out in Section 8.1
                  hereof;

         (bb)     "Indemnifying Party" has the meaning set out in Section 8.3
                  hereof;

<PAGE>

         (cc)     "Johnson Employment Contract" means that certain employment
                  contract entered into between the Company and Harvey Johnson
                  as set forth and described in Schedule 4.1(aa) hereof;

         (dd)     "Johnson Pension Obligation" means the obligation of the
                  Company to fund and to pay an amount of $290,827 to Harvey
                  Johnson's registered defined benefit pension plan;

         (ee)     "Johnson Severance  Obligation" means the obligation of the
                  Company to pay to Johnson a retirement allowance and severance
                  payment, as set forth in Schedule 4.1(aa);

         (ff)     "Landlords" means the landlords under the N.E. Lease and the
                  Parking Lot Lease;

         (gg)     "Leased Premises" means the N.E. Warehouse Property, the
                  Parking Lot and the Sundog Premises;

         (hh)     "Leases" means, collectively, the N.E. Lease, the Parking Lot
                  Lease and the Sundog Leases;

         (ii)     "Lien" means any mortgage, security interest, pledge,
                  hypothecation, assignment, deposit arrangement, encumbrance,
                  lien (statutory or otherwise), charge, preference, priority or
                  other security agreement, option, warrant, attachment, right
                  of first refusal, preemptive, conversion, put, call or other
                  claim or right, restriction on transfer (other than
                  restrictions imposed by securities laws), or preferential
                  arrangement of any kind or nature whatsoever (including any
                  restriction on the transfer of any assets, any conditional
                  sale or other title retention agreement, any financing lease
                  involving substantially the same economic effect as any of the
                  foregoing and the filing of any financing statement under the
                  PERSONAL PROPERTY SECURITY ACT (Alberta) or comparable law of
                  any jurisdiction);

         (jj)     "Mark" means all right, title and interest in and to any
                  Canadian or foreign trademarks, service marks and trade names
                  now held by the Company, including any registration or
                  application for registration of any trademarks and services
                  marks in Canada or in any foreign country, as well as any
                  unregistered marks used by the Company, and any trade dress
                  (including logos, designs, company names, business names,
                  fictitious names and other business identifiers) used by the
                  Company in Canada or any foreign country;

         (kk)     "Material Contracts" has the meaning set out in Section
                  4.1(u)(ii) hereof;

<PAGE>

         (ll)     "NASDAQ National  Market" means the United States National
                  Market automated  quotation system of the National
                  Association of Securities Dealers, Inc.;

         (mm)     "N.E. Lease" means that lease relating to that portion of N.E.
                  Warehouse Property, dated November 26, 1996 between Herma
                  Holdings Limited and Sundog Printing Limited, as amended by a
                  lease amending agreement dated on or about March 1st, 1997
                  between Herma Holdings Limited and Sundog Printing Limited
                  respecting premises located on lands municipally described as
                  2320 - 35th Avenue N.E., Calgary, Alberta, leased to the
                  Company;

         (nn)     "N.E. Warehouse Property" means those lands and buildings
                  located in the City of Calgary, in the Province of Alberta
                  legally described as: Plan 7410187, Block 6, Lot 7, Excepting
                  thereout all mines and minerals;

         (oo)     "Parking Lot" means that portion of those lands located in the
                  City of Calgary, in the Province of Alberta legally described
                  as Plan 9412695, Block 45, Lot 3, Excepting thereout all mines
                  and minerals, leased to the Company;

         (pp)     "Parking Lot Lease" means that lease relating to the Parking
                  Lot dated December 22, 1997 between Thomasz Goszczynski as
                  agent for Stefan Goszczynski and Hanna Goszczynski and Sundog
                  Printing Limited respecting lands municipally described as
                  1401 - 9th Avenue S.W., Calgary, Alberta;

         (qq)     "Patent" means any Canadian or foreign patent to which the
                  Company has title as of the date of this Agreement, as well
                  as any application for a Canadian or foreign patent made by
                  the Company.

         (rr)     "Person" has the meaning set out in Section 4.1(y)(i)(H)
                  hereof;

         (ss)     "Preferred Shares" means the preferred shares held by the
                  Company in 387177 Alberta Ltd., 387178 Alberta Inc. and D.
                  Hodgson Investments Ltd. as more particularly set forth in
                  Schedule 1.1(pp) hereof;

         (tt)     "Purchase Price" means the aggregate amount payable to the
                  Vendor pursuant to Section 3.1 hereof;

         (uu)     "Purchaser" means Data Business Forms Limited;

         (vv)     "Purchased Interests" means the Shares and the Shareholders'
                  Loans;

         (ww)     "Related Party Agreements" has the meaning set out in Section
                  4.1(u)(ii) hereof;

         (xx)     "Related Party Debt" means the indebtedness of the Company, in
                  the aggregate amount of $146,204 to the parties and in the
                  amounts set forth in Schedule 1.1(xx) hereof;

         (yy)     "Remenda"  means Ray  Remenda,  an  individual residing in the
                  City of Calgary in the  Province of Alberta, the sole
                  shareholder of 517244;

<PAGE>

         (zz)     "Remenda Agreement" means that agreement of even date
                  whereunder inter alia Remenda sells all of the shares Remenda
                  owns in 517244 to the Purchaser;

         (aaa)    "Shareholders" means Hodgson and 408446 and "Shareholder"
                  means any one of them;

         (bbb)    "Shareholders' Loans" means the Sundog Shareholder Loan and
                  the 408446 Shareholder Loan;

         (ccc)    "Shares" means, collectively, the Hodgson Shares and the
                  408446 Shares;

         (ddd)    "Significant Customers" has the meaning set out in Section
                  4.1(u)(i) hereof;

         (eee)    "Significant Suppliers" has the meaning set out in Section
                  4.1(u)(i) hereof;

         (fff)    "Subsidiaries"  has the  meaning  set  forth  in the  BUSINESS
                  CORPORATIONS  ACT  (Alberta)  or the BUSINESS CORPORATIONS ACT
                  (Ontario), as the case may be;

         (ggg)    "Sundog Leases" means, collectively, the lease between the
                  Company and 387177 Alberta Inc. and 387178 Alberta Inc. with
                  respect to the lands municipally described as 1311 - 9th
                  Avenue S.W., Calgary, Alberta and the lease between the
                  Company and 566657 Alberta Ltd. with respect to the lands
                  municipally described as 1333 - 9th Avenue S.W., Calgary,
                  Alberta;

         (hhh)    "Sundog Shareholder Loan" means the amount of $1,682,454
                  advanced by Vendor to the Company by way of a shareholder's
                  loan and remaining unpaid as at the Funding Time;

         (iii)    "Sundog  Premises"  means the premises of the Company  located
                  at 1311 - 9 Avenue S.W., and 1313 - 9  Avenue S.W., Calgary,
                  Alberta;

         (jjj)    "Tax" shall mean all governmental taxes, levies, duties,
                  assessments, reassessments and other charges of any nature
                  whatsoever, whether direct or indirect, including, but not
                  limited to, income tax, profit tax, gross receipts tax,
                  corporation tax, sales and use tax, wage tax, payroll tax,
                  employer health tax, workers' compensation levy, capital tax,
                  stamp duty, real and personal property tax, land transfer tax,
                  customs or excise duty, excise tax, turnover or value added
                  tax on goods sold or services rendered, withholding tax,
                  social security and unemployment insurance charges and
                  retirement contributions, and any interest, fines, additions
                  to tax and penalties thereon;

         (kkk)    "Tax Return" shall mean any return (including any information
                  return, report, statement, schedule, notice, form, estimate,
                  or declaration of estimated tax) relating to or required to be
                  filed with any governmental entity in connection with the
                  determination, assessment, collection or payment of any Tax;

<PAGE>

         (mmm)    "Third Party Claim" has the meaning set out in Section
                  8.3(b)(i);

         (nnn)    "Third Party Consents" has the meaning set out in Section
                  4.1(u)(iv);

         (ooo)    "TPI  Receivable"  means the amount of $963,600 owing by The
                  Pacific  Institute to the Company as of January 31, 1999;

         (ppp)    "Vendor" means Dale A. Hodgson;

         (qqq)    "Vendor's Portion" means 75%, being the percentage of common
                  shares of the Company directly or indirectly held by the
                  Vendor; and

         (rrr)    "Year 2000 Compliant and Ready" means that the computer
                  systems and the presses used in the Company's operations
                  contain the functionality need for the December 31, 1999
                  "millennium" date change.

1.2               HEADINGS

                  The division of this Agreement into Articles and Sections and
the insertion of headings are for convenience of reference only and shall not
affect the construction or interpretation of this Agreement. The terms "this
Agreement", "hereof", "hereunder" and similar expressions refer to this
Agreement and not to any particular Article, Section or other portion hereof and
include any agreement supplemental hereto. Unless something in the subject
matter or context is inconsistent therewith, references herein to Articles and
Sections are to Articles and Sections of this Agreement.

1.3               EXTENDED MEANINGS

                  In this Agreement words importing the singular number only
shall include the plural and VICE versa, words importing the masculine gender
shall include the feminine and neuter genders and VICE VERSA and words importing
persons shall include individuals, partnerships, associations, trusts,
unincorporated organizations and corporations.

<PAGE>




1.4               CURRENCY

                  All references to currency herein are to lawful money of
Canada.

1.5               ACCOUNTING PRINCIPLES

                  Except as otherwise expressly provided herein or in the
Schedules or agreed between by the parties hereto in writing, all accounting
terms used in this Agreement shall be interpreted, and all financial statements,
Schedules, certificates and reports as to financial matters required to be
delivered hereunder shall be prepared, in accordance with Canadian GAAP
consistently applied

1.6               SCHEDULES

                  The following are the Schedules annexed hereto and
incorporated by reference and deemed to be part hereof:

<TABLE>
<S>     <C>
                  Schedule 1.1(t)             -        Hodgson Employment Contract
                  Schedule 1.1(u)             -        Hodgson Insurance
                  Schedule 1.1(pp)            -        Preferred Share
                  Schedule 1.1(xx)            -        Related Party Debt
                  Schedule 3.1(a)(iii)        -        First Earn-Out
                  Schedule 3.1(a)(v)          -        Second Earn-Out
                  Schedule 3.2(a)             -        Form of Assignment of 408446
                                                       Shareholder Loan
                  Schedule 4.1(h)(iii)        -        Promissory Notes
                  Schedule 4.1(k)(ii)         -        Add-backs
                  Schedule 4.1(k)(iv)                  Related Party Debt since July 31, 1998
                  Schedule 4.1(l)             -        Company Financial Statements
                  Schedule 4.1(m)(iii)        -        Plans
                  Schedule 4.1(o)             -        Bank Accounts, Powers of Attorney
                  Schedule 4.1(p)                      Accounts Receivable
                  Schedule 4.1(r)             -        Leases of Real Property
                  Schedule 4.1(s)(i)          -        Personal Property
                  Schedule 4.1(s)(ii)         -        Liens on Personal Property
                  Schedule 4.1(t)(i)          -        Trade Marks and Trade Names
                  Schedule 4.1(t)(ii)         -        Patents and Copyrights
                  Schedule 4.1(t)(iii)        -        Other Rights
                  Schedule 4.1(t)(iv)         -        Third Party Rights
                  Schedule 4.1(u)(i)          -        Significant Customers and Suppliers
                  Schedule 4.1(u)(ii)         -        Material Contracts
                  Schedule 4.1(u)(iii)        -        Reductions and Cancellations
                  Schedule 4.1(u)(iv)         -        Third Party Consents
                  Schedule 4.1(u)(v)          -        Related Party Commitments
                  Schedule 4.1(u)(vi)         -        Exception to Acceleration
                  Schedule 4.1(x)             -        Insurance Policies
                  Schedule 4.1(y)(ii)         -        Environmental Matters
                  Schedule 4.1(z)             -        Employees/Compliance
                  Schedule 4.1(z)(viii)       -        Employee List
                  Schedule 4.1(aa)            -        Employee Benefit Plans
                  Schedule 4.1(bb)            -        Tax Exceptions
                  Schedule 4.1(cc)(iii)       -        Litigation
                  Schedule 4.1(ee)            -        Changes
                  Schedule 4.1(gg)            -        Predecessor Status
                  Schedule 4.1(jj)            -        Year 2000 Compliance
                  Schedule 7.1(i)             -        Lease of Sundog Premises
                  Schedule 8.2(d)             -        Indemnity Schedule
</TABLE>

1.7               BEST OF KNOWLEDGE

                  Any reference herein to "the best of the knowledge" of the
Vendor and the Shareholders or words of similar import shall mean the actual
knowledge of the Vendor and the Shareholders or in the case of 408446 shall mean
the actual knowledge of the Shareholder, directors and officers of 408446. Any
reference herein to "knowledge of the Company" or "Company's knowledge", or
words of similar import means the actual knowledge of the Vendor, Shareholders,
directors and officers of the Company.

                                    ARTICLE 2
                                   DISCLOSURE

2.1               DISCLOSURE

                  Certain matters may be disclosed on a Schedule hereto that are
not strictly required to be disclosed thereon pursuant to the terms of this
Agreement. Such disclosure is for information purposes only, and should not
constitute an indication or admission of the materiality thereof or create a
standard for disclosure. The Vendor, Company and 408446 shall not be liable for
a breach of any representation or warranty that might result from the failure to
disclose any item on any one Schedule if such item has been disclosed on any
other Schedule hereto in such a manner that a review of such other Schedule
would put Purchaser on notice that such item exists.



<PAGE>



                                    ARTICLE 3
                         PURCHASE AND SALE OF THE SHARES
                    AND ASSIGNMENT OF THE SHAREHOLDERS' LOANS

3.1               PURCHASE AND SALE OF SHARES

                  Subject to the terms and conditions of this Agreement, at the
Funding Time and effective as of the Effective Date, the Vendor will sell to
Purchaser, and Purchaser will purchase from the Vendor, the Shares, for the
Purchase Price.

         (a) The Purchase Price for the Shares shall be comprised of and shall
             be paid and satisfied by:

                  (i)        $2,749,376 payable by cheque to the Vendor at the
                             Funding Time inclusive of interest at a rate of
                             6.75% per annum calculated from the Effective Time
                             up to and including the Funding Date;

                  (ii)       the delivery to the Vendor of a demand promissory
                             note from the Purchaser in the amount of $820,056.
                             Such demand promissory note shall be paid in full
                             immediately following the Funding Time by payment
                             in cash by the Purchaser in an amount equal to the
                             Vendor's Portion of the TPI Receivable or by an
                             assignment of the Vendor's Portion of the TPI
                             Receivable to the Vendor or any combination
                             thereof, together with an assignment of the Hodgson
                             Insurance;

                  (iii)      a payment of the Vendor's Portion of the amount
                             calculated pursuant to Schedule 3.1(a)(iii) to the
                             Vendor on March 15, 2000;

                  (iv)       $750,000 to the Vendor on April 28, 2000; and

                  (v)        a payment on July 31, 2001 of the amounts, if any:

                             (A)     equal to the Vendor's Portion, of the
                                     amount calculated pursuant to Schedule
                                     3.1(a)(v) hereof less $1,000,000, which
                                     payment to the Vendor shall not exceed the
                                     sum of $750,000; and

                             (B)     equal to the entire amount calculated
                                     pursuant to Schedule 3.1(a)(v) hereof less
                                     the sum of $2,000,000;





<PAGE>



3.2               ASSIGNMENT OF SHAREHOLDERS' LOANS

         (a)      In consideration of payment to the Vendor in the amount of
                  $563,912 at the Funding Time, the Vendor shall execute and
                  deliver an assignment in the form of the assignment set out on
                  Schedule 3.2(a) hereof assigning to the Purchaser all of
                  Vendor's right, title and interest in and to the 408446
                  Shareholder Loan.

         (b)      In consideration of payment to the Vendor in the amount of
                  $1,682,454 at the Funding Time, the Vendor shall execute and
                  deliver an assignment in the form of the assignment set out on
                  Schedule 3.2(b) hereof assigning to the Purchaser all of
                  Vendor's right, title and interest in and to the Sundog
                  Shareholder Loan.


                                    ARTICLE 4
                         REPRESENTATIONS AND WARRANTIES

4.1               VENDORS' REPRESENTATIONS AND WARRANTIES

                  The Vendor, the Company and 408446, represent and warrant to
the Purchaser that:

         (a)      CORPORATE STANDING The Company is a corporation duly
                  incorporated and subsisting under the laws of Alberta as a
                  private company as that term is defined in the SECURITIES ACT
                  (Alberta) with the corporate power to own its assets and to
                  carry on its business and has made all necessary filings under
                  all applicable corporate, securities and taxation laws or any
                  other laws to which the Company is subject.

         (b)      CORPORATE RECORDS The corporate records and minute book of the
                  Company are complete and true and correct in all material
                  respects and the minute book contains copies of minutes of all
                  meetings of the directors, committees of directors and
                  shareholders of the Company and of all written resolutions of
                  such directors, committees and shareholders.

         (c)      AUTHORIZATION; VALIDITY The Company has the full legal right,
                  corporate power and authority to enter into this Agreement and
                  the transactions contemplated hereby and to perform its
                  obligations pursuant to the terms of this Agreement. Each of
                  the Vendor and 408446 has the full legal right and authority
                  to enter into this Agreement and the transactions contemplated
                  hereby and to perform its respective obligations pursuant to
                  the terms of this Agreement. The execution and delivery of
                  this Agreement by the Vendor, the Company and 408446 and the
                  performance by the Vendor, the Company and 408446 of the
                  transactions contemplated herein have been duly and validly
                  authorized by the Board of Directors of the Company and 408446
                  and this Agreement has been duly and validly authorized by all
                  necessary corporate action. This Agreement is a legal, valid
                  and binding obligation of the Vendor, the Company and 408446,
                  enforceable in accordance with its terms subject to
                  limitations with respect to enforcement imposed by law in
                  connection with bankruptcy or other laws generally affecting
                  creditors' rights, and to the extent that equitable remedies,
                  such as specific performance and injunction, are in the
                  discretion of the court from which they are sought.

<PAGE>

         (d)      EXECUTION AND DELIVERY The execution, delivery and performance
                  of this Agreement, the consummation of the transactions
                  contemplated hereby, and the fulfillment of the terms hereof
                  will not:

                  (i)        conflict with, or result in a breach or violation
                             of, any of the constating  documents or  by-laws of
                             the Company;

                  (ii)       conflict  with,  or result in a  default (or  would
                             constitute  a default  but for any  requirement  of
                             notice or lapse of time or both) under any
                             document,  agreement or other instrument  to which
                             the Vendor,  the Company or any  Shareholder  is a
                             party or by which the  Vendor,  the  Company or any
                             Shareholder is bound, or result in the creation  or
                             imposition  of any Lien on any of the  Company's
                             properties  pursuant  to (A) any law or  regulation
                             to  which  the  Vendor,  the  Company  or any
                             Shareholder  or  any of  their respective  property
                             is subject, or  (B) any  judgment, order or  decree
                             to which the Vendor, the Company or any Shareholder
                             is bound or any of their  respective  property is
                             subject;

                  (iii)      result in termination or any impairment of any
                             permit, license, franchise, contractual right or
                             other authorization of the Company; or

                  (iv)       violate any law, order, judgment, rule, regulation,
                             decree or ordinance to which the Vendor, the
                             Company or any Shareholder is subject or by which
                             the Vendor, the Company or any Shareholder is bound
                             provided however, that no representation and
                             warranty is being provided with respect to
                             compliance by the Purchaser with the INVESTMENT
                             CANADA ACT.

         (e)      AUTHORIZED CAPITAL The authorized capital of the Company
                  consists of an unlimited number of Class A Common Voting
                  Shares, Class B Non-Voting Preferred Redeemable Shares, Class
                  C Non-Voting Preferred Redeemable Convertible Shares, and
                  Class D Non-voting Preferred Redeemable Convertible Shares, of
                  which 252 Class A Common Voting Shares are issued and
                  outstanding as of the date hereof, of which the following are
                  validly issued and outstanding:

<TABLE>
<S>     <C>
                            SHARES                       BENEFICIAL & REGISTERED OWNER

                  160 Class A Common Voting              408446 Alberta Inc.

                  63 Class A Common Voting               517244 Alberta Limited

                  29 Class A Common Voting               Dale A. Hodgson
</TABLE>

<PAGE>

                  All of the issued and outstanding shares in the capital of the
                  Company have been duly authorized and validly issued and are
                  fully paid and non-assessable. The Shares are owned of record
                  and beneficially by the Shareholders and 517244 in the amounts
                  set forth above, free and clear of all Liens. All of the
                  issued and outstanding shares in the capital of the Company
                  were offered, issued, sold and delivered by the Company in
                  compliance with all applicable laws concerning the issuance of
                  securities. Further, none of such shares was issued in
                  violation of any preemptive rights. There are no voting
                  agreements or voting trusts with respect to any of the shares.

         (f)      ENTITLEMENTS   No option, warrant, call, subscription right,
                  conversion right or other contract or commitment of any kind
                  exists, of any character, written or oral, which may obligate
                  the Company to issue or sell any shares in the capital of the
                  Company. The Company has no obligation (contingent or
                  otherwise) to purchase, redeem or otherwise acquire any of its
                  shares or any interests therein or to pay any dividend or make
                  any distribution in respect thereof.

         (g)      SHAREHOLDERS' LOANS  The total amount of the Sundog
                  Shareholder  Loan is $1,682,454  and the total amount of the
                  408446 Shareholder Loan is $563,912.

         (h)      SUBSIDIARIES AND DEBT INTERESTS

                  (i)        The Company has no Subsidiaries or Affiliates;

                  (ii)       Except for the Preferred Shares, the Company does
                             not presently own, of record or beneficially, or
                             control, directly or indirectly, any shares,
                             securities convertible into shares or any other
                             equity interest in any corporation, limited
                             liability company, association or other business
                             entity, nor is the Company, directly or indirectly,
                             a participant in any joint venture, partnership or
                             other non-corporate entity; and

                  (iii)      Except as set forth on Schedule 4.1(h)(iii), there
                             are no promissory notes that have been issued to,
                             or are held by, the Company.

         (i)      COMPLETE COPIES OF MATERIALS The Company has delivered to
                  Purchaser at the Sundog Premises true and complete copies of
                  each agreement, contract, commitment or other document (or
                  summaries thereof) that is referred to in the Schedules or
                  that has been requested by Purchaser.

         (j)      ABSENCE OF CLAIMS AGAINST COMPANY Except for the Shareholders'
                  Loans, the 1999 Bonus, benefits and wages due to Dale A.
                  Hodgson in his capacity as an employee in the ordinary course
                  of business, and the performance of this Agreement by the
                  Company, neither 408446 nor the Vendor has any claims against
                  the Company.

<PAGE>

         (k)      FINANCIAL CONDITIONS

                  (i)        The  Company's  revenue  for the  fiscal year ended
                             July 31,  1998  was not less  than $25,000,000;

                  (ii)       The earnings of the Company before interest and
                             taxes and bonuses, adjusted to reflect the
                             add-backs set forth on Schedule 4.1(k)(ii) for the
                             fiscal year ended July 31, 1998 are not less than
                             $2,600,000;

                  (iii)      The sum of the Company's total outstanding interest
                             bearing indebtedness to banks, and all other
                             financial institutions and creditors (in each case
                             including the current portions of such
                             indebtedness, but excluding any amounts referred to
                             in Section 7.3(d) hereof and Section 7.3(d) of the
                             Remenda Agreement, and any amounts payable to the
                             Vendor, 408446, Remenda and 517244, and their
                             Affiliates, any income taxes payable from the
                             Balance Sheet Date on earnings, operating leases,
                             trade payables and other accounts payable incurred
                             in the ordinary course of the Company's business
                             consistent with past practice) as of the Funding
                             Date will not be more than $3,550,000; and

                  (iv)       Except as set forth on Schedule 4.1(k)(iv) no
                             related party debts other than as set forth herein
                             or contemplated hereby have been incurred or paid
                             since July 31, 1998.

         (l)      FINANCIAL STATEMENTS Schedule 4.1(l) includes true, complete
                  and correct copies of the Company's audited balance sheet
                  ("Balance Sheet") as of the Balance Sheet Date, and income
                  statement (the "Income Statement") as at and for the year
                  ended July 31, 1998 and the Company's internally generated,
                  unaudited balance sheet and income statement as of and for the
                  seven months ended February 28, 1999 (collectively, the
                  "Company Financial Statements").

                  (i)        The Company Financial Statements are materially in
                             accordance with the books and accounts of the
                             Company as at the Balance Sheet Date;

                  (ii)       The Company Financial Statements have been prepared
                             in accordance with GAAP consistently applied;

                  (iii)      The Balance Sheet presents fairly the financial
                             condition of the Company as of the date indicated
                             thereon and the Income Statement presents fairly
                             the results of its operations for the period
                             indicated thereon;

                  (iv)       Since the dates of the Company Financial
                             Statements, there have been no material changes in
                             the Company's accounting policies;

                  (v)        The financial position of the Company as at the
                             Effective Date will be at least as good as the
                             financial position of the Company as at the Balance
                             Sheet Date; and

<PAGE>

                  (vi)       Subject to Schedule 4.1(cc)(iii), the Company
                             Financial Statements fairly present all of the
                             assets and liabilities of the Company as at the
                             Balance Sheet Date and the Effective Date
                             including, without limitation, all contingent
                             liabilities of the Company as at the Balance Sheet
                             Date.

         (m)      LIABILITIES AND OBLIGATIONS

                  (i)        Except as disclosed on Schedule 4.1(u)(v), the
                             Company is not liable for or subject to any
                             liabilities except for:

                             (A)     those liabilities reflected  on the Balance
                                     Sheet and not previously paid or
                                     discharged;

                             (B)     those liabilities arising in the ordinary
                                     course of its business consistent with past
                                     practice under any contract, commitment or
                                     agreement specifically disclosed on any
                                     Schedule to this Agreement or not required
                                     to be disclosed thereon because of the term
                                     or amount involved or otherwise;

                             (C)     the lease of the Sundog Premises; and

                             (D)     those liabilities incurred since the
                                     Balance Sheet Date in the ordinary course
                                     of business consistent with past practice,
                                     which liabilities are not, individually or
                                     in the aggregate, material.

                  (ii)       The Company has delivered to Purchaser, in the case
                             of those liabilities which are not fixed or are
                             contested, a reasonable estimate of the maximum
                             amount which may be payable;

                  (iii)      Schedule 4.1(m)(iii) sets forth a summary
                             description of all plans or projects involving the
                             opening of new operations, expansion of any
                             existing operations or the acquisition of any real
                             property or existing business, to which management
                             of the Company has made any material expenditure in
                             the two-year period prior to the Effective Date,
                             which if pursued by the Company would require
                             additional material expenditures of capital; and

                  (iv)       For purposes of this Section 4.1(m), the term
                             "liabilities" shall include, without limitation,
                             any direct or indirect liability, indebtedness,
                             guaranty, endorsement, claim, loss, damage,
                             deficiency, cost, expense, obligation or
                             responsibility, either accrued, absolute,
                             contingent, mature, unmature or otherwise and
                             whether fixed or unfixed, choate or inchoate,
                             liquidated or unliquidated, secured or unsecured.
                             Schedule 4.1(s)(ii) insofar as it relates to the
                             leases contains a complete list of all
                             interest-bearing indebtedness of the Company not
                             disclosed on the Company Financial Statements.

<PAGE>

         (n)      BOOKS AND RECORDS The Company has made and kept books and
                  records and accounts, which, in reasonable detail, accurately
                  and fairly reflect the activities of the Company. The Company
                  has not engaged in any transaction, maintained any bank
                  account, or used any corporate funds except for transactions,
                  bank accounts, and funds which have been and are reflected in
                  its normally maintained books and records.

         (o)      BANK ACCOUNTS; POWERS OF ATTORNEY  Schedule  4.1(o) sets forth
                  a complete  and  accurate list as of the Funding Date, of:

                  (i)        the name of each financial institution at which the
                             Company  has any  account or safe  deposit box;

                  (ii)       the names in which the accounts or boxes are held;

                  (iii)      the type of account;

                  (iv)       the name of each person authorized to draw thereon
                             or have access thereto; and

                  (v)        the name of each person, corporation, firm or other
                             entity holding a general or special power of
                             attorney from the Company and a description of the
                             terms of such power.

            (p)   ACCOUNTS AND NOTES RECEIVABLE At the Funding Time, the Company
                  will deliver to Buyer a complete and accurate list, as of a
                  date not more than two (2) business days prior to the Funding
                  Date, of the accounts and notes receivable of the Company
                  (including without limitation receivables from and advances to
                  employees and the Shareholders) which includes an aging of all
                  accounts and notes receivables showing amounts due in thirty
                  (30) day aging increments the Accounts Receivable. All
                  Accounts Receivable represent valid obligations arising from
                  sales actually made or services actually performed in the
                  ordinary course of business. The Accounts Receivable are
                  current and collectible net of any respective reserves shown
                  on the Company's books and records (which reserves are
                  adequate and calculated consistent with past practice).
                  Subject to such reserves, each of the Accounts Receivable will
                  be collected in full, without any set-off, within one hundred
                  and twenty (120) days after the day on which it first became
                  due and payable other than those set forth in Schedule 4.1(p).
                  There is no contest, claim, or right of set-off, other than
                  rebates and returns in the ordinary course of business, under
                  any contract with any obligor of an Account Receivable
                  relating to the amount or validity of such Account Receivable.

         (q)      PERMITS The Company owns or holds all material permits and
                  other governmental authorizations, including without
                  limitation permits, licenses necessary for the continued
                  operation of its business as it is currently being conducted
                  (the "Permits"). The Permits are valid, and the Company has
                  not received any notice that any governmental authority
                  intends to modify, cancel, terminate or fail to renew any
                  Permit. No present or former officer director, shareholder, or
                  employee of the Company or any affiliate thereof, or any other
                  person, firm, corporation or other entity, owns or has any
                  proprietary, financial or other interest (direct or indirect)
                  in any Permits. The Company has conducted and is conducting
                  its business in material compliance with the requirements,
                  standards, criteria and conditions set forth in the Permits
                  and other applicable orders, approvals, rules and regulations
                  and is not in violation of any of the foregoing. The
                  transactions contemplated by this Agreement will not result in
                  a default under, or a breach or violation of, or adversely
                  affect the rights and benefits afforded to the Company, by any
                  Permit.

<PAGE>

         (r)      REAL PROPERTY

                  (i)        The Company does not own or have any right, title
                             or interest in any real property except for the
                             Leases.

                  (ii)       Except as set forth in Schedule 4.1(r) and
                             4.1(y)(ii):

                             (A)      All of the Leases are valid and in full
                                      force and effect. The Company has
                                      delivered to the Purchaser true and
                                      complete copies of all of the Leases, all
                                      amendments, renewals, extensions,
                                      modifications or supplements thereto, and
                                      all material correspondence pursuant to
                                      which any party to any of the Leases
                                      declared a default thereunder or provided
                                      notice of the exercise of any option
                                      granted to such party under such Lease.
                                      The Leases and the Company's interests
                                      thereunder are free of all Liens. The
                                      Company has paid all amounts payable to
                                      the landlords under the Leases;

                             (B)      None of the Leases requires the consent or
                                      approval of any party thereto in
                                      connection with the consummation of the
                                      transactions contemplated hereby;

                             (C)      All accounts for work and services
                                      performed or materials placed or furnished
                                      by or on behalf of the Vendor or the
                                      Company upon or in respect of construction
                                      in each of the Leased Premises has been
                                      fully paid by closing and no person will
                                      be entitled to claim a lien under the
                                      BUILDERS' LIEN ACT (Alberta) for work
                                      performed by or on behalf of the Vendor or
                                      the Company;

                             (D)      the Vendor or the Company have not
                                      received any notice of any proceedings by
                                      any Governmental Authority having
                                      jurisdiction advising of any deficiency or
                                      non-compliance with any building
                                      restriction, zoning by-law, fire code, or
                                      any other regulation relating to any of
                                      the Leased Premises, nor is the Vendor or
                                      the Company aware of any such deficiency
                                      or non-compliance;
<PAGE>


                             (E)      to the best of the Vendor's or the
                                      Company's knowledge, all obligations,
                                      conditions and requirements under all
                                      development permits required to be
                                      obtained by the Company have been met and
                                      satisfied and development completion
                                      permits required to be obtained by the
                                      Company evidencing the same have been
                                      obtained from The City of Calgary;

                             (F)      neither the Vendor nor the Company have
                                      received any notice of a proposal to
                                      expropriate any part of the Leased
                                      Premises;

                             (G)      each of the N.E. Lease and the Parking Lot
                                      Lease have been adopted and assumed by and
                                      are binding upon the current registered
                                      owners of the lands on which the N.E.
                                      Warehouse Property and the Parking Lot are
                                      located;

                             (H)      to the best of the Vendor's or the
                                      Company's knowledge, there are no
                                      structural defects, material
                                      non-structural defects or material
                                      deficiencies in any of the buildings on
                                      the Leased Premises, and the Leased
                                      Premises are presently in compliance with
                                      all statutory provisions;

                             (I)      to the best of the Vendor's or the
                                      Company's knowledge, there are no
                                      outstanding work orders or deficiency
                                      notices against the Vendor or the Company
                                      in respect of the Leased Premises, or
                                      other orders relating to any of the Leased
                                      Premises from or required by any police or
                                      fire department, sanitation or health
                                      authorities or from any other federal,
                                      provincial or municipal authority and any
                                      matters under discussion with any such
                                      departments or authorities relating to
                                      work or other orders;

                             (J)      notice has not been received by the Vendor
                                      or the Company from any authority having
                                      jurisdiction advising of any default or
                                      non-compliance with any lawful requirement
                                      or standard of workmanship in the
                                      construction of the improvements on the
                                      Leased Premises placed thereon by the
                                      Vendor or the Company, or in respect of
                                      the plumbing, heating, ventilating, air
                                      conditioning, electrical or other
                                      mechanical systems therein;

                             (K)      the Vendor or the Company have not
                                      received from any of their insurers which
                                      carries on their behalf insurance on the
                                      Leased Premises any written notice of any
                                      defect or inadequacy in connection with
                                      Leased Premises or its maintenance or
                                      operation that would affect the
                                      insurability of the Leased Premises that
                                      has not been cited;
<PAGE>


                             (L)      the Vendor or the Company have not
                                      intentionally withheld any material
                                      information relating to adverse facts or
                                      adverse material in connection with the
                                      Leased Premises or the Leases;

                             (M)      except for the use of premises by
                                      Hostmann-Steinberg, neither the Vendor nor
                                      the Company have granted leases, offers to
                                      lease, options with respect to leases,
                                      licenses, agreements to lease, renewals of
                                      leases, assignments and subleases thereof
                                      or other tenancy agreements or other
                                      agreements granting any right of
                                      occupation, possession or use with respect
                                      to the Leased Premises or buildings
                                      located thereon;

                             (N)      no written notice has been received by the
                                      Vendor or the Company which remains
                                      outstanding from any governmental or
                                      quasi-governmental authority relating to
                                      any defect in the construction of the
                                      buildings or any other improvements on the
                                      Leased Premises, or relating to any work
                                      order, deficiency or non-compliance with
                                      any building restrictions, building codes,
                                      zoning by-laws, fire codes, environmental
                                      laws, or other regulations, laws,
                                      statutes, ordinances or rules, in each
                                      case in respect of the Leased Premises and
                                      the buildings and improvements thereon;
                                      and

                             (O)      each of the Leased Premises are fully
                                      serviced by all required utilities
                                      including electricity, natural gas, water
                                      and sewer.

         (s)      PERSONAL PROPERTY

                  (i)       Schedule 4.1(s)(i) sets forth a complete and
                            accurate list of all material personal property
                            included on the Balance Sheet and all other personal
                            property owned or leased by the Company and all
                            trade fixtures and leasehold improvements owned by
                            both as of the Balance Sheet Date and acquired since
                            the Balance Sheet Date, including in each case a
                            list of all leases for material equipment, and an
                            indication as to which assets are currently owned,
                            or were formerly owned, by any Shareholder or
                            business or personal affiliates of any Shareholder
                            or of the Company. True, complete and correct copies
                            of the leases for material equipment will be
                            delivered to Purchaser at the Sundog Premises;

                  (ii)       The Company currently owns or leases all personal
                             property and other assets necessary to conduct the
                             business and operations of the Company as they are
                             currently being conducted, free and clear of all
                             Liens except for such Liens as are set forth on
                             Schedule 4.1(s)(ii); and

                  (iii)      All of the material, machinery and equipment of the
                             Company, including those listed on Schedule
                             4.1(s)(i), are in good working order and condition,
                             ordinary wear and tear excepted. All personal
                             property leases set forth on Schedule 4.1(s)(i) are
                             in full force and effect and constitute valid and
                             binding agreements of the Company, and the Company
                             is not in breach of any of their terms. All fixed
                             assets used by the Company that are material to the
                             operation of its business are either owned by the
                             Company or leased under an agreement listed on
                             Schedule 4.1(s)(i) or 4.1(s)(ii).

<PAGE>

         (t)      INTELLECTUAL PROPERTY

                  (i)       The Company is the true and lawful owner of, or is
                            licensed or otherwise possesses legally enforceable
                            rights to use, the registered and unregistered Marks
                            listed on Schedule 4.1(t)(i). Such schedule lists
                            all of the Marks registered in Canada or in any
                            foreign country, and all of the unregistered Marks,
                            that the Company now owns or uses in connection with
                            its business. Except with respect to those Marks
                            shown as licensed on Schedule 4.1(t)(i), the Company
                            owns all of the registered and unregistered
                            trademarks, service marks, and trade names that it
                            uses. The Marks listed on Schedule 4.1(t)(i) will
                            not cease to be valid rights of the Company by
                            reason of the execution, delivery and performance of
                            this Agreement or the consummation of the
                            transactions contemplated hereby;

                  (ii)       The Company is the true and lawful owner of, or is
                             licensed or otherwise possesses legally enforceable
                             rights to use, all rights in the Patents listed on
                             Schedule 4.1(t)(ii) and in the Copyrights listed on
                             Schedule 4.1(t)(ii). Such Patents and Copyrights
                             constitute all of the Patents and Copyrights that
                             the Company now owns or is licensed to use. The
                             Company owns or is licensed to practice under all
                             patents and copyright registrations that the
                             Company now owns or uses in connection with its
                             business;

                  (iii)      The Company is the true and lawful owner of, or is
                             licensed or otherwise possesses legally enforceable
                             rights to use, all rights in the trade secrets,
                             franchises, or similar rights (collectively, "Other
                             Rights") listed on Schedule 4.1(t)(iii). Those
                             Other Rights constitute all of the Other Rights
                             that the Company now owns or is licensed to use.
                             The Company owns or is licensed to practice under
                             all trade secrets, franchises or similar rights
                             that it owns, uses or practices under;

                  (iv)      The Marks, Patents, Copyrights, and Other Rights
                            listed on Schedules 4.1(t)(i), 4.1(t)(ii),
                            4.1(t)(ii), and 4.1(t)(iii) are referred to
                            collectively herein as the "Intellectual Property."
                            The Intellectual Property owned by the Company is
                            referred to herein collectively as the "Company
                            Intellectual Property." All other Intellectual
                            Property is referred to herein collectively as the
                            "Third Party Intellectual Property." Except as
                            indicated on Schedule 4.1(t)(iv), the Company has no
                            obligations to compensate any person for the use of
                            any Intellectual Property nor has the Company
                            granted to any person any license, option or other
                            rights to use in any manner any Intellectual
                            Property, whether requiring the payment of royalties
                            or not; and

<PAGE>

                  (v)       The Company is not, nor will it be as a result of
                            the execution and delivery of this Agreement or the
                            performance of its obligations hereunder, in
                            violation of any Third Party Intellectual Property
                            license, sublicense or agreement described in
                            Schedule 4.1(t)(i), 4.1(t)(ii), 4.1(t)(iii) or
                            4.1(t)(iv). No claims with respect to the Company
                            Intellectual Property or Third Party Intellectual
                            Property are currently pending or, to the knowledge
                            of the Company, are threatened by any person, nor,
                            to the Vendor's or Company's knowledge, do any
                            grounds for any claims exist: (A) to the effect that
                            the manufacture, sale, licensing or use of any
                            product as now used, sold or licensed or proposed
                            for use, sale or license by the Company infringes on
                            any copyright, patent, trademark, service mark or
                            trade secret; (B) against the use by the Company of
                            any trademarks, trade names, trade secrets,
                            copyrights, patents, technology, know-how or
                            computer software programs and applications used in
                            the Company's business as currently conducted by the
                            Company; (C) challenging the ownership, validity or
                            effectiveness of any of the Company Intellectual
                            Property or other trade secret material to the
                            Company; or (D) challenging the Company's license or
                            legally enforceable right to use of the Third Party
                            Intellectual Property. To the Vendor's or Company's
                            knowledge, there is no unauthorized use,
                            infringement or misappropriation of any of the
                            Company Intellectual Property by any third party.
                            Neither the Vendor or the Company (i) has been sued
                            or charged in writing as a defendant in any claim,
                            suit, action or proceeding which involves a claim or
                            infringement of trade secrets, any patents,
                            trademarks, service marks, or copyrights and which
                            has not been finally terminated or been informed or
                            notified by any third party that the Company may be
                            engaged in such infringement or (ii) has knowledge
                            of any infringement liability with respect to, or
                            infringement by, the Company of any trade secret,
                            patent, trademark, service mark, or copyright of
                            another.

         (u)      SIGNIFICANT CUSTOMERS; MATERIAL CONTRACTS AND COMMITMENTS

                  (i)        Schedule 4.1(u)(i) sets forth a complete and
                             accurate list of all Significant Customers and
                             Significant Suppliers. For purposes of this
                             Agreement, "Significant Customers" are the twenty
                             (20) customers that have effected the most
                             purchases, in dollar terms, from the Company during
                             each of the past four (4) fiscal quarters, and
                             "Significant Suppliers" are the twenty (20)
                             suppliers who supplied the largest amount by dollar
                             volume of products or services to the Company
                             during the twelve (12) months ending on the Balance
                             Sheet Date;

                  (ii)      Schedule 4.1(u)(ii) contains a complete and accurate
                            list of all contracts, commitments, leases,
                            instruments, agreements, licenses or permits,
                            written or oral, to which the Company is a party or
                            by which it or its properties are bound (including
                            without limitation contracts with Significant
                            Customers, joint venture or partnership agreements,
                            contracts with any labor organizations, employment
                            agreements, consulting agreements, loan agreements,
                            indemnity or guaranty agreements, bonds, mortgages,
                            options to purchase land, liens, pledges or other
                            security agreements) to which the Company and any
                            affiliate of the Company or any officer, director or
                            Shareholder of the Company are parties ("Related
                            Party Agreements"); that may give rise to
                            obligations or liabilities exceeding, during the
                            current term thereof, $110,000 or that may generate
                            revenues or income exceeding, during the current
                            term thereof, $110,000 (collectively with the
                            Related Party Agreements, the "Material Contracts"
                            for the purposes of this Section 4.1 (u)). The
                            Company has delivered to the Purchaser at the Sundog
                            Premises true, complete and correct copies of the
                            Material Contracts;

                  (iii)     Except to the extent set forth on Schedule
                            4.1(u)(iii), (A) none of the Company's Significant
                            Customers has canceled or substantially reduced or,
                            to the knowledge of the Vendor or the Company, is
                            currently attempting or threatening to cancel or
                            substantially reduce, any purchases from the
                            Company, (B) none of the Company's Significant
                            Suppliers has canceled or substantially reduced or,
                            to the knowledge of the Vendor or the Company, is
                            currently attempting to cancel or substantially
                            reduce, the supply of products or services to the
                            Company, and (C) the Company has complied with all
                            of its commitments and obligations and is not in
                            default under any of the Material Contracts, and no
                            notice of default has been received with respect to
                            any thereof and (D) there are no Material Contracts
                            that were not negotiated at arms length. The Company
                            has not received any material customer complaints
                            concerning its products and/or services, nor has it
                            had any of its products returned by a purchaser
                            thereof except for normal warranty returns
                            consistent with past history and those returns that
                            would not result in a reversal of any material
                            revenue;

                  (iv)      Each Material Contract is valid and binding on the
                            Company and is in full force and effect and is not
                            subject to any default thereunder by any party
                            obligated to the Company pursuant thereto. The
                            Company has obtained all necessary consents, waivers
                            and approvals of parties to any Material Contracts
                            that are required in connection with any of the
                            transactions contemplated hereby, or are required by
                            any Governmental Authority or other third party or
                            are advisable in order that any such Material
                            Contract remain in effect without modification after
                            the transactions contemplated by this Agreement and
                            without giving rise to any right to termination,
                            cancellation or acceleration or loss of any right or
                            benefit except as disclosed in Schedule 4.1(u)(iv);

                  (v)        The approximate outstanding balances on all loans
                             or credit agreements either (A) between the Company
                             and any person in which any of the Shareholders
                             owns a material interest, or (B) guaranteed by the
                             Company for the benefit of any person in which any
                             of the Shareholders owns a material interest, are
                             set forth in Schedule 4.1(u)(v).; and

<PAGE>

                  (vi)      The pledge, hypothecation or mortgage of all or
                            substantially all of the Company's assets
                            (including, without limitation, a pledge of the
                            Company's contract rights under any Material
                            Contract) will not, except as set forth on Schedule
                            4.1(u)(vi), (A) result in the breach or violation
                            of, (B) constitute a default under, (C) create a
                            right of termination under, or (D) result in the
                            creation or imposition of (or the obligation to
                            create or impose) any lien upon any of the assets of
                            the Company (other than a lien created pursuant to
                            the pledge, hypothecation or mortgage described at
                            the start of this Article 4.1(u)(vi)) pursuant to
                            any of the terms and provisions of, any Material
                            Contract to which the Company is a party or by which
                            the property of the Company is bound.

         (v)      GOVERNMENT CONTRACTS  The  Company  is  not  a  party  to  any
                  government  contracts  relative  to  the provisions of its
                  services.

         (w)      INVENTORY The inventory of the Company consists of raw
                  materials and supplies, manufactured and purchased parts,
                  goods in process and finished goods, all of which is
                  merchantable and fit for the purposes for which it was
                  procured or manufactured, and none of which is slow-moving,
                  obsolete, damaged, or defective, as adjusted for the passage
                  of time through the Funding Date in accordance with the past
                  custom and practice of the Company.

         (x)      INSURANCE Schedules 4.1(x), 4.1(aa) and 1.1(u) set forth a
                  complete and accurate list, as of the Balance Sheet Date, of
                  all insurance policies carried by the Company and all
                  insurance claims or workmen's compensation claims received for
                  the past two (2) policy years. The Company has delivered to
                  Purchaser at the Sundog Premises true, complete and correct
                  copies of all current insurance policies, all of which are in
                  full force and effect. All premiums payable under all such
                  policies set forth in Schedule 4.1(x) have been paid and the
                  Company is otherwise in full compliance with the terms of such
                  policies. Such policies of insurance are of the type and in
                  amounts customarily carried by persons conducting businesses
                  similar to that of the Company. To the knowledge of the
                  Company, there have been no threatened terminations of, or
                  material premium increases with respect to, any of such
                  policies.

         (y)      ENVIRONMENTAL MATTERS

                  (i)        For the purposes of this section:

                             (A)      "Environmental Authorization" means all
                                      licenses, permits, grants or other
                                      authorizations issued under or pursuant to
                                      any Environmental Laws pertaining to or
                                      relating in any way to the Company, or any
                                      of its assets, obligations or
                                      undertakings;

<PAGE>

                             (B)      "Environmental Investigation" includes,
                                      but is not limited to, any oral or written
                                      notice received by the Company from any
                                      Governmental Authority relating to any
                                      actual or alleged Release by the Company
                                      of any Hazardous Substance;

                             (C)      Environmental Laws" means all provisions
                                      relating to the environment that are now
                                      in effect under the common law or any
                                      applicable federal, provincial, municipal
                                      or local laws, statutes, by laws,
                                      regulations, rules, orders (including
                                      court orders), judgments, decrees,
                                      ordinances, directives and the terms and
                                      conditions of the Environmental
                                      Authorizations;

                             (D)      "Hazardous Substance" means a substance or
                                      mixture of substances that exhibits
                                      characteristics of flammability, toxicity,
                                      corrosivity or reactivity, including,
                                      without limitation, any contaminants,
                                      pollutants, noise, dangerous substances,
                                      liquid waste, industrial waste, hauled
                                      liquid waste, toxic substances, hazardous
                                      waste, hazardous materials, hazardous
                                      chemicals and hazardous substances as
                                      defined in, regulated by or controlled
                                      pursuant to any Environmental Law now in
                                      effect;

<PAGE>

                             (E)      "Environmental Claims" means any and all
                                      administrative, regulatory or judicial
                                      actions, suits, demands, claims, liens,
                                      notices of non-compliance or violation,
                                      investigations, inspections, inquiries or
                                      proceedings relating in any way to any
                                      Environmental Laws or any permit or
                                      approval issued under any Environmental
                                      Laws including, without limitation:

                                      (a)    any claim by a Governmental
                                             Authority for enforcement,
                                             clean-up, removal, response,
                                             remedial or other actions or
                                             damages pursuant to any
                                             Environmental Laws; and

                                      (b)    any claim by a Person seeking
                                             damages, contribution,
                                             indemnification, cost recovery,
                                             compensation or injunctive or other
                                             relief resulting from or relating
                                             to Regulated Substances, including
                                             any Release thereof, or arising
                                             from actual, alleged or threatened
                                             injury to human health or safety
                                             (arising from environmental
                                             matters) or to the environment;

                             (F)      the term "Governmental Authority" means
                                      any federal, provincial, state, regional,
                                      municipal or local government or any
                                      department, agency, board, tribunal or
                                      authority thereof or other political
                                      subdivision thereof and any individual or
                                      group exercising executive, legislative,
                                      judicial, regulatory or administrative
                                      functions of, or pertaining to, government
                                      or the operation thereof;

                             (G)      the term "Release" means any release,
                                      spill, emission, leak, pumping, injection,
                                      deposit, disposal, discharge, dispersal,
                                      leaching or migration of Hazardous
                                      Substances into the environment including,
                                      without limitation, the movement of
                                      Hazardous Substances through ambient air,
                                      soil, surface water, ground water,
                                      wetlands, land or sub-surface strata; and

                             (H)      the term "Person" means an individual,
                                      corporation, partnership, trust or other
                                      legal entity and includes any Governmental
                                      Authority.

                  (ii)       Except as set forth on Schedule 4.1(y)(ii): (A)
                             there are no outstanding orders, notices (whether
                             written or oral) or similar requirements relating
                             to the Company issued by any Governmental Authority
                             with respect to any Environmental Laws, (B) there
                             are no matters under discussion with any Person
                             relating to such orders, notices or similar
                             requirements and (C) the Company is not the subject
                             of, nor to the Company's knowledge, being
                             threatened to be the subject of, any Environmental
                             Investigation or Environmental Claim brought under
                             any federal, provincial or local Environmental Law
                             or any third party claim relating to environmental
                             conditions on or off the properties owned, leased
                             operated or otherwise occupied by the Company.

<PAGE>

                  (iii)      Except as set forth on Schedule 4.1(y)(ii), the
                             business conducted by the Company has been and now
                             is operated in full compliance with all
                             Environmental Laws, and to the knowledge of the
                             Company, there are no facts or circumstances which
                             are likely to give rise to any non-compliance with
                             any Environmental Law or any Environmental Claim.

                  (iv)       Except as set forth on Schedule 4.1(y)(ii), (A) no
                             Environmental Authorizations are required to carry
                             on the business of the Company and the Company has
                             not received any notice (whether oral or written)
                             from any Governmental Authority that any
                             Environmental Authorizations are required to carry
                             on the business of the Company; (B) the Company and
                             the Vendor have not placed any underground storage
                             tanks and Hazardous Substances and to the best of
                             the Vendor's and Company's knowledge there are no
                             underground storage tanks and no Hazardous
                             Substances are present in, on or under the lands
                             underlying the Sundog Premises (Schedule 4.1(y)(ii)
                             identifies all underground and aboveground storage
                             tanks, and the capacity, age and contents of such
                             tanks, located on real property owned or leased by
                             the Company), (C) the Company has not transported,
                             stored, used, manufactured, disposed of, Released,
                             or exposed its employees or others to any Hazardous
                             Substance in violation of any Environmental Law in
                             effect on or before the Funding Date, nor has the
                             Company manufactured, disposed of, transported,
                             stored, used Released, or sold, any product
                             containing a Hazardous Substance in violation of
                             any Environmental Law;

                  (v)        Except as set forth on Schedule 4.1(y)(ii), the
                             Company has not ever been prosecuted or convicted
                             of an offense for non-compliance with any
                             Environmental Law, nor has it or, to the best of
                             the Company's knowledge have any of its directors,
                             officers, employees or agents been fined or
                             otherwise subjected to any administrative
                             proceeding or the subject of any Environmental
                             Investigation, alleged or confirmed as a breach of
                             any Environmental Law, in relation to either of the
                             business of the Company or the conduct thereof by
                             or on behalf of the Company;

                  (vi)       Except as set forth on Schedule 4.1(y)(ii), (A) the
                             Company has not received any notice of any
                             Environmental Investigation or Environmental Claim
                             from any Person, including any notice under or
                             pursuant to any Environmental Law, nor to the
                             Company's knowledge are there any facts or
                             circumstances which could give rise to any such
                             notice, that the Company is a potentially
                             responsible or liable party for any environmental
                             contamination; and (B) the Company has not received
                             any notice of any conditions on or off the
                             properties owned, leased, operated or otherwise
                             occupied by the Company which could give rise to
                             any liabilities, known or unknown, under any
                             Environmental Law or as the result of any
                             Environmental Claim; and

<PAGE>

                  (vii)      Except as set forth on Schedule 4.1(y)(ii), (A) the
                             Company has not disposed of or arranged (by
                             contract, agreement or otherwise) for the disposal
                             of any Hazardous Substance that was generated,
                             stored or used by the Company at any offsite
                             location that has been or is listed or proposed for
                             inclusion on any list promulgated by any
                             Governmental Authority for the purpose of
                             identifying sites which pose a danger to health and
                             safety, and (B) there have been no environmental
                             studies, assessments, reports or analyses made or
                             prepared in the last five (5) years relating to the
                             facilities of the Company.

         (z)      LABOR AND EMPLOYMENT MATTERS Except as set forth in Schedule
                  4.1 (z), with respect to employees of and service providers to
                  the Company:

                  (i)        the Company is and has been in compliance in all
                             material respects with all applicable laws
                             respecting employment and employment practices,
                             terms and conditions of employment and wages and
                             hours, including without limitation any such laws
                             respecting employment discrimination, workers'
                             compensation, family and medical leave, and
                             occupational health and safety requirements, and
                             has not and is not engaged in any unfair labor
                             practice;

                  (ii)       there is not now, nor within the past three (3)
                             years has there been, any unfair labor practice
                             complaint against the Company pending or, to the
                             Vendor's or the Company's knowledge, threatened,
                             before the Alberta Labor Relations Board or any
                             other government entity;

                  (iii)      there is not now, nor within the past three (3)
                             years has there been, any Labour strike, slowdown
                             or stoppage actually pending or, to the Vendor's or
                             the Company's knowledge, threatened, against or
                             directly affecting the Company;

                  (iv)       to the Vendor's or the Company's knowledge, no
                             labor representation organization effort exists nor
                             has there been any such activity within the past
                             three (3) years;

                  (v)        no grievance or arbitration proceeding arising out
                             of or under collective bargaining agreements is
                             pending and, to the Vendor's or the Company's
                             knowledge, no claims therefor exist or have been
                             threatened;

                  (vi)       the employees of the Company are not and have never
                             been represented by any labor union, and no
                             collective bargaining agreement is binding and in
                             force against the Company or currently being
                             negotiated by the Company;

                  (vii)      to the Vendor's or the Company's knowledge, no
                             trade union, council of trade unions, employee
                             bargaining agency or affiliated bargaining agent:

<PAGE>

                             (A)      holds bargaining rights with respect to
                                      any of the Company's employees by way of
                                      certification, interim certification,
                                      voluntary recognition, designation or
                                      successor rights, or

                             (B)      has applied to be certified as the
                                      bargaining agent of any of the Company's
                                      employees;

                  (viii)     to the Vendor's or the Company's knowledge, no
                             executive or key employee or any group of employees
                             has plans to terminate his, her or their employment
                             with the Company, the Company has not terminated,
                             laid-off or dismissed (whether actually or
                             constructively) any employees of the Company during
                             the four (4) weeks prior to the Funding Date;

                  (ix)       the Company does not have any written employment
                             agreement with any person whomsoever except such
                             agreements as are listed in Schedule 4.1(z)(viii),
                             which Schedule sets forth a complete and accurate
                             list, as of March 15, 1999, of all employees of the
                             Company, their respective positions, dates of hire
                             with the Company (or any predecessors in interest
                             thereof), current salaries, benefits and other
                             remunerations and dates of last salary increases,
                             and indicates which employees are parties to a
                             written or oral agreement of employment (including
                             confidentiality and non-competition agreements);

                  (x)        there have been no claims or allegations brought
                             against the Company or any officer, director,
                             Shareholder or employee of the Company or any other
                             Person with whom an employee may have dealings
                             through his or her employment by the Company, with
                             respect to employment, employment practices or
                             terms or conditions of employment, including,
                             without limiting the generality of the foregoing,
                             claims alleging sexual harassment or
                             discrimination;

                  (xi)       all liabilities due and payable on or before the
                             Funding Date with respect to present or former
                             employees of the Company have been paid or shall be
                             paid in full on or before the Funding Date,
                             including premiums contributions, remittance and
                             assessments for unemployment insurance, Canada
                             Pension Plan, income tax, workers compensation and
                             any other related legislation, accrued wages,
                             Taxes, salaries, commissions and Benefit Plan
                             payments;

                  (xii)      all vacation pay, bonuses, commission and other
                             emoluments relating to the employees of the Company
                             are accurately reflected in all respects and have
                             been accrued in the financial records of the
                             Company; and

                  (xiii)     the Company has not entered into any agreement with
                             any of its employees with respect to termination of
                             their employment, and the Company has no obligation
                             to reinstate any employees or former employees.

<PAGE>

         (aa)     EMPLOYEE BENEFIT PLANS

                  (i)      Except as disclosed in Schedule 4.1(aa), the Company
                           is not bound by or a party to:

                             (A)     any benefit plan including, without
                                     limiting the generality of the foregoing,
                                     any pension plan, retirement savings plan,
                                     retirement compensation arrangement, salary
                                     deferral arrangement, health care plan or
                                     deferred profit sharing plan, or any
                                     benefit arrangement, obligation, custom, or
                                     practice, whether or not legally
                                     enforceable, to provide benefits, other
                                     than salary, as compensation for services
                                     rendered, to present or former directors,
                                     employees, agents, or independent
                                     contractors including, without limiting the
                                     generality of the foregoing, employment
                                     agreements, severance agreements, executive
                                     compensation arrangements, incentive
                                     programs or arrangements, sick leave,
                                     vacation pay, severance pay policies, plant
                                     closing benefits, salary continuation for
                                     disability, consulting, or other
                                     compensation arrangements, workers'
                                     compensation, retirement, deferred
                                     compensation, bonus, stock option or
                                     purchase, hospitalization, medical
                                     insurance, life insurance, tuition
                                     reimbursement or scholarship programs, any
                                     plans providing benefits or payments in the
                                     event of a change of control, change in
                                     ownership, or sale of a substantial portion
                                     (including all or substantially all) of the
                                     assets of any business or portion thereof,
                                     in each case with respect to any present or
                                     former employees, directors, or agents
                                     maintained by or on behalf of the Company
                                     or any of its Subsidiaries for any of their
                                     employees (each, a "Benefit Plan");

                             (B)     any liability for any unfunded obligation
                                     for any benefit or compensation for
                                     employees including, without limiting the
                                     generality of the foregoing, any profit
                                     sharing plans; or

                             (C)     any liability for any contingent obligation
                                     which will become an obligation upon the
                                     Closing including, without limiting the
                                     generality of the foregoing, any retirement
                                     allowance or retirement compensation
                                     arrangement.

                  (ii)     Subject to Schedule 4.1 (aa), all Benefit Plans
                           listed in Schedule 4.1(aa) have been duly registered
                           where required by, and are in good standing under,
                           all applicable legislation including, without
                           limiting the generality of the foregoing, the INCOME
                           TAX ACT and the EMPLOYMENT PENSION PLANS ACT
                           (Alberta), as amended, and all required employer
                           contributions under each Benefit Plan have been made
                           and the applicable funds have been funded in
                           accordance with the terms of such Benefit Plan and no
                           past service funding liabilities exist thereunder;

<PAGE>

                  (iii)    With respect to each Benefit Plan, true, correct, and
                           complete copies of all the following documents, to
                           the extent applicable, have been delivered to
                           Purchaser or its designee at the Sundog Premises:

                          (A)       all documents constituting the Benefit
                                    Plans, including but not limited to, trust
                                    agreements, insurance policies, service
                                    agreements, and formal and informal
                                    amendments thereto;

                          (B)       the most recent summary plan description;

                          (C)       the most recent written descriptions for all
                                    non-written agreements relating to any such
                                    plan or arrangement;

                          (D)       all annual reports submitted within the two
                                    (2) years preceding the Funding Date.

                          (E)       all notices of non-compliance that were
                                    given within the two (2) years preceding the
                                    Funding Date by any Governmental Authority
                                    with respect to any Benefit Plan; and

                          (F)       employee manuals or handbooks containing
                                    personnel or employee relations policies.


                  (iv)       Subject to Schedule 4.1 (aa), there are no pending
                             claims or lawsuits by, against, or relating to any
                             Benefit Plan that would, if successful, result in
                             liability of the Company, and no claims or lawsuits
                             have been asserted, instituted or, to the knowledge
                             of the Vendor or the Company, threatened by,
                             against, or relating to any Benefit Plan, against
                             the assets of any trust or other funding
                             arrangement under any Benefit Plan, by or against
                             the Company with respect to any Benefit Plan, or by
                             or against the plan administrator or any fiduciary
                             of any Benefit Plan, and to the Vendors or the
                             Company's knowledge there are no facts that could
                             form the basis for any such claim or lawsuit; and

                  (v)        No Benefit Plan contains any provision or is
                             subject to any law that would prohibit the
                             transactions contemplated by this Agreement or that
                             would give rise to any vesting of benefits,
                             severance, termination, or other payments or
                             liabilities as a result of the transactions
                             contemplated by this Agreement.

         (bb)     TAXES              Except as set forth in Schedule 4.1(bb):

                  (i)        The Company has filed or caused to be filed on a
                             timely basis with the appropriate federal,
                             provincial or municipal Governmental Authority all
                             Tax Returns required to be filed on or before the
                             Funding Date; all such Tax Returns, as filed, are
                             true, complete and correct in all respects and
                             fully disclose the income tax, expenses, deductions
                             and credits to the extent permitted by law; none of
                             such Tax Returns has been amended; all Taxes due
                             and payable or remittable with respect to the
                             periods reflected on such Tax Returns, all
                             assessments and reassessments and all tax
                             installments and other remittances required to be
                             made on or prior to the Funding Date have been or
                             will be fully paid prior to the Funding Date; there
                             are no pending assessments or reassessments in
                             respect of a preceding taxation year or other
                             taxable period or any audits or investigations in
                             progress, pending or threatened (either in writing
                             or verbally, formally or informally), by any
                             Governmental Authority against the Company or any
                             of its assets with respect to any Taxes; there are
                             no agreements, waivers or other arrangements
                             providing for an extension of time with respect to
                             the filing, assessment or reassessment of any Taxes
                             payable by the Company; there are no agreements
                             with any federal, provincial or municipal taxing
                             authority that may affect the subsequent Tax
                             liabilities of the Company; the reserves and
                             provisions for Taxes on the books of the Company
                             are adequate for all Taxes which have been or may
                             in the future be assessed or reassessed against the
                             Company with respect to the appropriate periods
                             then ended and all periods prior thereto;

<PAGE>

                  (ii)       The Company (A) has withheld for each payment made
                             to each of its present and former employees,
                             officers and directors and to any non-resident of
                             Canada the amount of any Taxes and other deductions
                             required to be withheld therefrom, (B) has paid the
                             same to the proper Government Authority within the
                             time periods required under any applicable
                             legislation, and (C) has complied with all
                             information reporting and backup withholding
                             requirements, including maintenance of required
                             records with respect thereto, in connection with
                             amounts paid to any employee, independent
                             contractor, creditor, or other third party;

                  (iii)      The income tax liabilities of the Company have been
                             assessed for all taxation years up to and including
                             the taxation year ended July 31, 1998; true and
                             complete copies of the federal and provincial Tax
                             Returns for the Company for each of the fiscal
                             years ended July 31, 1998, 1997, 1996 and 1995 and
                             copies of all assessments and reassessments
                             relating to such taxation years have been delivered
                             to Purchaser or its representatives;

                  (iv)       The income tax liabilities of Sundog Digital
                             Printing Limited have been assessed for the
                             taxation years ended July 31, 1996 and July 31,
                             1995; true and complete copies of the federal and
                             provincial Tax Returns for Sundog Digital Printing
                             Limited for each of the fiscal years ended July 31,
                             1996 and 1995 and copies of all assessments and
                             reassessments relating to such taxation years have
                             been delivered to the Purchaser or its
                             representatives;

<PAGE>

                  (v)        No amount in respect of any outlay or expense that
                             is deductible for the purposes of computing the
                             income of the Company for the purposes of the
                             Income Tax Act has been owing by the Company for
                             longer than two (2) years to any person or entity
                             with whom the Company was not dealing at arm's
                             length (for the purposes of the Income Tax Act) at
                             the time that outlay or expense was incurred;

                  (vi)       The Company has not, either directly or indirectly,
                             transferred property to or acquired property from
                             any person or entity with whom it was not dealing
                             at arm's length (for the purposes of the Income Tax
                             Act) for consideration other than consideration
                             equal to the fair market value of the property at
                             the time of the disposition or acquisition thereof;

                  (vii)      The Company has not claimed a deduction with
                             respect to an outlay or expense which Revenue
                             Canada may disallow in the circumstances;

                  (viii)     All amounts of consideration paid or agreed to be
                             paid by the Company with respect to the acquisition
                             from, the use or reproduction of property of, or
                             services rendered by, a non-resident of Canada not
                             dealing at arm's length with the Company for the
                             purposes of and within the meaning of the Income
                             Tax Act have been no greater than would be
                             considered reasonable in the circumstances where
                             such non-resident would be dealing at arm's length
                             with such entity;

                  (ix)       All amounts of consideration paid or agreed to be
                             paid to the Company with respect to the acquisition
                             by, the use or reproduction of property by, loan
                             to, or services rendered to, a non-resident of
                             Canada with whom the Company was not dealing at
                             arm's length for the purposes of and within the
                             meaning of the Income Tax Act have been equal to at
                             least an amount which would be considered
                             reasonable in circumstances where such non-resident
                             would be dealing at arm's length with such entity;

                  (x)        There are no circumstances which exist and would
                             result in, or which have existed and resulted in,
                             any of sections 80 to and including section 80.04
                             of the Income Tax Act applying to the Company;

                  (xi)       The Company has not been a party to an election
                             made under section 83 nor has the Company been a
                             party to an election under section 85 of the Income
                             Tax Act;

                  (xii)      The Company is a registrant for the purposes of the
                             ETA; the Company is not a financial institution
                             within the meaning of the ETA;

                  (xiii)     The Company has not made any elections under the
                             ETA;

<PAGE>

                  (xiv)      All applicable retail sales tax was paid by the
                             Company on the initial acquisition of its tangible
                             personal property;

                  (xv)       During the three years prior to the Funding Date,
                             except as set forth in Schedule 4.1(bb), the
                             Company (A) has not ever done business in, or
                             currently does not do business in, the United
                             States of America, and (B) has not ever filed, or
                             has no obligation to file, any Tax Return in the
                             United States of America;

                  (xvi)      The amount of the Company's liability for unpaid
                             Taxes as of the Balance Sheet Date did not exceed
                             the amount of the current liability accruals for
                             Taxes (excluding reserves for deferred Taxes) shown
                             on the Balance Sheet, and the amount of the
                             Company's liability for unpaid Taxes for all
                             periods or portions thereof ending or deemed to
                             have ended on or before the Effective Date will not
                             exceed the amount of the current liability accruals
                             for Taxes (excluding reserves for deferred Taxes)
                             as such accruals are reflected on the books and
                             records of the Company made as of the Effective
                             Date;

                  (xvii)     The Company has filed all reports and has created
                             and/or retained all records required with respect
                             to its ownership by and transactions with related
                             parties. Each related person required to maintain
                             records with respect to transactions between the
                             Company and related persons has maintained such
                             records. All documents that are required to be
                             created and/or preserved by related persons with
                             respect to transactions with the Company were
                             created and are maintained as required by law;

                  (xviii)    The Company currently utilizes the accrual method
                             of accounting for income tax purposes and such
                             method of accounting has not changed in the past
                             five (5) years;

                  (xix)      No deficiencies exist or have been asserted (either
                             in writing or verbally, formally or informally) or
                             are expected to be asserted with respect to Taxes
                             of the Company and the Company has not received
                             notice (either in writing or verbally, formally or
                             informally) and does not expect to receive notice
                             that it has not filed a Tax Return or paid Taxes
                             required to be filed or paid by it; the Company is
                             not a party to any action or proceeding for
                             assessment or collection of Taxes, and no such
                             event has been asserted or threatened (either in
                             writing or verbally, formally or informally)
                             against the Company or any of its assets;

                  (xx)       There are (and as of immediately following the
                             Funding Date there will be) no Liens on the assets
                             of the Company relating to or attributable to
                             Taxes;

                  (xxi)      To the Company's knowledge, there is no basis for
                             the assertion of any claim relating or attributable
                             to Taxes which, if adversely determined, would
                             result in any Lien on the assets of the Company or
                             otherwise have an adverse effect on the Company or
                             its business;

<PAGE>

                  (xxii)     None of the Company's assets are leased from or to
                             a Tax exempt entity under the Income Tax Act (or
                             comparable laws of any jurisdiction);

                  (xxiii)    There are no contracts, agreements, plans or
                             arrangements, including but not limited to the
                             provisions of this Agreement, covering any employee
                             or former employee of the Company that,
                             individually or collectively, could give rise to
                             the payment of any amount (or portion thereof) that
                             would not be deductible pursuant to Sections 9, 18,
                             20 or 68 of the Income Tax Act (or comparable laws
                             of any jurisdiction);

                  (xxiv)     The Company is not nor has it ever been, a party to
                             a Tax indemnity agreement, and the Company has not
                             assumed the Tax liability of any other Person under
                             contract;

                  (xxv)      The Company's Tax basis in their assets for
                             purposes of determining their future amortization,
                             depreciation and other income tax deductions is
                             accurately reflected on the Company's books and
                             records;

                  (xxvi)     The Company has no net operating losses or other
                             Tax attributes presently subject to limitation
                             under Section 111 of the Income Tax Act (or
                             comparable laws of any jurisdiction); and

                  (xxvii)    The Company has filed or caused to be filed, within
                             the time and manner provided by the Income Tax Act,
                             any necessary tax elections, pursuant thereto that
                             relate to the amount of taxable income reported in
                             any tax returns filed for taxation years ending on
                             or before the Effective Date.

         (cc)     CONFORMITY WITH LAW; LITIGATION

                  (i)        The Company has not violated any law or regulation
                             or any order of any court or federal, provincial,
                             municipal or other governmental department,
                             commission, board, bureau, agency or
                             instrumentality having jurisdiction over it;

                  (ii)       No Shareholder has, at any time: (i) committed any
                             criminal act (except for minor traffic violations);
                             (ii) engaged in acts of fraud, dishonesty, gross
                             negligence or moral turpitude; (iii) filed for
                             personal bankruptcy; or (iv) been an officer,
                             director, manager, trustee or controlling
                             shareholder of a company that made an assignment in
                             bankruptcy; and

                  (iii)      Except as set forth on Schedule 4.1(cc)(iii), there
                             are no claims, actions, suits or proceedings,
                             pending or, to the knowledge of the Vendor or the
                             Company, threatened or commenced against or
                             affecting the Vendor or the Company at law or in
                             equity, or before or by any federal, provincial,
                             municipal or other governmental department,
                             commission, board, bureau, agency or
                             instrumentality having jurisdiction over it and no
                             notice of any claim, action, suit or proceeding,
                             whether pending or threatened, has been received.
                             There are no judgments, orders, injunctions,
                             decrees, stipulations or awards (whether rendered
                             by a court or administrative agency or by
                             arbitration) against the Vendor or the Company or
                             against any of its properties or business.

<PAGE>

         (dd)     Intentionally left blank.

         (ee)     ABSENCE OF CHANGES Since the Balance Sheet Date, the Company
                  has conducted its business in the ordinary course and, except
                  as contemplated herein or as set forth on Schedule 4.1(ee) or
                  disclosed herein, there has not been:

                  (i)        any change, by itself or together with other
                             changes, that has materially adversely affected, or
                             is likely to materially adversely affect, the
                             business, operations, affairs, prospects,
                             properties, assets, profits or condition (financial
                             or otherwise) of the Company;

                  (ii)       any damage, destruction or loss (whether or not
                             covered by insurance) adversely affecting the
                             properties or business of the Company;

                  (iii)      any change in the authorized capital of the Company
                             or in its outstanding securities or any change in
                             its ownership interests or any grant of any
                             options, warrants, calls, conversion rights or
                             commitments;


<PAGE>



                  (iv)       any declaration or payment of any dividend or
                             distribution in respect of the shares, or any
                             direct or indirect redemption, purchase or other
                             acquisition of any of the shares of the Company;

                  (v)        any increase in the compensation, bonus, sales
                             commissions or fee arrangements payable or to
                             become payable by the Company to any of its
                             officers, directors, Shareholders, employees,
                             consultants or agents, except for ordinary and
                             customary bonuses and salary increases for
                             employees in accordance with past practice, nor has
                             the Company entered into or amended any Employee
                             Benefit Plan, employment, severance or other
                             agreement relating to compensation or fringe
                             benefits;

                  (vi)       any work interruptions, labor grievances or claims
                             filed, or any similar event or condition of any
                             character, materially adversely affecting the
                             business or future prospects of the Company;

                  (vii)      any sale or transfer, or any agreement to sell or
                             transfer, any material assets, property or rights
                             of the Company to any person, including without
                             limitation the shareholders and their Affiliates;

                  (viii)     any cancellation, or agreement to cancel, any
                             indebtedness or other obligation owing to the
                             Company, including without limitation any
                             indebtedness or obligation of the Shareholders and
                             their Affiliates, provided that the Company may
                             negotiate and adjust bills in the course of good
                             faith disputes with customers in a manner
                             consistent with past practice;

                  (ix)       any plan, agreement or arrangement granting any
                             preferential rights to purchase or acquire any
                             interest in any of the assets, property or rights
                             of the Company or requiring consent of any party to
                             the transfer and assignment of any such assets,
                             property or rights;

                  (x)        any purchase or acquisition of, or agreement, plan
                             or arrangement to purchase or acquire, any
                             property, rights or assets outside of the ordinary
                             course of business of the Company;

                  (xi)       any waiver of any material rights or claims of the
                             Company;

                  (xii)      any breach, amendment or termination of any
                             material contract, agreement, license, permit or
                             other right to which the Company is a party;

                  (xiii)     any transaction by the Company outside the ordinary
                             course of business;


<PAGE>



                  (xiv)      any capital commitment by the Company, either
                             individually or in the aggregate, exceeding
                             $110,000;

                  (xv)       any change in accounting methods or practices
                             (including any change in depreciation or
                             amortization policies or rates) by the Company or
                             the revaluation by the Company of any of its
                             assets;

                  (xvi)      any creation or assumption by the Company of any
                             mortgage, pledge, security interest or lien or
                             other encumbrance on any asset (other than liens
                             arising under existing lease financing arrangements
                             which are not material and liens for Taxes not yet
                             due and payable);

                  (xvii)     any entry into, amendment of, relinquishment,
                             termination or non- renewal by the Company of any
                             contract, lease transaction, commitment or other
                             right or obligation requiring aggregate payments by
                             the Company in excess of $110,000;

                  (xviii)    any loan by the Company to any Person, incurring by
                             the Company of any indebtedness, guaranteeing by
                             the Company of any indebtedness, issuance or sale
                             of any debt securities of the Company or
                             guaranteeing of any debt securities of others; or

                  (xix)      negotiation or agreement by the Company or any
                             officer or employee thereof to do any of the things
                             described in the preceding clauses (i) through
                             (xix) (other than negotiations with Purchaser and
                             its representatives regarding the transactions
                             contemplated by this Agreement).

         (ff)     DISCLOSURE      All written agreements, lists, schedules,
                  instruments, exhibits, documents, certificates, reports,
                  statements and other writings furnished to Purchaser pursuant
                  hereto or in connection with this Agreement or the
                  transactions contemplated hereby, are and will be complete and
                  accurate in all material respects. No representation or
                  warranty by the Vendor, the Company or 408446 contained in
                  this Agreement, in the Schedules attached hereto or in any
                  certificate furnished or to be furnished by the Vendor, the
                  Company or 408446 to Purchaser in connection herewith or
                  pursuant hereto contains or will contain any untrue statement
                  of a material fact or omits or will omit to state any material
                  fact necessary in order to make any statement contained herein
                  or therein not misleading. There is no fact known to the
                  Vendor, the Company or 408446 that has specific application to
                  the Vendor, the Company and 408446 (other than general
                  economic or industry conditions) and that materially adversely
                  affects or, as far as the Vendor, 408446 and the Company can
                  reasonably foresee, materially threatens, the assets,
                  business, prospects, financial condition, or results of
                  operations of the Company that has not been set forth in this
                  Agreement or any Schedule hereto.

<PAGE>

         (gg)     PREDECESSOR STATUS; Schedule 4.1(gg) sets forth a listing of
                  all legal names, trade names, fictitious names or other names
                  (including, without limitation, any names of divisions or
                  operations) of the Company and all of its predecessor
                  companies during the five-year period immediately preceding
                  the Closing, including without limitation the names of any
                  entities from whom the Company has acquired material assets.
                  During the five (5) year period immediately preceding the
                  Closing, the Company has operated only under the names set
                  forth on Schedule 4.1(gg) in the jurisdiction or jurisdictions
                  set forth on Schedule 4.1(gg) and has not been a subsidiary or
                  division of another corporation or a part of an acquisition
                  which was later rescinded.

         (hh)     LOCATION OF CHIEF EXECUTIVE OFFICES The Company's chief
                  executive offices are located at 1311 - 9 Avenue S.W.,
                  Calgary, Alberta.

         (ii)     LOCATION OF EQUIPMENT AND INVENTORY All inventory and
                  equipment held on the date hereof by the Company is located at
                  either the Sundog Premises or at 2320 - 35th Avenue N.E.,
                  Calgary or at the premises of Coast Paper in Calgary. For
                  purposes of this section, (a) the term "inventory" shall mean
                  any inventory of whatever nature owned by the Company as of
                  the date hereof, and, in any event, shall include, but shall
                  not be limited to, all merchandise, inventory and goods
                  wherever located, together with all goods, supplies,
                  incidentals, packaging materials and any other items used or
                  usable in manufacturing, processing, packaging or shipping the
                  same; in all stages of production -- from raw materials
                  through work-in-process to finished goods; and (b) the term
                  "equipment" shall mean any equipment of any nature owned by
                  the Company as of the date hereof, and, in any event, shall
                  include, but shall not be limited to, all machinery,
                  equipment, furnishings, fixtures and vehicles owned by the
                  Company as of the date hereof, wherever located, together with
                  all attachments, components, parts, equipment and accessories
                  installed thereon or affixed thereto.

         (jj)     YEAR 2000 COMPLIANCE The Company is currently undergoing a
                  Year 2000 compliance review but has not yet completed same. As
                  such, the Company may not be Year 2000 Compliant and Ready. To
                  the best of the knowledge of the Vendor, the Company and
                  408446 no customer, supplier of the Company or party with whom
                  the Company has business dealings has notified the Company
                  that they are not or may not be Year 2000 Complaint and Ready.
                  Schedule 4.1(jj) appends various reports on Year 2000
                  Compliance and a Company internal memorandum in regard to Year
                  2000 Compliance.


<PAGE>



4.2               HODGSON'S REPRESENTATIONS AND WARRANTIES

                  The Vendor represents and warrants to the Purchaser that:

         (a)      408446 is a corporation duly amalgamated, organized and
                  subsisting under the laws of Alberta as a private company as
                  that term is defined in the SECURITIES ACT (Alberta) with the
                  corporate power to own its assets and to carry on its business
                  and has made all necessary filings under all applicable
                  corporate, securities and taxation laws or any other laws to
                  which 408446 is subject;

         (b)      the authorized capital of 408446 consists of 25,000 Class A
                  Common Shares, 25,000 Class B Common Shares and unlimited
                  number of C Preferred Shares which as of the Funding Date
                  there is issued and outstanding the following as fully-paid
                  and non-assessable:


<TABLE>
<S>     <C>

                                   SHARES                                   BENEFICIAL AND REGISTERED OWNER
                                   ------                                   -------------------------------

                  106 Class A Common Shares                                              Vendor
</TABLE>

         (c)      The Vendor is the beneficial and registered owner of the
                  shares referred to in Section 3.2(b) above and the Hodgson
                  Shares which, at the Funding Date, will be free and clear of
                  all Liens and any other rights of others;

         (d)      The Vendor has good and sufficient power, authority, and right
                  to enter into and deliver this Agreement and as at the Funding
                  Date to transfer the legal and beneficial title and ownership
                  of the 408446 Shares and the Hodgson Shares to the Purchaser
                  free and clear of all Liens and any other rights of others;

         (e)      there is no contract, option or any other right of another
                  binding upon or which at any time in the future may become
                  binding upon:

                  (i)        The Vendor to sell, transfer, assign, pledge,
                             charge, mortgage or in any other way dispose of or
                             encumber any of the 408446 Shares or the Hodgson
                             Shares other than pursuant to the provisions of
                             this Agreement, or

                  (ii)       to allot or issue any of the unissued shares of
                             408446 or to create any additional class of shares.

         (f)      neither the entering into nor the delivery of this Agreement
                  nor the completion of the transactions contemplated hereby by
                  the Vendor or by 408446 will result in the violation of:

                  (i)        any of the provisions of the constating documents
                             or by-laws of 408446,

<PAGE>

                  (ii)       any  agreement or other instrument  to which 408446
                             is a party or by which  408446,  is bound, or

                  (iii)      any applicable law, rule or regulation.

         (g)      at the Funding Time, the sole asset of 408446 will be 160
                  Class A Common Voting Shares in the capital of the Company
                  registered in its name and 408446 will be the owner of such
                  assets with a good and marketable title, free and clear of all
                  Liens and any other rights of others;

         (h)      as at the Funding Date, there will be no outstanding
                  liabilities against 408446 other than the 408446 Shareholders
                  Loan;

         (i)      408446 is not a party to any contract or contractual
                  commitment other than those agreements entered into in
                  accordance with the terms of this Agreement;

         (j)      408446 is not a party to or bound by any guarantee,
                  indemnification, surety or similar obligation other than
                  guarantees granted on behalf of the Company;

         (k)      408446 is not a party to any lease or agreement in the nature
                  of a lease for real property, whether as lessor or lessee;

         (l)      as of the Funding Date, and except for the shares it holds in
                  the Company, 408446 will not have any Subsidiaries or
                  agreements, options or commitments to acquire any shares or
                  securities of any corporation or to acquire or lease any
                  business operations, real property or assets;

         (m)      there are no actions, suits or proceedings (whether or not
                  purportedly on behalf of 408446) pending or threatened against
                  or adversely affecting, or which could adversely affect,
                  408446 or any of its assets before or by any federal,
                  provincial, municipal or other governmental court, department,
                  commission, board, bureau, agency or instrumentality, domestic
                  or foreign, whether or not insured, and which might involve
                  the possibility of any judgment or liability against 408446;

         (n)      408446 is conducting its business in compliance with all
                  applicable laws, rules, regulations, notices, approvals and
                  orders of Canada and of the Province of Alberta and all
                  municipalities thereof in which its business is carried on, is
                  not in material breach of any such laws, rules, regulations,
                  notices, approvals or orders and is duly licensed, registered
                  or qualified, and duly possesses all material permits, in the
                  Province of Alberta and all municipalities thereof in which
                  408446 carries on its business to enable its business to be
                  carried on as now conducted and its assets to be owned, leased
                  and operated, and all such licences, registrations,
                  qualifications and permits are valid and subsisting and in
                  good standing and none of the same contains or is subject to
                  any term, provision, condition or limitation which has or may
                  have a material adverse effect on the operation of its
                  business or which may materially adversely change or terminate
                  such licence, registration, qualification or permit by virtue
                  of the completion of the transactions contemplated hereby; and

         (o)      408446 does not have any liability, obligation or commitment
                  for the payment of income taxes, corporation capital taxes or
                  any other taxes or duties of whatever nature or kind or
                  interest or penalties with respect thereto, except such as are
                  disclosed in the 408446 financial statements or such taxes or
                  duties not yet due as have arisen since the date of last
                  408446 financial statements in the usual and ordinary course
                  of business and for which adequate provision in the accounts
                  of 408446 has been made. 408446 is not in arrears with respect
                  to any required withholdings, remittances or instalment
                  payments of any tax or duty of any kind and has not filed any
                  waiver for a taxation year under the Income Tax Act or any
                  other legislation imposing tax on it. 408446 has, at the
                  prescribed times, filed all tax returns, information returns
                  and schedules thereto required to be filed by it in all
                  applicable jurisdictions. All such tax returns properly
                  reflect, and do not in any respect understate, the taxable
                  income or the liability for taxes of 408446 in a relevant
                  taxation year or calendar year. Without limiting the
                  generality of the foregoing, 408446 is in compliance with all
                  registration, timely reporting, and remittance obligations in
                  respect of all provincial and federal sales tax legislation
                  and the goods and services tax. There are no actions, suits,
                  or other proceedings or investigations or claims in progress,
                  pending or threatened against 408446 in respect of any taxes,
                  governmental charges, or assessments and, in particular, there
                  are no currently outstanding reassessments or written
                  enquiries that have been issued or raised by any governmental
                  authority relating to any such taxes, governmental charges and
                  assessments. To the knowledge of the Vendor and 408446, there
                  is no basis for any adverse reassessment by any taxing
                  authority for any year remaining open for reassessment.

                                    ARTICLE 5
                   PURCHASER'S REPRESENTATIONS AND WARRANTIES

5.1               PURCHASER'S REPRESENTATIONS

                  The Purchaser represents and warrants to the Vendor that:

         (a)      CORPORATE STANDING The Purchaser is a corporation duly
                  organized, validly existing and in good standing under the
                  laws of the Province of Ontario, and is duly authorized and
                  qualified to do business under all applicable laws,
                  regulations, ordinances and orders of public authorities to
                  carry on its business in the places and in the manner as now
                  conducted.


         (b)      AUTHORIZATION; VALIDITY OF OBLIGATIONS The representative of
                  the Purchaser executing this Agreement has all requisite
                  corporate power and authority to enter into and bind the
                  Purchaser to the terms of this Agreement. The Purchaser has
                  the full legal right, power and corporate authority to enter
                  into this Agreement and the transactions contemplated hereby.
                  The execution and delivery of this Agreement by the Purchaser
                  and the performance by the Purchaser of the transactions
                  contemplated herein has been duly and validly authorized by
                  the Board of Directors of the Purchaser and this Agreement has
                  been duly and validly authorized by all necessary corporate
                  action. This Agreement is a legal, valid and binding
                  obligation of the Purchaser enforceable in accordance with its
                  terms; and

<PAGE>

         (c)      NO CONFLICTS The execution, delivery and performance of this
                  Agreement, the consummation of the transactions herein
                  contemplated hereby and the fulfillment of the terms hereof
                  will not:

                  (i)        conflict with, or result in a breach or violation
                             of the constating  documents or by-laws of the
                             Purchaser;

                  (ii)       conflict with, or result in a default (or would
                             constitute a default but for a requirement of
                             notice or lapse of time or both) under any
                             document, agreement or other instrument to which
                             the Purchaser is a party, or result in the creation
                             or imposition of any Lien on any of the Purchaser's
                             properties pursuant to (A) any law or regulation to
                             which the Purchaser or any of its property is
                             subject, or (B) any judgment, order or decree to
                             which the Purchaser is bound or any of its property
                             is subject;

                  (iii)      result in termination or any impairment of any
                             material permit, license, franchise, contractual
                             right or other authorization of the Purchaser;

                  (iv)       violate any law, order, judgment, rule, regulation,
                             decree or ordinance to which the Purchaser is
                             subject, or by which the Purchaser is bound
                             including, without limitation, the Investment
                             Canada Act.


                                    ARTICLE 6
                                    COVENANTS

6.1               TAXES

                  The following provisions shall govern the allocation of
responsibility as between the Company and 408446, on the one hand, and the
Vendor, on the other, for certain tax matters following the Effective Date:


<PAGE>



         (a)      The Vendor shall prepare or cause to be prepared and file or
                  cause to be filed, within the time and in the manner provided
                  by law, all Tax Returns of the Company and 408446 for all
                  fiscal periods ending on or deemed to have ended on or before
                  the Effective Date that are due after the Effective Date. The
                  Vendor shall pay to the Company and 408446 on or before the
                  date of such Tax Returns the amount of all Taxes shown as due
                  on such Tax Returns to the extent that such Taxes are not
                  reflected in the current liability accruals for Taxes
                  (excluding reserves for deferred Taxes) shown on the books and
                  records of the Company and 408446 as of the Effective Date.
                  Such Returns shall be prepared and filed in accordance with
                  applicable law and in a manner consistent with past practices
                  and shall be subject to review and approval by Purchaser. To
                  the extent reasonably requested by the Vendor or required by
                  law, Purchaser shall participate in the filing of any Tax
                  Returns filed pursuant to this paragraph;

         (b)      The Purchaser, the Company, and 408446 on one hand, and the
                  Vendor on the other hand, shall (A) cooperate fully, as
                  reasonably requested, in connection with the preparation and
                  filing of Tax Returns pursuant to this Section 6.1 and any
                  audit, litigation or other proceeding with respect to Taxes;
                  (B) make available to the other, as reasonably requested, all
                  information, records or documents with respect to Tax matters
                  pertinent to the Company and 408446 for all periods ending
                  prior to or including the Effective Date; and (C) preserve
                  information, records or documents relating to Tax matters
                  pertinent to the Company and 408446 that is in their
                  possession or under their control until the expiration of any
                  applicable statue of limitations or extensions thereof;

         (c)      The Vendor shall timely pay all transfer, documentary, sales,
                  use, stamp, registration and other Taxes and fees applicable
                  to the Vendor arising from or relating to the transactions
                  contemplated by this Agreement, and the Vendor shall, file all
                  necessary Tax Returns and other documentation with respect to
                  all such transfers, documentary, sales, use stamp,
                  registration, and other Taxes and fees. If required by
                  applicable law the Purchaser and the Company will join in the
                  execution of any such Tax Returns and other documentation;

         (d)      The Purchaser does not assume and shall not be liable for any
                  Taxes under the Income Tax Act or any other Taxes whatsoever
                  which may be or become payable by the Vendor and 408446
                  including, without limiting the generality of the foregoing,
                  any Taxes resulting from or arising as a consequence of this
                  Agreement;

         (e)      The Vendor shall prepare or cause to be prepared and file or
                  cause to be filed, within the time and manner provided by the
                  Income Tax Act, the elections pursuant to Section 16.1
                  thereof, that relate to the August 26, 1998 financing
                  transaction entered into with the Bank of Nova Scotia; and

<PAGE>

         (f)      The Company shall be responsible for the expense of filing its
                  Tax Return resulting from the transactions contemplated by
                  this Agreement.

6.2               ACCOUNTS RECEIVABLE

                  In the event that all Accounts Receivable as at the Funding
Date are not collected in full (subject to and net of reserves specified in
Section 4.1(p)) within one hundred and twenty (120) days after the Closing then,
at the request of the Company or Purchaser, the Vendor shall pay the Company an
amount equal to the Vendor's Portion of the Accounts Receivable not so
collected, and upon receipt of such payment the Company shall assign to the
Vendor, all rights with respect to the uncollected Accounts Receivable giving
rise to the payment and shall also thereafter promptly remit to Vendor any
excess collections received by it with respect to such assigned Accounts
Receivable. Subsequent to the Funding Time the Purchaser shall cause the Company
to use all commercially reasonable efforts to collect the Accounts Receivable.

6.3               RELATED PARTY AGREEMENTS

                  The Vendor, the Company and/or 408446, as the case may be,
shall terminate any Related Party Agreements, which Purchaser requests the
Vending the Company or 408446 to terminate, whether before or after the Funding
Time, with the exception of the leases of the Sundog Premises.

6.4               COOPERATION

          (a)     The Company, Vendor, 408446 and Purchaser shall each deliver
                  or cause to be delivered to the other on the Funding Date, and
                  at such other times and places as shall be reasonably agreed
                  to, such instruments as the other may commercially reasonably
                  request for the purpose of carrying out this Agreement. In
                  connection therewith, if required, the president or chief
                  financial officer of the Company and 408446 shall execute any
                  documentation reasonably required by Purchaser's independent
                  public accountants (in connection with such accountant's audit
                  of the Company and 408446) or the NASDAQ National Market;

         (b)      The Vendor, the Company and 408446 shall cooperate and use
                  their commercially reasonable efforts to have the current
                  officers, directors and employees of the Company and 408446
                  cooperate with the Purchaser on and after the Funding Date in
                  furnishing information, evidence, testimony and other
                  assistance in connection with any filing obligations, actions,
                  proceedings, arrangements or disputes of any nature with
                  respect to matters pertaining to all periods prior to the
                  Funding Date;

         (c)      Each party hereto shall cooperate in obtaining all consents
                  and approvals required under this Agreement to effect the
                  transactions contemplated hereby; and


<PAGE>



         (d)      The Company, the Vendor, 408446 and the Purchaser shall file
                  all notices and other information and documents required under
                  the INVESTMENT CANADA ACT as promptly as practicable after the
                  date hereof.

6.5               ACCESS TO INFORMATION; CONFIDENTIALITY; PUBLIC DISCLOSURE

         (a)      Between the date of this Agreement and the Funding Date, the
                  Vendor will afford to the officers and authorized
                  representatives of the Purchaser access to (A) all of the
                  sites, properties, books and records of the Company and 408446
                  and (B) such additional financial and operating data and other
                  information as to the business and properties of the Company
                  and 408446 as the Purchaser may from time to time reasonably
                  request, including without limitation, access upon reasonable
                  request to the Company's employees, customers, vendors,
                  suppliers and creditors for due diligence inquiry;

         (b)      The Purchaser recognizes and acknowledges that it had in the
                  past, currently has, and in the future may possibly have,
                  access to certain confidential information of the Company,
                  such as lists of customers, operational policies, and pricing
                  and cost policies that are valuable, special and unique assets
                  of the Company's business. The Purchaser agrees that, unless
                  there is a Closing, it will not disclose confidential
                  information with respect to the Company to any person, for any
                  purpose or reason whatsoever, except to authorized
                  representatives of the Company and to counsel and other
                  advisers, provided that such advisers (other than counsel)
                  agree to the confidentiality provisions of this Section
                  6.5(b), unless:

                           (A)      such information becomes known to the public
                                    generally through no fault of the Purchaser;

                           (B)      disclosure is required by law or the order
                                    of any governmental authority under color of
                                    law; or

                           (C)      the disclosing party reasonably believes
                                    that such disclosure is required in
                                    connection with the defense of a lawsuit
                                    against the disclosing party;

                  provided, that prior to disclosing any information pursuant to
                  clause (A), (B) or (C) above, the Purchaser shall give prior
                  written notice thereof to the Company and provide the Company
                  with the opportunity to contest such disclosure and shall
                  cooperate with efforts to prevent such disclosure; and

         (c)      Prior to the Funding Date, neither the Vendor, the Company nor
                  408446 shall make any disclosure (whether or not in response
                  to an inquiry) of the subject matter of this Agreement unless
                  such disclosure is previously approved by the Purchaser in
                  writing. The Purchaser agrees to keep the Vendor, the Company
                  and 408446 apprised in advance of any disclosure of the
                  subject matter of this Agreement by the Purchaser prior to the
                  Funding Date.

<PAGE>

6.6               CONDUCT OF BUSINESS PENDING CLOSING

                  Between the Effective Date and the Funding Date, the Company
and 517244 will (except as requested or agreed by Purchaser or except as
contemplated by the terms hereof):

         (a)      carry on its business in  substantially  the same manner as it
                  has  heretofore and not introduce any material new method of
                  management, operation or accounting;

         (b)      maintain its properties and facilities, including those held
                  under the Leases, in as good working order and condition as at
                  present, ordinary wear and tear excepted;

         (c)      perform all of its obligations under agreements relating to or
                  affecting its respective assets, properties or rights;

         (d)      keep in full force and effect present insurance policies or
                  other comparable insurance coverage;

         (e)      use all commercially reasonable efforts to maintain and
                  preserve its business organization intact, retain its present
                  officers and key employees and maintain its relationships with
                  suppliers, vendors, customers, creditors and others having
                  business relations with it;

         (f)      maintain compliance with all permits, laws, rules and
                  regulations, consent orders, and all other orders of
                  applicable courts, regulatory agencies and similar
                  governmental authorities;

         (g)      maintain present debt and lease instruments and not enter into
                  new or amended debt or lease instruments; and

         (h)      maintain present salaries and commission levels for all
                  officers, directors, employees, agents, representatives and
                  independent contractors, except for ordinary and customary
                  bonuses and salary increases for employees in accordance with
                  past practice or as contemplated herein.

6.7               PROHIBITED ACTIVITIES

                  Between the Effective Date and the Funding Date, the Company
and 408446 will not, without the prior written consent of Purchaser, not to be
unreasonably withheld unless the same is contemplated by the terms hereof:

         (a)      make any change in their respective  articles of incorporation
                  or bylaws,  or authorize or propose the same;


<PAGE>



         (b)      issue, deliver or sell, authorize or propose the issuance,
                  delivery or sale of any securities, options, warrants, calls,
                  conversion rights or commitments relating to its securities of
                  any kind, or authorize or propose any change in its equity
                  capitalization, or issue or authorize the issuance of any debt
                  securities;

         (c)      declare or pay any dividend, or make any distribution (whether
                  in cash, stock or property) in respect of its stock whether
                  now or hereafter outstanding, or split, combine or reclassify
                  any of its shares or issue or authorize the issuance of any
                  other securities in respect of, in lieu of or in substitution
                  for shares of its shares, or purchase, redeem or otherwise
                  acquire or retire for value any shares;

         (d)      enter into any contract or commitment or incur or agree to
                  incur any liability or make any capital expenditures, or
                  guarantee any indebtedness, except in the ordinary course of
                  business and consistent with past practice in an amount in
                  excess of $110,000, including contracts to provide services to
                  customers;

         (e)      increase the compensation payable or to become payable to any
                  officer, director, shareholder, employee, agent,
                  representative or independent contractor, except for ordinary
                  and customary bonus and salary increases, make any bonus or
                  management fee payment to any such person; make any loans or
                  advances; adopt or amend any plan or benefit arrangement; or
                  grant any severance or termination pay;

         (f)      create or assume any mortgage, pledge or other lien or
                  encumbrance upon any assets or properties whether now owned or
                  hereafter acquired;

         (g)      sell, assign, lease, pledge or otherwise transfer or dispose
                  of any property or equipment except in the ordinary course of
                  business consistent with past practice;

         (h)      acquire or negotiate for the acquisition of (by merger,
                  consolidation, purchase of a substantial portion of assets or
                  otherwise) any business or the start-up of any new business,
                  or otherwise acquire or agree to acquire any assets that are
                  material, individually or in the aggregate, to the Company;

         (i)      amalgamate or consolidate or agree to amalgamate or
                  consolidate with or into any other corporation;

         (j)      waive any material rights or claims of the Company, provided
                  that the Company may negotiate and adjust bills in the course
                  of good faith disputes with customers in a manner consistent
                  with past practice;

         (k)      commit a breach of or amend or terminate any material
                  agreement, permit, license or other right;


<PAGE>



         (l)      enter into any other transaction:

                  (i)        that is not negotiated at arm's length with a third
                             party  not  affiliated  with the Company or any
                             officer, director or Shareholder; or

                  (ii)       outside the ordinary course of business consistent
                             with past practice; or

                  (iii)      prohibited hereunder;


         (m)      commence a lawsuit other than for routine collection of bills;

         (n)      revalue any of its assets, including without limitation,
                  writing down the value of inventory or writing off notes or
                  accounts receivable other than in the ordinary course of
                  business consistent with past practice;

         (o)      make any tax election other than in the ordinary course of
                  business and consistent with past practice, change any tax
                  election, adopt any tax accounting method other than in the
                  ordinary course of business and consistent with past practice,
                  change any tax accounting method, file any Tax Return (other
                  than any estimated tax returns, payroll tax returns or sales
                  tax returns) or any amendment to a Tax Return, enter into any
                  closing agreement, settle any tax claim or assessment, or
                  consent to any tax claim or assessment, without the prior
                  written consent of Purchaser; or

         (p)      take, or agree (in writing or otherwise) to take, any of the
                  actions described in Sections 6.7(a) through (o) above, or any
                  action which would make any of the representations and
                  warranties of the Vendor, Company and 408446 contained in this
                  Agreement untrue or result in any of the conditions set forth
                  in Article 7 not being satisfied.

6.8               EXCLUSIVITY

                  None of the Vendor, the Company, 408446 or any agent, officer,
director or any representative of the Vendor, the Company or 408446 or the
Vendor will, during the period commencing on the date of this Agreement and
prior to the earlier to occur of the Funding Time or the termination of this
Agreement in accordance with its terms, directly or indirectly:

         (a)      solicit, encourage or initiate the submission of proposals or
                  offers from any Person for;

         (b)      engage in any discussions pertaining to; or

         (c)      furnish any information to any person other than Purchaser
                  relating to

any acquisition or purchase of all or a material amount of the assets of, or any
equity interest in, the Company or a merger, consolidation or business
combination of the Company.

                  In addition to the foregoing, if any one of the Vendor, the
Company or 408446 receives any unsolicited offer or proposal, or has actual
knowledge of any unsolicited offer or proposal, relating to any of the above,
the Vendor, the Company or 408446 shall immediately notify Purchaser thereof,
including the identity of the party making such offer or proposal and the
specific terms of such offer or proposal.

<PAGE>

6.9               NOTIFICATION OF CERTAIN MATTERS

                  Each party hereto shall give prompt notice to the other
                  parties hereto of:

(a)               the occurrence or non-occurrence of any event the occurrence
                  or non-occurrence of which would be likely to cause any
                  representation or warranty of it contained herein to be untrue
                  or inaccurate in any material respect at or prior to the
                  Funding Time; and

(b)               any material failure of such party to comply with or satisfy
                  any covenant, condition or agreement to be complied with or
                  satisfied by such party hereunder.



                  The delivery of any notice pursuant to this Section 6.9 shall
not, without the express written consent of the other parties be deemed to (x)
modify the representations or warranties hereunder of the party delivering such
notice, (y) modify the conditions set forth in Articles 7 and 8, or (z) limit or
otherwise affect the remedies available hereunder to the party receiving such
notice.

                                    ARTICLE 7
                                   CONDITIONS

7.1               CONDITIONS FOR THE BENEFIT OF THE PURCHASER

                  The obligation of Purchaser to consummate the transactions
contemplated by this Agreement is subject to the satisfaction or waiver, on or
before the Funding Date, of the following conditions and deliveries:

         (a)      All of the representations and warranties of the Vendor, the
                  Company and 408446 contained in this Agreement shall be true,
                  correct and complete on and as of the Funding Date with the
                  same effect as though such representations and warranties had
                  been made on and as of such date; all of the terms, covenants,
                  agreements and conditions of this Agreement to be complied
                  with, performed or satisfied by the Vendor, the Company and
                  408446 on or before the Funding Date shall have been duly
                  complied with, performed or satisfied; and a certificate to
                  the foregoing effects dated the Funding Date and signed on
                  behalf of the Vendor, the Company and 408446 and shall have
                  been delivered to Purchaser;

         (b)      No temporary restraining order, preliminary or permanent
                  injunction or other order issued by any court of competent
                  jurisdiction or other legal or regulatory restraint or
                  provision challenging Purchaser's proposed acquisition of the
                  Shares, or limiting or restricting Purchaser's conduct or
                  operation of the business of the Company (or its own business)
                  following the transactions contemplated by this Agreement
                  shall be in effect, nor shall any proceeding brought by an
                  administrative agency or commission or other Governmental
                  Authority or instrumentality, domestic or foreign, seeking any
                  of the foregoing be pending;

<PAGE>

         (c)      There shall be no action, suit, claim or proceeding of any
                  nature pending or threatened against Purchaser or the Vendor,
                  the Company or 408446 their respective properties or any of
                  their officers or directors, that could materially and
                  adversely affect the business, assets, liabilities, financial
                  condition, results of operations or prospects of the Company.
                  A certificate in respect of the Vendor, the Company and 408446
                  to the foregoing effect dated the Funding Date and signed on
                  behalf of the Vendor, the Company and 408446 shall have been
                  delivered to Purchaser;

         (d)      There shall have been no material adverse changes in the
                  business, operations, affairs, prospects, properties, assets,
                  existing and potential liabilities, obligations, profits or
                  condition (financial or otherwise) of the Company, taken as a
                  whole, since the Balance Sheet Date except those that affect
                  the industry generally; and Purchaser shall have received a
                  certificate signed by the Vendor, the Company and 408446 dated
                  the Funding Date to such effect;

         (e)      The Purchaser shall have received (i) a copy of the articles
                  of incorporation of the Company and 408446 certified by an
                  appropriate authority in the jurisdiction of its incorporation
                  and (ii) a copy of the bylaws of the Company and 408446
                  certified by a duly authorized officer of the Company, and
                  such documents shall be in form and substance reasonably
                  acceptable to the Purchaser;

         (f)      Purchaser shall have received from the Company completed
                  interim financial statements for the period ending on February
                  28, 1999 in a form reasonably satisfactory to Purchaser;

         (g)      The Purchaser shall have received a certificate (the "Closing
                  Financial Certificate"), dated as of the Funding Date, signed
                  on behalf of the Company and by the Vendor, setting forth:

                  (i)        the revenue of the Company for the fiscal year
                             ended July 31, 1998 and the period ended February
                             28, 1999;

                  (ii)       the earnings of the Company before interest and
                             taxes and bonuses, adjusted to reflect the add-back
                             of certain non-recurring costs, for the fiscal year
                             ended July 31, 1998 and the period ended February
                             28, 1999;

                  (iii)      The sum of the Company's total outstanding interest
                             bearing indebtedness to banks, and all other
                             financial institutions and creditors (in each case
                             including the current portions of such
                             indebtedness, but excluding any amounts payable
                             pursuant to Section 3.1(b) hereof and Section
                             3.1(b) of the Remenda Agreement, and any amounts
                             payable to the Vendor, Remenda and 517244, and
                             their Affiliates, any income taxes payable from the
                             Balance Sheet Date on earnings, operating leases,
                             trade payables and other accounts payable incurred
                             in the ordinary course of the Company's business
                             consistent with past practice) as of the Funding
                             Date.

<PAGE>

         (h)      Vendor shall have entered into an employment agreement with
                  the Purchaser in the form set forth in Schedule 1.1(t) hereof
                  prior to the Funding Time;

         (i)      the Company shall have entered into a lease with the
                  registered owner(s) of the Sundog Premises on the terms set
                  forth in Schedule 7.1(i) hereof prior to or contemporaneous
                  with the Funding Time and each of such leases shall be
                  registered by way of caveat against the certificates of title
                  to the Sundog Premises and in the event that any mortgage,
                  encumbrance or financial charge exists, then the holder of
                  each such mortgage, encumbrance or financial charge shall have
                  executed and delivered to the Company a non-disturbance
                  agreement in form and content acceptable to the Purchaser;

         (j)      Remenda shall have signed the Remenda Agreement; and

         (k)      The Vendor, the Company and 408446 shall have made all
                  deliveries as are called for by this Agreement. The Purchaser
                  shall be fully satisfied in its sole discretion with the
                  results of its review of all of the Schedules, whether
                  delivered before or after the execution hereof, and such
                  deliveries, and its review of, and other due diligence
                  investigations with respect to, the business, operations,
                  affairs, prospects, properties, assets, existing and potential
                  liabilities, obligations, profits and condition (financial or
                  otherwise) of the Company.

7.2               CONDITIONS FOR THE BENEFIT OF THE VENDOR, THE COMPANY AND
                  408446

                  The obligation of the Vendor, the Company and 408446 to
consummate the transactions contemplated by this Agreement are subject to the
satisfaction or waiver, at or before the Funding Time, of the following
conditions and deliveries:

         (a)      All of the representations and warranties of Purchaser
                  contained in this Agreement shall be true, correct and
                  complete on and as of the Funding Time with the same effect as
                  though such representations and warranties had been made as of
                  such date; all of the terms, covenants, agreements and
                  conditions of this Agreement to be complied with, performed or
                  satisfied by Purchaser on or before the Funding Date shall
                  have been duly complied with, performed or satisfied; and a
                  certificate to the foregoing effects dated the Funding Date
                  and signed by any officer of the Purchaser shall have been
                  delivered to the Vendor, the Company and 408446;

         (b)      No temporary restraining order, preliminary or permanent
                  injunction or other order issued by any court of competent
                  jurisdiction or other legal or regulatory restraint or
                  provision challenging Purchaser's proposed acquisition of the
                  Shares, or limiting or restricting Purchaser's conduct or
                  operation of the business of the Company (or its own business)
                  following the transactions contemplated by this Agreement
                  shall be in effect, nor shall any proceeding brought by an
                  administrative agency or commission or other governmental
                  authority or instrumentality, domestic or foreign, seeking any
                  of the foregoing be pending; and a certificate to the
                  foregoing effects dated the Funding Date and signed by any
                  officer of the Purchaser shall have been delivered to the
                  Vendor, the Company and 408446;

<PAGE>

         (c)      All necessary material consents of, and filings with, any
                  governmental authority or agency or third party relating to
                  the consummation by the Purchaser of the transactions
                  contemplated herein, shall have been obtained and made;

         (d)      The Company or Purchaser shall have entered into an employment
                  agreement with Vendor in the form set forth in Schedule 1.1(t)
                  hereof prior to or contemporaneously with the Funding Time;
                  and

         (e)      Remenda shall have entered into the Remenda Agreement.

7.3               CONDITIONS FOR BENEFIT OF PURCHASER, VENDOR, COMPANY AND
                  408446

                  The obligation of the Purchaser, the Vendor, the Company and
408446 to consummate the transactions contemplated by this Agreement are subject
to the satisfaction or waiver, at or before the Funding Time, of the following
conditions and deliveries to be completed immediately prior to the Funding Time:

         (a)      the Company shall sell to Vendor, and Vendor will purchase
                  from the Company,  the Preferred  Shares for the sum of
                  $375,000;

         (b)      the Company shall pay out the Related Party Debt in its
                  entirety;

         (c)      the Company shall remit the Johnson Pension Obligation to such
                  entity as shall be designated by Harvey Johnson. Concurrently
                  therewith, Harvey Johnson shall unconditionally release the
                  Company for all claims in relation to the Johnson Pension
                  Obligation and enter into an amendment of the Johnson
                  Employment Contract acknowledging deferral of payment of the
                  Johnson Severance Obligation to June 30, 1999 and providing
                  for an assignment to Harvey Johnson of the life insurance on
                  his life held by the Company;

         (d)      the Company shall declare, as evidenced by a written
                  resolution of the board of directors of the Company that a
                  bonus net of withholdings has been credited to the Sundog
                  Shareholder Loan account in the net amount of $408,715 (the
                  "1999 Bonus"). The Company shall make all remittances,
                  including any remittances required under the Income Tax Act,
                  to be made in connection with the payment of the 1999 Bonus;
                  and

         (e)      Hodgson shall release the Company from that certain employment
                  agreement dated December 22, 1989 between Hodgson and the
                  Company.

<PAGE>

                                    ARTICLE 8
                                 INDEMNIFICATION

8.1               GENERAL INDEMNIFICATION BY THE VENDOR

                  The Vendor as to the Vendor's Portion, covenants and agrees to
indemnify, defend, protect and hold harmless the Purchaser and the Company and
their respective officers, directors, employees, shareholders, assigns,
successors and Affiliates (individually, an "Indemnified Party" and
collectively, the "Indemnified Parties") from, against and in respect of:

         (a)      all liabilities, losses, claims, damages, punitive damages,
                  causes of action, lawsuits, administrative proceedings
                  (including informal proceedings), investigations, audits,
                  demands, assessments, adjustments, judgments, settlement
                  payments, deficiencies, penalties, fines, interest (including
                  interest from the date of such damages) and costs and expenses
                  (including without limitation reasonable legal fees and
                  disbursements of every kind, nature and description)
                  (collectively, "Damages") suffered, sustained, incurred or
                  paid by the Indemnified Parties in connection with, resulting
                  from or arising out of:

                  (i)        any breach of any representation or warranty of the
                             Vendor, 408446 or the Company set forth in this
                             Agreement or any Schedule or certificate, delivered
                             by or on behalf of any of the Vendor, 408446 or the
                             Company in connection herewith;

                  (ii)       any nonfulfillment of any covenant or agreement by
                             the Vendor or, prior to the Funding Date, the
                             Company or 408446, under this Agreement. or

                  (iii)      the business, operations or assets of the Company
                             or 408446 prior to the Funding Time or the actions
                             or omissions of the Company's or 408446's
                             directors, officers, shareholders, employees or
                             agents prior to the Funding Time, other than
                             Damages arising from matters expressly disclosed in
                             the Company Financial Statements, this Agreement or
                             the Schedules to this Agreement

                  (iv)       any additional assessment, Tax or penalties payable
                             as a result of the assignment of the Hodgson
                             Insurance and any other assignment of any employee
                             insurance in accordance with this Agreement; and

         (b)      any and all Damages incident to any of the foregoing or to the
                  enforcement of this Section 8.1.

8.2      LIMITATION AND EXPIRATION

                  Notwithstanding the above:

         (a)      there shall be no liability for indemnification under Section
                  8.1 unless, and solely to the extent that, the aggregate
                  amount of Damages exceeds $110,000 (the "Indemnification
                  Threshold"); provided, however, that the Indemnification
                  Threshold shall not apply to (i) Damages arising out of any
                  breaches of the covenants of the Vendor, 408446 or the Company
                  set forth in this Agreement or representations and warranties
                  made in Sections 4.1(e) (Authorized Capital), 4.1(f)
                  (Entitlements), 4.1(u) (Significant Customers; Material
                  Contracts and Commitments), 4.1(aa) (Employee Benefit Plans),
                  4.1(bb) (Taxes), or 4.1(cc) (Conformity with Law; Litigation);

<PAGE>

         (b)      the aggregate amount of the Vendor's liability under this
                  Article 8 shall not exceed the Purchase Price, provided
                  however, that the Vendor's liability for Damages arising out
                  of any breaches of the representations made in Sections
                  4.1(y), 4.1(aa) or 4.1(bb) or Damages described in Section 8.1
                  (a)(ii) or (iv) shall not be subject to such limitation and
                  shall not count toward the limitation described in the first
                  clause of this Section 8.2(b);

         (c)      the indemnification obligations under this Article 8, or under
                  any certificate or writing furnished in connection herewith,
                  shall terminate at the date that is the later of clause (i) or
                  (ii) of this Section 8.2(c):

                  (i)        (A)     except as to  representations,  warranties,
                                     and  covenants  specified  in clause (i)(B)
                                     of this Section 8.2(c), the third
                                     anniversary of the Funding Date;

                             (B)     with respect to  representations  and
                                     warranties  contained in Sections  4.1(y),
                                     4.1(aa),  4.1(bb) and the  indemnification
                                     set forth in Section  8.1(a)(ii)(iii)
                                     or (iv),  on (A) the date  that is six (6)
                                     months  after the  expiration  of the
                                     longest  applicable  limitation  period
                                     contained in the  applicable  federal or
                                     provincial  statute  (including  extensions
                                     thereof),  or  (B)  if  there  is no
                                     applicable  federal or provincial  statute,
                                     (x) five (5) years after the Funding  Date
                                     if the Claim (as defined  below) is related
                                     to the cost of  investigating,  containing,
                                     removing  or  remediating  a release  of
                                     Hazardous  Substances  (as defined  above)
                                     into the environment, or (y) five (5) years
                                     after the Funding Date for any other Claim
                                     covered by clause (i)(B) of this Section
                                     8.2(c); or

                  (ii)       The final resolution of claims or demands pending
                             as of the dates described in clause (i) of this
                             Section 8.2(c) (such claims referred to as "Pending
                             Claims").

         (d)      For greater certainty the Vendor shall, in accordance with the
                  provisions of this Article 8, indemnify the Purchaser and the
                  Company in respect of those matters set out in that schedule
                  delivered at the Funding Time by the Purchaser to the Vendor
                  which letter is attached hereto as Schedule 8.2(d). The Vendor
                  acknowledges that Schedule 8.2(d) shall in no way constitute
                  any amendment, waiver, modification or abridgement of any of
                  the Purchasers rights under this Article 8.

8.3               INDEMNIFICATION PROCEDURES

                  All claims or demands for indemnification under this Article 8
("Claims") shall be asserted and resolved as follows:

<PAGE>

         (a)      In the event that any Indemnified Party has a Claim against
                  any party obligated to provide indemnification pursuant to
                  Section 8.1 hereof (the "Indemnifying Party") which does not
                  involve a Claim being asserted against or sought to be
                  collected by a third party, the Indemnified Party shall within
                  thirty (30) days of having actual knowledge of such Claim
                  (failing which the Indemnified Party shall be deemed to waive
                  its right to indemnification in respect of such Claim) notify
                  the Vendor of such Claim, specifying the nature of such Claim
                  and the amount or the estimated amount thereof to the extent
                  then feasible (the "Claim Notice"). If the Vendor does not
                  notify the Indemnified Party within thirty (30) days after the
                  date of delivery of the Claim Notice that the Indemnifying
                  Party disputes such Claim, with a detailed statement of the
                  basis of such position, the amount of such Claim shall be
                  conclusively deemed a liability of the Indemnifying Party
                  hereunder. In case an objection is made in writing in
                  accordance with this Section 8.3(a), the Indemnified Party
                  shall respond in a written statement to the objection within
                  thirty (30) days and, for sixty (60) days thereafter, attempt
                  in good faith to agree upon the rights of the respective
                  parties with respect to each of such Claims (and, if the
                  parties should so agree, a memorandum setting forth such
                  agreement shall be prepared and signed by both parties).

         (b)      (i)        In the event that any Claim for which the
                             Indemnifying Party would be liable to an
                             Indemnified Party hereunder is asserted against an
                             Indemnified Party by a third party (a "Third Party
                             Claim"), the Indemnified Party shall deliver a
                             Claim Notice to the Vendor within thirty (30) days
                             of having actual knowledge of such Third Party
                             Claim (failing which the Indemnified Party shall be
                             deemed to waive its right to Indemnification in
                             respect of such Claim). The Vendor shall have
                             thirty (30) days from the date of delivery of the
                             Claim Notice to notify the Indemnified Party (A)
                             whether the Indemnifying Party disputes liability
                             to the Indemnified Party hereunder with respect to
                             the Third Party Claim, and, if so, the basis for
                             such a dispute, and (B) if such party does not
                             dispute liability, whether or not the Indemnifying
                             Party desires, at the sole cost and expense of the
                             Indemnifying Party, to defend against the Third
                             Party Claim, provided that the Indemnified Party is
                             hereby authorized (but not obligated) to file any
                             motion, answer or other pleading and to take any
                             other action which the Indemnified Party shall deem
                             necessary or appropriate to protect the Indemnified
                             Party's interests.

                  (ii)       In the event that the Vendor timely notifies the
                             Indemnified Party that the Indemnifying Party does
                             not dispute the Indemnifying Party's obligation to
                             indemnify with respect to the Third Party Claim,
                             the Indemnifying Party shall defend the Indemnified
                             Party against such Third Party Claim by appropriate
                             proceedings, provided that, unless the Indemnified
                             Party otherwise agrees in writing, the Indemnifying
                             Party may not settle any Third Party Claim (in
                             whole or in part) if such settlement does not
                             include a complete and unconditional release of the
                             Indemnified Party. If the Indemnified Party desires
                             to participate in, but not control, any such
                             defense or settlement the Indemnified Party may do
                             so at its sole cost and expense. If the
                             Indemnifying Party elects not to defend the
                             Indemnified Party against a Third Party Claim,
                             whether by failure of such party to give the
                             Indemnified Party timely notice as provided herein
                             or otherwise, then the Indemnified Party, without
                             waiving any rights against such party, may settle
                             or defend against such Third Party Claim in the
                             Indemnified Party's sole discretion and the
                             Indemnified Party shall be entitled to recover from
                             the Indemnifying Party the amount of any settlement
                             or judgment and, on an ongoing basis, all
                             indemnifiable costs and expenses of the Indemnified
                             Party with respect thereto, including interest from
                             the date such costs and expenses were incurred.

<PAGE>

                  (iii)      If at any time, in the reasonable opinion of the
                             Indemnified Party, notice of which shall be given
                             in writing to the Vendor any Third Party Claim
                             seeks material prospective relief which could have
                             an adverse effect on any Indemnified Party or the
                             Company or any subsidiary, the Indemnified Party
                             shall have the right to control or assume (as the
                             case may be) the defense of any such Third Party
                             Claim and the amount of any judgment or settlement
                             and the reasonable costs and expenses of defense
                             shall be included as part of the indemnification
                             obligations of the Indemnifying Party hereunder. If
                             the Indemnified Party elects to exercise such
                             right, the Indemnifying Party shall have the right
                             to participate in, but not control, the defense of
                             such Third Party Claim at the sole cost and expense
                             of the Indemnifying Party.

         (c)      Nothing herein shall be deemed to prevent the Indemnified
                  Party from making a Claim, and an Indemnified Party may make a
                  Claim hereunder, for potential or contingent Damages provided
                  the Claim Notice sets forth the specific basis for any such
                  potential or contingent claim or demand to the extent then
                  feasible and the Indemnified Party has reasonable grounds to
                  believe that such Claim may be made.

         (d)      Subject to the provisions of Section 8.2, the Indemnified
                  Party's failure to give notice as required by this Section 8.3
                  of any actual, threatened or possible claim or demand which
                  may give rise to a right of indemnification hereunder shall
                  not relieve the Indemnified Party unless the failure to give
                  such notice materially and adversely prejudiced the
                  Indemnifying Party.

         (e)      The parties will make appropriate adjustments for any Tax
                  benefits, Tax detriments or insurance proceeds in determining
                  the amount of any indemnification obligation under this
                  Article 8, provided that no Indemnified Party shall be
                  obligated to continue pursuing any payment pursuant to the
                  terms of any insurance policy.

8.4               GENERAL INDEMNIFICATION BY THE PURCHASER

                  The Purchaser covenants and agrees to indemnify, defend,
protect and hold harmless the Vendor from, against and in respect of:

<PAGE>

         (a)      all Damages suffered, sustained, incurred or paid by the
                  Vendor in connection with, resulting from or arising out of,
                  directly or indirectly:

                  (i)        any breach of any representation or warranty of the
                             Purchaser  set  forth  in this  Agreement;

                  (ii)       any nonfulfillment of any covenant or agreement by
                             the Purchaser, or after the Funding Date, the
                             Company, under this Agreement, excluding any such
                             non-fulfillment caused by the Vendor;

                  (iii)      the business, operations or assets of the Company
                             subsequent to the Funding Date or the actions or
                             omissions of the Company's directors, officers,
                             shareholders, employees or agents subsequent to the
                             Funding Date, excluding Damages caused by or
                             actions or omissions of the Vendor; or

                  (iv)       guarantees or indemnities or the sureties provided
                             by Vendor or his Affiliates for the benefit of the
                             Company as set forth in Schedule 8.4(a)(iv).

         (b)      the indemnification obligation under this Section 8.4 shall
                  terminate on the third anniversary of the Funding Date.

8.5               SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS

                  All representations, warranties and covenants made by the
Vendor, the Company, 408446 and the Purchaser in or pursuant to this Agreement
or in any document delivered pursuant hereto shall be deemed to have been made
on the date of this Agreement (except as otherwise provided herein) and, if a
Closing occurs, as of the Funding Date. The representations of the Vendor, the
Company and 408446 will survive the Closing and will remain in effect until, and
will expire upon, the termination of the indemnification obligations as provided
in Section 8.2. The representations and warranties of the Purchaser will survive
Closing and will remain in effect until, and will expire upon the third
anniversary of the Funding Date.

8.6               REMEDIES CUMULATIVE

                  The remedies set forth in this Article 8 are cumulative and
shall not be construed to restrict or otherwise affect any other remedies that
may be available to the Indemnified Parties under any other agreement or
pursuant to statutory or common law.

8.7               RIGHT TO SET OFF

                  Subject to complying with the procedures set forth in Section
11.10, Purchaser shall have the right, but not the obligation, to set off, in
whole or in part, against the portion of the Purchase Price payable pursuant to
Sections 3.1(a)(iii), 3.1(a)(iv) or 3.1(a)(v) hereof, amounts finally determined
under Section 8.3 to be owed to the Purchaser by the Vendor, 408446 or the
Company or any Indemnifying Party under this Article 8.

<PAGE>

8.8      CLAIMS

                  The Vendor's Liability to an Indemnified Party pursuant to
Section 8.1 shall be limited to the Vendor's Portion. Similarly, the Parties
acknowledge that in relation to any other action or claim whatsoever under and
pursuant to this Agreement whether in relation to a breach of the representation
or warranties, the covenants or otherwise, the Vendor's Liability shall be
limited to the Vendor's Portion and the Purchaser shall deliver notice to the
Vendor of such other claim within thirty days of having actual knowledge of such
claim failing which the Purchaser shall be deemed to have waived such claim.


                                    ARTICLE 9
                                NON - COMPETITION


9.1               PROHIBITED ACTIVITIES

                  The Vendor acknowledges that he has developed relationships on
behalf of and acquired proprietary and confidential information about the
Company, including, but not limited to, its customers, vendors, prices, sales
strategies and other information, some of which may be regarded and treated by
the Company and the Purchaser as trade secrets. In order to protect the
Company's and/or the Purchaser's critical interest in these relationships and
information, the Vendor covenants that he will not, for a period of four (4)
years following the Funding Date, for any reason whatsoever, directly or
indirectly, for himself or on behalf of or in conjunction with any other person,
persons, partnership, corporation, or business of whatever nature:

         (a)      engage, as an officer, director, shareholder, owner, partner,
                  member, joint venturer, or in a managerial capacity, whether
                  as an employee, independent contractor, consultant or adviser,
                  or as a sales representative, in any business selling any
                  products or services in direct competition with the Company,
                  within 50 miles of any locations where the Company both has an
                  office and conducts business ("Territory"). As used in this
                  subsection, "competition" shall mean engaging, directly or
                  indirectly, for himself or any other person or entity, in (i)
                  any facet of the business of the Company in which the Vendor
                  was engaged in prior to the Funding Date or (ii) any facet of
                  the business of the Company about which the Vendor acquired
                  proprietary or confidential information during the course of
                  his ownership of the Shares;

         (b)      hire or join with in a competitive business capacity, any
                  employee of the Company within the Territory;

         (c)      solicit or accept business which competes with the business of
                  the Company from any person who is, on the Funding Date, or
                  that has been, within one (1) year prior to the Funding Date,
                  a customer of the Company; or

<PAGE>

         (d)      acquire or enter into any agreement to acquire any prospective
                  acquisition candidate that was, to the knowledge of the
                  Vendor, either called upon by the Company as a prospective
                  acquisition candidate or was the subject of an acquisition
                  analysis by the Company within 3 years prior to the Funding
                  Date. The Vendor, to the extent lacking the knowledge
                  described in the preceding sentence, shall immediately cease
                  all contact with such prospective acquisition candidate upon
                  being informed that the Company had called upon such candidate
                  or made an acquisition analysis thereof.

                  Notwithstanding the above, the foregoing covenant shall not be
deemed to prohibit the Vendor from acquiring as an investment not more than one
percent (1%) of the capital stock of a competing business whose stock is traded
on a national securities exchange or over- the-counter.


9.2               CONFIDENTIALITY

                  The Vendor acknowledges that he has acquired confidential
information and trade secrets concerning the operation of the Company, the use
or disclosure of which could cause the Company or its affiliates or subsidiaries
substantial loss and damages that could not be readily calculated and for which
no remedy at law would be adequate. Accordingly, the Vendor covenants and agrees
with the Company and Purchaser that he will not at any time, except in
performance of Vendor's obligations to the Company or with the prior written
consent of the Company pursuant to authority granted by a resolution of the
Board of Directors of the Company, directly or indirectly, disclose any secret
or confidential information that he or she may learn or has learned by reason of
his ownership of the Company or his employment by the Company, or any of its
Subsidiaries and Affiliates, or use any such information in a manner detrimental
to the interests of the Company or Purchaser, unless (i) such information
becomes known to the public generally through no fault of any Shareholder, (ii)
disclosure is required by law or the order of any Governmental Authority under
color of law, or (iii) the disclosing party reasonably believes that such
disclosure is required in connection with the defense of a lawsuit against the
disclosing party, provided, that prior to disclosing any information pursuant to
clause (i), (ii) or (iii) above, the Vendor shall give prior written notice
thereof to Purchaser and provide Purchaser with the opportunity to contest such
disclosure and shall cooperate with efforts to prevent such disclosure. The term
"confidential information" includes, without limitation, information not
previously disclosed to the public or to the trade by the Company's or
Purchaser's management with respect to the Company's or Purchaser's, or any of
their Affiliates' or Subsidiaries', products, facilities, and methods, trade
secrets and other intellectual property, software, source code, systems,
procedures, manuals, confidential reports, product price lists, customer lists,
financial information (including the revenues, costs, or profits associated with
any of the Company's products), business plans, prospects, or opportunities but
shall exclude any information already in the public domain.

9.3               DAMAGES

                  Because of the difficulty of measuring economic losses to
Purchaser as a result of a breach of the foregoing covenant, and because of the
immediate and irreparable damage that could be caused to Purchaser for which it
would have no other adequate remedy, the Vendor agrees that the foregoing
covenant may be enforced by Purchaser in the event of breach by the Vendor, by
injunctions and restraining orders.

<PAGE>

9.4               REASONABLE RESTRAINT

                  The parties agree that the foregoing covenants in this Article
9 impose a reasonable restraint on the Vendor in light of the activities and
business of the Purchaser on the date of the execution of this Agreement,
assuming the completion of the transactions contemplated hereby.

9.5               SEVERABILITY; REFORMATION

                  The covenants in this Article 9 are severable and separate,
and the unenforceability of any specific covenant shall not affect the
provisions of any other covenant. Moreover, in the event any court of competent
jurisdiction shall determine that the scope, time or territorial restrictions
set forth are unreasonable, then it is the intention of the parties that such
restrictions be enforced to the fullest extent which the court deems reasonable,
and the Agreement shall thereby be reformed.

9.6               INDEPENDENT COVENANT

                  All of the covenants in this Article 9 shall be construed as
an agreement independent of any other provision in this Agreement, and the
existence of any claim or cause of action of the Vendor against the Purchaser,
whether predicated on this Agreement or otherwise, shall not constitute a
defence to the enforcement by the Purchaser of such covenants. The parties
expressly acknowledge that the terms and conditions of this Article 9 are
independent of the terms and conditions of any other agreements including, but
not limited to, any employment agreements entered into in connection with this
Agreement. It is specifically agreed that the period of four (4) years stated at
the beginning of this Article 9 during which the agreements and covenants of the
Vendor made in this Article 9 shall be effective, shall be completed by
excluding from such computation any time during which the Vendor is found by a
court of competent jurisdiction to have been in violation of any provisions of
this Article 9. The covenants contained in this Article 9 shall not be affected
by any breach of any other provision hereof by any party hereto and shall have
no effect if the transactions contemplated by this Agreement are not
consummated.

9.7               MATERIALITY

                  The Company and the Vendor hereby agree that the covenants set
forth in this Article 9 are a material and substantial part of the transactions
contemplated by this Agreement, supported by adequate consideration.

<PAGE>

                                   ARTICLE 10
                                     CLOSING

10.1              CLOSING

         (a)      The Closing shall take place through the delivery of executed
                  originals or facsimile counterparts of all documents required
                  hereunder on such date that all conditions to Closing shall
                  have been satisfied or waived, or at such other time and date
                  as the Purchaser and the Vendor may agree, which date is
                  referred to as the "Funding Date."

         (b)      The completion of the transactions contemplated herein shall
                  be carried out pursuant to such reasonable trust conditions as
                  are agreed upon between the solicitors representing the
                  Vendor, the Company and 408449 and the Solicitors representing
                  the Purchaser which shall provide that all closing documents
                  and funds shall be delivered to the Solicitors representing
                  the Purchaser and held in escrow and not released until all
                  parties have delivered all required closing documents and
                  funds and caveats respecting the Leases have been registered
                  at the Land Titles Office against the respective certificates
                  of title to the lands referenced in the Leases, subject only
                  to the caveats and instruments that were registered against
                  titles as at the Effective Date.

10.2     DELIVERIES AT FUNDING TIME

At the Funding Time:

         (a)      the Purchaser shall deliver or cause to be delivered to the
                  Vendor the following:

                  (i)      funds in the amount of $4,995,742 for the Purchased
                           Interests;

                  (ii)     demand promissory note in the amount of $820,056;

                  (iii)    releases of the personal guarantees of Vendor and the
                           corporate guarantees of 408446 and its Affiliates;

                  (iv)     releases of the Vendor by the Company and 408446;

                  (v)      a legal opinion in form reasonably satisfactory to
                           Vendor's solicitors in relation to the enforceability
                           of this Agreement and the other agreements delivered
                           pursuant to the terms hereof;

                  (vi)     an  undertaking  to  pay to the  Johnson  Severance
                           Obligation and the Johnson Pension Obligation.

         (b)      the Vendor shall deliver or cause to be delivered to the
                  Purchaser the following:

                  (i)      a certificate of each of the Vendor, 408446 and the
                           Company confirming that the representations set forth
                           herein by them to are true and correct at the Funding
                           Date;

<PAGE>

                  (ii)     a certified copy of the resolution of the board of
                           directors of the Company and 408446 approving the
                           agreement and the transfer of the Hodgson Shares and
                           408446 Shares from the Vendor to the Purchaser;

                  (iii)    certificates representing the Shares duly endorsed in
                           blank for transfer;

                  (iv)     The share certificate book, minute book, corporate
                           seal and all other corporate records and business
                           records of 408446;

                  (v)      resignations of the existing directors and officers
                           of 408446;

                  (vi)     a legal opinion in form reasonably satisfactory to
                           Purchaser's solicitors in relation to the
                           enforceability of this Agreement and the other
                           agreements delivered pursuant to the terms hereof;

         (c)      At the Funding Time, the Vendor, the Shareholders, the Company
                  and the Purchaser, as the case may be, shall execute and
                  deliver or cause to be delivered the following:

                  (i)      an assignment of the Shareholders Loans; and

                  (ii)     the Hodgson Employment contract.


10.3              PURCHASER POST CLOSING OBLIGATIONS

                  Following the Funding Time the Purchaser shall:

         (a)      appoint new directors for 408446 and the Company and cause a
                  duly completed Notice of Change of Directors to be filed with
                  Alberta Corporate Registry and in any other jurisdictions
                  where 408446 or the Company is registered and such
                  notification is required to be filed;

         (b)      designate a new registered office for 408446 and the Company
                  and cause a duly completed Notice of Change of Address to be
                  filed with Alberta Corporate Registry;

         (c)      cause 408446 and the Company to deliver to the former
                  directors of 408446 and the Company, as the case may be, duly
                  executed releases in a form reasonably acceptable to the
                  solicitors for the Vendor;

         (d)      assign the Hodgson Insurance from the Company to Hodgson or
                  his nominee; and

         (e)      assign the TPI Receivable from the Purchaser in favor of the
                  Vendor.

<PAGE>

10.4              JOHNSON CONTRACT

                  In due course, following the Funding Time, the Purchaser shall
ensure the payment to Harvey Johnson of the Johnson Severance Obligation by the
Company.



<PAGE>



                                   ARTICLE 11
                                     GENERAL


11.1              TERMINATION

                  This Agreement may be terminated at any time prior to the
Funding Date solely:

         (a)      by  mutual  consent  of the board of  directors  of  Purchaser
                  and the  board of  directors  of the  Company; or

         (b)      by the Vendor, the Company and 408446 as a group, on the one
                  hand, or by Purchaser, on the other hand, if the Closing shall
                  not have occurred on or before April 15, 1999, provided that
                  the right to terminate this Agreement under this Section
                  11.1(b) shall not be available to either party (with the
                  Vendor, the Company and 408446 deemed to be a single party for
                  this purpose) whose material misrepresentation, breach of
                  warranty or failure to fulfill any obligation under this
                  Agreement has been the cause of, or resulted in, the failure
                  of the closing to occur on or before such date; or

         (c)      by the Vendor, the Company and 408446 as a group, on the one
                  hand, or by Purchaser, on the other hand, if there is or has
                  been a material breach, failure to fulfill or default on the
                  part of the other party (with the Vendor, the Company and
                  408446 deemed to be a single party for this purpose) of any of
                  the representations and warranties contained herein or in the
                  due and timely performance and satisfaction of any of the
                  covenants, agreements or conditions contained herein, and the
                  curing of such default shall not have been made or shall not
                  reasonably be expected to occur before the Funding Date; or

         (d)      by the Vendor, the Company and 408446 as a group, on the one
                  hand, or by Purchaser, on the other hand, if there shall be a
                  final non-appealable order of a federal or provincial court in
                  effect preventing consummation of the transactions
                  contemplated by this Agreement; or there shall be any action
                  taken, or any statute, rule, regulation or order enacted,
                  promulgated or issued or deemed applicable to the transactions
                  contemplated by this Agreement by any governmental entity
                  which would make the consummation of the transactions
                  contemplated by this Agreement illegal.

11.2              EFFECT OF TERMINATION

                  In the event of the termination of this Agreement pursuant to
Section 11.1, this Agreement shall forthwith become ineffective, and there shall
be no liability or obligation on the part of any party hereto or its officers,
directors or shareholders. Notwithstanding the foregoing sentence, (i) the
provisions of Articles 11 and 8, shall remain in full force and effect and
survive any termination of this Agreement; (ii) each party shall remain liable
for any breach of this Agreement prior to its termination; and (iii) in the
event of termination of this Agreement pursuant to Section 11.1(c) above, then
notwithstanding the provisions of Section 11.7 below, the breaching party (with
the Vendor, 408446 and the Company deemed to be a single party for purposes of
this Article 11), shall be liable to the other party to the extent of the
expenses incurred by such other party in connection with this Agreement and the
transactions contemplated hereby, as well as any damages in accordance with
applicable law.

<PAGE>

11.3              SUCCESSORS AND ASSIGNS

                  This Agreement and the rights of the parties hereunder may not
be assigned (except by operation of law) and shall be binding upon and shall
inure to the benefit of the parties hereto, the successors of the Purchaser, and
the heirs and legal representatives of the Vendor. Notwithstanding anything in
the foregoing to the contrary, the Purchaser may assign any of its rights or
obligations under this Agreement to any direct or indirect Subsidiary or
Affiliate of the Purchaser in its sole and absolute discretion and without the
consent of the Vendor or the Company or 408446; provided, however that in the
event of such assignment the Purchaser shall continue to be liable to the Vendor
for the payment of the Purchase Price.

11.4              ENTIRE AGREEMENT; AMENDMENT; WAIVER

                  This Agreement sets forth the entire understanding of the
parties hereto with respect to the transactions contemplated hereby. Each of the
Schedules to this Agreement is incorporated herein by this reference and
expressly made a part hereof. Any and all previous agreements and understandings
between or among the parties regarding the subject matter hereof, whether
written or oral, are superseded by this Agreement. This Agreement shall not be
amended or modified except by a written instrument duly executed by each of the
parties hereto. Any extension or waiver by any party of any provision hereto
shall be valid only if set forth in an instrument in writing signed on behalf of
such party.

11.5              COUNTERPARTS

                  This Agreement may be executed in any number of counterparts
and any party hereto may execute any such counterpart, each of which when
executed and delivered shall be deemed to be an original, and all of which
counterparts taken together shall constitute but one and the same instrument.

11.6              BROKERS AND AGENTS

                  Purchaser and the Vendor, the Company and 408446 (as a group)
each represents and warrants to the other that it has not employed any broker or
agent for which the other would be liable in connection with the transactions
contemplated by this Agreement and agrees to indemnify the other against all
losses, damages or expenses relating to or arising out of claims for fees or
commission of any broker or agent employed or alleged to have been employed by
such party.

11.7              EXPENSES

                  The Purchaser has and will pay the fees, expenses and
disbursements of the Purchaser and its agents, representatives, accountants and
counsel incurred in connection with the subject matter of this Agreement. The
Vendor (and not the Company or 408446) have and will pay the fees, expenses and
disbursements of the Vendor, the Company and 408446 and their agents,
representatives, financial advisers, accountants and counsel incurred in
connection with the subject matter of this Agreement.

<PAGE>

11.8              SPECIFIC PERFORMANCE; REMEDIES

                  Each party hereto acknowledges that the other parties will be
irreparably harmed and that there will be no adequate remedy at law for any
violation by any of them of any of the covenants or agreements contained in this
Agreement, including without limitation, the confidentiality obligations set
forth in Section 9.2 and the non-competition provisions set forth in Section
9.1. It is accordingly agreed that, in addition to any other remedies which may
be available upon the breach of any such covenants or agreements, each party
hereto shall have the right to obtain injunctive relief to restrain a breach or
threatened breach of, or otherwise to obtain specific performance of, the other
parties, covenants and agreements contained in this Agreement.

11.9              NOTICES

                  Any notice, request, claim, demand, waiver, consent, approval
or other communication which is required or permitted hereunder shall be in
writing and shall be deemed given if delivered personally or sent by telefax
(with confirmation of receipt), by registered or certified mail, postage
prepaid, or by recognized courier service, as follows:

                  If to the Purchaser or the Company to:

                  Workflow Management Inc.
                  240 Royal Palm Way
                  Palm Beach, Fl.
                  USA 33480

                  Attn: Claudia S. Amlie
                  Vice President and General Counsel

                  (Telefax:  (561) 659-5099)


<PAGE>



                  with a required copy to:

                  McCarthy Tetrault
                  #3300, 421 - 7 Avenue S.W.
                  Calgary, Alberta   T2P 4K9

                  Attn: John S. Osler

                  (Telefax: (403) 260-3501)

                  and to:

                  Kaufman & Canoles
                  Post Office Box 3037
                  Norfolk, Virginia 23514

                  Attn: T. Richard Litton, Jr., Esq.
                  (Telefax: (757)624-3169)
                  If to the Vendor to:

                  (Telefax: (757) 624-3169)

                  and to:

                  the Vendor
                  R.R. 12
                  Calgary, Alberta
                  T3E 6W3

                  and to:

                  Field Atkinson Perraton
                  Suite 1900, 350 - 7 Avenue S.W.
                  Calgary, Alberta   T2P 3N9

                  Attention:  John R. Perraton, Q.C.

                  (Telefax: (403) 264-7084)


                  or to such other address as the person to whom notice is to be
given may have specified in a notice duly given to the sender as provided
herein. Such notice, request, claim, demand, waiver, consent, approval or other
communication shall be deemed to have been given as of the date so delivered,
telefaxed, mailed or dispatched and, if given by any other means, shall be
deemed given only when actually received by the addressees.

<PAGE>

11.10             GOVERNING LAW

         (a)      Subject to the provisions of Section 11.10(b) below, this
                  Agreement shall be governed by and construed, interpreted and
                  enforced in accordance with the laws of Alberta and the
                  federal laws of Canada applicable therein. Any disputes
                  arising out of, in connection with or with respect to this
                  Agreement, the subject matter hereof, the performance or
                  non-performance of any obligation hereunder, or any of the
                  transactions contemplated hereby shall be adjudicated in a
                  court of competent civil jurisdiction sitting in the City of
                  Calgary, Alberta and appeal courts therefrom and nowhere else.
                  Each of the parties hereto hereby irrevocably submits to the
                  jurisdiction of such court for the purposes of any suit, civil
                  action or other proceeding arising out of, in connection with
                  or with respect to this Agreement, the subject matter hereof,
                  the performance or non-performance of any obligation
                  hereunder, or any of the transactions contemplated hereby
                  (collectively, "Suit"). Each of the parties hereto hereby
                  waives and agrees not to assert by way of motion, as a defense
                  or otherwise in any such Suit, any claim that it is not
                  subject to the jurisdiction of the above courts, that such
                  Suit is brought in an inconvenient forum, or that the venue of
                  such Suit is improper.

         (b)      Prior to instituting any formal legal actions in connection
                  with disputes arising under this Agreement, the Vendor, the
                  Company, 408446 and the Purchaser (collectively, the
                  "Parties") shall first attempt to resolve their disputes
                  informally as follows:

                  (i)        upon written request of a Party, each Party shall
                             appoint a designated representative whose task it
                             will be to meet for the purpose of endeavoring to
                             resolve such dispute, such meetings to be held in
                             Calgary, Alberta;

                  (ii)       the designated representatives shall meet as often
                             as the Parties reasonably deem necessary in order
                             to gather and furnish to the other all information
                             with respect to the matter in issue which the
                             Parties believe to be appropriate and germane in
                             connection with its resolution and the
                             representatives shall discuss the problem and
                             negotiate in good faith in an effort to resolve the
                             dispute without the necessity of any formal
                             proceeding;

                  (iii)      during the course of negotiations, all reasonable
                             requests made by one Party to another for
                             nonprivileged information, reasonably related to
                             this Agreement, shall be honoured in order that
                             each of the Parties may be fully advised of the
                             other's position;

                  (iv)       the specific format for discussion shall be left to
                             the discretion of the Parties, but may include the
                             preparation of agreed upon statements of fact or
                             written statements of position;

                  (v)        formal proceedings for the resolution of a dispute
                             may not be commenced until the earlier of (A) the
                             designated representatives concluding in good faith
                             that amicable resolution through continued
                             negotiation of the matter does not appear likely or
                             (B) 30 days after the initial request to negotiate
                             the dispute;
<PAGE>

                  (vi)       the foregoing provisions of this Section 11.10(b)
                             shall not be construed to prevent a Party from
                             instituting, and a Party is authorized to
                             institute, formal proceedings earlier to avoid the
                             expiration of any applicable limitations period or
                             to preserve a superior position to creditors. In
                             addition, (i) nothing in this Section 11.10(b)
                             shall be construed to limit the rights of the
                             Purchaser to seek injunctive relief in the event
                             that the Vendor violates any of the provisions of
                             Article 9 and (ii) any Party may institute formal
                             legal proceedings if it makes a good faith
                             determination that a breach of the terms of this
                             Agreement by another Party is such that the damages
                             to such Party resulting from the breach will be so
                             immediate, so large or severe, and so incapable of
                             adequate redress after the fact that a temporary
                             restraining order or other injunctive relief is the
                             only adequate remedy.

11.11             SEVERABILITY

                  If any provision of this Agreement or the application thereof
to any person or circumstances is held invalid or unenforceable in any
jurisdiction, the remainder hereof, and the application of such provision to
such person or circumstances in any other jurisdiction, shall not be affected
thereby, and to this end the provisions of this Agreement shall be severable.
The preceding sentence is in addition to and not in place of the severability
provisions in Section 9.5.

11.12             ABSENCE OF THIRD PARTY BENEFICIARY RIGHTS

                  No provision of this Agreement is intended, nor will any
provision be interpreted, to provide or to create any third party beneficiary
rights or any other rights of any kind in any client, customer, affiliate,
shareholder, employee or partner of any party hereto or any other person or
entity.

11.13             MUTUAL DRAFTING

                  This Agreement is the mutual product of the parties hereto,
and each provision hereof has been subject to the mutual consultation,
negotiation and agreement of each of the parties, and shall not be construed for
or against any party hereto.



<PAGE>



11.14             FURTHER REPRESENTATIONS

                  Each party to this Agreement acknowledges and represents that
it has been represented by its own legal counsel in connection with the
transactions contemplated by this Agreement, with the opportunity to seek advice
as to its legal rights from such counsel. Each party further represents that it
is being independently advised as to the tax consequences of the transactions
contemplated by this Agreement and is not relying on any representation or
statements made by the other party as to such tax consequences.


11.15             FURTHER ASSURANCES

                  From time to time subsequent to the Funding Date, the parties
shall execute and deliver or cause the execution and delivery of such additional
documents as may be reasonably required to carry out the intent of this
Agreement.


<PAGE>



IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Effective Date.



                                             DATA BUSINESS FORMS LIMITED

                                             By:/s/ Data Business Forms Limited
                                                -------------------------------
                                             Name:
                                             Title:

                                             By:
                                                -------------------------------
                                             Name:
                                             Title:




SIGNED, SEALED, AND DELIVERED in the presence of:



                                             /s/ Dale A. Hodgson
---------------------------------            ----------------------------------
Witness                                      DALE A. HODGSON







                                             SUNDOG PRINTING LIMITED

                                             By: /s/ Sundog Printing Limited
                                                 ------------------------------
                                             Name:
                                             Title:


                                             408446 ALBERTA INC.
                                             By: /s/ 408446 Alberta Inc.
                                                 ------------------------------
                                             Name:
                                             Title: