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                            DEBENTURE TRUST INDENTURE


                Dated as of the 8th day of August, 1996 and made
                          effective as of July 31, 1996


                                     Between

                                BATTERY ONE, INC.

                                       and

                        MONTREAL TRUST COMPANY OF CANADA



                  Providing for the Issue of a Series of up to 
     $6,000,000 10% Convertible Fixed and Floating Charge Secured Debentures
                                Due July 31, 2001

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                                       -i-

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

                                    ARTICLE 1
                                 INTERPRETATION. . . . . . . . . . . . . . .   2
     1.1       Definitions . . . . . . . . . . . . . . . . . . . . . . . . .   2
     1.2       Gender. . . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     1.3       Headings. . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     1.4       Applicable Law. . . . . . . . . . . . . . . . . . . . . . . .   6
     1.5       Enurement . . . . . . . . . . . . . . . . . . . . . . . . . .   6
     1.6       Meaning of "Outstanding". . . . . . . . . . . . . . . . . . .   7

                                    ARTICLE 2
                                 THE DEBENTURES. . . . . . . . . . . . . . .   7
     2.1       Principal Amount. . . . . . . . . . . . . . . . . . . . . . .   7
     2.2       Form and Signature of Debentures. . . . . . . . . . . . . . .   8
     2.3       Issue of Debentures . . . . . . . . . . . . . . . . . . . . .   8
     2.4       Certification . . . . . . . . . . . . . . . . . . . . . . . .   8
     2.5       Debentures to Rank Pari Passu . . . . . . . . . . . . . . . .   9
     2.6       Registration and Transfer of Debentures . . . . . . . . . . .   9
     2.7       Persons Entitled to Payment . . . . . . . . . . . . . . . . .  10
     2.8       Mutilation, Loss, Theft or Destruction. . . . . . . . . . . .  11
     2.9       Exchanges of Debentures . . . . . . . . . . . . . . . . . . .  11
     2.10      Charges . . . . . . . . . . . . . . . . . . . . . . . . . . .  12
     2.11      Option of Holder as to Place of Payment . . . . . . . . . . .  12
     2.12      Trustee Not Bound to Make Enquiries . . . . . . . . . . . . .  12
     2.13      Debentureholder Not a Shareholder . . . . . . . . . . . . . .  12

                                    ARTICLE 3
                                    REPAYMENT. . . . . . . . . . . . . . . .  12
     3.1       Covenant to Pay . . . . . . . . . . . . . . . . . . . . . . .  12
     3.2       Maturity. . . . . . . . . . . . . . . . . . . . . . . . . . .  13
     3.3       Interest. . . . . . . . . . . . . . . . . . . . . . . . . . .  13
     3.4       Order of Repayment. . . . . . . . . . . . . . . . . . . . . .  13

                                    ARTICLE 4
               SECURITY FOR PAST, PRESENT AND FUTURE INDEBTEDNESS. . . . . .  13
     4.1       Security. . . . . . . . . . . . . . . . . . . . . . . . . . .  13
     4.2       Mortgaged Property. . . . . . . . . . . . . . . . . . . . . .  14
     4.3       Exceptions. . . . . . . . . . . . . . . . . . . . . . . . . .  14
     4.4       Obligation to Pay . . . . . . . . . . . . . . . . . . . . . .  15
     4.5       Defeasance. . . . . . . . . . . . . . . . . . . . . . . . . .  15
     4.6       Partial Release . . . . . . . . . . . . . . . . . . . . . . .  15
     4.7       Proviso for Possession Until Default. . . . . . . . . . . . .  16

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                                    ARTICLE 5
          COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE CORPORATION . . .  16
     5.1       Representations and Warranties. . . . . . . . . . . . . . . .  16
     5.2       Covenants . . . . . . . . . . . . . . . . . . . . . . . . . .  16
     5.3       Insurance . . . . . . . . . . . . . . . . . . . . . . . . . .  19
     5.4       Negative Covenants. . . . . . . . . . . . . . . . . . . . . .  20
     5.5       Defend Mortgaged Property . . . . . . . . . . . . . . . . . .  20
     5.6       Supplemental Instruments. . . . . . . . . . . . . . . . . . .  21
     5.7       To Pay Trustee's Remuneration . . . . . . . . . . . . . . . .  21
     5.8       Trustee May Perform Covenants . . . . . . . . . . . . . . . .  22

                                    ARTICLE 6
                                     DEFAULT . . . . . . . . . . . . . . . .  22
     6.1       Acceleration of Maturity. . . . . . . . . . . . . . . . . . .  22
     6.2       Notice of Events of Default . . . . . . . . . . . . . . . . .  23
     6.3       Waiver of Default . . . . . . . . . . . . . . . . . . . . . .  23
     6.4       Enforcement by the Trustee. . . . . . . . . . . . . . . . . .  24
     6.5       No Suits by Debentureholders. . . . . . . . . . . . . . . . .  28
     6.6       Application of Monies by Trustee. . . . . . . . . . . . . . .  28
     6.7       Distribution of Proceeds. . . . . . . . . . . . . . . . . . .  29
     6.8       Remedies Cumulative . . . . . . . . . . . . . . . . . . . . .  29
     6.9       Judgment Against the Corporation. . . . . . . . . . . . . . .  29
     6.10      Immunity of Shareholders and Others . . . . . . . . . . . . .  29
     6.11      Trustee Appointed Attorney. . . . . . . . . . . . . . . . . .  30

                                    ARTICLE 7
                           SATISFACTION AND DISCHARGE. . . . . . . . . . . .  30
     7.1       Cancellation and Destruction. . . . . . . . . . . . . . . . .  30
     7.2       Non-Presentation of Debentures. . . . . . . . . . . . . . . .  30
     7.3       Repayment of Unclaimed Monies or Common Shares. . . . . . . .  30

                                    ARTICLE 8
                             SUCCESSOR CORPORATIONS. . . . . . . . . . . . .  31
     8.1       Certain Requirements. . . . . . . . . . . . . . . . . . . . .  31
     8.2       Vesting of Powers in Successor. . . . . . . . . . . . . . . .  31

                                    ARTICLE 9
                          MEETINGS OF DEBENTUREHOLDERS . . . . . . . . . . .  32
     9.1       Right to Convene Meeting. . . . . . . . . . . . . . . . . . .  32
     9.2       Notice of Meetings. . . . . . . . . . . . . . . . . . . . . .  32
     9.3       Chairman. . . . . . . . . . . . . . . . . . . . . . . . . . .  32
     9.4       Quorum. . . . . . . . . . . . . . . . . . . . . . . . . . . .  32
     9.5       Power to Adjourn. . . . . . . . . . . . . . . . . . . . . . .  33
     9.6       Show of Hands . . . . . . . . . . . . . . . . . . . . . . . .  33
     9.7       Poll. . . . . . . . . . . . . . . . . . . . . . . . . . . . .  33
     9.8       Voting. . . . . . . . . . . . . . . . . . . . . . . . . . . .  33
     9.9       Regulations . . . . . . . . . . . . . . . . . . . . . . . . .  34
     9.10      Persons Entitled to Attend Meetings . . . . . . . . . . . . .  34
     9.11      Powers Exercisable by Extraordinary Resolution. . . . . . . .  34
     

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                                     -iii-

     9.12      Meaning of "Extraordinary Resolution" . . . . . . . . . . . .  36
     9.13      Powers Cumulative . . . . . . . . . . . . . . . . . . . . . .  36
     9.14      Minutes . . . . . . . . . . . . . . . . . . . . . . . . . . .  37
     9.15      Instruments in Writing. . . . . . . . . . . . . . . . . . . .  37
     9.16      Binding Effect of Resolutions . . . . . . . . . . . . . . . .  37
     9.17      Evidence of Rights of Debentureholders. . . . . . . . . . . .  37

                                   ARTICLE 10
                                     NOTICES . . . . . . . . . . . . . . . .  38
     10.1      Notice to Corporation . . . . . . . . . . . . . . . . . . . .  38
     10.2      Notice to Debentureholders. . . . . . . . . . . . . . . . . .  38
     10.3      Notice to Trustee . . . . . . . . . . . . . . . . . . . . . .  39

                                   ARTICLE 11
                             CONCERNING THE TRUSTEE. . . . . . . . . . . . .  39
     11.1      No Conflict of Interest . . . . . . . . . . . . . . . . . . .  39
     11.2      Replacement of Trustee. . . . . . . . . . . . . . . . . . . .  39
     11.3      Duties of Trustee . . . . . . . . . . . . . . . . . . . . . .  40
     11.4      Reliance Upon Declarations. . . . . . . . . . . . . . . . . .  40
     11.5      Evidence of Compliance to Trustee . . . . . . . . . . . . . .  40
     11.6      Officers' Certificate as Evidence . . . . . . . . . . . . . .  42
     11.7      Experts, Advisors and Agents. . . . . . . . . . . . . . . . .  42
     11.8      Trustee May Deal in Debentures. . . . . . . . . . . . . . . .  42
     11.9      Investment of Monies Held by Trustee. . . . . . . . . . . . .  43
     11.10     Trustee Not Ordinarily Bound. . . . . . . . . . . . . . . . .  43
     11.11     Trustee Not Required to Give Security . . . . . . . . . . . .  43
     11.12     Trustee Not to be Appointed Receiver. . . . . . . . . . . . .  44
     11.13     Trustee Not Bound to Act on Corporation's Request . . . . . .  44
     11.14     Protection of Trustee . . . . . . . . . . . . . . . . . . . .  44
     11.15     Conditions Precedent to Trustee's Obligations to Act
               Hereunder . . . . . . . . . . . . . . . . . . . . . . . . . .  44
     11.16     Authority to Carry on Business. . . . . . . . . . . . . . . .  45
     11.17     Acceptance of Trust . . . . . . . . . . . . . . . . . . . . .  45
     11.18     Direction of Trustee's Actions by Holders . . . . . . . . . .  45
     11.19     Environmental Indemnity . . . . . . . . . . . . . . . . . . .  45

                                   ARTICLE 12
                            CONVERSION OF DEBENTURES . . . . . . . . . . . .  46
     12.1      Conversion. . . . . . . . . . . . . . . . . . . . . . . . . .  46
     12.2      Manner of Exercise of Right to Convert. . . . . . . . . . . .  47
     12.3      Adjustment. . . . . . . . . . . . . . . . . . . . . . . . . .  49
     12.4      No Requirement to Issue Fractional Shares . . . . . . . . . .  50
     12.5      Corporation to Reserve Shares . . . . . . . . . . . . . . . .  50
     12.6      Taxes and Charges on Conversion . . . . . . . . . . . . . . .  51
     12.7      Cancellation of Converted Debentures. . . . . . . . . . . . .  51
     12.8      Certificate as to Adjustment. . . . . . . . . . . . . . . . .  51
     12.9      Notice of Special Matters . . . . . . . . . . . . . . . . . .  51

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                                   ARTICLE 13
                             SUPPLEMENTAL INDENTURES . . . . . . . . . . . .  52
     13.1      Supplemental Indentures . . . . . . . . . . . . . . . . . . .  52

                                   ARTICLE 14
                            EXECUTION AND FORMAL DATE. . . . . . . . . . . .  52
     14.1      Execution . . . . . . . . . . . . . . . . . . . . . . . . . .  52
     14.2      Formal Date . . . . . . . . . . . . . . . . . . . . . . . . .  53

<PAGE>

                                    

THIS INDENTURE dated the 8th day of August, 1996 and made effective as of the 
31st day of July, 1996.

BETWEEN:

          BATTERY ONE, INC., a corporation incorporated under the laws
          of the Province of Alberta and having its head office in the
          City of Calgary, in the Province of Alberta

          (hereinafter called the "Corporation")

                                                               OF THE FIRST PART

                                     - and -

          MONTREAL TRUST COMPANY OF CANADA, a trust company
          incorporated under the laws of Canada and authorized to
          carry on business in all provinces of Canada

          (hereinafter called the "Trustee")

                                                              OF THE SECOND PART

WHEREAS:

1.        The Corporation has agreed to issue a minimum of $2,500,000 and a
maximum of $6,000,000 in principal amount of Special Notes pursuant to the
Special Note Indenture;

2.        The Special Notes entitle the holders thereof to acquire Debentures of
the Corporation, each Special Note exercisable to acquire Debentures on the
basis of $1,000 principal amount of Special Notes per $1,000 principal amount of
Debentures;

3.        The Corporation has deemed it necessary for its corporate purposes to
create and issue the Debentures upon exercise of the Special Notes as herein
provided;

4.        The Corporation, under the laws relating thereto, is duly authorized
to create and issue the Debentures to be issued as herein provided;

5.        All necessary by-laws and resolutions of the Corporation have been
duly enacted, passed, and/or confirmed and other proceedings taken and
conditions complied with to make the creation and issue of the Debentures
proposed to be issued hereunder and this Indenture and the execution thereof
legal, valid and binding on the Corporation in accordance with the laws relating
to the Corporation;

6.        The Trustee has agreed to act as trustee on behalf of the
Debentureholders (and not as agent for the Corporation) in the manner and upon
the terms hereinafter set forth; and

7.        The foregoing recitals are made as representations and statements of
fact by the Corporation and not by the Trustee.

NOW THEREFORE it is hereby witnessed, covenanted, agreed and declared as
follows:

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                                    -2-


                                    ARTICLE 1
                                 INTERPRETATION
 
1.1       DEFINITIONS

          In this Indenture and in the Debentures, unless there is something in
the subject matter or context inconsistent therewith, the following expressions
shall mean as follows:

     (a)  "Agency Agreement" means the agency agreement, dated August 8, 1996
          and made effective as of the 31st day of July, 1996 between the
          Corporation and the Agent relating to the offering of the Debentures;

     (b)  "Agent" means C.M. Oliver & Company Limited;

     (c)  "this Indenture", "this Debenture Trust Indenture", "hereto",
          "herein", "hereby", "hereunder", "hereof" and similar expressions
          refer to this indenture and not to any particular article, clause,
          subclause, subdivision or other portion hereof and, include any and
          every instrument supplemental or ancillary hereto;

     (d)  "Applicable Law" means, in relation to any person, transaction or
          event, all applicable provisions (or mandatory applicable provisions,
          if so specified) of laws, statutes, rules, regulations, official
          directives and orders of all governmental bodies (whether
          administrative, legislative, executive or otherwise) and judgments,
          orders and decrees of all courts, arbitrators, commissions or bodies
          exercising similar functions having jurisdiction over the person,
          transaction or event in question;

     (e)  "Business Day" means a day which is not Saturday or Sunday or a legal
          holiday in the City of Calgary, Alberta;

     (f)  "Common Shares" means fully paid and non-assessable common shares of
          the Corporation as presently constituted, provided that in the event
          of an adjustment pursuant to clause 12.3, then "Common Share" shall
          thereafter mean a share or other security or property purchasable upon
          exercise of a Debenture as a result of any such adjustment;

     (g)  "Conversion Date" means, with respect to any Debenture, the date on
          which the Debenture Certificate representing such Debenture is
          surrendered for conversion into Common Shares as contemplated in
          clause 12.2 hereof;

     (h)  "Conversion Price" means the price at which the principal amount of
          the Debentures are convertible into Common Shares of the Corporation
          as described in clause 12.1(a) or 12.1(b), as the case may be;

     (i)  "Corporation" means the party of the first part hereunder and includes
          any successor corporation to or of the Corporation which shall have
          complied with the provisions of Article 8;

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                                      -3-

     (j)  "Corporation's Auditors" or "Auditors of the Corporation" means an
          independent firm of chartered or certified public accountants duly
          appointed as auditors of the Corporation;

     (k)  "Counsel" means a barrister or solicitor or firm of barristers or
          solicitors retained or employed by the Trustee or retained or employed
          by the Corporation;

     (l)  "Debenture Certificate" means a certificate issued on or after the
          Issue Date to evidence Debentures;

     (m)  "Debentures" means the series of $6,000,000 10% convertible fixed and
          floating charge secured debentures of the Corporation issued or to be
          issued hereunder and for the time being outstanding;

     (n)  "Debentureholders" or "holders" means the several persons for the time
          being entered in the registers hereinafter mentioned as holders of
          Debentures;

     (o)  "director" means a director of the Corporation for the time being and
          "directors" or "board of directors" means the board of directors of
          the Corporation or, if duly constituted and whenever duly empowered,
          the executive committee of the board of directors of the Corporation
          for the time being, and reference to action by the directors means
          action by the directors of the Corporation as a board or action by the
          said executive committee as such committee;

     (p)  "dollars" or "$" means, unless otherwise stated, Canadian dollars and
          all reference to cash or money shall mean dollars as so defined;

     (q)  "Effective Date" means the 31st day of July, 1996;

     (r)  "Event of Default" means any event specified in clause 6.1, continued
          for the period of time, if any, therein designated;

     (s)  "Filing Jurisdiction" means each of the Provinces of Alberta, British
          Columbia and Ontario;

     (t)  "Issue Date" means the date upon which the Debentures are issued;

     (u)  "Mortgaged Property" shall have the meaning ascribed thereto in
          clause 4.2 hereof, including, without limitation, all of the
          undertaking, property and assets, both present and future, of the
          Corporation, of whatsoever nature and kind and wheresoever situated,
          that are from time to time subject to any mortgage, lien, assignment,
          transfer, hypothec, pledge or charge created under or secured by this
          Indenture or by any indenture supplementary hereto;

     (v)  "Negotiable Instruments" means cash and all negotiable instruments
          including, without limitation, promissory notes, cheques, drafts and
          bills of exchange;

     (w)  "Note Agency" means the principal office of the Trustee in the City of
          Calgary, or such place as may be designated in accordance with
          clause 2.6 hereof;

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                                      -4-

     (x)  "Officer's Certificate" means a certificate signed by the Chairman,
          President, Vice-President or by the Secretary of the Corporation;

     (y)  "Order" means an order of a Securities Commission in a Filing
          Jurisdiction that permits the Debentures and Common Shares issuable
          upon the exercise of Debentures to be tradeable in such Filing
          Jurisdiction without being subject to the prospectus requirement nor
          any "hold period" under the Applicable Legislation in such Filing
          Jurisdiction;

     (z)  "Permitted Encumbrances" means, as of any date, any of the following:
     
          (i)    liens for taxes, assessments or governmental charges:

                 (1)    not at such date due or delinquent; or

                 (2)    the validity of which the Corporation shall be
                        contesting in good faith and in respect of which:

                        (A)    an amount in cash sufficient to pay such taxes,
                               assessments or charges shall have been deposited
                               with a court, a taxing or assessing authority or
                               the Debentureholder; or

                        (B)    a surety bond, satisfactory to the
                               Debentureholder, for such amount shall have been
                               deposited with the Debentureholder;

          (ii)   the lien of any judgment rendered, or of any claim filed,
                 against the Corporation which the Corporation shall be
                 contesting in good faith and in respect of which:

                 (1)    an amount in cash sufficient to pay such judgment or
                        claim shall have been deposited with a court or the
                        Debentureholder; or

                 (2)    a surety bond, satisfactory to the Debentureholder, for
                        such amount, shall have been deposited with the
                        Debentureholder;

          (iii)  undetermined or inchoate liens incidental to construction or
                 current operations which have not at such date been filed
                 pursuant to law against the Mortgaged Property or against the
                 Corporation or which relate to obligations not at such date due
                 or delinquent;

          (iv)   easements, rights of way, servitudes or other similar rights in
                 property (including, without limitation, rights of way and
                 servitudes for railways, sewers, drains, pipelines, gas and
                 water mains, electric light, power, telephone, telegraph or
                 cable television conduits, poles, wires and cables) granted to
                 or reserved or taken by other persons which in the aggregate do
                 not materially detract from the value of such property or

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                                      -5-

                 materially impair its use in the operation of the business of
                 the Corporation;

          (v)    security given by the Corporation to a public utility, any
                 municipality, governmental or other public authority when
                 required by such utility, municipality or authority in the
                 ordinary course of the business of the Corporation; and

          (vi)   any other lien, the validity of which is being contested in
                 good faith and where the Corporation has deposited:

                 (1)    with the court of the Debentureholder, an amount in cash
                        sufficient to pay the same in full;

                 (2)    with the Debentureholder, a surety bond, satisfactory to
                        the Holder, for such amount;

     (aa) "person" means an individual, corporation, company, partnership,
          association or trust;

     (ab) "principal" or "principal amount" means the principal sum of up to and
          including $6,000,000 or part thereof which remains outstanding and
          unpaid from time to time;

     (ac) "Prospectus" means a final prospectus in respect of the distribution
          of Debentures and Common Shares upon the exercise of the Debentures;

     (ad) "receiver" means the receiver appointed pursuant to clause 6.4(g)
          hereof and includes a receiver manager;

     (ae) "Securities Commissions" means, collectively, the securities
          commissions or similar regulatory authorities in the Filing
          Jurisdictions;

     (af) "Security Interest" means any assignment, mortgage, charge, pledge,
          lien, encumbrance or security interest whatsoever, howsoever, created
          or arising, whether absolute or contingent, fixed or floating,
          perfected or not, but does not include set-off or any right of set-
          off;

     (ag) "Special Note Indenture" means the special note trust indenture, dated
          August 8, 1996 and made effective as of July 31, 1996, between the
          Corporation and the Trustee providing for the issuance of the Special
          Notes, as amended or supplemented from time to time;

     (ah) "Special Notes" means the special notes issued and certified under the
          Special Note Indenture;

     (ai) "Subsidiary" or "Subsidiary Company" means any corporation of which
          more than fifty (50%) percent of the outstanding voting shares are
          owned, directly or indirectly, by or for the Corporation, provided
          that the ownership of such 

<PAGE>

                                      -6-

          voting shares confers the right to elect at least a majority of the 
          board of directors of such corporation and includes any corporation 
          in like relation to a subsidiary;

     (aj) "Trustee" means the party of the second part hereunder or its
          successor or successors for the time being as trustee hereunder; 

     (ak) "Voting Shares" means shares of capital stock of any class of any
          corporation carrying voting rights under all circumstances, provided
          that, for the purposes of such definition, shares which only carry the
          right to vote conditionally on the happening of an event shall not be
          considered voting shares, whether or not such event shall have
          occurred, nor shall any shares be deemed to cease to be voting shares
          solely by reason of a right to vote accruing to shares of another
          class or classes by reason of the happening of such event; and

     (al) "written direction of the Corporation" means an instrument in writing
          signed by the Chairman, President, Vice-President or by the Secretary
          of the Corporation.

1.2       GENDER

          Words importing the singular number shall also include the plural and
vice versa, and words importing any of the masculine, feminine or neuter genders
shall include the others.

1.3       HEADINGS

          The division of this Indenture into Articles and Clauses, the
provision of a table of contents and the insertion of headings are for
convenience of reference only and shall not affect the construction or
interpretation of this Indenture or the Debentures.

1.4       APPLICABLE LAW

          This Indenture and the Debentures shall be construed in accordance
with the laws of the Province of Alberta and shall be treated in all respects as
Alberta contracts.

1.5       ENUREMENT

          This Indenture and the Debentures shall enure to the benefit of and be
binding upon in respect of successors, heirs, executors, administrators and
permitted assigns of the Corporation, the Trustee and the holders.

1.6       MEANING OF "OUTSTANDING"

          Every Debenture certified and delivered by the Corporation and Trustee
hereunder shall be deemed to be outstanding until it shall be cancelled or
delivered to the Trustee for cancellation or monies for the payment or
conversion thereof shall have been set aside under clause 7.2, as the case may
be, provided that:

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                                      -7-

     (a)  Debentures which have been partially converted shall be deemed to be
          outstanding only to the extent of the unconverted part of the
          principal amount thereof;

     (b)  when a new Debenture has been issued in substitution for a Debenture
          which has been lost, stolen or destroyed, only one of such Debentures
          shall be counted for the purpose of determining the aggregate
          principal amount of Debentures outstanding; and

     (c)  for the purposes of any provision of this Indenture entitling holders
          of outstanding Debentures to vote, sign consents, requisitions or
          other instruments or take any other action under this Indenture,
          Debentures owned directly or indirectly, legally or equitably by the
          Corporation or any Subsidiary shall be disregarded except that:

          (i)    for the purpose of determining whether the Trustee shall be
                 protected in relying on any such vote, consent, requisition or
                 other instrument or action, only the Debentures which the
                 Trustee knows are so owned shall be so disregarded; and

          (ii)   Debentures so owned which have been pledged in good faith other
                 than to the Corporation or a Subsidiary shall not be so
                 disregarded if the pledgee shall establish to the satisfaction
                 of the Trustee the pledgee's right to vote such Debentures in
                 his discretion free from the control of the Corporation or any
                 Subsidiary.


                                    ARTICLE 2
                                 THE DEBENTURES

2.1       PRINCIPAL AMOUNT

          The aggregate principal amount of Debentures authorized to be issued
under this Indenture shall consist of and be limited to six million ($6,000,000)
dollars in lawful money of Canada.

          The Debentures shall be designated as "$6,000,000 10% Convertible
Fixed and Floating Charge Secured Debentures" and shall be dated as of the Issue
Date.  

2.2       FORM AND SIGNATURE OF DEBENTURES

          The Debentures shall be issued only as fully registered Debentures in
the denomination of $1,000 and integral multiples of $1,000.  The Debentures and
the certificate of the Trustee endorsed thereon shall be substantially in the
form set forth in Schedule "A" hereto.  The Debentures shall be dated as of the
Issue date and shall bear such distinguishing letters and numbers as the Trustee
may approve.

          The Debentures may be engraved, printed or lithographed, or be partly
in one form and partly in another, as the Corporation may determine.

<PAGE>

                                     -8-

          The Debentures shall be under the seal of the Corporation (or a
reproduction thereof which shall be deemed to be the seal of the Corporation)
and shall be signed (either manually or by facsimile signature) by any one
officer or director of the Corporation.  A facsimile signature upon any of the
Debentures shall for all purposes of this Indenture be deemed to be the
signature of the person whose signature it purports to be and to have been
signed at the time such facsimile signature is reproduced and notwithstanding
that any person whose signature, either manual or in facsimile, may appear on
the Debentures is not, at the date of this Indenture or at the date of the
Debentures or at the date of the certifying and delivery thereof, the holder of
the office indicated, any such Debentures shall be valid and binding upon the
Corporation and entitled to the benefits of this Indenture.

2.3       ISSUE OF DEBENTURES

          The Debentures shall be issued from time to time upon the holders of
Special Notes duly exercising the Special Notes pursuant to the Special Note
Indenture.

          Debentures in the aggregate principal amount not exceeding six million
($6,000,000) dollars in lawful money of Canada shall be executed by the
Corporation and, forthwith after such execution, shall be delivered to the
Trustee and shall be certified by the Trustee and delivered to or to the order
of the Corporation pursuant to a written direction of the Corporation without
the Trustee receiving any consideration therefor.

2.4       CERTIFICATION

          No Debenture shall be issued or, if issued, shall be obligatory or
shall entitle the holder to the benefits of this Indenture, until it has been
certified by or on behalf of the Trustee substantially in the form set out in
Schedule "A" hereto or in some other form approved by the Trustee.  Such
certification on any Debenture shall be conclusive evidence that such Debenture
is duly issued, is a valid obligation of the Corporation and is entitled to the
benefits hereof.

          The certificate of the Trustee signed on the Debentures shall not be
construed as a representation or warranty by the Trustee as to the validity of
this Indenture or of the Debentures or as to the issuance of the Debentures, and
the Trustee shall in no respect be liable or answerable for the use made of the
Debentures or any of them or the proceeds thereof.  The certificate of the
Trustee signed on the Debentures, shall, however, be a representation and
warranty by the Trustee that the Debentures have been duly certified by or on
behalf of the Trustee pursuant to the provisions of this Indenture.

2.5       DEBENTURES TO RANK PARI PASSU

          The Debentures may be issued in such amounts, to such persons and on
such terms not inconsistent with the provisions of this Indenture, as the
directors may determine.  Each Debenture as soon as issued or negotiated shall,
subject to the terms hereof, be equally and proportionately entitled to the
benefits hereof as if all of the Debentures had been issued and negotiated
simultaneously.




<PAGE>

                                    - 9 -

2.6       REGISTRATION AND TRANSFER OF DEBENTURES

          The Corporation shall, at all times while any Debentures are 
outstanding, cause to be kept by and at the principal office of the Trustee 
in the City of Calgary and in such other place or places as the Corporation 
with the approval of the Trustee may designate, registers in which shall be 
entered the names and addresses of the holders of Debentures and particulars 
of the Debentures held by them respectively and of all transfers of 
Debentures.  The registers referred to in this clause shall at all reasonable 
times be open for inspection by the Corporation, the Trustee and any 
Debentureholder.

          The Debentures are subject to resale restrictions and may not be 
sold or otherwise traded or transferred except in accordance with the 
provisions of applicable securities legislation.  Compliance with the 
securities laws of any jurisdiction to which the Debentureholder or 
transferee is subject is the responsibility of the Debentureholder or its 
transferee.

          Except in the case of the register required to be kept at the City 
of Calgary, the Corporation shall have power at any time to close any 
register upon which the registration of any Debenture appears and in that 
event it shall transfer the records thereof to another existing register or 
to a new register and thereafter such Debentures shall be deemed to be 
registered on such existing or new register, as the case may be.

          The Debentures may only be transferred on the registers as herein 
contemplated by the holder or its legal representatives or its attorney duly 
appointed by an instrument in writing in form and execution satisfactory to 
the Trustee only upon surrendering to the Trustee of the Debenture 
Certificate or Debenture Certificates representing the Debentures to be 
transferred, with the transfer form thereon duly completed and executed, 
signed by the Debentureholder or by the duly appointed legal representative 
thereof or a duly authorized attorney, together with evidence of authority of 
any such legal representative or attorney and, if required by the transfer 
form, with such signature properly guaranteed, and upon compliance with (i) 
the conditions herein; (ii) any reasonable requirements as the Trustee may 
prescribe; and (iii) all applicable securities legislation and requirements 
of regulatory authorities relating to the transferability of the Debentures 
or restrictions thereon; and such transfer shall be duly noted in the 
registers of the Debentures as herein contemplated by the Trustee.  Upon 
compliance with such requirements, the Trustee shall issue to the transferee 
a Debenture Certificate representing the Debentures transferred. Such new 
Debenture Certificate shall be sent by first class mail or held for pick-up 
by the transferee in accordance with the instructions given on the transfer 
form and, if no such instructions are given, shall be sent by first class 
mail to the address of the transferee appearing on the form of transfer. If 
less than all of the Debenture represented by a Debenture Certificate are 
transferred, the Trustee shall issue a new Debenture Certificate representing 
the Debentures not transferred in the same name as the name appearing on the 
Debenture Certificate surrendered for transfer.  Such new Debenture 
Certificate shall be sent by first class mail or held for pick-up in 
accordance with instructions given on the transfer form, and, if no 
instructions are given, shall be sent by first class mail to the address of 
the holder of the Debenture surrendered for transfer appearing on the 
register of the Debentures as herein contemplated.

<PAGE>

                                  - 10 -

          The Corporation and the Trustee will deem and treat the registered 
owner of any Debenture as the beneficial owner thereof for all purposes and 
neither the Corporation nor the trustee shall be effected by any notice to 
the contrary.

          Subject to the provisions of this Indenture, and applicable law, 
the Debentureholder shall be entitled to the rights and privileges attached 
to the Debentures and the issuance of Common Shares upon conversion of the 
Debentures by any Debentureholder in accordance with the terms and conditions 
herein contained shall discharge all responsibilities of the Corporation and 
the Trustee with respect to such Debentures and neither the Corporation nor 
the Trustee shall be bound to inquire into the title of any such holder.

          Notwithstanding the foregoing, neither the Corporation nor the 
Trustee shall be required to transfer or exchange any Debentures on any 
payment date or during a period of seven (7) Business Days immediately 
preceding any such date.

          Neither the Trustee, the Corporation nor any registrar shall be 
charged with notice of or be bound to see to the execution of any trust, 
whether expressed, implied or constructive, in respect of any Debenture, and 
the Trustee or the Corporation may transfer any Debenture on the direction of 
the holder thereof, whether named as trustee or otherwise, as though that 
person were the beneficial owner thereof.

2.7       PERSONS ENTITLED TO PAYMENT

          The person in whose name any Debenture shall be registered shall be 
deemed and regarded as the owner thereof for all purposes of this Indenture 
and payment of or on account of the principal amount of such Debenture shall 
be made only to or upon the order in writing of such holder thereof.  Such 
payment shall be a good and sufficient discharge to the Trustee and any 
registrar and to the Corporation and any paying agent for the amounts so paid.

          The holder for the time being of any Debenture shall be entitled to 
the principal monies, free from all equities and rights of set-off or counter 
claim between the Corporation and the original or any intermediate holder 
thereof, and all persons may act accordingly.  A transferee of a Debenture 
shall, after an appropriate form of transfer is lodged with the Trustee or 
other registrar and upon compliance with all other conditions in that behalf 
required by this Indenture or by any conditions contained in such Debenture 
or by law, be entitled to be entered on any of the appropriate registers as 
the owner of such Debenture free from all equities and rights of set-off or 
counterclaim between the Corporation and his transferor or any previous 
holder thereof, save in respect of equities of which the Corporation is 
required to take notice by statute or by order of a court of competent 
jurisdiction.

          Delivery to the Trustee by a Debentureholder of a Debenture or the 
receipt of such holder for the principal monies shall be a good and 
sufficient discharge to the Corporation (subject to any outstanding 
obligations owing by the Corporation to any Debentureholder pursuant to 
Articles 3, 4, 5, 6, 7 and 8 herein), which shall not be bound to enquire 
into the title of such holder, save as ordered by some court of competent 
jurisdiction or as required by statute. Neither the Corporation, the Trustee 
nor any registrar shall be charged with notice of or be bound to see to the 
execution of any trust, whether express, implied or constructive, 

<PAGE>

                                  - 11 -

in respect of any Debenture nor be affected by notice of any equity that may 
be subsisting in respect thereof.

          Where Debentures are registered in more than one name the principal 
monies may be paid by cheque payable to the order of all such holders, 
failing written instruction from them to the contrary, and such payment shall 
be a good and sufficient discharge to the Trustee and any registrar and to 
the Corporation (subject to any outstanding obligations owing by the 
Corporation to any Debentureholder pursuant to Articles 3, 4, 5, 6, 7 and 8 
herein) and any paying agent.

          In the case of the death of one or more joint holders, the 
principal monies may be paid to the survivor or survivors of such holders 
whose receipt therefor shall constitute a good and sufficient discharge to 
the Trustee and any registrar and to the Corporation and paying agent.

2.8       MUTILATION, LOSS, THEFT OR DESTRUCTION

          In case any of the Debentures issued hereunder shall become 
mutilated or be lost, stolen or destroyed, the Corporation, in its 
discretion, may issue, and thereupon the Trustee shall certify and deliver, a 
new Debenture upon surrender and cancellation of the mutilated Debenture, or 
in the case of a lost, stolen or destroyed Debenture, in lieu of and in 
substitution for the same, and the substituted Debenture shall be in a form 
approved by the Trustee and shall be entitled to the benefits of this 
Indenture equally with all other Debentures issued or to be issued hereunder 
without preference or priority one over another.  In case of loss, theft or 
destruction the applicant for a substituted Debenture shall furnish to the 
Corporation and to the Trustee such evidence of such loss, theft or 
destruction as shall be satisfactory to them in their discretion and shall 
also furnish indemnity satisfactory to them in their discretion.  The 
applicant shall pay all reasonable expenses incidental to the issuance of any 
substituted Debenture.

2.9       EXCHANGES OF DEBENTURES

          Debentures of any denomination may be exchanged for Debentures of 
any other authorized denomination or denominations for an equivalent 
aggregate principal amount.  Any exchange of Debentures may be made at the 
offices of the Trustee or at the offices of any registrar or registrars where 
registers are maintained for the Debentures pursuant to the provisions of 
clause 2.6.  Any Debentures tendered for exchange shall be surrendered to the 
Trustee or appropriate registrar and shall be cancelled.

2.10      CHARGES

          Except as herein otherwise provided and subject to the terms 
hereof, upon any exchange of Debentures of any denomination for other 
Debentures and upon any transfer of Debentures, the Corporation or the 
Trustee may make a sufficient charge to reimburse it for any stamp or 
security transfer taxes or other governmental charge required to be paid and, 
in addition, a reasonable charge for its services, and payment of the said 
charge shall be made by the party requesting such exchange or transfer as a 
condition precedent thereto.

<PAGE>

                                  - 12 -

2.11      OPTION OF HOLDER AS TO PLACE OF PAYMENT

          Except as herein otherwise provided, all sums which may at any time 
become payable, whether at maturity or otherwise, on account of any Debenture 
shall be payable at the option of the holder at any of the places at which 
the principal of such Debentures are payable.

2.12      TRUSTEE NOT BOUND TO MAKE ENQUIRIES

          The Trustee, prior to the certification and delivery of any 
Debentures under any of the provisions of this Article, shall not be bound to 
make any enquiry or investigation as to the correctness of the matters set 
out in any of the resolutions, opinions, certificates or other documents 
required by the provisions of this Indenture, but shall be entitled to accept 
and act upon the said resolutions, opinions, certificates and other 
documents.  The Trustee may nevertheless, in its discretion, require further 
proof in cases where it deems further proof desirable.

2.13      DEBENTUREHOLDER NOT A SHAREHOLDER

          Nothing in this Indenture or in the holding of a Debenture or 
otherwise, shall, in itself, confer or be construed as conferring upon a 
Debentureholder any right or interest whatsoever as a shareholder or as any 
other shareholder of the Corporation, including, but not limited to, the 
right to vote at, to receive notice of, or to attend, meetings of 
shareholders or any other proceedings of the Corporation, or the right to 
receive dividends or other distributions.

                                 ARTICLE 3
                                 REPAYMENT
                                 --------- 

3.1       COVENANT TO PAY

          The Corporation, for value received, acknowledges and confirms 
itself to be indebted to the holders and promises to pay the holders the 
principal amount of Debentures outstanding from time to time, in the manner 
and the priority as hereinafter set forth, or on such earlier date as the 
principal amount hereby secured may be payable and in the meantime promises 
to pay interest on the principal amount at the rate and times as hereinafter 
set forth, and should the Corporation at any time make default of its 
obligations or in the payment of any part or all of the principal amount or 
interest, then to pay interest on the amount in default both before and after 
judgment at the same rate and like money at the same place on the same date.

3.2       MATURITY

          The Debentures shall mature and become payable on July 31, 2001.

<PAGE>

                                  - 13 -
3.3       INTEREST

          Except in the event that the Debentures or any part thereof is
converted into Common Shares of the Corporation as hereinafter provided,
interest shall be payable on the outstanding balance of the principal amount of
the Debentures at a rate of ten (10%) percent per annum and payable after as
well as before maturity, default and judgment with interest payable on overdue
interest at the same rate.

          Interest shall accrue from the most recent date to which interest 
has been paid or, if no interest has been paid, from the date of the 
execution of this Indenture.  Interest will be computed on the basis of a 365 
day year.  As interest becomes due hereunder, the Corporation shall pay such 
interest at the holder's office as contemplated in clause 2.6 and clause 2.7 
hereof.

          The Corporation will pay interest semi-annually on the last day of 
each calendar month of such half year during the term of the Debentures (June 
30 and December 31), from the date of execution of this Indenture, with the 
first payment of interest to commence on December 31, 1996.

3.4       ORDER OF REPAYMENT

          The holders shall, and the Corporation hereby irrevocably 
authorizes the holders, to apply all payments made by the Corporation against 
the principal amounts of the Debentures, interest thereon and other monies 
which are payable by the Corporation under the Debentures in the following 
order:  (a) all expenses and other monies from time to time secured 
hereunder; (b) interest payable hereunder; and (c) the principal amount of 
the Debentures.

                                    ARTICLE 4
               SECURITY FOR PAST, PRESENT AND FUTURE INDEBTEDNESS
               --------------------------------------------------

4.1       SECURITY

          The mortgages, pledges and charges created herein shall take effect 
forthwith upon the execution hereof and shall secure any and all indebtedness 
now or hereafter owing by the Corporation to the holders hereunder; and 
provided further, without restricting the generality of the foregoing, the 
Corporation may reduce the principal amount outstanding from time to time, 
without notice, bonus or penalty, and the holders, if they are so willing, 
and in their sole discretion, may provide further advances to the Corporation 
to the extent that the balance outstanding may be increased, reduced and 
varied from time to time; and provided further, without restricting the 
generality of the foregoing, the indebtedness secured by the mortgages, 
pledges and charges created herein shall include the following:

     (a)  Any sums advanced by the holders on behalf of the Corporation or
          expenses or costs incurred by the holders, or the Trustee appointed
          hereunder, which are made or incurred pursuant to, or permitted by,
          the terms hereof, from the date of the advances or the incurring of
          such expenses or costs until reimbursed;

<PAGE>

                                 - 14 -

     (b)  Any and all other indebtedness of the Corporation to the holders now
          or hereafter owing, regardless of how evidenced or arising, including
          but without limitation, any and all Debentures issued hereunder; and

     (c)  Any extensions or renewals of all such indebtedness described herein.

4.2       MORTGAGED PROPERTY

          In consideration of the premises herein contained and one ($1.00) 
dollar paid by the Trustee to the Corporation, the receipt and sufficiency 
whereof is hereby acknowledged, and to secure the due payment of the 
principal amount of the Debentures from time to time issued and certified 
hereunder and all other monies, if any, for the time being and from time to 
time owing on the security of this Indenture and the due performance of the 
obligations of the Corporation herein contained and in pursuance of the power 
and authority hereinbefore recited and of every other power and authority it 
thereunto enables, and subject to the Permitted Encumbrances, the Corporation 
hereby grants, assigns, transfers, mortgages, pledges, charges and grants a 
Security Interest to and in favour of the Trustee, as trustee on behalf of 
the Debentureholders, a first fixed and floating charge over and in respect 
of all of its undertaking and all of the property and assets of the 
Corporation for the time being, both present and future of whatsoever nature 
including, without restricting the generality of the foregoing, any real and 
personal, moveable and immoveable property, of whatsoever nature and kind and 
wheresoever situate, both present and future,  except to the extent that the 
Personal Property Security Act, Alberta, is not applicable to a security 
interest in such personal property, and to the exception as to leaseholds, as 
set forth in clause 4.3 hereof and, without in any way limiting the 
generality of the foregoing, its uncalled capital and all present and future 
incomes, monies, sources of money, rights, powers, privileges, franchises, 
easements, agreements, leases, shares, bonds, debentures, book debts, 
accounts receivable, negotiable and non-negotiable instruments, judgments, 
chooses in actions, securities and all other property and things of value, 
tangible or intangible, legal or equitable of which the Corporation may be 
possessed or entitled to or which may at any time hereafter be acquired by 
the Corporation (all of such undertaking, property and assets being 
mortgaged, pledged and charged being herein collectively called the 
"Mortgaged Property").

4.3       EXCEPTIONS

          The Corporation shall not, without the prior consent of holders of 
not less than sixty-six and two-thirds (66-2/3%) in principal amount of 
Debentures then outstanding first had and obtained, be at liberty to and 
shall not, (i) except in respect of Permitted Encumbrances, create or incur 
or suffer to be created or incurred any mortgage, pledge, hypothec, lien, 
charge, encumbrance, assignment or other security of any kind whatsoever upon 
the Mortgaged Property or any part thereof ranking or purporting to rank in 
priority or pari passu to this Indenture or the charges created and secured 
hereby, or (ii) sell, assign, transfer, lease or otherwise dispose of the 
Mortgaged Property or any part thereof otherwise than in the ordinary course 
of business of the Corporation as it is presently conducted; provided always 
that the last day of the term of any lease, verbal or written, or any 
agreement therefor, now held or hereafter acquired by the Corporation or any 
renewal thereof, is hereby and shall be excepted out of the mortgage, pledge 
and charge created hereby or by any other instrument supplemental hereto and 
does not and shall not form part of the Mortgaged Property, but the 
Corporation shall stand possessed of the reversionary interest remaining in 

<PAGE>

                               - 15 -

the Corporation of any leasehold interest forming part of the Mortgaged 
Property, upon trust to assign and dispose thereof as the Holder shall 
direct, and upon any sale of a leasehold interest or any part thereof, the 
Holder, for the purposes of vesting the aforesaid reversionary interest of 
any such term or any renewal thereof in any purchaser or purchasers thereof 
shall be entitled by deed or writing to appoint such purchaser or purchasers 
or any other person or persons a new trustee or trustees of the aforesaid 
reversion in the place of the Corporation and to vest the same accordingly in 
the new trustee or trustees so appointed, freed and discharged from any 
obligation respecting the same.  

4.4       OBLIGATION TO PAY

          Nothing contained in this Indenture or the Debentures, is intended 
to or shall impair, as between the Corporation, its creditors and the 
holders, the obligation of the Corporation, which is absolute and 
unconditional, to pay to the holders the principal amount and other 
indebtedness of the Corporation to the holders, as and when the same shall 
become due and payable in accordance with the terms hereof, or affect the 
relative rights of the holders, nor shall anything herein prevent the 
Trustee, on behalf of the holders, from exercising all remedies otherwise 
permitted by applicable law or equity under this Indenture and the Debentures.

4.5       DEFEASANCE

          Upon payment by the Corporation to the holders of the total 
principal amount of the Debentures and all other money secured by this 
Indenture and provided the security herein constituted shall not have become 
enforceable, then the Mortgaged Property shall revert and revest in the 
Corporation without any release, acquittance, reconveyance, re-entry or other 
act or formality whatsoever, but the Trustee shall nevertheless, within 
thirty (30) days of being requested in writing by the Corporation to do so, 
deliver up this Indenture to the Corporation and execute, acknowledge or 
deliver to the Corporation a full release and reconveyance of the Mortgaged 
Property or such parts thereof as shall not have been disposed under the 
powers herein contained and such further and other documents reasonably 
requested by the Corporation.  

4.6       PARTIAL RELEASE

          No postponement or partial release or discharge of the Security 
Interest, created under and secured by this Indenture in respect of all or 
any part of the Mortgaged Property shall in any way operate or be construed 
so as to release and discharge the security hereby constituted in respect of 
the Mortgaged Property except as herein specifically provided, or so as to 
release or discharge the Corporation from its liability to the holders to 
fully pay and satisfy the principal amount of the Debentures and all other 
monies due or remaining unpaid by the Corporation to the holders from time to 
time as provided herein. 

<PAGE>

                                - 16 -

4.7       PROVISO FOR POSSESSION UNTIL DEFAULT

          Until the security hereby created shall become enforceable and the 
Trustee on behalf of the Debentureholders hereof shall have determined to 
enforce the same, the Corporation shall be permitted in the same manner and 
to the same extent as if this Indenture had not been executed, but subject to 
the express terms hereof, to possess, operate, manage, use and enjoy its 
Mortgaged Property in the ordinary course of business of the Corporation and 
for the purpose of carrying on the same, and for such purpose, to take and 
use the rents, income, profits and issues thereof, including dividends, 
profits and interest upon or in respect of any shares, bonds or other 
securities, claims and demands in judgment or otherwise at any time forming 
part of the Mortgaged Property.

                                    ARTICLE 5
          COVENANTS, REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
          ------------------------------------------------------------

5.1       REPRESENTATIONS AND WARRANTIES

          The Corporation represents and warrants to the Trustee for the 
benefit of the Trustee and the Debentureholders as follows:

     (a)  the Corporation is a corporation duly organized, legally existing and
          in good standing under the laws of the Province of Alberta and is 
          duly authorized to do business in each other jurisdiction where a 
          failure so to qualify would have a materially adverse effect on the 
          business or operations of the Corporation;

     (b)  the Corporation is duly authorized and empowered to execute, deliver
          and perform its obligations under this Indenture and all corporate
          action on the part of the Corporation for the due execution, delivery
          and performance by the Corporation of this Indenture has been duly 
          and effectively taken;

     (c)  this Indenture and the Debentures constitute valid and binding
          obligations of the Corporation, enforceable in accordance with their
          terms (except that such enforcement may be subject to any applicable
          bankruptcy, insolvency or similar laws generally affecting the
          enforcement of creditors' rights and that specific performance and
          other equitable remedies are subject to the discretion of the courts
          before which such remedies are sought and the provisions of the
          Interest Act, (Canada).

5.2       COVENANTS

          The Corporation covenants and agrees with the Trustee for the 
benefit of the Trustee and the Debentureholders as follows:

     (a)  so long as any Debentures remain outstanding:

          (i)    it shall reserve and keep available a sufficient number of
                 Common Shares for the purpose of enabling it to satisfy its
                 obligations to issue Common Shares upon the conversion of the
                 Debentures;

<PAGE>

                                   - 17 -

          (ii)   it shall cause the Common Shares and the certificates
                 representing the Common Shares acquired pursuant to the
                 conversion of the Debentures to be duly issued and delivered 
                 in accordance with the Debenture Certificates and the terms
                 hereof;

          (iii)  all Common Shares which shall be issued upon conversion of
                 Debentures as provided for herein and in the Debenture
                 Certificate shall be issued as fully paid and non-assessable;

          (iv)   it shall maintain its corporate existence;

          (v)    it shall use its best efforts to ensure that all Common Shares
                 outstanding or issuable from time to time (including without
                 limitation the Common Shares issuable on the conversion of the
                 Debentures) are listed and posted for trading on The Alberta
                 Stock Exchange;

          (vi)   it shall make all requisite filings under applicable Canadian
                 securities legislation including those necessary to remain a
                 reporting issuer not in default in each of the Filing
                 Jurisdictions and those necessary to report the issuance of
                 Common Shares pursuant to the conversion of the Debentures;

          (vii)  it shall use its best efforts to obtain a receipt for the
                 Prospectus or obtain an Order, as soon as practicable, from
                 each of the Securities Commissions so that the resale of the
                 Debentures and Common Shares issuable upon the conversion of
                 the Debentures will not be subject to the prospectus
                 requirements nor any "hold period" under applicable securities
                 legislation in such Filing Jurisdictions;

          (viii) it shall give written notice to the Trustee and to each
                 registered Debentureholder of the issuance of the receipts for
                 a Prospectus or an Order, as soon as practicable but, in any
                 event, not later than three Business Days after the issuance 
                 of such receipts; and

          (ix)   generally, it will well and truly perform and carry out all of
                 the acts, or things, to be done by it as provided in this
                 Indenture or as the Trustee may reasonably require for the
                 better accomplishing and effecting of the intentions and
                 provisions of this Indenture;

     (b)  to forever defend all and singular the Mortgaged Property unto the
          Trustee against every person whomsoever lawfully claiming or
          attempting to claim the same or any part thereof;

     (c)  to punctually and duly pay the principal amount, interest on each of
          the Debentures and other monies hereby secured, together with other
          appurtenant charges thereon, in accordance with the terms of this
          Indenture;

     (d)  to carry on and continuously conduct its business in respect of the
          Mortgaged Property in a lawful, efficient, diligent and businesslike
          manner;

<PAGE>

                                    - 18 -

     (e)  to keep and maintain proper books of account and records accurately
          covering all aspects of the business affairs of the Corporation and
          its Subsidiaries relating to the Mortgaged Property and to permit
          authorized officers, employees or agents of the Trustee to inspect 
          the same during regular business hours;

     (f)  to furnish annually to the Trustee within one hundred forty (140) 
          days after the end of each fiscal year of the Corporation audited 
          financial statements of the Corporation together with the report 
          of its auditors thereon;

     (g)  to furnish to the Trustee within sixty (60) days after the end of 
          each quarter of its fiscal year unaudited financial statements of the
          Corporation for such quarter containing such information as the
          Trustee may reasonably require;

     (h)  to furnish to the Trustee any financial or operating statements or
          reports relating to the business or affairs of the Corporation as the
          Trustee may reasonably request;

     (i)  to fully pay and discharge as and when the same become due and 
          payable all taxes (including local improvement rates), rates, duties
          and assessments that may be levied, rated, charged or assessed 
          against the Corporation, or the Mortgaged Property, or any part 
          thereof unless same is being contested in good faith, and if the 
          Corporation fails to pay any of such taxes, rates, duties or 
          assessments and if it is not in good faith contesting the same, 
          the Trustee may pay, but shall not be obligated to pay, the same 
          and any amounts so paid by the Trustee shall become and form part 
          of the principal amount secured hereby and shall bear interest at 
          the rate aforesaid until paid;

     (j)  to at all times promptly observe, perform, execute and comply with 
          all applicable laws, rules, requirements, orders, directions, 
          by-laws, ordinances, work orders and regulations of every 
          governmental authority and agency whether federal, provincial, 
          municipal or otherwise, including, without limiting the generality 
          of the foregoing, those dealing with fire, access, the environment 
          (whether for its protection, preservation, clean-up or otherwise), 
          toxic materials or other environmental hazards, public health and 
          safety, and all private covenants and restrictions affecting the 
          Mortgaged Property or any portion thereof, and from time to time, 
          upon request of the Trustee, to provide to the Trustee evidence of 
          such observance and compliance and at the Corporation's expense make 
          any and all improvements thereon or alterations to the Mortgaged 
          Property and to take all such other action as may be required at 
          any time by any such present or future law, rule, requirement, 
          order, direction, by-law, ordinance, work order or regulation; 

     (k)  to give notice to the Trustee promptly of any Event of Default or of
          any event which with notice or lapse of time, or both, would
          constitute an Event of Default hereunder; 

     (l)  to execute such further assurances of the Mortgaged Property as may 
          be reasonably required by the Trustee;

<PAGE>

                                  - 19 -

     (m)  where the Corporation's interest in any of the Mortgaged Property,
          real or personal, is that of a purchaser under an agreement or option
          to purchase, the mortgage, pledge and charge hereby created shall
          extend to the entire estate or interest from time to time of the
          Corporation in such property, including in the case of real property
          the fee simple when the real property is conveyed in fee simple to 
          the Corporation.

5.3       INSURANCE

     (a)  The Corporation covenants that, at all times during the continuation
          of this Indenture, it will keep such of the Mortgaged Property that
          are of an insurable nature and are of a character usually insured by
          companies owning or operating the same or similar premises insured
          with responsible insurers, against loss, or damage by fire and other
          causes customarily insured against by similar premises in Canada and
          within limits of coverage reasonably acceptable to the Trustee. 
          Unless otherwise agreed to in writing by the Trustee, the losses 
          under all such insurances shall be payable firstly to the 
          Debentureholders hereunder.

     (b)  The Corporation agrees that so long as it remains indebted to the
          Debentureholders, it will, unless otherwise requested in writing by
          the Trustee, maintain with reputable insurers third party public
          liability and property damage insurance covering all operations of 
          the Corporation within limits of coverage usually carried by others 
          owning or operating the same or a similar type and size of business 
          as that being conducted by the Corporation.

     (c)  The Corporation will, upon the request of the Trustee, deliver to the
          Trustee certified copies of all policies or contracts of insurance
          being carried by the Corporation pursuant to the terms hereof,
          together with such certificates of insurance as the Trustee may
          reasonably require and evidence that the premiums on all such
          insurance have been paid.

     (d)  If the Corporation should fail to take out or maintain all or any of
          the insurance required to be carried by the Corporation pursuant to
          the terms hereof, the Trustee may, but shall not be obligated to, 
          take out some or all of such insurance and all sums expended by the 
          Trustee in effecting such insurance shall forthwith become due and be
          payable by the Corporation to the Trustee and until paid shall form 
          part of the principal amount secured hereby.

     (e)  In the event of loss under any of the insurance referred to in
          clause 5.3(a) hereof, the Trustee, at its option, may apply the
          insurance proceeds on account of the principal amount secured hereby
          or may apply the same to rebuilding, repairing and restoring the
          Mortgaged Property, or may at its sole discretion apply the same
          partly for one purpose and partly for the other purpose.

<PAGE>

                                 - 20 -

5.4       NEGATIVE COVENANTS

          The Corporation shall not, and covenants with the Trustee on behalf 
of the Trustee and the Debentureholders, that it will not, without the 
consent of holders of not less than sixty-six and two-thirds (66-23%) percent 
of the principal amount of Debentures outstanding first had and received:

     (a)  sell, exchange, transfer, assign or dispose of any part of the
          Mortgaged Property, except in the ordinary and normal course of
          business of the Corporation as such business is currently being
          carried out;

     (b)  create or suffer to be created any mortgage, hypothec, lien, charge,
          encumbrance or security interest of whatsoever nature upon the
          Mortgaged Property ranking in priority to or pari passu with the lien
          hereof except for Permitted Encumbrances;

     (c)  incur or become liable for any indebtedness when it is in default
          under this Indenture, except for current indebtedness incurred in the
          ordinary course of business of the Corporation;

     (d)  guarantee the debts, liabilities or obligations of any Person or
          become the endorser on any note or other obligation when it is in
          default under the terms of this Indenture;

     (e)  reduce its capital or make any distribution otherwise than out of
          surplus of its assets, or redeem, purchase or otherwise retire or pay
          off any of the issued and outstanding shares for the time being of 
          the Corporation;

     (f)  lend money to any person, when it is in default under this Indenture;

     (g)  make any capital expenditures when it is in default under this
          Indenture; or

     (h)  make any distribution to its shareholders or any of them or declare 
          or pay any dividends.

5.5       DEFEND MORTGAGED PROPERTY

     (a)  The Corporation at its own cost will protect the Mortgaged Property
          against all liabilities of any nature, including all claims of 
          workmen or materialmen that might arise from the administration or 
          operation of any part of the Mortgaged Property or from the 
          Corporation's operations; and will pay or cause to be paid all such 
          liabilities and all charges for labour, materials and equipment 
          incurred in such administration and operation unless same is being 
          contested in good faith; will indemnify and hold the Trustee free and
          clear of any liens, charges and security interest or attempted liens,
          charges or security interests upon the Mortgaged Property.

     (b)  If a lien hereof, or the title to, or the rights of the Trustee in or
          to the Mortgaged Property or any part thereof, shall be endangered or
          shall be attacked directly

<PAGE>

                                - 21 -

          or indirectly, or if any legal proceedings are instituted against the
          Corporation or the Trustee with respect thereto, the Corporation 
          will promptly give written notice thereof to the Trustee and the 
          Corporation, at its sole cost and expense, and will diligently cure 
          any defect that may be developed or validly claimed, and will take 
          all necessary and proper steps for the defence of the title to the 
          Mortgaged Property and the lien of this Indenture thereon and will 
          take such action as is reasonably appropriate to the defence of any 
          such legal proceedings including, but not limited to, the 
          employment of counsel, for the prosecution or defence of litigation 
          and the release or discharge of claims made against the title to 
          the Mortgaged Property or the lien of this Indenture.  If the 
          Trustee shall deem it necessary or expedient, a defence of such 
          title, mortgage lien or charge, the Corporation hereby authorizes 
          the Trustee, at the Corporation's sole expense, to take all 
          additional steps deemed by the Debentureholder reasonably necessary 
          or advisable for the defence of such title, mortgage, lien or 
          charge including, but not limited to, the employment of independent 
          counsel, for the prosecution or defence of litigation and the 
          compromise or discharge of any adverse claims made with respect 
          thereto.

5.6       SUPPLEMENTAL INSTRUMENTS

          The Corporation, at its cost and expense, will duly execute and 
deliver all such supplementary and corrective instruments and other 
instruments and assurances as the Trustee may reasonably require in order to 
render all of the Mortgaged Property now owned and hereinafter acquired by 
the Corporation, subject to the specific lien, charge and security interest 
hereof or as the Trustee deems necessary or advisable for the perfection and 
protection of the mortgages, liens, charges and assignments created or 
intended to be created hereby and the rights conferred or intended to be 
conferred upon the Trustee under this Indenture.  The Corporation, at its 
cost and expense, will cause this Indenture and all such supplementary and 
corrective instruments and other instruments and assurances to be properly 
filed and re-filed, registered and re-registered and deposited and 
re-deposited in such manner, at such offices and places and at such times and 
as often as may be required by law or as may be necessary or desirable to 
perfect and preserve the mortgage, liens, charges and assignments created or 
intended to be created hereby and the rights conferred or intended to be 
conferred upon the Trustee under this Indenture, and will cause to be 
furnished promptly to the Trustee evidence satisfactory to the Trustee of 
such filing, registering and depositing, all at the cost and expense of the 
Corporation.

5.7       TO PAY TRUSTEE'S REMUNERATION

          The Corporation will pay the Trustee reasonable remuneration for 
its services as Trustee hereunder and will repay to the Trustee on demand all 
monies which shall have been paid by the Trustee in and about the execution 
of the trusts hereby created, and such monies shall be payable out of any 
funds coming into the possession of the Trustee in priority to any of the 
Debentures.  The said remuneration shall continue payable until the trusts 
hereof be finally wound up and whether or not the trusts of this Indenture 
shall be in course of administration by or under the direction of the court.



<PAGE>

                                      -22-

5.8       TRUSTEE MAY PERFORM COVENANTS

          If the Corporation shall fail to perform any covenant on its part 
herein contained, the Trustee may in its discretion, but (subject to clause 
6.2) need not, notify the Debentureholders of such failure or itself may 
perform any of said covenants capable of being performed by it and, if any 
such covenant requires the payment or expenditure of money, it may make such 
payment or expenditure with its own funds, or with money borrowed by or 
advanced to it for such purposes, but shall be under no obligation so to do.  
All sums so expended or advanced shall be repayable by the Corporation in the 
manner provided in clause 5.7, but no such performance or payment shall be 
deemed to relieve the Corporation from any default hereunder.

                                    ARTICLE 6
                                     DEFAULT

6.1       ACCELERATION OF MATURITY

          Upon the happening of any one or more of the following events, namely:

     (a)  if the Corporation makes default in payment of any principal amount
          due on any Debentures and any such default continues for a period of
          seven (7) Business Days;

     (b)  if a decree or order of a court having jurisdiction in the premises is
          entered adjudging the Corporation a bankrupt or insolvent under the
          BANKRUPTCY & INSOLVENCY ACT (Canada) or any other bankruptcy,
          insolvency or analogous laws, or issuing sequestration or process of
          execution against, or against any substantial part of the property of,
          the Corporation, or appointing a receiver of, or of any substantial
          part of the property of, the Corporation or ordering the winding-up or
          liquidation of its affairs, and any such decree or order continues
          unstayed and in effect for a period of thirty (30) days;

     (c)  if a resolution is passed for the winding-up or liquidation of the
          Corporation except in the course of carrying out or pursuant to a
          transaction in respect of which the conditions of clause 8.1 are duly
          observed and performed or if the Corporation institutes proceedings to
          be adjudicated a bankrupt or insolvent, or consents to the institution
          of bankruptcy or insolvency proceedings against it under the
          BANKRUPTCY & INSOLVENCY ACT (Canada) or any other bankruptcy,
          insolvency or analogous laws, or consents to the filing of any such
          petition or to the appointment of a receiver of, or of any substantial
          part of the property of, the Corporation or makes a general assignment
          for the benefit of creditors, or admits in writing its inability to
          pay its debts generally as they become due or takes corporate action
          in furtherance of any of the aforesaid purposes;

     (d)  if an encumbrancer shall take possession of the property of the
          Corporation or any part thereof which is, in the opinion of the
          Trustee, a substantial part thereof, or if a distress or execution or
          any similar process be levied or enforced 

<PAGE>

                                          -23-

          there against and remain unsatisfied for such period as would permit 
          such property or such part thereof to be sold thereunder; or

     (e)  if the Corporation shall neglect to observe or perform any other
          covenant or condition herein contained on its part to be observed or
          performed and, after notice in writing has been given by the Trustee
          to the Corporation specifying such default and requiring the
          Corporation to put an end to the same (which said notice may be given
          by the Trustee, in its discretion, and shall be given by the Trustee
          upon receipt of a request in writing signed by the holder of not less
          than sixty-six and two-thirds (66-2/3%) percent in the principal
          amount of the Debentures then outstanding), the Corporation shall fail
          to make good such default within a period of thirty (30) days, unless
          the Trustee (having regard to the subject matter of the default) shall
          have agreed to a longer period, and in such event, within the period
          agreed to by the Trustee;

then in each and every such event the Trustee shall upon consent of holders 
of not less than sixty-six and two-thirds (66-2/3%) percent in principal 
amount of the Debentures then outstanding, (subject to the provisions of 
clause 6.3), by notice in writing to the Corporation declare the principal 
amount of all Debentures then outstanding and all other monies outstanding 
hereunder to be due and payable and the same shall forthwith become 
immediately due and payable to the Trustee, anything therein or herein to the 
contrary notwithstanding, and the Trustee may proceed to enforce such payment 
and the Security Interest created hereunder, and subject to the other terms 
hereof, the Corporation shall forthwith pay to the Trustee for the benefit of 
the Debentureholders the principal amount of and such other monies from the 
date of the said declaration until payment is received by the Trustee.  Such 
payment when made shall be deemed to have been made in discharge of the 
Corporation's obligations hereunder, and any monies so received by the 
Trustee shall be applied in the manner provided in clause 6.6.

6.2       NOTICE OF EVENTS OF DEFAULT

          If an Event of Default shall occur and be continuing the Trustee 
shall, within thirty (30) days after it becomes aware of the occurrence of 
such Event of Default, give notice of such Event of Default to the 
Debentureholders in the manner provided in clause 10.2, provided that, 
notwithstanding the foregoing, unless the Trustee shall have been requested 
to do so by the holders of at least sixty-six and two-thirds (66-2/3%) 
percent of the principal amount of the Debentures then outstanding, the 
Trustee shall not be required to give such notice if the Trustee in good 
faith shall have determined that the withholding of such notice is in the 
best interests of the Debentureholders and shall have so advised the 
Corporation in writing.

6.3       WAIVER OF DEFAULT

          Upon the happening of any Event of Default hereunder:

     (a)  the holders of sixty-six and two-thirds (66-2/3%) percent of the
          principal amount of the Debentures then outstanding shall have the
          power (in addition to the powers exercisable by extraordinary
          resolution as hereinafter provided) by requisition in writing to
          instruct the Trustee to waive any Event of Default 

<PAGE>

                                    -24-

          and to cancel any declaration made by the Trustee pursuant to 
          clause 6.1 and the Trustee shall thereupon waive the Event of Default 
          and cancel such declaration, or either, upon such terms and conditions
          as shall be prescribed in such requisition; and

     (b)  the Trustee, so long as it has not become bound to declare the
          principal of the Debentures then outstanding to be due and payable, or
          to obtain or enforce payment of the same, shall have power to waive
          any Event of Default if, in the Trustee's opinion, the same shall have
          been cured or adequate satisfaction made therefor, and in such event
          to cancel any such declaration theretofore made by the Trustee in the
          exercise of its discretion, upon such terms and conditions as the
          Trustee may deem advisable;

provided that no act or omission either of the Trustee or of the 
Debentureholders in the premises shall extend to or be taken in any manner 
whatsoever to affect any subsequent Event of Default or the rights resulting 
therefrom.

6.4       ENFORCEMENT BY THE TRUSTEE

     (a)  Subject to the provisions of clause 6.3 and to the provisions of any
          extraordinary resolution that may be passed by the Debentureholders,
          the Trustee may in its discretion and shall upon receiving the consent
          of holders of not less than sixty-six and two-thirds (66-2/3%) percent
          in principal amount of the Debentures then outstanding and upon being
          indemnified to its reasonable satisfaction against all costs, expenses
          and liabilities to be incurred, proceed in its name as Trustee
          hereunder to enforce the Security Interest created hereunder and to
          obtain or enforce payment of the principal amount of all the
          Debentures then outstanding together with any other amounts due
          hereunder by such proceedings authorized by this Indenture or by law
          or equity as the Trustee in such request shall have been directed to
          take, or if such request contains no such direction, or if the Trustee
          shall act without such request, then by such proceedings authorized by
          this Indenture or by suit at law or in equity as the Trustee shall
          deem expedient.  

     (b)  The Trustee shall be entitled and empowered, either in its own name or
          as trustee of an express trust, or as attorney-in-fact for the holders
          of the Debentures, or in any one or more of such capacities, to file
          such proof of debt, amendment of proof of debt, claim, petition or
          other document as may be necessary or advisable in order to have the
          claims of the Trustee and of the holders of the Debentures allowed in
          any insolvency, bankruptcy, liquidation or other judicial proceedings
          relating to the Corporation or its creditors or relating to or
          affecting its property.  The Trustee is hereby irrevocably appointed
          (and the successive respective holders of the Debentures by taking and
          holding the same shall be conclusively deemed to have so appointed the
          Trustee) the true and lawful attorney-in-fact of the respective
          holders of the Debentures with authority to make and file in the
          respective names of the holders of the Debentures or on behalf of the
          holders of the Debentures as a class, subject to deduction from any
          such claims of the amounts of any claims filed by any of the holders
          of the Debentures themselves, any proof of debt, amendment of 

<PAGE>

                                            -25-


          proof of debt, claim, petition or other document in any such 
          proceedings and to receive payment of any sums becoming distributable
          on account thereof, and to execute any such other papers and documents
          and to do and perform any and all such acts and things for and on 
          behalf of such holders of the Debentures, as may be necessary or 
          advisable in the opinion of the Trustee, in order to have respective 
          claims of the Trustee and of the holders of the Debentures against 
          the Corporation or its property allowed in any such proceeding, and 
          to receive payment of or on account of such claims; provided, however,
          that nothing contained in this Indenture shall be deemed to give to 
          the Trustee, unless so authorized by extraordinary resolution, any 
          right to accept or consent to any plan or reorganization or otherwise 
          by action of any character in such proceeding to waive or change in 
          any way any right of any Debentureholder.

     (c)  In the event the Security Interest hereby constituted shall have
          become enforceable, then the Trustee, to the extent permitted by law,
          in its discretion and subject to Permitted Encumbrances, may enter
          upon and/or take possession of the Mortgaged Property or any part
          thereof and may in the like discretion sell, call in, collect and
          convert into money the same or any part thereof with full power to
          sell any of the Mortgaged Property either together or in parcels and
          either by public auction or private contract and either for a lump sum
          or for a sum payable by instalments or for a sum on account and a
          mortgage or charge for the balance and with full power upon every such
          sale to make any special or other stipulations as to title or evidence
          of commencement of title or otherwise which the Trustee shall deem
          proper and with full power to buy in or rescind or vary any contract
          for sale of the said premises or any part thereof and to resell the
          same without being responsible for any loss which may be occasioned
          thereby and with full power to compromise and effect compositions and
          for the purposes of the aforesaid, or any of them, to execute and do
          all such assurances and things as it shall think fit.

     (d)  Upon any such sale, calling-in, collection or conversion as aforesaid,
          the receipt of the Trustee for the purchase money of the premises sold
          and for any other monies paid to it shall effectually discharge the
          purchaser or purchasers or other person or persons paying the same
          therefrom and from being concerned to see to the application or being
          answerable for the loss or misapplication thereof.  Any such sale,
          calling-in, collection or conversion shall be a perpetual bar, both in
          law and in equity, against the Corporation and all other persons
          claiming the Mortgaged Property sold or any part thereof by, through
          or under the Corporation.

     (e)  The Trustee shall hold and apply monies which arise from any sale,
          calling-in, collection or conversion against the principal amount and
          other monies which are secured hereby in such order and to such
          indebtedness of the Corporation to the Trustee as the Trustee may
          determine in its sole and absolute discretion from time to time and as
          prescribed by law.

     (f)  The Trustee shall out of the rents and profits and income of the
          Mortgaged Property, pay and discharge the expenses incurred in and
          about the carrying on 

<PAGE>

                                         -26-

          and management of the assets or in the exercise of any of the 
          powers under the last preceding clauses hereof or otherwise in 
          respect of the premises and all outgoings which it shall think 
          fit to pay and shall pay and apply the residue of the said
          rents, profits, income and monies in the same manner as is
          hereinbefore provided. 

     (g)  Subject to Permitted Encumbrances, the Trustee at any time after the
          security hereby constituted becomes enforceable may, by writing
          appoint or a court of competent jurisdiction, on application of the
          Trustee, may appoint a receiver or receivers or receiver-manager of
          the Mortgaged Property or any part thereof and remove any receiver or
          receivers or receiver-manager so appointed and appoint another in his
          stead and the following provisions shall have effect:

          (i)    Such appointment may be made either before or after the Trustee
                 shall have entered into or taken possession of the Mortgaged
                 Property or any part thereof;

          (ii)   Such receiver may be vested by the Trustee with such powers and
                 discretions as the Trustee may think expedient; 

          (iii)  Unless otherwise directed by the Trustee, such receiver may
                 exercise all the powers and authorities vested in the Trustee
                 by this Indenture;

          (iv)   Such receiver shall, in the exercise of his powers, authorities
                 and discretions, conform to the regulations and directions from
                 time to time made and given by the Trustee; 

          (v)    The Trustee may from time to time fix the remuneration of such
                 receiver and direct payment thereof out of the Mortgaged
                 Property;

          (vi)   The Trustee may from time to time and at any time require any
                 such receiver to give security for the due performance of his
                 duties as such receiver and may fix the nature and the amount
                 of the security to be so given, but the Trustee shall not be
                 bound in any case, to require any such security;

          (vii)  Save so far as otherwise directed by the Trustee, all monies
                 from time to time received by such receiver shall be paid in
                 trust for and over to the Trustee; 

          (viii) The Trustee may pay over to such receiver, any monies
                 constituting part of the Mortgaged Property to the intent that
                 the same may be applied for the purposes hereof by such
                 receiver, and the Trustee may from time to time determine what
                 funds the receiver shall be at liberty to keep in hand with a
                 view to the performance of his duties as such receiver; and

          (ix)   The receiver shall be the agent of the Corporation and the
                 Corporation shall be solely responsible for his acts and
                 defaults (including negligence, 

<PAGE>

                                             -27-

                 misconduct or misfeasance on the part of any such receiver) 
                 and for his remuneration.

     (h)  The receiver appointed hereunder by the Trustee may be any person,
          whether an officer or officers or employee or employees of the Trustee
          or not, and the Trustee may appoint another or others in his or their
          stead.  

     (i)  The rights and powers conferred herein, in regard to appointment and
          powers of the receiver, are in supplement to and not in substitution
          for any rights or powers the Trustee may from time to time have as the
          Trustee of this Indenture and every such receiver may, in the
          discretion of the Trustee, be vested with all or any of the rights and
          powers of the Trustee.  

     (j)  After the security hereby created shall have become enforceable and
          the Trustee shall have determined or become bound to enforce the same,
          the Corporation will from time to time, execute and do all such
          assurances and things as the Trustee may reasonably require for
          facilitating the realization of the Mortgaged Property and for
          exercising all the powers, authorities and discretions hereby
          conferred upon the Trustee and for confirming to any purchaser of any
          of the Mortgaged Property, whether sold by the Trustee hereunder or by
          judicial proceedings, the title to the property so sold, and that it
          will give all notices and directions which the registered holder
          hereof may consider expedient; provided that for said purposes the
          Corporation does hereby irrevocably appoint the Trustee to be the
          attorney of the Corporation in the name and on behalf of it to execute
          and do any deeds, transfers, conveyances, assignments, assurances and
          things which the Corporation ought to execute and do under the
          covenants and provisions herein contained, and generally, to use the
          name of the Corporation in the exercise of all or any of the powers
          hereby conferred on the Trustee.

     (k)  The Trustee shall not nor shall any receiver as aforesaid by reason of
          the Trustee or such receiver entering into possession of the Mortgaged
          Property or any part thereof be liable to account as mortgagee in
          possession or for anything or be liable for any loss upon realization
          or for any default or omission for which a mortgagee in possession
          might be liable.

     (l)  The Trustee shall also have power at any time and from time to time to
          institute and to maintain such suits and proceedings as it may be
          advised shall be necessary or advisable to preserve and protect its
          interests and the interests of the Debentureholders.

     (i)  All rights of action hereunder including the realization of the
          Security Interest granted hereunder may be enforced by the Trustee
          without the possession of any of the Debentures or the production
          thereof on the trial or other proceedings related thereto.  Any such
          suit or proceeding instituted by the Trustee shall be brought in the
          name of the Trustee as trustee of an express trust, and any recovery
          of judgment shall be for the rateable benefit of the holders of the
          Debentures subject to the provisions of this Indenture.  In any
          proceeding brought by the Trustee (and also any proceeding in which a

<PAGE>

                                           -28-


          declaratory judgment of a court may be sought as to the interpretation
          or construction of any provision of this Indenture, to which the
          Trustee shall be a party) the Trustee shall be held to represent all
          the holders of the Debentures, and it shall not be necessary to make
          any holders of the Debentures parties to any such proceeding.

6.5       NO SUITS BY DEBENTUREHOLDERS

          No holder of any Debenture shall have any right to institute any 
action, suit or proceeding at law or in equity for the purpose of enforcing 
its Security Interest and payment of the principal of the Debentures or any 
other monies payable hereunder or for the execution of any trust or power 
hereunder or for the appointment of a liquidator or receiver or for a 
receiving order under the BANKRUPTCY & INSOLVENCY ACT (Canada) to have the 
Corporation wound up or to file or prove a claim in any liquidation or 
bankruptcy proceeding or for any other remedy hereunder, unless:

     (a)  such holder shall previously have given to the Trustee written notice
          of the happening of an Event of Default hereunder;

     (b)  the Debentureholders by extraordinary resolution (as hereinafter
          defined) or consent of holders of not less than sixty-six and two-
          thirds (66-2/3%) percent in principal amount of the Debentures then
          outstanding shall have made a request to the Trustee and the Trustee
          shall have been afforded reasonable opportunity either itself to
          proceed to exercise the powers hereinbefore granted or to institute an
          action, suit or proceeding in its name and for such purpose.

     (c)  the Debentureholders or any of them shall have furnished to the
          Trustee, when so requested by the Trustee, sufficient funds and
          security and indemnity satisfactory to it against the costs, expenses
          and liabilities to be incurred therein or thereby; and

     (d)  the Trustee shall have failed to act within a reasonable time after
          such notification, request and provision of indemnity and such
          notification, request and provision of indemnity are hereby declared
          in every such case, at the option of the Trustee, to be conditions
          precedent to any such proceeding.

6.6       APPLICATION OF MONIES BY TRUSTEE

          Except as herein otherwise expressly provided any monies received by
the Trustee from the Corporation pursuant to the foregoing provisions or as a
result of legal or other proceedings or from any receiver, trustee in bankruptcy
or liquidator of the Corporation, shall be applied, together with any other
monies in the hands of the Trustee available for such purpose, as follows:

     (a)  first, in payment or in reimbursement to the Trustee of its
          compensation, costs, charges, expenses, borrowings, advances and other
          monies furnished or provided by or at the instance of the Trustee in
          or about the execution of its trusts under, or otherwise in relation
          to, this Indenture, with interest thereon as herein provided;

<PAGE>

                                         -29-

     (b)  second, in payment, rateably and proportionately to the holders of
          Debentures (taking into consideration any sums received directly by
          one or more of the Debentureholders), of the principal amount of the
          Debentures in the specific order of priority and to such specific
          indebtedness as set forth in clause 3.4 and clause 3.5 hereof; and

     (c)  third, in payment of the surplus, if any, of such monies to the
          Corporation or its assigns;

provided, however, that no payment shall be made pursuant to subclause (b) above
in respect of the principal amount due on any Debenture held, directly or
indirectly, by or for the benefit of the Corporation or any Subsidiary (other
than any Debenture pledged for value and in good faith to a person other than
the Corporation or any Subsidiary but only to the extent of such person's
interest therein) except subject to the prior payment in full of the principal
due on all Debentures which are not so held.

6.7       DISTRIBUTION OF PROCEEDS

          Payments to Debentureholders pursuant to subclause (b) of clause 6.6
shall be made at least seven (7) Business Days' notice of every such payment
shall be given in the manner provided in clause 10.2 specifying the time when
and the place or places where the Debentures are to be presented and the amount
of the payment and the application thereof.

6.8       REMEDIES CUMULATIVE

          No remedy herein conferred upon or reserved to the Trustee, or upon or
to the holders of Debentures is intended to be exclusive of any other remedy,
but each and every such remedy shall be cumulative and shall be in addition to
every other remedy given hereunder or now existing or hereafter to exist by law
or by statute.

6.9       JUDGMENT AGAINST THE CORPORATION

          The Corporation covenants and agrees with the Trustee that in case of
any judicial or other proceedings to enforce the rights of the Debentureholders,
judgment may be rendered against it in favour of the Debentureholders or in
favour of the Trustee, as trustee for the Debentureholders, for any amount which
may remain due in respect of the Debentures and any other monies owing
hereunder.

6.10      IMMUNITY OF SHAREHOLDERS AND OTHERS

          Subject to section 8.1, the Debentureholders and the Trustee hereby
waive and release any right, cause of action or remedy now or hereafter existing
in any jurisdiction against any past, present or future incorporator,
shareholder, director or officer of the Corporation or of any successor company
for the payment of the principal amount on any of the Debentures or on any
covenant, agreement, representation or warranty by the Corporation herein or in
the Debentures contained.

<PAGE>

                                        -30-


6.11      TRUSTEE APPOINTED ATTORNEY

          The Corporation hereby irrevocably appoints the Trustee to be the
attorney of the Corporation in the name and on behalf of the Corporation to
execute any instruments and do any acts and things which the Corporation ought
to execute and do, and has not executed or done, under the covenants and
provisions contained in this Indenture and generally to use the name of the
Corporation in the exercise of all or any of the powers hereby conferred on the
Trustee, with full powers of substitution and revocation.


                                    ARTICLE 7
                           SATISFACTION AND DISCHARGE

7.1       CANCELLATION AND DESTRUCTION

          All Debentures shall forthwith after payment or conversion thereof be
delivered to the Trustee and cancelled by it.  All Debentures cancelled or
required to be cancelled under this or any other provision of this Indenture
shall be destroyed by the Trustee and if required by the Corporation the Trustee
shall furnish to it a destruction certificate setting out the designating
numbers of the Debentures so destroyed.

7.2       NON-PRESENTATION OF DEBENTURES

          In case the holder of any Debenture shall fail to present the same for
payment or conversion on the date on which the principal thereof becomes payable
either at maturity or otherwise:

     (a)  the Corporation shall be entitled to pay the principal amount, if any,
          or deliver Common Shares to the Trustee and direct it to set aside; or

     (b)  in respect of monies in the hands of the Trustee which may or should
          be applied to the payment of the Debentures, the Corporation shall be
          entitled to direct the Trustee to set aside;

such amounts or Common Shares, in trust to be paid or delivered to the holder of
such Debenture upon due presentation or surrender thereof in accordance with the
provisions of this Indenture; and thereupon the principal monies payable on or
represented by each Debenture in respect whereof such monies have been set aside
shall be deemed to have been paid and the holder thereof shall thereafter have
no right in respect thereof except that of receiving payment of the monies or
Common Shares so set aside by the Trustee upon due presentation and surrender
thereof, subject always to the provisions of clause 7.3.

7.3       REPAYMENT OF UNCLAIMED MONIES OR COMMON SHARES

          Any monies or Common Shares set aside under clause 7.2 and not claimed
by and paid or delivered to Debentureholders as provided in clause 7.2 within
two (2) years after the date of such setting aside shall be repaid or re-
delivered to the Corporation by the Trustee on demand and thereupon the Trustee
shall be released from all further liability with respect to such monies. 
Thereafter the holders of the Debentures in respect of which such monies 

<PAGE>

                                     -31-

or Common Shares were so repaid or delivered to the Corporation shall have no 
rights in respect thereof except to obtain payment of the monies or Common 
Shares due thereon from the Corporation up to such time as the right to 
proceed against the Corporation for recovery of such monies has become 
statute barred under the laws of the Province of Alberta.

                                    ARTICLE 8
                             SUCCESSOR CORPORATIONS

8.1       CERTAIN REQUIREMENTS

          The Corporation shall not enter into any transaction (including by way
of reconstruction, reorganization, consolidation, amalgamation, merger,
liquidation, transfer, sale or otherwise) whereby all or substantially all of
its undertakings, property and assets would become the property of any other
person, or, in the case of any such amalgamation, of the continuing corporation
resulting therefrom, unless:

     (a)  such other person or continuing corporation (herein called the
          "Successor Corporation") is a corporation incorporated under the laws
          of Canada or one of its provinces;

     (b)  the Successor Corporation shall execute, prior to or contemporaneously
          with the consummation of such transaction, such instruments, if any,
          as are in the opinion of Counsel to the Trustee necessary or advisable
          to evidence the assumption by the Successor Corporation of liability
          for the due and punctual payment of all the Debentures, interest
          thereon and all other monies payable hereunder, the covenant of the
          Successor Corporation to observe and perform all the covenants and
          obligations of the Corporation under this Indenture;

     (c)  such transaction, in the opinion of Counsel to the Trustee, shall be
          upon such terms as to substantially preserve and not impair any of the
          rights and powers of the Trustee or the Debentureholders hereunder;
          and

     (d)  no condition or event shall exist in respect of the Successor
          Corporation at the time of such transaction or after giving full
          effect thereto which constitutes or would constitute an Event of
          Default hereunder;

provided however, that the provisions hereof shall not apply in respect of any
reorganization, reconstruction, amalgamation, merger, liquidation, transfer,
sale or otherwise involving the Corporation and its Subsidiaries whereby there
is no effective change in control or effective ownership of the assets,
undertakings and property of the Corporation or its Subsidiaries. 

8.2       VESTING OF POWERS IN SUCCESSOR

          Whenever the conditions of clause 8.1 have been duly observed and
performed, the Successor Corporation shall possess and from time to time may
exercise each and every right and power of the Corporation under this Indenture
in the name of the Corporation or otherwise and any act or proceeding by any
provision of this Indenture required to be done or 

<PAGE>

                                    -32-

performed by any directors or officers of the Corporation may be done and 
performed with like force and effect by the directors or officers of such 
Successor Corporation.

                                    ARTICLE 9
                          MEETINGS OF DEBENTUREHOLDERS

9.1       RIGHT TO CONVENE MEETING

          The Trustee may at any time and from time to time and the Trustee
shall on receipt of a written request of the Corporation or a written request
signed by the holders of not less than sixty-six and two-thirds (66-2/3%)
percent in principal amount of the Debentures then outstanding and upon being
indemnified to its reasonable satisfaction by the Corporation or by the
Debentureholders signing such request against the costs which may be incurred in
connection with the calling and holding of such meeting, convene a meeting of
the Debentureholders.  In the event of the Trustee failing within fifteen (15)
Business Days after receipt of any such request and such indemnity to give
notice convening a meeting, the Corporation or such Debentureholders, as the
case may be, may convene such meeting.  Every such meeting shall be held in the
City of Calgary or at such other place as may be approved or determined by the
Trustee.

9.2       NOTICE OF MEETINGS

          At least fifteen (15) Business Days' notice of any meeting shall be
given to the Debentureholders in the manner provided in clause 10.2.  A copy of
the notice shall be sent by post to the Trustee, unless the meeting has been
called by it.  Such notice shall state the time when and the place where the
meeting is to be held and shall state briefly the general nature of the business
to be transacted thereat.  It shall not be necessary for any such notice to set
out the terms of any resolution to be proposed or any of the provisions of this
Article.  The accidental omission to give notice of a meeting to any holder of
Debentures shall not invalidate any resolution passed at any such meeting.

9.3       CHAIRMAN

          Some person, who need not be a Debentureholder, nominated in writing
by the Trustee shall be chairman of the meeting and if no person is so
nominated, or if the person so nominated is not present within fifteen (15)
minutes from the time fixed for the holding of the meeting, the Debentureholders
present in person or by proxy shall choose some person present to be chairman.

9.4       QUORUM

          Subject to the provisions of clause 9.12, at any meeting of the
Debentureholders a quorum shall consist of Debentureholders present in person or
by proxy and representing at least sixty-six and two-thirds (66-2/3%) percent in
principal amount of the outstanding Debentures.  If a quorum of the
Debentureholders shall not be present within thirty (30) minutes from the time
fixed for holding any meeting, the meeting, if summoned by the Debentureholders
or pursuant to a request of the Debentureholders, shall be dissolved; but in any
other case the meeting shall be adjourned to the same day in the next week
(unless such 

<PAGE>

                                      -33-

day is a non-business day in which case it shall be adjourned to the next 
following business day thereafter) at the same time and place and no notice 
shall be required to be given in respect of such adjourned meeting.  At the 
adjourned meeting the Debentureholders present in person or by proxy shall 
form a quorum and may transact the business for which the meeting was 
originally convened notwithstanding that they may not represent fifty one 
(51%) percent of the principal amount of the outstanding Debentures.  Any 
business may be brought before or dealt with at an adjourned meeting which 
might have been brought before or dealt with at the original meeting in 
accordance with the notice calling the same.  No business shall be transacted 
at any meeting unless the required quorum is present at the commencement of 
business.

9.5       POWER TO ADJOURN

          The chairman of any meeting at which a quorum of the Debentureholders
is present may with the consent of the holders of a majority in principal amount
of the Debentures represented thereat adjourn any such meeting, and no notice of
such adjournment need be given except such notice, if any, as the meeting may
prescribe.

9.6       SHOW OF HANDS

          Every question submitted to a meeting shall, subject to clause 9.7, be
decided in the first place by a majority of the votes given on a show of hands. 
At any such meeting, unless a poll is duly demanded as herein provided, a
declaration by the chairman that a resolution has been carried or carried
unanimously or by a particular majority or lost or not carried by a particular
majority shall be conclusive evidence of the fact.  The chairman of any meeting
shall be entitled, both on a show of hands and on a poll, to vote in respect of
the Debenture, if any, held by him.

9.7       POLL

          On every extraordinary resolution, and on any other question submitted
to a meeting, when demanded by the chairman or by one or more Debentureholders
or proxies for Debentureholders, a poll shall be taken in such manner and either
at once or after an adjournment as the chairman shall direct.  Questions other
than extraordinary resolutions shall, if a poll be taken, be decided by the
votes of the holders of a majority in principal amount of the Debentures
represented at the meeting and voted on the poll.

9.8       VOTING

          On a show of hands every person who is present and entitled to 
vote, whether as a Debentureholder or as proxy for one or more 
Debentureholders or both, shall have one vote.  On a poll each 
Debentureholder present in person or represented by a proxyholder duly 
appointed by an instrument in writing shall be entitled to one vote in 
respect of each $1,000 principal amount of Debentures of which he shall then 
be the holder.  A proxyholder need not be a Debentureholder. In the case of 
joint registered holders of a Debenture, any one of them present in person or 
by proxy at the meeting may vote in the absence of the other or others; but 
in case more than one of them be present in person or by proxy, they shall 
vote together in respect of the Debentures of which they are joint registered 
holders.


<PAGE>

                                     -34-

9.9       REGULATIONS

          The Trustee, or the Corporation with the approval of the Trustee, may
from time to time make, vary or revoke such regulations as it shall think fit
providing for and governing:

     (a)  the form of the instrument appointing a proxy, which shall be in
          writing, the manner in which the same shall be executed and the
          production of the authority of any person signing on behalf of a
          Debentureholder;

     (b)  the deposit of instruments appointing proxies at such place as the
          Trustee, the Corporation or the Debentureholder convening the meeting,
          as the case may be, may, in the notice convening the meeting, direct
          and the time, if any, before the holding of the meeting or any
          adjournment thereof by which the same be deposited; and

     (c)  the deposit of instruments appointing proxies at some approved place
          or places other than the place at which the meeting is to be held and
          enabling particulars of such instruments appointing proxies to be
          mailed, cabled, telegraphed or sent by telex before the meeting to the
          Corporation or to the Trustee at the place where the same is to be
          held and for the voting of proxies so deposited as though the
          instruments themselves were produced at the meeting.

Any regulations so made shall be binding and effective and the votes given in
accordance therewith shall be valid and shall be counted.  Save as such
regulations may provide, the only persons who shall be recognized at any meeting
as the holders of any Debentures, or as entitled to vote or be present at the
meeting in respect thereof, shall be Debentureholders and persons whom
Debentureholders have by instrument in writing duly appointed as their proxies.

9.10      PERSONS ENTITLED TO ATTEND MEETINGS

          The Corporation and the Trustee, by their respective officers and
directors, and the legal advisors of each of the Corporation and the Trustee may
attend any meeting of the Debentureholders, but none of such persons shall have
a vote as such.

9.11      POWERS EXERCISABLE BY EXTRAORDINARY RESOLUTION

          In addition to the powers conferred upon them by any other provisions
of this Indenture or by law, a meeting of the Debentureholders shall have the
following powers exercisable from time to time by extraordinary resolution:

     (a)  power to sanction and agree to any modification, abrogation,
          alteration, compromise or arrangement of the rights of the
          Debentureholders or the Trustee against the Corporation, whether such
          rights arise under this Indenture or the Debentures or otherwise;

     (b)  power to assent to any modification of or change in or addition to or
          omission from the provisions contained in this Indenture or any
          Debenture which shall be agreed to by the Corporation and to authorize
          the Trustee to concur in and 

<PAGE>

                                     -35

          execute any indenture supplemental hereto embodying any 
          such modification, change, addition or omission;

     (c)  power to sanction any scheme for the reconstruction or reorganization
          of the Corporation or for the consolidation, amalgamation or merger of
          the Corporation with any other corporation or for the sale, leasing,
          transfer or other disposition of the undertaking, property and assets
          of the Corporation or any part thereof. provided that no such sanction
          shall be necessary in respect of any such transaction if the
          provisions of clause 8.1 shall have been complied with;

     (d)  power to direct or authorize the Trustee to exercise any power, right,
          remedy or authority given to it by this Indenture in any manner
          specified in any such extraordinary resolution or to refrain from
          exercising any such power, right, remedy or authority;

     (e)  power to waive and direct the Trustee to waive any default hereunder
          to cancel any declaration made by the Trustee pursuant to clause 6.1
          either unconditionally or upon any condition specified in such
          extraordinary resolution;

     (f)  power to direct any Debentureholder who, as such, has brought any
          action, suit or proceeding to stay or discontinue or otherwise deal
          with the same upon payment, if the taking of such suit, action or
          proceeding shall have been permitted by clause 6.5, of the costs.
          charges and expenses reasonably and properly incurred by such
          Debentureholder in connection therewith;

     (g)  power to assent to any compromise or arrangement with any creditor or
          creditors or any class or classes of creditors, whether secured or
          otherwise, and with holders of any shares or other securities of the
          Corporation;

     (h)  power to remove the Trustee from office and to appoint a new Trustee
          or Trustees;

     (i)  power to sanction the exchange of the Debentures for or the conversion
          thereof into shares, bonds, debentures or other securities or
          obligations of the Corporation or of any corporation formed or to be
          formed;

     (j)  power, notwithstanding clause 5.6, to authorize the Corporation and
          the Trustee to grant extensions of time for payment of interest on any
          of the Debentures, whether or not the interest the payment in respect
          of which is extended, is at the time due or overdue; and

     (k)  power to amend, alter or repeal any extraordinary resolution
          previously passed or sanctioned by the Debentureholders.

<PAGE>

                              - 36 -

9.12      MEANING OF "EXTRAORDINARY RESOLUTION"

     (a)  The expression "extraordinary resolution" when used in this Indenture
          means, subject as hereinafter in this Article provided, a resolution
          proposed to be passed as an extraordinary resolution at a meeting of
          Debentureholders (including an adjourned meeting) duly convened for
          the purpose and held in accordance with the provisions of this Article
          at which the holders of not less than sixty-six and two-thirds (66-
          2/3%) percent in principal amount of the Debentures then outstanding
          are present in person or by proxy and passed by the favourable votes
          of the holders of not less than sixty-six and two-thirds (66-2/3%)
          percent of the principal amount of Debentures represented at the
          meeting and voted on a poll upon such resolution.

     (b)  If, at any such meeting, the holders of not less than sixty-six and
          two-thirds (66-2/3%) percent in principal amount of the Debentures
          outstanding are not present in person or by proxy within thirty (30)
          minutes after the time appointed for the meeting, then the meeting, if
          convened by or on the requisition of the Debentureholders, shall be
          dissolved; but in any case it shall stand adjourned to such date,
          being not less than seven (7) nor more than sixty (60) days later, and
          to such place and time as may be appointed by the chairman.  Not less
          than ten (10) days' notice shall be given of the time and place of
          such adjourned meeting in the manner provided in clause 10.2.  Such
          notice may be given prior to the convening of the original meeting, in
          anticipation of no quorum being present thereat, in which event it
          shall state that it is to have effect only if the original meeting is
          adjourned for lack of a quorum.  Such notice shall state that at the
          adjourned meeting the Debentureholders present in person or by proxy
          shall form a quorum but it shall not be necessary to set forth the
          purposes for which the meeting was originally called or any other
          particulars.  At the adjourned meeting the Debenture-holders present
          in person or by proxy shall form a quorum and may transact the
          business for which the meeting was originally convened.  A resolution
          proposed at such adjourned meeting and passed by the requisite vote as
          provided in clause 9.12(a) shall be an extraordinary resolution within
          the meaning of this Indenture, notwithstanding that the holders of not
          less than fifty-one (51%) percent in principal amount of the
          Debentures then outstanding are not present in person or by proxy at
          such adjourned meeting.

     (c)  Votes on an extraordinary resolution shall always be given on a poll,
          and no demand for a poll on an extraordinary resolution shall be
          necessary.

9.13      POWERS CUMULATIVE

          It is hereby declared and agreed that any one or more of the powers in
this Indenture stated to be exercisable by the Debentureholders by extraordinary
resolution or otherwise may be exercised from time to time and the exercise of
any one or more of such powers from time to time shall not be deemed to exhaust
the rights of the Debentureholders to exercise the same or any other such power
or powers thereafter from time to time.

<PAGE>

                                 - 37 -

9.14      MINUTES

          Minutes of all resolutions and proceedings at every meeting as 
aforesaid shall be made and duly entered in books to be from time to time 
provided for that purpose by secretary of the meeting, and any such minutes 
as aforesaid, if signed by the chairman of the meeting at which such 
resolutions were passed or proceedings had, or by the chairman of the next 
succeeding meeting of the Debentureholders, shall be prima facie evidence of 
the matters therein stated.  Until the contrary is proved, every such 
meeting, in respect of the proceedings of which minutes shall have been made, 
shall be deemed to have been duly held and convened, and all resolutions 
passed thereat or proceedings taken thereat to have been duly passed and 
taken.

9.15      INSTRUMENTS IN WRITING

          All actions which may be taken and all powers that may be exercised 
by the Debentureholders at a meeting held as hereinbefore in this Article 
provided may also be taken and exercised by the holders of sixty-six and 
two-thirds (66-2/3%) percent of the principal amount of all the outstanding 
Debentures, by an instrument in writing signed in one or more counterparts 
and the expression "extraordinary resolution" when used in this Indenture 
shall include an instrument so signed.

9.16      BINDING EFFECT OF RESOLUTIONS

          Every resolution and every extraordinary resolution passed in 
accordance with the provisions of this Article at a meeting of 
Debentureholders shall be binding upon all the Debentureholders, whether 
present at or absent from such meeting, and every instrument in writing 
signed by Debentureholders in accordance with clause 9.15 shall be binding 
upon all the Debentureholders, whether signatories thereto or not, and each 
and every Debentureholder and the Trustee (subject to the provisions for its 
indemnity herein contained) shall be bound to give effect accordingly to 
every such resolution, extraordinary resolution and instrument in writing.

9.17      EVIDENCE OF RIGHTS OF DEBENTUREHOLDERS

          Any request, direction, notice, consent or other instrument which 
this Indenture may require or permit to be signed or executed by the 
Debentureholders may be in any number of concurrent instruments of similar 
tenor and may be signed or executed by such Debentureholders in person or by 
attorney duly appointed in writing.  Proof of the execution of any such 
request or other instrument or of a writing appointing any such attorney or 
(subject to the provisions of this Article with regard to voting at meetings 
of Debentureholders) of the holding by any person of Debentures shall be 
sufficient for any purpose of this Indenture if made in the following manner, 
namely, the fact and date of execution by any person of such request or other 
instrument or writing may be proved by the certificate of any notary public, 
or other officer authorized to take acknowledgements of deeds to be recorded 
at the place where such certificate is made, that the person signing such 
request or other instrument in writing acknowledged to him the execution 
thereof, or by an affidavit of a witness of such execution or in any other 
manner which the Trustee may consider adequate.

<PAGE>

                                 - 38 -

          The Trustee may, nevertheless, in its discretion require further 
proof in cases where it deems further proof desirable or may accept such 
other proof as it shall consider proper.

                                   ARTICLE 10
                                     NOTICES

10.1      NOTICE TO CORPORATION

          Any notice to the Corporation under the provisions of this 
Indenture shall be valid and effective if given by registered letter, postage 
prepaid, addressed to the Corporation at:

          Battery One, Inc.
          7850 Woodbine Avenue, Suite 201
          Markham, Ontario
          L3R 0B9

          Attention:  The President

and shall be deemed to have been effectively given from the time when in the 
ordinary course of post the said letter should have reached its destination. 
The Corporation may from time to time notify the Trustee in writing of a 
change of address which thereafter, until changed by like notice, shall be 
the address of the Corporation for all purposes of this Indenture.

If, by reason of a strike, lockout or other work stoppage, actual or 
threatened, involving postal employees, any notice to be given to the 
Corporation hereunder could reasonably be considered unlikely to reach its 
destination, such notice shall be valid and effective only if it is delivered 
to the named officer of the party to which it is addressed or, if it is 
delivered to such party at the appropriate address as provided above, by 
cable, telegram, telecopy or other means of prepaid, transmitted and recorded 
communication.

10.2      NOTICE TO DEBENTUREHOLDERS

          All notices to be given hereunder with respect to the Debentures 
shall be deemed to be validly given to the holders thereof if sent by mail, 
postage prepaid, by letter or circular addressed to such holders at their 
post office addresses appearing in any of the registers hereinbefore 
mentioned and shall be deemed to have been given on the day of mailing.  
Accidental error or omission in giving notice or accidental failure to mail 
notice to any Debentureholder or the inability of the Corporation to give or 
mail any notice due to anything beyond the reasonable control of the 
Corporation shall not invalidate any action or proceeding founded thereon.

          All notices with respect to any Debenture may be given to whichever 
one of the holders thereof (if more than one) is named first in the registers 
hereinbefore mentioned, and any notice so given shall be sufficient notice to 
all holders of and persons interested in such Debenture.

<PAGE>

                                 - 39 -

If, by reason of a strike, lockout or other work stoppage, actual or 
threatened, involving postal employees, any notice to be given to the 
Debentureholders or to the Corporation hereunder could reasonably be 
considered unlikely to reach its destination, such notice shall be valid and 
effective only if it is delivered personally to such Debentureholders or if 
delivered to the address for such Debentureholders contained in the register 
of Debentures maintained by the Trustee, by cable, telegram, telex or other 
means of prepaid transmitted and recorded communication.

10.3      NOTICE TO TRUSTEE

          Any notice to the Trustee under the provisions of this Indenture 
shall be valid and effective if given by registered letter, postage prepaid, 
addressed to the Trustee at Suite 710, 530 - 8th Avenue S.W., Calgary, 
Alberta, T2P 3S8, Attention: Corporate Trust Department and shall be deemed 
to have been effectively given from the time when in the ordinary course of 
post the said letter should have reached its destination.

If, by reason of a strike, lockout or other work stoppage, actual or 
threatened, involving postal employees, any notice to be given to the Trustee 
hereunder could reasonably be considered unlikely to reach its destination, 
such notice shall be valid and effective only if it is delivered to the named 
officer of the party to which it is addressed or, if it is delivered to such 
party at the appropriate address as provided above, by cable, telegram, 
telecopy or other means of prepaid, transmitted and recorded communication.

                                   ARTICLE 11
                             CONCERNING THE TRUSTEE

11.1      NO CONFLICT OF INTEREST

          The Trustee represents to the Corporation that at the date of 
execution and delivery by it of this Indenture there exists no material 
conflict of interest in the role of the Trustee as a fiduciary hereunder.

11.2      REPLACEMENT OF TRUSTEE

          The Trustee may resign its trust and be discharged from all further 
duties and liabilities hereunder by giving to the Corporation three (3) 
months' notice in writing or such shorter notice as the Corporation may 
accept as sufficient.  If at any time a material conflict of interest exists 
in the Trustee's role as a fiduciary hereunder the Trustee shall, within 
ninety (90) days after ascertaining that such a material conflict of interest 
exists, either eliminate such material conflict of interest or resign in the 
manner and with the effect specified in this clause.  The validity and 
enforceability of this Indenture and of the Debentures issued hereunder shall 
not be affected in any manner whatsoever by reason only that such material 
conflict of interest exists. In the event of the Trustee resigning or being 
removed or being dissolved, becoming bankrupt, going into liquidation or 
otherwise becoming incapable of acting hereunder, the Corporation shall 
forthwith appoint a new Trustee unless a new Trustee has already been 
appointed by the Debentureholders; failing such appointment by the 
Corporation, the retiring Trustee or any Debentureholder may apply to a Judge 
of the Court of Queen's Bench of Alberta, on such notice as such Judge may 
direct, for the appointment of a new 

<PAGE>

                                 - 40 -

Trustee; but any new Trustee so appointed by the Corporation or by the Court 
shall be subject to removal as aforesaid by the Debentureholders.  Any new 
Trustee appointed under any provision of this clause shall be a corporation 
authorized to carry on business of a trust company in the Province of 
Alberta.  On any new appointment the new Trustee shall be vested with the 
same powers, rights, duties and responsibilities as if it had been originally 
named herein as Trustee.

          Upon the written request of the successor Trustee or of the 
Corporation, the Trustee ceasing to act shall execute and deliver an 
instrument assigning and transferring to such successor Trustee, upon the 
trusts herein expressed, all the rights, powers and trusts of the Trustee so 
ceasing to act, and shall duly assign, transfer and deliver all property and 
money held by such Trustee to the successor Trustee so appointed in its 
place.  Should any deed, conveyance or instrument in writing from the 
Corporation be required by any new Trustee for more fully and certainly 
vesting in and confirming to it such estates' properties, rights, powers and 
trusts, then any and all such deeds, conveyances and instruments in writing 
shall on request of said new Trustee, be made, executed, acknowledged and 
delivered by the Corporation.  Notwithstanding the foregoing, any company 
into which the Trustee may be merged or with which it may be consolidated or 
amalgamated or any company resulting from any merger, consolidation or 
amalgamation to which the Trustee shall be a party, shall be the successor 
Trustee under this Indenture without the execution of any instrument or any 
further act.

11.3      DUTIES OF TRUSTEE

          In the exercise of the rights, duties and obligations prescribed or 
conferred by the terms of this Indenture, the Trustee shall exercise that 
degree of care, diligence and skill that a reasonably prudent trustee would 
exercise in comparable circumstances.

11.4      RELIANCE UPON DECLARATIONS

          In the exercise of its rights, duties and obligations hereunder the 
Trustee may, if acting in good faith, rely, as to the truth of the statements 
and accuracy of the opinions expressed therein, upon statutory declarations, 
opinions, reports or certificates furnished pursuant to any covenant, 
condition or requirement of this Indenture or required by the Trustee to be 
furnished to it in the exercise of its rights and duties hereunder, if the 
Trustee examines such statutory declarations, opinions, reports or 
certificates and determines that they comply with clause 11.5, if applicable, 
and with any other applicable requirements of this Indenture.

11.5      EVIDENCE OF COMPLIANCE TO TRUSTEE

          The Corporation shall furnish to the Trustee evidence of compliance 
with the conditions precedent provided for in this Indenture relating to any 
action or step required or permitted to be taken by the Corporation or the 
Trustee under this Indenture or as a result of any obligation imposed under 
this Indenture. including without limitation, the certification and delivery 
of Debentures hereunder, the satisfaction and discharge of this Indenture and 
the taking of any other action to be taken by the Trustee at the request of 
or on the application of the Corporation, forthwith if and when:

<PAGE>

                                 - 41 -

     (a)  such evidence is required by any other clause of this Indenture to be
          furnished by the Trustee in accordance with the terms of this
          clause 11.5; or

     (b)  the Trustee, in the exercise of its rights and duties under this
          Indenture, gives the Corporation written notice requiring it to
          furnish such evidence in relation to any particular action or
          obligation specified in such notice.

          Such evidence shall consist of:

     (a)  a certificate made by any officer of the Corporation stating that any
          such condition precedent has been complied with in accordance with the
          terms of this Indenture;

     (b)  in the case of a condition precedent compliance with which is, by the
          terms of this Indenture, made subject to review or examination by a
          solicitor, an opinion of Counsel that such condition precedent has
          been complied with in accordance with the terms of this Indenture; and

     (c)  in the case of any such condition precedent compliance with which is
          subject to review or examination by auditors or accountants, an
          opinion or report of the Auditors of the Corporation whom the Trustee
          for such purposes hereby approves, that such condition precedent has
          been complied with in accordance with the terms of this Indenture.

          Whenever such evidence relates to a matter other than the 
certification and delivery of Debentures and the satisfaction and discharge 
of this Indenture, and except as otherwise specifically provided herein, such 
evidence may consist of a report or opinion of any solicitor, auditor, 
accountant, engineer or appraiser or any other person whose qualifications 
give authority to a statement made by him, provided that if such report or 
opinion is furnished by a director, officer or employee of the Corporation it 
shall be in the form of a statutory declaration.  Such evidence shall be, so 
far as appropriate, in accordance with the immediately preceding paragraph of 
this Article.

          Each certificate, opinion or report with respect to compliance with 
a condition precedent provided for in this Indenture shall include:

     (a)  a statement by the person giving the evidence that he has read and is
          familiar with those provisions of this Indenture relating to the
          condition precedent in question;

     (b)  a brief statement of the nature and scope of the examination or
          investigation upon which the statements or opinions contained in such
          evidence are based;

     (c)  a statement that, in the belief of the person giving such evidence, he
          has made such examination or investigation as is necessary to enable
          him to make the statements or give the opinions contained or expressed
          therein; and

     (d)  a statement whether in the opinion of such person the conditions
          precedent in question have been complied with or satisfied.

<PAGE>

                                 - 42 -

          The Corporation shall furnish to the Trustee annually, and at any 
other reasonable time if the Trustee so requires, a certificate signed by an 
officer of the Corporation certifying that the Corporation has complied with 
all covenants, conditions or other requirements contained in this Indenture, 
the non-compliance with which would, with the giving of notice or the lapse 
of time, or both, or otherwise, constitute an Event of Default, or if such is 
not the case, specifying the covenant, condition or other requirement which 
has not been complied with and giving particulars of such non-compliance.  
The Corporation shall, whenever the Trustee so requires, furnish the Trustee 
with evidence by way of statutory declaration, opinion, report or certificate 
as specified by the Trustee as to any action or step required or permitted to 
be taken by the Corporation or as a result of any obligation imposed by this 
Indenture.

11.6      OFFICERS' CERTIFICATE AS EVIDENCE

          Except as otherwise specifically provided or prescribed by this 
Indenture, whenever in the administration of the provisions of this Indenture 
the Trustee shall deem it necessary or desirable that a matter be proved or 
established prior to taking or omitting any action hereunder, the Trustee, if 
acting in good faith, may rely upon an Officers' Certificate.

11.7      EXPERTS, ADVISORS AND AGENTS

          The Trustee may:

     (a)  in relation to these presents act on the opinion or advice of or
          information obtained from any solicitor, auditor, valuer, engineer,
          surveyor, appraiser or other expert, whether obtained by the Trustee
          or by the Corporation, or otherwise, and may employ such assistants as
          may be necessary to the proper discharge of its duties and may pay
          proper and reasonable compensation for all such legal and other advice
          or assistance as aforesaid; and

     (b)  employ such agents and other assistants as it may reasonably require
          for the proper discharge of its duties hereunder, and may pay
          reasonable remuneration for all services performed for it (and shall
          be entitled to receive reasonable remuneration for all services
          performed by it) in the discharge of the trusts hereof and
          compensation for all disbursements, costs and expenses made or
          incurred by such agents or other assistants in the discharge of the
          Trustee's duties hereunder and in the management of the trusts 
          hereof. Any solicitors employed or consulted by the Trustee may, 
          but need not be, solicitors for the Corporation.

11.8      TRUSTEE MAY DEAL IN DEBENTURES

          Subject to clause 11.2, the Trustee may, in its personal or other 
capacity, buy, sell, lend upon and deal in the Debentures and generally 
contract and enter into financial transactions with the Corporation or 
otherwise, without being liable to account for any profits made thereby.

<PAGE>

                                 - 43 -

11.9      INVESTMENT OF MONIES HELD BY TRUSTEE

          Unless otherwise provided in this Indenture, any monies held by the 
Trustee which under the trusts of this Indenture may or ought to be invested 
or which may be on deposit with the Trustee or which may be in the hands of 
the Trustee may be invested and reinvested in the name or under the control 
of the Trustee in securities in which, under the laws of the Province of 
Alberta, trustees are authorized to invest trust monies, provided that such 
securities are expressed to mature within one (1) year after their purchase 
by the Trustee, and unless and until the Trustee shall have declared the 
principal of the Debentures to be due and payable, the Trustee shall so 
invest such monies at the request of the Corporation.

          Pending the investment of any monies as hereinbefore provided, such 
monies may be deposited in the name of the Trustee in any chartered bank of 
Canada or, with the consent of the Corporation, in the deposit department of 
the Trustee or any other loan or trust company authorized to accept deposits 
under the laws of Canada or any Province thereof at the rate of interest then 
current on similar deposits.

          Unless and until the Trustee shall have declared the principal of 
the Debentures to be due and payable, the Trustee shall pay over to the 
Corporation all interest received by the Trustee in respect of any 
investments or deposits made pursuant to the provisions of this clause.

11.10            TRUSTEE NOT ORDINARILY BOUND

          Except as provided in clause 6.2 and as otherwise specifically 
provided herein, the Trustee shall not, subject to clause 11.3, be bound to 
give notice to any person of the execution hereof, nor to do, observe or 
perform or see to the observance or performance by the Corporation of any of 
the obligations herein imposed upon the Corporation or of the covenants on 
the part of the Corporation herein contained, nor in any way to supervise or 
interfere with the conduct of the Corporation's business, unless the Trustee 
shall have been required to do so in writing by the holders of not less than 
fifty-one (51%) percent of the aggregate principal amount of the Debentures 
then outstanding or by any extraordinary resolution of the Debentureholders 
passed in accordance with the provisions contained in Article 9, and then 
only after it shall have been indemnified to its satisfaction against all 
actions, proceedings, claims and demands to which it may render itself liable 
and all costs, charges, damages and expenses which it may incur by so doing.

11.11            TRUSTEE NOT REQUIRED TO GIVE SECURITY

          The Trustee shall not be required to give any bond or security in 
respect of the execution of the trusts and powers of this Indenture or 
otherwise in respect of the premises.
<PAGE>

                                     -44-

11.12     TRUSTEE NOT TO BE APPOINTED RECEIVER

          The Trustee and any person related to the Trustee shall not be 
appointed a receiver or receiver and manager or liquidator of all or any part 
of the assets or undertaking of the Corporation.

11.13     TRUSTEE NOT BOUND TO ACT ON CORPORATION'S REQUEST

          Except as in this Indenture otherwise specifically provided, the 
Trustee shall not be bound to act in accordance with any direction or request 
of the Corporation or of the directors until a duly authenticated copy of the 
instrument or resolution containing such direction or request shall have been 
delivered to the Trustee, and the Trustee shall be empowered to act upon any 
such copy purporting to be authenticated and believed by the Trustee to be 
genuine.

11.14     PROTECTION OF TRUSTEE

          Subject to clause 11.3, the Trustee:

     (a)  shall not at any time be under any duty or responsibility to any
          Debentureholder to determine whether any facts exist which may require
          any adjustment in the conversion formula, or with respect to the
          nature or extent of any such adjustment when made, or with respect to
          the method employed in making the same;

     (b)  shall not be accountable with respect to the validity or value (or the
          kind or amount) of any Common Shares or of any shares or other
          securities or property which may at any time be issued or delivered
          upon the conversion of any Debenture; and

     (c)  shall not be responsible for any failure of the Corporation to make
          any cash payment or to issue, transfer or deliver Common Shares or
          share certificates upon the surrender of any Debenture for the purpose
          of conversion, or to comply with any of the covenants contained in
          this Article.

11.15     CONDITIONS PRECEDENT TO TRUSTEE'S OBLIGATIONS TO ACT HEREUNDER

          The obligation of the Trustee to commence or continue any act, 
action or proceeding for the purpose of enforcing the rights of the Trustee 
and of the Debentureholders hereunder shall be conditional upon the 
Debentureholders furnishing, when required by notice in writing by the 
Trustee' sufficient funds to commence or continue to such act, action or 
proceeding and indemnity reasonably satisfactory to the Trustee to protect 
and hold harmless the Trustee against the costs, charges, expenses and 
liabilities to be incurred thereby and any loss and damage it may suffer by 
reason thereof.

          None of the provisions contained in this Indenture shall require 
the Trustee to expend or risk its own funds or otherwise incur financial 
liability in the performance of any of its duties or in the exercise of any 
of its rights or powers unless indemnified as aforesaid.


<PAGE>

                                     -45-

          The Trustee may, before commencing or at any time during the 
continuance of any such act, action or proceeding, require the 
Debentureholders at whose instance it is acting to deposit with the Trustee 
the Debentures held by them for which Debentures the Trustee shall issue 
receipts.

11.16     AUTHORITY TO CARRY ON BUSINESS

          The Trustee represents to the Corporation that at the date of
execution and delivery by it of this Indenture it is authorized to act as
trustee hereunder.

11.17     ACCEPTANCE OF TRUST

          The Trustee hereby accepts the trusts in this Indenture declared and
provided for and agrees to perform the same upon the terms and conditions herein
set forth and to hold all rights, privileges and benefits conferred hereby and
by law in trust for the various persons who shall from time to time be
Debentureholders, subject to all the terms and conditions herein set forth.

11.18     DIRECTION OF TRUSTEE'S ACTIONS BY HOLDERS

          If and so long as the Trustee shall not have received notice from any
holder of Debentures of an Event of Default hereunder then, notwithstanding any
other provision hereof to the contrary, the Trustee shall only perform such non-
discretionary duties as are specifically set forth in this Indenture but shall
not be obligated to take any other action hereunder except as may be requested
from time to time in writing by the holders of not less than sixty-six and two-
thirds (66-2/3%) percent in principal amount of the Debentures at the time
outstanding; the making of any decision or judgment, giving of any approval or
consent, or exercise of any power, which would otherwise be within the
discretion of the Trustee under the provisions hereof to make, give or exercise,
or not to make, give or exercise, shall only be done upon the written
instructions of the holders of not less than sixty five (65%) percent in
principal amount of the Debentures at the time outstanding.  Copies of all
certificates, notices, reports and other communications given by the Corporation
to the Trustee shall be given to each Debentureholder.  The Trustee shall not be
required to examine any such certificate, notice, report or other communication
or be on notice of the contents thereof.

11.19     ENVIRONMENTAL INDEMNITY

          The Corporation hereby agrees and by these presents does hereby
indemnify the Trustee, its directors, officers, employees, and agents, and all
of their successors and assigns (collectively the "Indemnified Parties") against
any loss, expense, claim liability or asserted liability (including strict
liability and including costs and expenses of abatement and remediation of
spills or releases or releases of contaminants and including liabilities of the
Indemnified Parties to third parties (including governmental agencies) in
respect of bodily injuries, property damage, damage to or impairment of the
environment or any other  injury or damage and including liabilities of the
Indemnified Parties to third parties for the third parties' foreseeable and
unforeseeable consequential damages) incurred as a result of:

     (a)  the administration of the trust created hereby;

<PAGE>

                                     -46-

     (b)  the exercise by the Trustee of any rights hereunder or under any
          mortgage or charge created hereunder;

which result from or relate, directly or indirectly, to:

     (c)  the presence or release of any contaminants, by any means or for any
          reason, on the Mortgaged Property, whether or not release or presence
          of the contaminants was under the control, care or management of the
          Corporation, or of a previous owner, or of a tenant;

     (d)  any contaminant present on or released from any contiguous property to
          the Mortgaged Property; or

     (e)  the breach or alleged breach of any environmental laws by the
          Corporation.

          For purposes of this clause, "liability" shall include (i) liability
of an Indemnified Party for costs and expenses of abatement and remediation of
spills and releases of contaminants, (ii) liability of an Indemnified Party to a
third party to reimburse the third party for bodily injuries, property damages
and other injuries or damages which the third party suffers, including (to the
extent, if any, that the Indemnified Party is liable therefor) foreseeable and
unforeseeable consequential damages suffered by the third party and (iii)
liability for the Indemnified Party for damage to or impairment of the
environment.

          In no event shall the Corporation be liable to indemnify an
Indemnified Party against any loss, expense, claims, liability or asserted
liability to the extent resulting from the gross negligence or wilful misconduct
of the Indemnified Party.

          The obligations of the Corporation to the Indemnified Parties under
this clause shall be joint and several.  


                                   ARTICLE 12
                            CONVERSION OF DEBENTURES

12.1      CONVERSION

     (a)  Upon and subject to the provisions and conditions of this Article 12,
          the holders of Debentures shall have the right, at their option, at
          any time during the term hereof, in denominations of one thousand
          ($1,000) dollars principal amount, to convert the whole or, in the
          case of a Debenture having a denomination in excess of one thousand
          ($1,000) dollars, any part which is one thousand ($1,000) dollars or
          an integral multiple thereof, the principal amount payable by the
          Corporation to the holder as herein provided into fully paid and non-
          assessable Common Shares of the Corporation at the Conversion Price as
          hereinafter set forth.

          Such right of conversion shall extend only to the maximum number of
          whole Common Shares into which the aggregate principal amount of the
          Debenture or Debentures surrendered for conversion at any one time by
          the holder thereof 
<PAGE>

                                     -47-

          may be converted in accordance with the foregoing provisions of 
          this clause.  Fractional interests in Common Shares shall be 
          adjusted for in the manner provided in clause 12.4.

          Subject to the provisions and conditions of this Article 12, the
          Conversion Price for conversion of the whole or any part of a
          Debenture, at the option of a holder hereunder shall be $0.125 per
          Common Share.

     (b)  If at any time after the third anniversary date of the date of this
          Indenture, the Current Market Price per Common Share of the
          Corporation is equal to or greater than $0.20 per Common Share, the
          Corporation shall have the right, at its option, upon giving not less
          than fifteen (15) Business Days prior notice in writing to the holders
          in the manner herein provided, in denominations of one thousand
          ($1,000) dollars principal amount, to convert the whole, or in the
          case of a Debenture having a denomination in excess of one thousand
          ($1,000) dollars, any part which is one thousand ($1,000) dollars or
          an integral multiple thereof, the principal amount into fully paid and
          non-assessable Common Shares of the Corporation at a Conversion Price
          of $0.125 per Common Share.

     (c)  For the purposes of this Article 12, the "Current Market Price" per
          Common Share shall be the weighted average closing price of the
          Corporation's Common Shares for ten (10) consecutive trading days
          commencing not more than twenty (20) trading days before such date on
          the principal stock exchange on which the Common Shares, or if the
          Common Shares are not listed on any stock exchange, then on the
          principal over-the-counter market on which the Common Shares are
          traded.  If there is no market for the Common Shares for the period
          during which the Current Market Price thereof would otherwise be
          determined, the Current Market Price in respect of the Common Shares
          shall be determined by the board of directors of the Corporation
          acting in good faith.  The weighted average price shall be determined
          by dividing the aggregate sale price of all Common Shares sold on the
          said stock exchange or market, as the case may be, during the said ten
          (10) consecutive trading days by the total number of Common Shares so
          sold.

12.2      MANNER OF EXERCISE OF RIGHT TO CONVERT

     (a)  The holder of a Debenture desiring to convert such Debenture in whole
          or in part into Common Shares, or in the alternative, the holder who
          is required to convert such Debenture in whole or in part into Common
          Shares in accordance with clause 12.1(b) hereof shall surrender such
          Debenture to the Trustee at its principal office in the City of
          Calgary together with the conversion form on the back of such
          Debenture or any other written notice in a form satisfactory to the
          Corporation, in either case duly executed by the holder or his
          executors or administrators or other legal representatives or his or
          their attorney duly appointed by an instrument in writing in a form
          and executed in a manner satisfactory to the Corporation, exercising
          his right or obligation to convert such Debenture in accordance with
          the provisions of this Article.  Thereupon such Debentureholder or,
          subject to payment of all applicable stamp or security transfer taxes
          or other governmental charges and compliance with all 

<PAGE>

                                      -48-

          reasonable requirements of the Trustee, his nominee(s) or 
          assignee(s) shall be entitled to be entered in the books of the 
          Corporation as at the date of conversion (or the date as is 
          specified in the notice as contemplated in clause 12.2(b)) as the 
          holder of the number of Common Shares into which such Debenture is 
          convertible in accordance with the provisions of this Article and, 
          as soon as practicable thereafter, the Corporation shall deliver to 
          such Debentureholder or, subject as aforesaid, his nominee(s) or 
          assignee(s) a certificate or certificates for such Common Shares.
          
     (b)  For the purposes of Article 12, a Debenture shall be deemed to be
          surrendered for conversion by the holder on the date on which it is so
          surrendered by the holder in accordance with the provisions of this
          Article and, in the case of a Debenture so surrendered by post or
          other means of transmission, on the date on which it is received by
          the Trustee at its office specified herein or on the date in the
          notice given by the Corporation under clause 12.1(b) hereof, whichever
          is the first to occur (herein referred to as the "Conversion Date");
          provided that if a Debenture is surrendered for conversion on a day on
          which the register of Common Shares is closed, the person or persons
          entitled to receive Common Shares shall become the holder or holders
          of record of such Common Shares as at the date on which such registers
          are next reopened.

     (c)  Any part, being one thousand ($1,000) dollars or an integral multiple
          thereof, of a Debenture of a denomination in excess of one thousand
          ($1,000) dollars may be converted as provided in this Article and all
          references in this Indenture to conversion of Debentures shall be
          deemed to include conversion of such parts.

     (d)  The holder of any Debenture of which part only is converted shall
          surrender the said Debenture to the Trustee, and the Trustee shall
          cancel the same and shall without charge forthwith certify and deliver
          to the holder a new Debenture or Debentures in an aggregate principal
          amount equal to the unconverted part of the principal amount of the
          Debenture so surrendered.

     (e)  The holder of a Debenture surrendered for conversion in accordance
          with Article shall rank only in respect of dividends declared in
          favour of shareholders of record on and after the Conversion Date or
          such later date as such holder shall become the holder of record of
          such Common Shares pursuant to this Article, from which applicable
          date they will for all purposes be and be deemed to be issued and
          outstanding as fully paid and non-assessable Common Shares.

     (f)  The forwarding of Common Shares by the Trustee or the Corporation to
          the holders of the Debenture upon conversion of the Debentures as
          provided in this Article 12 shall satisfy and discharge the
          Corporation and the Trustee of their obligations hereunder, provided
          that in the event of non-receipt of certificates representing such
          Common Shares by the holder, or the loss or destruction thereof, the
          Corporation, upon being furnished with reasonable evidence of such
          non-receipt, loss or destruction and indemnity reasonably satisfactory
          to it, shall issue to such holder a replacement certificate or
          certificates.

<PAGE>

                                     -49-

     (g)  In the event the principal amount of a Debenture, or any portion
          thereof, is converted into Common Shares pursuant to the terms hereof,
          then same shall be applied in the reverse order of payment of
          indebtedness as is set forth in clause 3.4 hereof.

12.3      ADJUSTMENT

          The Conversion Price as provided for in clause 12.1(a) or 12.1(b)
hereof in effect at any date shall be subject to adjustment from time to time as
follows:

     (a)  If and whenever at any time prior to the Conversion Date, the
          Corporation shall:

          (i)    subdivide or redivide the outstanding Common Shares into a
                 greater number of shares;

          (ii)   reduce, combine or consolidate the outstanding Common Shares
                 into a smaller number of shares; or

          (iii)  issue Common Shares of the Corporation to the holders of all or
                 substantially all of the outstanding Common Shares by way of a
                 stock dividend;

          the Conversion Price in effect on the effective date of such
          subdivision, redivision, reduction, combination or consolidation or on
          the record date for such issue of Common Shares by way of a stock
          dividend, as the case may be, shall in the case of the events referred
          to in (i) and (iii) above be decreased in proportion to the number of
          outstanding Common Shares resulting from such subdivision, redivision
          or dividend, or shall, in the case of the events referred to in (ii)
          above, be increased in proportion to the number of outstanding Common
          Shares resulting from such reduction, combination or consolidation. 
          Such adjustment shall be made successively whenever any event referred
          to in this subsection (a) shall occur; any such issue of Common Shares
          by way of a stock dividend shall be deemed to have been made on the
          record date for the stock dividend for the purpose of calculating the
          number of outstanding Common Shares under this clause 12.3(a).

     (b)  In the case of any reclassification or change (other than a change
          resulting only from consolidation or subdivision) of the Common Shares
          or in case of any amalgamation, consolidation or merger of the
          Corporation with or into any other corporation, or in the case of any
          sale of the properties and assets of the Corporation, as or
          substantially as, an entirety to any other corporation, the applicable
          Conversion Price shall be adjusted so that each Debenture shall, after
          such reclassification, change, amalgamation, consolidation, merger or
          sale, be exercisable for the number of shares or the number, kind or
          amount of other securities or property of the Corporation,, or such
          continuing, successor or purchaser corporation, as the case may be,
          which the holder thereof would have been entitled to receive as a
          result of such reclassification, change, amalgamation, consolidation,
          merger or sale if on the effective date thereof he had been the holder
          of the number of Common Shares into which the Debenture 

<PAGE>

                                     -50-

          was convertible prior to the effective date of such 
          reclassification, change, amalgamation, consolidation, merger or 
          sale.  No such reclassification, change, amalgamation, 
          consolidation, merger or sale shall be carried into effect unless, 
          in the opinion of the board of directors acting in good faith, all 
          necessary steps shall have been taken to ensure that the holders 
          shall thereafter be entitled to receive such number of shares or 
          other securities or property of the Corporation, or such 
          continuing, successor or purchasing corporation, as the case may 
          be, subject to adjustment thereafter in accordance with provisions 
          similar, as nearly as may be, to those contained in this clause 
          12.12.

     (c)  The adjustments provided for in this clause 12.3 are cumulative and
          shall apply to successive subdivisions, redivisions, reductions,
          combinations, consolidations, distributions, issues or other events
          resulting in any adjustment under the provisions of this Article.

     (d)  For the purpose of calculating the number of Common Shares of the
          Corporation outstanding, Common Shares owned by or for the benefit of
          the Corporation or its Subsidiaries shall be counted.

     (e)  In the event of any question arising with respect to the adjustments
          provided in this clause 12.3, such question shall be conclusively
          determined by a firm of chartered accountants appointed by the
          Corporation and acceptable to the Trustee (who may be Auditors of the
          Corporation); such accountants shall have access to all necessary
          records of the Corporation and such determination shall be binding
          upon the Corporation, the Trustee, and the Debentureholders.

12.4      NO REQUIREMENT TO ISSUE FRACTIONAL SHARES

          The Corporation shall not be required to issue fractional Common
Shares upon the conversion of Debentures pursuant to this Article.  If more than
one Debenture shall be surrendered for conversion at one time by the same
holder, the number of whole Common Shares issuable upon conversion thereof shall
be computed on the basis of the aggregate principal amount of such Debentures to
be converted.  If any fractional interest in a Common Share would, except for
the provision of this Article, be deliverable upon the conversion of any
principal amount of Debentures, the Corporation shall, in lieu of delivering any
certificate of such fractional interest, satisfy such fractional interest by
issuing such additional or lesser number of Common Shares, rounding up or down,
as the case may be, to the next whole number of Common Share.

12.5      CORPORATION TO RESERVE SHARES

          The Corporation covenants with the Trustee that it will at all times
reserve and keep available out of its authorized Common Shares, solely for the
purpose of issue upon conversion of Debentures as in this Article provided, and
conditionally allot to Debentureholders who may exercise their conversion rights
hereunder, such number of Common Shares as shall then be issuable upon the
conversion of all outstanding Debentures.  The Corporation covenants with the
Trustee that all Common Shares which shall be so issuable shall be duly and
validly issued as fully paid and non-assessable.

<PAGE>

                                     -51-

12.6      TAXES AND CHARGES ON CONVERSION

          The Corporation will from time to time promptly pay or make provision
satisfactory to the Trustee for the payment of any and all taxes and charges
which may be imposed by the laws of Canada or any province thereof (except
income tax or security transfer tax, if any) which shall be payable with respect
to the issuance or delivery to the holders of Debentures, upon the exercise of
their right of conversion or automatic conversion, as the case may be, of Common
Shares of the Corporation pursuant to the terms of the Debentures and of this
Indenture.

12.7      CANCELLATION OF CONVERTED DEBENTURES

          All Debentures converted in whole or in part under the provisions of
this Article shall be forthwith delivered to and cancelled by the Trustee and,
subject to the provisions of clause 12.2(d), no Debenture shall be issued in
substitution therefor.

12.8      CERTIFICATE AS TO ADJUSTMENT

          The Corporation shall from time to time immediately after the
occurrence of any event which requires an adjustment or readjustment as provided
in clause 12.3, deliver an Officers' Certificate to the Trustee specifying the
nature of the event requiring the same and the amount of the adjustment
necessitated thereby and setting forth in reasonable detail the method of
calculation and the facts upon which such calculation is based, which
certificate and the amount of the adjustment specified therein shall be verified
by an opinion of a firm of chartered accountants appointed by the Corporation
and acceptable to the Trustee (who may be the Auditors of the Corporation) and,
when approved by the Trustee shall be conclusive and binding on all parties in
interest.  When so approved, the Corporation shall, except in respect of any
subdivision, redivision, reduction, combination or consolidation of the Shares,
forthwith give notice to the Debentureholders in the manner provided in
clause 10.2 specifying the event requiring such adjustment or readjustment and
the results thereof, including the resulting applicable Conversion formula; 
provided that, if the Corporation has given notice under clause 12.9 covering
all the relevant facts in respect of such event and if the Trustee approves, no
such notice need be given under this clause 12.8.

12.9      NOTICE OF SPECIAL MATTERS

          The Corporation covenants with the Trustee that so long as any
Debenture remains outstanding, it will give notice to the Trustee, and to the
Debentureholders in the manner provided in clause 10.2, of its intention to fix
a record date for the payment of a stock dividend which may give rise to an
adjustment in the applicable conversion formula, and such notice shall specify
the particulars of such event and the record date and the effective date for
such event; provided that the Corporation shall only be required to specify in
such notice such particulars of such event as shall have been fixed and
determined on the date on which such notice is given.  Such notice shall be
given not less than fourteen (14) days in each case prior to such applicable
record date.

<PAGE>

                                     -52-

                                   ARTICLE 13
                             SUPPLEMENTAL INDENTURES

13.1      SUPPLEMENTAL INDENTURES

          From time to time the Trustee and, when authorized by a resolution of
the directors, the Corporation may, and they shall when required by this
Indenture, execute, acknowledge and deliver by their proper officers deeds or
indentures supplemental hereto. which thereafter shall form part hereof, for any
one or more of the following purposes:

     (a)  adding to the covenants of the Corporation herein contained for the
          protection of the holders of the Debentures or providing for Events of
          Default in addition to those herein specified;

     (b)  making such provisions not inconsistent with this Indenture as may be
          necessary or desirable with respect to matters or questions arising
          hereunder, including the making of any modifications in the form of
          the Debentures which do not affect the substance thereof and which, in
          the opinion of the Trustee.  It may be expedient to make, provided
          that the Trustee shall be of the opinion that such provisions and
          modifications will not be prejudicial to the interests of the
          Debentureholders;

     (c)  evidencing the succession, or successive successions, of other
          companies to the Corporation and the covenants of and obligations
          assumed by any such successor in accordance with the provisions of
          this Indenture;

     (d)  giving effect to any extraordinary resolution passed as provided in
          Article 9;

     (e)  for any other purpose not inconsistent with the terms of this
          Indenture.

The Trustee may also, without the consent or concurrence of the
Debentureholders, by supplemental indenture or otherwise, concur with the
Corporation in making any changes or corrections to this Indenture which it
shall have been advised by Counsel are required for the purpose of curing or
correcting any ambiguity or defective or inconsistent provisions or clerical
omissions or mistakes or manifest errors contained herein or in any deed or
indenture supplemental or ancillary hereto, provided that in the opinion of the
Trustee the rights of the Trustee and of the Debentureholders are in no way
prejudiced thereby.


                                   ARTICLE 14
                            EXECUTION AND FORMAL DATE

14.1      EXECUTION

          This Indenture may be simultaneously executed in several counterparts,
each of which when so executed shall be deemed to be an original and such
counterparts together shall constitute one and the same instrument.

<PAGE>

                                     -53-

14.2      FORMAL DATE

          For the purpose of convenience this Indenture may be referred to as
bearing formal date of July 31, 1996, irrespective of the actual date of
execution hereof.

          IN WITNESS WHEREOF the parties hereto have executed these presents
under their respective corporate seals and the hands of their proper officers in
that behalf.



                                             BATTERY ONE, INC.


                                             Per: /s/ illegible
                                                 ----------------------------

                                             Per:                            
                                                 ----------------------------


                                             MONTREAL TRUST COMPANY OF CANADA
                 

                                             Per: /s/ [illegible] 
                                                 ----------------------------


                                             Per:                               
                                                 ----------------------------