<PAGE>   1
Industry Canada


CERTIFICATE
OF AMENDEMENT

CANADA BUSINESS
CORPORATIONS ACT


<TABLE>
<S>                                                   <C>
ALCAN ALUMINIUM LIMITED                               310145-2

------------------------                              -----------------------
Name of corporation                                   Corporation number


</TABLE>

I hereby certify that the articles of the above- 
named corporation were amended

(a) under section 13 of the Canada Business
Corporations Act in accordance with the                [ ]
attached notice;

(b) under section 27 of the Canada Business
Corporations Act as set out in the attached            [ ]
of amendment designating a series of shares;

(c) under section 179 of the Canada Business           [X]
Corporations Act as set out in the attached articles
of amendment;

(d) under section 191 of the Canada Business
Corporations Act as set out in the attached articles   [ ]
or reorganization;

(e) under section 192 of the Canada Business
Corporations Act as set out in the attached articles   [ ]
of arrangement.


<TABLE>
<S>                                                         <C>
Director                                                    May 8, 1995
                                                            Date of Amendment
</TABLE>

CANADA
<PAGE>   2

<TABLE>
<S>                                                                      <C>
Canada Business                                                                  FORM 4
Corporations Act                                                         ARTICLES OF AMENDMENT
                                                                          (SECTION 27 OR 177)



1- Name of corporation                                                    2 - Corporation - No
    ALCAN ALUMINIUM LIMITED                                                   310145-2
</TABLE>


3 - The articles of the above-named corporation are amended as follows:


By deleting Part A of Schedule 1, pertaining to the 2,000,000 Cumulative
Redeemable First Preferred Shares, and the related description set out in
Schedule 1-A.

By deleting Part D of Schedule 1, pertaining to the unlimited number of Junior
Preferred Shares, and the related description set out in Schedule 1-A.

By the addition of the following to Item 5:

"The Directors may appoint one or more additional Directors (above the number
elected at the previous Annual Meeting) who shall hold office for a term
expiring not later than the close of the next Annual Meeting provided that the
total number of Directors so appointed may not exceed one-third of the number
of Directors elected at the said previous Annual Meeting.



<TABLE>
<S>                 <C>                                     <C>
Date                Signature                               Title
2 May 1995          Serge Fecteau                           Assistant Secretary
                                                            FOR DEPARTMENTAL USE ONLY
                                                            Filed                                              
                                                                                                               
</TABLE>
<PAGE>   3
Industry Canada


CERTIFICATE
OF AMALGAMATION

CANADA BUSINESS
CORPORATIONS ACT





<TABLE>
<S>                                                       <C>
ALCAN ALUMINIUM LIMITED                                             310145-2


______________________________                              _____________________________
Name of corporation                                         Corporation number




I hereby certify that the above-named corporation
resulted from an amalgamation, under section 185 
of the Canada Business Corporations Act, of the  
corporations set out in the attached articles of 
amalgamation.                                    





 /s/                                                         January 1, 1995

 Director                                                    Date of amalgamation

</TABLE>

CANADA
<PAGE>   4

<TABLE>
<S>                                            <C>
Canada Business                                          FORM 9
Corporations Act                               ARTICLES OF AMALGAMATION
                                                      (SECTION 185)        
---------------------------------------------------------------------------
</TABLE>

1 - Name of amalgamated corporation

    ALCAN ALUMINUM LIMITED


2 - The place in Canada where the registered office is to be situated

    CITY OF MONTREAL, PROVINCE OF QUEBEC

3 - The classes and any maximum number of shares that the corporation is
    authorized to issue

    SCHEDULES 1 AND 1-A ARE INCORPORATED IN THIS FORM

4 - Restrictions, if any, on share transfers

    THERE ARE NO RESTRICTIONS ON THE TRANSFER OF SHARES OF THE CORPORATION.

5 - Number (or minimum and maximum number) of directors

    MINIMUM: 9    MAXIMUM: 20

6 - Restrictions, if any, on business the corporation may carry on

    THERE ARE NO RESTRICTIONS ON THE BUSINESS THAT THE CORPORATION MAY
    CARRY ON.

7 - Other provisions, if any

    WITHOUT THE CONSENT GIVEN BY WAY OF SPECIAL RESOLUTION OF THE HOLDERS OF
    THE COMMON SHARES, THERE SHALL NOT BE CREATED OR ISSUED ANY SERIES OF
    PREFERENCE SHARES TO WHICH ARE ATTACHED VOTING RIGHTS OTHER THAN VOTING
    RIGHTS ARISING ONLY IN THE EVENT OF NON-PAYMENT OF DIVIDENDS
    THEREON.

8 - The amalgamation has been approved pursuant to that section or subsection
    of the Act which is indicated as follows:

                                     183
                                     184 (1)
                                     184 (2)                                  
9 - Name of Amalgamating
    corporations          Corporation No. Signature      Date       Title    
ALCAN ALUMINIUM LIMITED      010058-7     [P.K. Pal]    22/12/94  SECRETARY
ALCAN ALUMINIUM HOLDINGS
LIMITED                      010041-2   [Serge Fecteau] 22/12/94  SECRETARY  
FOR DEPARTMENTAL USE ONLY                     Filed -
Corporation No.
                     310145-2               JAN - 4 1995

<PAGE>   5

The classes and any maximum  number of shares

                                   SCHEDULE 1

The classes of shares and, where applicable, the maximum number of Shares that
the Corporation is authorized to issue are set out below and the rights,
privileges, restrictions and conditions attaching to each class of shares of
the Corporation are set out in Schedule 1-A annexed hereto:

A.       2,000,000 Cumulative Redeemable First Preferred Shares without
         nominal or par value, issuable in series (See Schedule 1-A, Part A);

B.       An unlimited number of Preference Shares without nominal or par value,
         issuable in series (See Schedule 1-A, Part B), of which:

         i)      the third series consists of 4,200,000 Floating Rate
                 Cumulative Redeemable Preference Shares, Series C, 1984 Issue
                 (See Schedule 1-A, Part B.1);

         ii)     the fourth series consists of 1,300,000 Floating Rate
                 Cumulative Redeemable Preference Shares, Series D, 1984 Issue
                 (See Schedule 1-A, Part B.2);

         iii)    the fifth series consists of 1,500,000 Floating Rate
                 Cumulative Redeemable Preference Shares, Series C, 1985 Issue
                 (See Schedule 1-A, Part B.3);

         iv)     the sixth series consists of 400,000 Floating Rate Cumulative
                 Redeemable Preference Shares, Series D, 1985 issue (See
                 Schedule 1-A, Part B.4);

         v)      the seventh series consists of 3,000,000 Cumulative Redeemable
                 Preference Shares, Series E (See Schedule 1-A, Part B.5);

         vi)     the eighth series consists of 400,000 Cumulative Redeemable
                 Retractable Preference Shares, Series F (See Schedule 1-A 
                 Part B.6);

         vii)    the ninth series consists of 300 Floating Rate Cumulative
                 Redeemable Preference Shares, Series G (See Schedule 1-A, Part
                 B.7);
<PAGE>   6

The classes and any maximum  number of shares

C.    An unlimited number of Common Shares without nominal or par value (See
      Schedule 1-A, Part C);
    
D.    An unlimited number of Junior Preferred Shares (See Schedule 1-A, Part D)

<PAGE>   7

                                  SCHEDULE 1-A

The rights, privileges, restrictions and conditions attaching to the Cumulative
Redeemable First Preferred Shares without nominal or par value, issuable in
series; Preference Shares without nominal or par value, issuable in series;
Common Shares without nominal or par value; and the Junior Preferred Shares
shall be as set out in this Schedule.

                                     PART A

2,000,000 CUMULATIVE REDEEMABLE FIRST PREFERRED SHARES WITHOUT NOMINAL OR PAR
VALUE, ISSUABLE IN SERIES (hereinafter referred to as "First Preferred
Shares").

PROVISIONS OF FIRST PREFERRED SHARES AS A CLASS

The First Preferred Shares shall, as a class, carry and be subject to the
following preferences, priorities, rights, conditions, limitations and
restrictions:

         (a) The First Preferred Shares may be issued at any time or from time
to time in one or more series with such preferred, deferred or other special
rights, restrictions, conditions, limitations or designations attaching thereto
including, without limiting the generality of the foregoing, such rates of
cumulative preferred dividends, redemption price, conversion rights (if any),
sinking or purchase fund (if any), retraction provisions (if any) and
provisions for the amendment of such rights, restrictions, conditions,
limitations or designations (the whole subject to the preferences, priorities,
rights, conditions, limitations and restrictions attaching to the First
Preferred Shares as a class) as shall be prescribed from time to time before
issuance by any resolution providing for the issue of the First Preferred
Shares of any series which may be passed by the Directors of the Corporation.
The number of shares in any series may from time to time be increased by the
Directors upon compliance with the same conditions as are applicable to the
issue of shares of a new series.

         (b) The First Preferred Shares of each series shall rank on a parity
with the First Preferred Shares of every other series with respect to priority
in payment of dividends and in the distribution of assets in the event of the
liquidation, dissolution or winding-up of the Corporation whether voluntary or
involuntary, or any other distribution of the assets of the Corporation among
its shareholders for the purpose of winding up its affairs.

         (c) The holders of the First Preferred Shares shall be entitled to
receive and the Corporation shall pay thereon as and when declared by the
Directors of the Corporation, out of the moneys of the Corporation properly
applicable to the payment of dividends, fixed, cumulative, preferential, cash
dividends at such rates and payable at such intervals as shall have been
prescribed for each series. Such dividends shall accrue from such date as may
in the case of each series be determined by the Directors of the Corporation,
or in case no date be so determined, then from the date of issue thereof.
Cheques of the Corporation, payable at par at any branch in Canada of a
chartered bank from time to time selected by the Directors of the Corporation,
shall be issued in respect of such dividends (less any taxes required to be
deducted) and payment thereof shall satisfy such dividends. With respect to
each series of First Preferred Shares, dividends shall be paid to the
registered holders appearing on the register at the close of business on such a
day preceding the day fixed for the payment of dividends as may be determined
from time to time by the Directors of the Corporation.

         (d) Subject to the provisions of the Canada Business Corporations Act
as from time to time amended or replaced ("Act"), and the provisions relating
to any particular series, the Corporation may at any time or from time to time,
at its option, purchase (if obtainable) for cancellation out of

<PAGE>   8

capital or otherwise pursuant to the Act, the whole or any part of the First
Preferred Shares of any one or more series outstanding from time to time in the
open market (including purchase through or from any investment dealer or firm
holding membership on a recognized stock exchange) or by invitation for tenders
addressed to all holders of record of the series of First Preferred Shares
proposed to be purchased at the lowest price or prices at which, in the opinion
of the Treasurer or an Assistant Treasurer of the Corporation, such shares are
obtainable but not exceeding the price at which such shares could be redeemed
at the time of purchase or, if not then callable for redemption, on the date of
their first becoming redeemable, together with an amount equal to all
dividends, if any, accrued thereon up to the date of purchase and then
remaining unpaid, whether or not earned or declared (which dividends, for such
purpose, shall be calculated as if they were accruing from day to day up to the
date of purchase), plus costs of purchase. If, upon any invitation for tenders
more First Preferred Shares are tendered at a price or prices acceptable to the
Corporation than the Corporation is then prepared to purchase, the Corporation
will accept, to the extent required, the tenders submitted at the lowest price
and then, if and to the extent required, the tenders submitted at the next
progressively higher prices and if more shares are tendered at any such price
than the Corporation is prepared to purchase, the shares tendered at that price
shall be purchased as nearly as possible pro rata (disregarding fractions)
according to the number of First Preferred Shares so tendered by each holder
thereof. From and after the date of purchase, the First Preferred Shares so
purchased shall be canceled and shall not be reissued.

         (e) Subject to the provisions of the Act and the provisions relating
to any particular series, the Corporation may upon giving notice as hereinafter
provided redeem out of capital or otherwise pursuant to the Act, at any time
the whole or, from time to time, any part of the then outstanding First
Preferred Shares of any series at such redemption price (consisting of the
amount paid up thereon and of such premium thereon, if any, not exceeding 20%
of the amount paid up thereon) as shall have been prescribed for such series,
together with an amount equal to all dividends, if any, accrued thereon up to
the date fixed for redemption and then remaining unpaid, whether or not earned
or declared (which dividends, for such purpose, shall be calculated as if they
were accruing from day to day up to and including the date fixed for
redemption). In case a part only of the First Preferred Shares of any series is
to be redeemed, the shares of such series to be redeemed shall be selected by
lot in such manner as the Directors of the Corporation may determine or if the
Directors so determine, may be redeemed pro rata disregarding fractions and the
Directors may make such adjustments as may be necessary to avoid redemption of
fractional parts of shares. In the case of any redemption of First Preferred
Shares, not less than 30 days' notice in writing of such redemption shall be
given by mailing such notice to each registered holder who at the time of the
mailing is a registered holder of First Preferred Shares to be redeemed, at his
address as it appears on the books of the Corporation, or in the event of the
address of any such shareholder not so appearing, then to the last known
address of such shareholder; provided, however, that accidental failure to give
any such notice to one or more of such holders shall not affect the validity of
such redemption as to the other holders. Such notice shall set out the
redemption price, the place or places at which the redemption price is to be
paid and the date on which redemption is to take place, and, if part only of
the First Preferred Shares held by the person to whom such notice is addressed
is to be redeemed, the number thereof so to be redeemed. On or before the date
so fixed for redemption, the Corporation shall deposit the redemption price of
the First Preferred Shares to be redeemed in the chartered bank or trust
company specified in the notice of redemption, to be paid without interest to
or to the order of the respective holders of such First Preferred Shares upon
presentation and surrender to such chartered bank or trust company of the
certificates representing the same. Provided such deposit shall have been made,
such First Preferred Shares so called for redemption shall on the date fixed
for redemption be deemed to be redeemed, shall cease to be entitled to
dividends and the holders thereof shall cease to be entitled to exercise any of
the rights of shareholders in respect thereof. If the redemption price shall
not be deposited as aforesaid, the rights of the holders of the First Preferred
Shares so called for redemption shall remain unaffected. From and after the
date fixed for redemption, the First Preferred Shares so redeemed shall be
deemed cancelled and shall not be reissued.

<PAGE>   9

         (f) In the event of the liquidation, dissolution or winding up of the 
Corporation or other distribution of assets of the Corporation among 
shareholders for the purpose of winding up its affairs, the holders of the 
First Preferred Shares shall be entitled to receive (i) the amount paid up on 
such shares together with all unpaid dividends (which dividends, for such 
purpose, shall be calculated as if they were accruing from day-to-day for the 
period from the expiration of the last period for which dividends have been 
paid up to and including the date of distribution), and (ii) if such 
liquidation, dissolution, winding up or distribution shall be voluntary, an 
additional amount equal to the premium, if any, which would have been payable 
on the redemption (for other than sinking fund purposes) of the First 
Preferred Shares respectively if they had been called for redemption by the 
Corporation (a) on the date of distribution, or (b) if not then callable for 
redemption, on the date of their first becoming redeemable, before any amount 
shall be paid to, or any property or assets of the Corporation distributed 
among, the holders of any shares of the Corporation ranking junior to the 
First Preferred Shares. After payment to the holders of the First Preferred 
Shares of the amounts so payable to them, they shall not be entitled to share 
in any further distribution of the property or assets of the Corporation.

         (g) The holders of the First Preferred Shares shall not be entitled as
such (except as hereinafter specifically provided) to receive notice of or to
attend any meeting of the shareholders of the Corporation or to vote at any
such meeting unless and until the Corporation from time to time shall fail to
pay in the aggregate six quarterly dividends on the First Preferred Shares of
any one series on the dates on which the same should be paid according to the
terms thereof whether or not consecutive and whether or not such dividends have
been declared and whether or not there are any moneys of the Corporation
properly applicable to the payment of dividends. Thereafter, but only so long
as any dividends on the First Preferred Shares of any series remain in arrears,
the holders of the First Preferred Shares shall be entitled to receive notice
of attend and vote at all meetings of shareholders of the Corporation and shall
be entitled, voting separately and exclusively as a class, to elect two members
of the Board of Directors of the Corporation. Each holder of the First
Preferred Shares shall be entitled to one vote in respect of each First
Preferred Share held by him. Nothing herein contained shall be deemed to limit
the right of the Corporation from time to time to increase or decrease the
number of its  Directors.

Notwithstanding anything contained in the by-laws of the Corporation, the term
of office of all persons who may be Directors of the Corporation at any time
when the right to elect Directors shall accrue to the holders of First
Preferred Shares as herein provided, or who may be appointed as Directors
thereafter and before a meeting of shareholders shall have been held, shall
terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at least one-tenth of the outstanding First Preferred Shares. In default of
the calling of such general meeting by the Secretary within 15 days after the
making of such request, such meeting may be called by any holder of record of
First Preferred Shares.

Any vacancy occurring among members of the Board elected by the holders of
First Preferred Shares may be filled by the Board of Directors with the consent
and approval of the remaining Director elected by the holders of First
Preferred Shares. Whether or not such vacancy is so filled by the Board, the
holders of record of at least one-tenth of the outstanding First Preferred
Shares shall have the right to require the Secretary of the Corporation to call
a meeting of the holders of First Preferred Shares for the purpose of filling
the vacancy or replacing any person elected or appointed by the Board of
Directors to fill such vacancy and the provisions of the last preceding
paragraph shall apply with respect to the calling of any such meeting.

Notwithstanding anything contained in the by-laws of the Corporation (i) upon
any termination of the said right to elect Directors, the term of Office of the
Directors elected or appointed to represent

<PAGE>   10

the holders of First Preferred Shares exclusively shall forthwith terminate and
(ii) the holding of one First Preferred Share shall be sufficient to qualify a
person for election or appointment as a Director of the Corporation to
represent the holders of First Preferred Shares exclusively.

         (h) The Corporation shall not, without prior approval of the holders
of the First Preferred Shares given as hereinafter specified, create any First
Preferred Shares in addition to the 2,000,000 presently authorized First
Preferred Shares or create any class of shares ranking as to payment of
dividends or repayment of capital in priority to, or on a parity with, the
First Preferred Shares.

         (i) The holders of the First Preferred Shares shall not be entitled as
of right to subscribe for, purchase or receive any part of any issue of any
shares, bonds, debentures or other securities of the Corporation now or
hereafter authorized, otherwise than in accordance with exercise of the
conversion rights, if any, which may from time to time attach to any series of
the First Preferred Shares.

         (j) The provisions contained in paragraphs (a) to (i) and in this
paragraph (j) may be repealed or amended in whole or in part but only with the
approval of the holders of the First Preferred Shares.

The approval of the holders of the First Preferred Shares as to any and all
matters hereinbefore referred to may be given in writing by all the holders of
the outstanding First Preferred Shares or by resolution passed or by-law
sanctioned at a meeting of holders of First Preferred Shares duly called for
the purpose and held upon at least 21 days' notice at which the holders of at
least a majority of the outstanding First Preferred Shares are present or
represented by proxy and carried by not less than two-thirds of the votes cast
on a poll at such meeting. If at any such meeting the holders of a majority of
the outstanding First Preferred Shares are not present or represented by proxy
within half an hour after the time appointed for the meeting, then the meeting
shall be adjourned to such date being not less than 15 days later and to such
time and place as may be appointed by the shareholders present and at least ten
days' notice shall be given of such adjourned meeting, but it shall not be
necessary in such notice to specify the purpose for which the meeting was
originally called. At such adjourned meeting the holders of First Preferred
Shares present or represented by proxy may transact the business for which the
meeting was originally convened, and a resolution passed thereat by not less
than two-thirds of the votes cast on a poll at such adjourned meeting shall
constitute the approval of the holders of the First Preferred Shares referred
to above.

If the repeal or amendment of the provisions hereinbefore contained affects the
rights of the holders of First Preferred Shares of any series in a manner
different from that in or to which the rights of the holders of First Preferred
Shares of any other series are affected, then such repeal or amendment shall,
in addition, be approved by the holders of the First Preferred Shares of such
series so affected, and the provisions of this paragraph (j) shall apply,
mutatis mutandis, with respect to the giving of such approval.

Any meeting of the holders of the outstanding First Preferred Shares may be
held at any time and for any purpose, without notice, if all holders of First
Preferred Shares entitled to vote at the meeting waive notice of the meeting in
writing. For the purposes of waiver of notice, the words "in writing" shall,
without limitation, include the sending of a telegram, telex, cable or any
other form of written communication by a shareholder. Any holder of First
Preferred Shares may waive notice of any meeting either before or after the
meeting is held.

Irregularities in the notice or in the giving thereof as well as the accidental
omission to give notice of any meeting to, or the non-receipt of any notice by,
any holder of First Preferred Shares, shall not invalidate any action taken at
any meeting.

<PAGE>   11

At any meeting of the holders of First Preferred Shares without distinction as
to series, each holder of First Preferred Shares shall be entitled to one vote
in respect of each First Preferred Share held by him. At any meeting of the
holders of First Preferred Shares of any particular series, each holder shall
be entitled to one vote in respect of each First Preferred Share of such series
held by him.

The formalities to be observed with respect to the giving of notice of any
meeting of holders of First Preferred Shares and the conduct thereof shall be
those from time to time prescribed in the by-laws of the Corporation with
respect to meetings of shareholders.

<PAGE>   12

                                     PART B

AN UNLIMITED NUMBER OF PREFERENCE SHARES WITHOUT NOMINAL OR PAR VALUE, ISSUABLE
IN SERIES

PROVISIONS OF PREFERENCE SHARES AS A CLASS

The Preference Shares shall, as a class, carry and be subject to the following
rights, privileges, restrictions and conditions:

         (a) The Preference Shares may be issued at any time or from time to
time in one or more series, each series consisting of such number of shares and
having such preferred, deferred or other special rights, restrictions,
conditions, limitations or designations attaching thereto including, without
limiting the generality of the foregoing, such rates, amounts or methods of
calculation of cumulative preferred dividends, redemption price, conversion
rights (if any), sinking or purchase fund (if any), retraction provisions (if
any), voting rights, and provisions for the amendment of such rights,
restrictions, conditions, limitations or designations (the whole subject to the
rights, privileges, restrictions and conditions attaching to the Preference
Shares as a class) as shall be prescribed from time to time before issuance by
any resolution providing for the issue of the Preference Shares of any series
which may be passed by the Directors of the Corporation.

         (b) The rights, privileges, restrictions and conditions attaching to
the Preference Shares shall be subject and subordinate to those attaching to
the First Preferred Shares and to the Second Preferred Shares, but only to the
extent that they may conflict therewith.

         (c) The Preference Shares of each series shall rank pari passu with
the Preference Shares of every other series and shall be entitled to preference
over the Common Shares and over any other shares ranking junior to the
Preference Shares with respect to payment of dividends or distribution of
assets in the event of the liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary, or any other distribution of the
assets of the Corporation among its shareholders for the purpose of winding up
its affairs.

         (d) Subject to the provisions of paragraph (b) hereof, the holders of
the Preference Shares shall be entitled to receive and the Corporation shall
pay thereon as and when declared by the Directors of the Corporation, out of
the moneys of the Corporation properly applicable to the payment of dividends,
cumulative, preferential, cash dividends at such rates, in such amounts or by
such methods of calculation, in such currencies and payable at such intervals
as shall have been prescribed for each series. Such dividends shall accrue from
such date as may in the case of each series be determined by the Directors of
the Corporation, or in case no date be so determined, then from the date of
issue thereof. Cheques of the Corporation, payable at par at any branch in
Canada or the United States of America of a bank from time to time selected by
the Directors of the Corporation shall be issued in respect of such dividends
(less any taxes required to be deducted) and payment thereof shall satisfy such
dividends. A dividend that is represented by a cheque which has not been
presented to the Corporation's bankers for payment or that otherwise remains
unclaimed for a period of six years from the date on which it was declared to
be payable shall be forfeited to the Corporation. With respect to each series
of Preference Shares, dividends shall be paid to the registered holders
appearing on the register at the close of business on such a day preceding the
day fixed for the payment of dividends as may be determined from time to time
by the Directors of the Corporation.

         (e) Subject to the provisions of the Canada Business Corporation Act
as from time to time amended ("Act"), the provisions of paragraph (b) hereof
and the provisions relating to any particular series, the Corporation may at
any time or from time to time, at its option, purchase (if obtainable)

<PAGE>   13

for cancellation out of capital or otherwise pursuant to the Act, the whole or
any part of the Preference Shares or any one or more series outstanding from
time to time in the open market (including purchase through or from any
investment dealer or firm holding membership on a recognized stock exchange),
by invitation for tenders addressed to all holders of record of the series of
Preference Shares proposed to be purchased or by private contract at the lowest
price or prices at which, in the opinion of the Treasurer or an assistant
Treasurer of the Corporation, such shares are obtainable but not exceeding the
price at which such shares could be redeemed at the time of purchase or, if not
then callable for redemption, on the date of their first becoming redeemable,
together with an amount equal to all dividends, if any, accrued thereon up to
the date of purchase and then remaining unpaid, whether or not earned or
declared (which dividends, for such purpose, shall be calculated as if they
were accruing from day to day up to the date of purchase) plus costs of
purchase. If upon any invitation for tenders, more Preference Shares are
tendered at a price or prices acceptable to the Corporation than the
Corporation is then prepared to purchase, the Corporation will accept, to the
extent required, the tenders submitted at the lowest price and then, if and to
the extent required, the tenders submitted at the next progressively higher
prices, and if more shares are tendered at any such price than the Corporation
is prepared to purchase, the shares tendered at that price shall be purchased
as nearly as possible pro rata (disregarding fractions) according to the number
of Preference Shares so tendered by each holder thereof. From and after the
date of purchase the Preference Shares so purchased shall be cancelled and
shall not be reissued.

         (f) Subject to the provisions of the Act, the provisions of paragraph
(b) hereof and the provisions relating to any particular series, the
Corporation may, upon giving notice as hereinafter provided, redeem out of
capital or otherwise pursuant to the Act at any time the whole or from time to
time any part of the then outstanding Preference Shares of any series at such
redemption price as shall have been prescribed for such series, together with
an amount equal to all dividends, if any, accrued thereon up to the date fixed
for redemption and then remaining unpaid, whether or not earned or declared
(which dividends, for such purpose, shall be calculated as if they were
accruing from day to day up to and including the date fixed for redemption). In
case a part only of the Preference Shares of any series is to be redeemed, the
shares of such series to be redeemed shall be selected by lot in such manner as
the Directors of the Corporation may determine or if the Directors so
determine, may be redeemed pro rata disregarding fractions and the Directors
may make such adjustments as may be necessary to avoid redemption of fractional
parts of shares. In the case of any redemption of Preference Shares, notice in
writing of such redemption of such number of days as shall have been prescribed
for each series and failing such prescription of not less than 90 days shall be
given by mailing such notice to each registered holder who at the time of the
mailing is a registered holder of Preference Shares to be redeemed, at his
address as it appears on the books of the Corporation, or in the event of the
address of any such shareholder not so appearing, then to the last known
address of such shareholder; provided, however, that accidental failure to give
any such notice to one or more of such holders shall not affect the validity of
such redemption as to the other holders. Such notice shall set out the
redemption price, the place or places at which the redemption price is to be
paid and the date on which redemption is to take place, and, if part only of
the Preference Shares held by the person to whom it is addressed is to be
redeemed, the number thereof so to be redeemed. On or before the date so fixed
for redemption, the Corporation shall deposit the redemption price of the
Preference Shares to be redeemed in the bank or trust company specified in the
notice of redemption, to be paid without interest to or to the order of the
respective holders of such Preference Shares upon presentation and surrender to
such bank or trust company of the certificates representing the same. Provided
such deposit shall have been made, such Preference Shares so called for
redemption shall on the date fixed for redemption be deemed to be redeemed,
shall cease to be entitled to dividends and the holders thereof shall cease to
be entitled to exercise any of the rights of shareholders in respect thereof.
If the redemption price shall not be deposited as aforesaid, the rights of the
holders of the Preference Shares so called for redemption shall remain
unaffected. From and after the date fixed for redemption, the Preference Shares
so redeemed shall be deemed cancelled and shall not be reissued.

<PAGE>   14

         (g) Except as set forth in paragraph (h) and subject to the provisions
relating to any particular series, the holders of Preference Shares shall not
be entitled as such to receive notice of or to attend any meeting of the
shareholders of the Corporation or to vote at any such meeting.

         (h) The provisions contained in paragraphs (a) to (g) and in this
paragraph (h) may be repealed or amended in whole or in part but only with the
approval of the holders of the Preference Shares, except that without such
approval the Directors of the Corporation may change the designation of the
Preference Shares or any series thereof. The approval of the holders of the
Preference Shares as to any and all matters hereinbefore referred to may be
given in writing by all the holders of the outstanding Preference Shares or by
resolution passed or by-law sanctioned at a meeting of holders of Preference
Shares duly called for the purpose and held upon at least 21 days' notice at
which the holders of at least 50% of the outstanding Preference Shares are
present or represented by proxy and carried by not less than two-thirds of the
votes cast on a poll at such meeting. If at any such meeting the holders of 50%
of the outstanding Preference Shares are not present or represented by proxy
within half an hour after the time appointed for the meeting then the meeting
shall be adjourned to such date being not less than 15 days later and to such
time and place as may be appointed by the shareholders present and at least ten
days' notice shall be given of such adjourned meeting, but it shall not be
necessary in such notice to specify the purpose for which the meeting was
originally called. At such adjourned meeting, the holders of Preference Shares
present or represented by proxy may transact the business for which the meeting
was originally convened, and a resolution passed thereat by not less than
two-thirds of the votes cast on a poll at such adjourned meeting shall
constitute the approval of the holders of the Preference Shares referred to
above.

If the repeal or amendment of the provisions hereinbefore contained affects the
rights of the holders of Preference Shares of any series in a manner different
from that in or to which the rights of the holders of Preference Shares of any
other series are affected, then such repeal or amendment shall, in addition, be
approved by the holders of the Preference Shares of such series so affected,
and the provisions of this paragraph (h) shall apply, mutatis mutandis, with
respect to the giving of such approval.

Any meeting of the holders of the outstanding Preference Shares may be held at
any time and for any purpose, without notice, if all holders of Preference
Shares entitled to vote at the meeting waive notice of the meeting in writing.
For the purpose of waiver of notice, the words "in writing" shall, without
limitation, include the sending of a telegram, telex, cable or any other form
of written communication by a shareholder. Any holder of Preference Shares may
waive notice of any meeting either before or after the meeting is held.

Irregularities in the notice or in the giving thereof as well as the accidental
omission to give notice of any meeting to, or the non-receipt of any notice by,
any holder of Preference Shares, shall not invalidate any action taken at any
meeting.

At any meeting of the holders of Preference Shares, without distinction as to
series, each holder shall be entitled to one vote in respect of each dollar of
issue price of Preference Shares held by him, whether such issue price is in
Canadian or United States currency. At any meeting of the holders of Preference
Shares of any particular series, each holder shall be entitled to one vote in
respect of each Preference Share of such series held by him.

The formalities to be observed with respect to the giving notice of any meeting
of holders of Preference Shares and the conduct thereof shall be those from
time to time prescribed in the by-laws of the Corporation with respect to
meetings of shareholders.

<PAGE>   15

                                    PART B.1

PROVISIONS OF THE THIRD SERIES OF PREFERENCE SHARES CONSISTING OF 4,200,000
FLOATING RATE CUMULATIVE REDEEMABLE PREFERENCE SHARES, SERIES C, 1984 ISSUE
(hereinafter referred to as "Series C Preference Shares")

The Series C Preference Shares shall, in addition to the rights, privileges,
restrictions and conditions attaching to the Preference Shares as a class, have
the following rights, privileges, restrictions and conditions:

1. Issue Price

The Series C Preference Shares will have an issue price of $25.00 each.

2. Dividends

2.1 The holders of Series C Preference Shares will be entitled to receive a
quarterly cumulative preferential cash dividend, as and when declared by the
Board of Directors of the Corporation, on the 20th day of February, May, August
and November in each year ("Dividend Payment Dates") in an amount per share
determined by applying to the $25.00 issue price per share one-quarter of the
Annual Dividend Rate applicable to the Quarter preceding the Dividend Payment
Date for which the determination is being made. The record date for the payment
of dividends will be the 5th day of February, May, August and November or any
other day, chosen by the Board of Directors, which is not more than 30 days
preceding the Dividend Payment Date.

The initial dividend will be payable on November 20, 1984 to holders of record
on November 5, 1984 in an amount per share determined by applying to $25.00 the
Annual Dividend Rate applicable to the period from the date of issue to
September 30, 1984 multiplied by the number of days following the date of issue
through November 20, 1984, all divided by 365.

"Annual Dividend Rate" applicable to a Quarter is the greater of (i) 72% of
Canadian Prime and (ii) the lesser of 7.5% and Canadian Prime.

"Quarter" is a period of three consecutive calendar months commencing on the
first day of any of January, April, July or October.  "Quarter" shall also mean
the period from the date of issue to September 30, 1984.

"Canadian Prime" for a Quarter is the average of the Prime Interest Rates in
effect on each day of that Quarter.

"Prime Interest Rate" is the average of the annual rates of interest announced
from time to time by The Royal Bank of Canada and The Toronto-Dominion Bank as
reference rates then in effect for determining interest rates on Canadian
dollar commercial loans in Canada. In the event that for any reason one of the
said banks does not have a Prime Interest Rate in effect during all of a
Quarter, then the Prime Interest Rate for such bank for such Quarter shall be
the Prime Interest Rate of the other bank. In the event that both of the said
banks do not have a Prime Interest Rate in effect during all of a Quarter, then
the Prime Interest Rate for that Quarter shall be equal to 1.65% per annum plus
the average during such Quarter of the average yields at weekly tender on
91-day Government of Canada Treasury Bills as reported by the Bank of Canada.

In any case where a dividend is payable for a period that ends on a date
("reference date") other than a Dividend Payment Date, the amount of such
dividend shall be determined by applying to $25.00 the Annual Dividend Rate
applicable to the Quarter preceding the reference date multiplied by the number

<PAGE>   16

of days following the Dividend Payment Date preceding the reference date
through the reference date, all divided by 365.

2.2 In these provisions, "accrued and unpaid dividends" means an amount
computed at the applicable rates as though dividends had been accruing on a
day-to-day basis from the date of issue to the date to which the computation of
accrued dividends is to be made, after deducting all dividend payments made.

3. Redemption

The Series C Preference Shares shall not be redeemable on or before December
31, 1987, but thereafter shall be redeemable at the option of the Corporation
on at least 30 days' notice prior to the date fixed for redemption in whole at
any time or in part from time to time on payment of the following redemption
prices in Canadian currency for each share to be redeemed:

<TABLE>
<CAPTION>
If redeemed in the l2 months ending                                                         Redemption Price
-----------------------------------                                                         ----------------
<S>                                                                                                  <C>
December 31, 1988  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.50
December 31, 1989  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.20
December 31, 1990  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.90
December 31, 1991  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.60
December 31, 1992  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.30
and thereafter   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.00
</TABLE>

together in each case with an amount equal to all accrued and unpaid dividends
to the date fixed for redemption. In case a part only of the Series C
Preference Shares is to be redeemed, the shares to be redeemed shall be
selected by lot in such manner as the Board of Directors shall by resolution
determine.

4. Creation or Issue of Additional Shares

So long as any of the Series C Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
C Preference Shares given as hereinafter specified, create or issue any shares
ranking prior to or on a parity with the Series C Preference Shares with
respect to return of capital or payment of dividends, provided that the
Corporation may without such approval, if all dividends then payable on the
Series C Preference Shares shall have been declared and paid or set apart for
payment, (i) issue additional series of Preference Shares and (ii) create
additional series of First Preferred Shares or Second Preferred Shares to be
issued upon the exercise of a right of conversion which may hereafter be
attached to the 1975 Series Preferred Shares or the Series B Second Preferred
Shares or Series C Second Preferred Shares, as the case may be, provided that
the date of retraction at the option of the holder attached to such additional
series shall not be earlier than December 31,1989 except, with respect to the
additional Second Preferred Shares, in the circumstances referred to in
paragraph 5 of the provisions relating to the Series B and C Second Preferred
Shares.

5. Restrictions on Dividends, Retirement of Shares and Certain Investments

5.1 So long as any of the Series C Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
C Preference Shares given as hereinafter specified, declare any dividends on
any class of its Common Shares (other than dividends payable solely in such
shares) to, or make any payment on account of the purchase, redemption or other
retirement of any shares of any class to, or make any distribution in respect
thereof to, or make or permit any subsidiary to make any Investment in, or
permit to exist any extended Short-Term Investment in, the Parent Corporation
or any subsidiary thereof (other than the Corporation or a Subsidiary) either
directly or indirectly, unless any such dividends are declared to be payable


<PAGE>   17

not more than 120 days after the day of declaration, and unless (a) all
dividends then payable on the Series C Preference Shares shall have been
declared and paid or set apart for payment and (b) after giving effect to such
proposed dividend or other payment or distribution or investment and the
application of the proceeds thereof and to any other dividends declared but not
yet paid, at the Computation Date, the sum of:

         (i) $350,000,000 in United States currency plus (or minus in the case
         of a deficit),

         (ii) the Consolidated Net Income of the Corporation and its
         Subsidiaries computed for the period commencing January 1, 1982 to and
         including a date not more than 135 days prior to the Computation Date,
         plus

         (iii) the aggregate amount of the net cash proceeds to the Corporation
         from sales subsequent to December 31, 1981 of shares of its capital
         stock,

shall be greater than the sum of the aggregate amount of all such dividends and
all such other payments and distributions declared or made during the period
commencing January 1, 1982 to and including the Computation Date, plus the net
amount of Investment outstanding on such date, provided however that with
regard to the foregoing restrictions of this paragraph 5.1, the Corporation may
purchase, redeem or retire any shares of any class by exchange for or out of
the proceeds of the substantially concurrent sale of other shares ranking
either (1) junior to the Series C Preference Shares, or (2) equally with or
junior to the shares being purchased, redeemed or retired and neither any such
purchase, redemption or retirement nor any such proceeds shall be included in
and computation provided for in this paragraph 5.1.

For the purposes of this paragraph 5.1, all sums shall be determined in United
States currency.

As used in this paragraph 5.1, the following terms shall have the meanings set
forth below:

"Computation Date" shall mean (i) in the case of a dividend, the date of the
declaration thereof, (ii) in the case of payment on account of the purchase,
redemption or retirement of, or any distribution with respect to, shares, or
any Investment, the date of the making thereof and (iii) in the case of
extended Short-Term Investment, any date.

"Consolidated Net Income" shall mean the Net Income of the Corporation and its
Subsidiaries, all consolidated in accordance with generally accepted accounting
principles. The Consolidated Net Income of the Corporation and its Subsidiaries
computed for the period commencing January 1, 1982 to and including a date not
more than 135 days prior to any Computation Date shall conclusively be deemed 
to be that shown by an interim statement of the Consolidated Net Income of the 
Corporation and its Subsidiaries for such period prepared by the Corporation.

"Investment" shall mean all loans, advances and capital contributions in cash
to any Person, and all cash payments in respect of the purchase from any Person
of evidences of indebtedness, capital stock or other securities of such Person,
but shall not include any Short-Term Investment.

"Short-Term Investment" shall mean all Investments repayable on demand or
within one year from the making thereof. "Net Amount of Short-Term Investment"
outstanding on any day shall mean all Short-Term Investments by the Corporation
or any Subsidiary in the Parent Corporation or any subsidiary thereof (other
than a Subsidiary), less the aggregate amount of all cash received by the
Corporation or any Subsidiary, as payments of principal or premium, returns of
capital, liquidation dividends or distributions, proceeds of sale or other
dispositions, or otherwise, in respect of such Short-Term Investments (except
to the extent any such cash has been included in the Consolidated Net Income of
the Corporation and its Subsidiaries), during the period commencing January 1,
1982 to and including such day. "Net Amount of Investment" outstanding on any
day shall mean all Investments by the Corporation or any Subsidiary in the

<PAGE>   18

Parent Corporation or any subsidiary thereof (other than a Subsidiary), less
the aggregate amount of all cash received by the Corporation or any Subsidiary,
as payments of principal or premium, returns of capital, liquidation dividends
or distributions, proceeds of sale or other dispositions, or otherwise, in
respect of such Investments (except to the extent any such cash has been
included in the Consolidated Net Income of the Corporation and its
Subsidiaries), during the period commencing January 1, 1982 to and including
such day, provided, however, that Net Amount of Investment shall include
extended Short-Term Investment.  "Extended Short-Term Investment" shall mean
the highest Net Amount of Short-Term Investment outstanding during any period
of 30 consecutive days within the 12 months preceding the date of
determination, such 30-day period to be selected by the Corporation.

"Net Income" of any corporation for any period shall mean the net income (or
net deficit) of such corporation for such period, determined in accordance with
generally accepted accounting principles.

"Parent Corporation" shall mean any corporation which owns, together with its
subsidiaries, at least a majority of the outstanding Voting Stock of the
Corporation.

"Person" shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.

"Stock" shall include any and all shares, interests, participations or other
equivalents (however designated) of corporate stock, and the term "Voting
Stock", as applied to the stock of any corporation, shall mean Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the Board of Directors (or other
governing body) of such corporation, other than Stock having such power only by
reason of the happening of a contingency.

"subsidiary" shall mean any corporation at least a majority of whose
outstanding Voting Stock shall at the time be owned by another corporation or
by one or more subsidiaries of such other corporation or by such other
corporation and one or more subsidiaries thereof.

5.2 So long as any of the Series C Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
C Preference Shares given as hereinafter specified:
        
         (a) pay any dividends (other than stock dividends) or make any
         distributions on any shares of the Corporation ranking junior to the
         Series C Preference Shares with respect to payment of dividends or
         return of capital, or

         (b) retire for value any shares of the Corporation ranking junior to
         the Series C Preference Shares with respect to payment of dividends or
         return of capital, or

         (c) except in connection with the exercise of the retraction privilege
         attaching thereto, retire less than all the Series C Preference
         Shares,

unless all dividends then payable on the Series C Preference Shares shall have
been declared and paid or set apart for payment.

6. Voting Rights

6.1 The holders of the Series C Preference Shares shall not be entitled as such
(except as hereinafter specifically provided) to receive notice of or to attend
any meeting of the shareholders of the Corporation or to vote at any such
meeting unless and until the Corporation from time to time shall fail to pay in
the aggregate six quarterly dividends on the Series C Preference Shares on the
        
<PAGE>   19

dividend payment dates whether or not consecutive and whether or not such
dividends have been declared and whether or not there are any moneys of the
Corporation properly applicable to the payment of dividends. Thereafter, but
only so long as any dividends on the Series C Preference Shares remain in
arrears, the holders of the Series C Preference Shares shall be entitled to
receive notice of and to attend, but not to vote at, all meetings of
shareholders of the Corporation and shall be entitled on any election of
Directors, together with holders of shares of all other series of Preference
Shares having the right to vote in similar circumstances, voting separately and
exclusively as a class, to elect two members of the Board of Directors of the
Corporation. Each holder of Preference Shares entitled to so vote shall be
entitled to one vote in respect of each dollar of issue price of Preference
Shares held by him whether such issue price is in Canadian or United States
currency. Nothing herein contained shall be deemed to limit the right of the
Corporation from time to time to increase or decrease the number of its
Directors.

6.2 Notwithstanding anything contained in the by-laws of the Corporation, the
term of office of all persons who may be Directors of the Corporation at any
time when the right to elect Directors shall accrue to the holders of Series C
Preference Shares as herein provided, or who may be appointed as Directors
thereafter and before a meeting of shareholders shall have been held, shall
terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at least one-tenth of the outstanding Series C Preference Shares. In default
of the calling of such general meeting by the Secretary within 15 days after
the making of such request, such meeting may be called by any holder of record
of Series A Preference Shares.

6.3 Any vacancy occurring among members of the Board elected by the holders of
Preference Shares may be filled by the Board of Directors with the consent and
approval of the remaining Director elected by the holders of Preference Shares.
Whether or not such vacancy is so filled by the Board, the holders of record of
at least one-tenth of the outstanding Series C Preference Shares shall have the
right to require the Secretary of the Corporation to call a meeting of the
holders of Preference Shares for the purpose of filling the vacancy or
replacing any person elected or appointed by the Board of Directors to fill
such vacancy and the provisions of paragraph 6.2 shall apply with respect to
the calling of any such meeting.

6.4 Notwithstanding anything contained in the by-laws of the Corporation upon
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

7. Rights on Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation
or other distribution of assets of the Corporation among shareholders for the
purpose of winding up its affairs, the borders of the Series C Preference
Shares shall be entitled to receive (i) the sum of $25.00 in Canadian currency
per share together with all accrued and unpaid dividends up to and including
the date of distribution, and (ii) if such liquidation, dissolution, winding-up
or distribution shall be voluntary, an additional amount equal to the premium,
if any, which would have been payable on the redemption of the Series C
Preference Shares if they had been called for redemption by the Corporation (a)
on the date of distribution, or (b) if not then callable for redemption, on the
date of their first becoming redeemable, before any amount shall be paid to, or
any property or assets of the Corporation distributed among, the holders of any
shares of the Corporation ranking junior to the Series C Preference Shares.
After payment to the holders of the Series C Preference Shares of the amounts
so payable to them, they shall not be entitled to share in any further
distribution of the property or assets of the Corporation.

<PAGE>   20
8. Amendments

The rights, privileges, restrictions and conditions attaching to the Series C
Preference Shares may be repealed or amended in whole or in part but only with
the approval of the holders of the Series C Preference Shares, given as
hereinafter specified; provided, however, that the Directors of the Corporation
may at any time or from time to time, without such shareholder approval, but
subject to the provisions of any applicable law, attach the right, exercisable
at the option of the holder, to convert on such terms and conditions and in
such manner as the Directors shall determine each Series C Preference Share
into a Preference Share of another series.

9. Approvals

9.1 The approval of the holders of the Series C Preference Shares as to any and
all matters hereinbefore referred to may be given in writing by all the holders
of the outstanding Series C Preference Shares or by resolution passed or by-law
sanctioned at a meeting of holders of Series C Preference Shares duly called
for the purpose and held upon at least 21 days' notice at which the holders of
at least 50% of the outstanding Series C Preference Shares are present or
represented by proxy and carried by not less than two- thirds of the votes cast
on a poll at such meeting. If at any such meeting the holders of 50% of the
outstanding Series C Preference Shares are not present or represented by proxy
within half an hour after the time appointed for the meeting, then the meeting
shall be adjourned to such date being not less than 15 days later and to such
time and place as may be appointed by the shareholders present and at least ten
days' notice shall be given of such adjourned meeting, but it shall not be
necessary in such notice to specify the purpose for which the meeting was
originally called. At such adjourned meeting, the holders of Series C
Preference Shares present or represented by proxy may transact the business for
which the meeting was originally convened, and a resolution passed thereat by
not less than two-thirds of the votes cast on a poll at such adjourned meeting
shall constitute the approval of the holders of the Series C Preference Shares
referred to above.

9.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of Series C Preference Shares, shall not invalidate any
action taken at any meeting.

9.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of Series C Preference Shares and the conduct thereof shall
be those from time to time prescribed in the by-laws of the Corporation with
respect to meetings of shareholders.

10. Notices

Any notice required to be given under the provisions attaching to the Series C
Preference Shares to the holders thereof shall be given by posting the same in
a postage-paid envelope addressed to each holder at the last address of such
holder as it appears on the books of the Corporation or, in the event of the
address of any such holder not so appearing, then to the address of such holder
last known to the Corporation; provided that accidental failure or omission to
give any notice as aforesaid to one or more of such holders shall not
invalidate any action or proceeding founded thereon. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall
be given to registered holders of Series C Preference Shares by means of
publication twice in successive weeks in a daily newspaper of general
circulation in each of the cities of Halifax, Montreal, Toronto, Winnipeg,
Regina, Calgary and Vancouver. Publication in each week in each newspaper shall
be made within a period of seven days of publication in each other newspaper.
If at any time any notice is required under the provisions of this paragraph 10

<PAGE>   21

to be published in a particular city and no newspaper of general circulation is
then being published and circulated on a daily basis in that city, the
Corporation shall not be required to publish in that city. Any notice given by
mail shall be deemed to be given on the day on which it is mailed. Any notice
given by publication shall be deemed to be given on the day on which the first
publication is completed in all of the cities in which publication is required.

<PAGE>   22

                                    PART B.2

PROVISIONS OF THE FOURTH SERIES OF PREFERENCE SHARES CONSISTING OF 1,300,000
FLOATING RATE CUMULATIVE REDEEMABLE PREFERENCE SHARES, SERIES D, 1984 ISSUE
(hereinafter referred to as "Series D Preference Shares")

The Series D Preference Shares shall, in addition to the rights, privileges,
restrictions and conditions attaching to the Preference Shares as a class, have
the following rights, privileges, restrictions and conditions:

1. Issue Price

The Series D Preference Shares will have an issue price of U.S. $25.00 each.

2. Dividends

2.1 The holders of Series D Preference Shares will be entitled to receive a
quarterly cumulative preferential cash dividend, as and when declared by the
Board of Directors of the Corporation, on the 20th day of February, May August
and November in each year ("Dividend Payment Dates") in an amount per share
determined by applying to the U.S. $25.00 issue price per share one-quarter of
the Annual Dividend Rate applicable to the Quarter preceding the Dividend
Payment Date for which the determination is being made. The record date for the
payment of dividends will be the 5th day of February, May, August and November
or any other day, chosen by the Board of Directors which is not more than 30
days preceding the Dividend Payment Date.

The initial dividend will be payable on November 20, 1984 to holders of record
on November 5, 1984 in an amount per share determined by applying to U.S.
$25.00 the Annual Dividend Rate applicable to the period from the date of issue
to September 30, 1984 multiplied by the number of days following the date of
issue through November 20, 1984, all divided by 365.

"Annual Dividend Rate" applicable to a Quarter is the greater of (i) 72% of
U.S. Prime and (ii) the lesser of 7.5% and U.S. Prime.

"Quarter" is a period of three consecutive calendar months commencing on the
first day of any of January, April, July or October.  "Quarter" shall also mean
the period from the date of issue to September 30, 1984.

"U.S. Prime" for a Quarter is the average of the U.S. Prime Rates in effect on
each day of that Quarter.

"U.S. Prime Rate" is the average of the annual rates of interest announced from
time to time by The Royal Bank of Canada and The Toronto-Dominion Bank as
reference rates then in effect for determining interest rates on United States
dollar commercial loans made in the United States of America. In the event that
for any reason one of the said banks does not have a U.S. Prime Rate in effect
during all of a Quarter, then the U.S. Prime Rate for such bank for such
Quarter shall be the U.S. Prime Rate of the other bank. In the event that both
of the said banks do not have a U.S. Prime Rate in effect during all of a
Quarter, then the U.S. Prime Rate for that Quarter shall be equal to the
average of the rates of interest per annum announced from time to time by two
major reference banks in the United States of America, as selected by the
Corporation in its sole discretion, as their prime or reference interest rate
then in effect on United States dollar commercial loans made in the United
States of America.

<PAGE>   23

In any case where a dividend is payable for a period that ends on a date
("reference date") other than a Dividend Payment Date, the amount of such
dividend shall be determined by applying to U.S. $25.00 the Annual Dividend
Rate applicable to the Quarter preceding the reference date multiplied by the
number of days following the Dividend Payments Date preceding the reference
date through the reference date, all divided by 365.

2.2 In these provisions, "accrued and unpaid dividends" means an amount
computed at the applicable rates as though dividends had been accruing on a
day-to-day basis from the date of issue to the date to which the computation of
accrued dividends is to be made, after deducting all dividend payments made.

3. Redemption

The Series D Preference Shares shall not be redeemable on or before December
31, 1987, but thereafter shall be redeemable at the option of the Corporation
on at least 30 days' notice prior to the date fixed for redemption in whole at
any time or in part from time to time on payment of the following redemption
prices in United States currency for each share to be redeemed:


<TABLE>
<CAPTION>
If redeemed in the l2 months ending                                                         Redemption Price
-----------------------------------                                                         ----------------
<S>                                                                                                  <C>
December 31, 1988  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.50
December 31, 1989  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.20
December 31, 1990  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.90
December 31, 1991  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.60
December 31, 1992  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.30
and thereafter   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.00
</TABLE>

together in each case with an amount equal to all accrued and unpaid dividends
to the date fixed for redemption. In case a part only of the Series D
Preference Shares is to be redeemed, the shares to be redeemed shall be
selected by lot in such manner as the Board of Directors shall by resolution
determine.

4. Creation or Issue of Additional Shares

So long as any of the Series D Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
D Preference Shares given as hereinafter specified, create or issue any shares
ranking prior to or on a parity with the Series D Preference Shares with
respect to return of capital or payment of dividends, provided that the
Corporation may without such approval, if all dividends then payable on the
Series D Preference Shares shall have been declared and paid or set apart for
payment, (i) issue additional series of Preference Shares and (ii) create
additional series of First Preferred Shares or Second Preferred Shares to be
issued upon the exercise of a right of conversion which may hereafter be
attached to the 1975 Series Preferred Shares or the Series B Second Preferred
Shares or Series C Second Preferred Shares, as the case may be, provided that
the date of retraction at the option of the holder attached to such additional
series shall not be earlier than December 31, 1989 except, with respect to the
additional Second Preferred Shares, in the circumstances referred to in
paragraph 5 of the provisions relating to the Series B and C Second Preferred
Shares.

5. Restrictions on Dividends, Retirement of Shares and Certain Investments

5.1 So long as any of the Series D Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
D Preference Shares given as hereinafter specified, declare any dividends on
any class of its Common Shares (other than dividends payable solely in such
shares) to, or make any payment on account of the purchase, redemption or other

<PAGE>   24

retirement of any shares of any class to, or make any distribution in respect
thereof to, or make or permit any Subsidiary to make any Investment in, or
permit to exist any extended Short-Term Investment in, the Parent Corporation
or any subsidiary thereof (other than the Corporation or a Subsidiary) either
directly or indirectly, unless any such dividends are declared to be payable
not more than 120 days after the day of declaration, and unless (a) all
dividends then payable on the Series D Preference Shares shall have been
declared and paid or set apart for payments and (b) after giving effect to such
proposed dividend or other payment or distribution or Investment and the
application of the proceeds thereof and to any other dividends declared but not
yet paid, at the Computation Date, the sum of:

         (i) $350,000,000 in United States currency plus (or minus in the case
         of a deficit),

         (ii) the Consolidated Net Income of the Corporation and its
         Subsidiaries computed for the period commencing January 1, 1982 to and
         including a date not more than 135 days prior to the Computation Date,
         plus

         (iii) the aggregate amount of the net cash proceeds to the Corporation
         from sales subsequent to December 31, 1981 of its capital stock,

shall be greater than the sum of the aggregate amount of all such dividends and
all such other payments and distributions declared or made during the period
commencing January 1, 1982 to and including the Computation Date, plus the Net
Amount of Investment outstanding on such date, provided however that with
regard to the foregoing restrictions of this paragraph 5.1, the Corporation may
purchase, redeem or retire any shares of any class by exchange for or out of
the proceeds of the substantially concurrent sale of other shares ranking
either ( 1 ) junior to the Series D Preference Shares, or (2) equally with or
junior to the shares being purchased, redeemed or retired and neither any such
purchase, redemption or retirement nor any such proceeds shall be included in
any computation provided for in this paragraph 5.1.

For the purposes of this paragraph 5.1, all sums shall be determined in United
States currency.

As used in this paragraph 5.1, the following terms shall have the meanings set
forth below:

"Computation Date" shall mean (i) in the case of a dividend, the date of the
declaration thereof, (ii) in the case of any payment on account of the purchase,
redemption or retirement of, or any distribution with respect to, shares, or
any Investment, the date of the making thereof and (iii) in the case of
Extended Short-Term Investment, any date.

"Consolidated Net Income" shall mean the Net Income of the Corporation and its
Subsidiaries, all consolidated in accordance with generally accepted accounting
principles. The Consolidated Net Income of the Corporation and its Subsidiaries
computed for the period commencing January 1, 1982 to and including a date not
more than 135 days prior to any Computation Date shall conclusively be deemed
to be that shown by an interim statement of the Consolidated Net Income of the
Corporation and its Subsidiaries for such period prepared by the Corporation.

"Investment" shall mean all loans, advances and capital contributions in cash
to any Person, and all cash payments in respect of the purchase from any Person
of evidences of indebtedness, capital stock or other securities of such Person,
but shall not include any Short-Term Investment.

"Short-Term Investment" shall mean all Investments repayable on demand or
within one year from the making thereof. "Net Amount of Short-Term Investment"
outstanding on any day shall mean all Short-Term Investments by the Corporation
or any Subsidiary in the Parent Corporation or any subsidiary thereof (other
than a Subsidiary), less the aggregate amount of all cash received by the
Corporation or any Subsidiary as payments of principal or premium, returns of

<PAGE>   25

capital, liquidation dividends or distributions, proceeds of sale or other
dispositions, or otherwise, in respect of such Short-Term Investments (except
to the extent any such cash has been included in the Consolidated Net Income of
the Corporation and its Subsidiaries), during the period commencing January 1,
1982 to and including such day. "Net Amount of Investment" outstanding on any
day shall mean all Investments by the Corporation or any Subsidiary in the
Parent Corporation or any subsidiary thereof (other than a Subsidiary), less
the aggregate amount of all cash received by the Corporation or any Subsidiary,
as payments of principal or premium, returns of capital, liquidation dividends
or distributions, proceeds of sale or other dispositions or otherwise, in
respect of such Investments (except to the extent any such cash has been
included in the Consolidated Net Income of the Corporation and its
Subsidiaries), during the period commencing January 1, 1982 to and including
such day, provided, however, that Net Amount of Investment shall include
extended Short-Term Investment.  "Extended Short-Term Investment" shall mean
the highest net amount of Short-Term Investment outstanding during any period
of 30 consecutive days within the 12 months preceding the date of
determination, such 30-day period to be selected by the Corporation.

"Net Income" of any corporation for any period shall mean the net income (or
net deficit) of such corporation for such period, determined in accordance with
generally accepted accounting principles.

"Parent Corporation" shall mean any corporation which owns, together with its
subsidiaries, at least a majority of the outstanding Voting Stock of the
Corporation.

"Person" shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.

"Stock" shall include any and all shares, interests, participations or other
equivalents (however designated) of corporate stock, and the term "Voting
Stock", as applied to the stock of any corporation, shall mean Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the Board of Directors (or other
governing body) of such corporation, other than Stock having such power only by
reason of the happening of a contingency.

"subsidiary" shall mean any corporation at least a majority of whose
outstanding Voting Stock shall at the time be owned by another corporation or
by one or more subsidiaries of such other corporation or by such other
corporation and one or more subsidiaries thereof.


"Subsidiary" shall mean a subsidiary of the Corporation.

5.2 So long as any of the Series D Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
D Preference Shares given as hereinafter specified:

         (a) pay any dividends (other than stock dividends) or make any
         distributions on any shares of the Corporation ranking junior to the
         Series D Preference Shares with respect to payment of dividends or
         return of capital, or

         (b) retire for value any shares of the corporation ranking junior to
         the Series D Preference Shares with respect to payment of dividends or
         return of capital, or

         (c) except in connection with the exercise of the retraction privilege
         attaching thereto' retire less than all the Series D Preference
         Shares,
<PAGE>   26

unless all dividends then payable on the Series D Preference Shares shall have
been declared and paid or set apart for payment.

6. Voting Rights

6.1 The holders of the Series D Preference Shares shall not be entitled as such
(except as hereinafter specifically provided) to receive notice of or to attend
any meeting of the shareholders of the Corporation or to vote at any such
meeting unless and until the Corporation from time to time shall fail to pay in
the aggregate six quarterly dividends on the Series D Preference Shares on the
dividend payment dates whether or not consecutive and whether or not such
dividends have been declared and whether or not there are any moneys of the
Corporation properly applicable to the payment of dividends. Thereafter, but
only so long as any dividends on the Series D Preference Shares remain in
arrears, the holders of the Series D Preference Shares shall be entitled to
receive notice of and to attend, but not to vote at, all meetings of
shareholders of the Corporation and shall be entitled on any election of
Directors, together with holders of shares of all other series of Preference
Shares having the right to vote in similar circumstances, voting separately and
exclusively as a class, to elect two members of the Board of Directors of the
Corporation. Each holder of Preference Shares entitled to so vote shall be
entitled to one vote in respect of each dollar of issue price of Preference
Shares held by him whether such issue price is in Canadian or United States
currency. Nothing herein contained shall be deemed to limit the right of the
Corporation from time to time to increase or decrease the number of its
Directors.

6.2 Notwithstanding anything contained in the by-laws of the Corporation, the
term of office of all persons who may be Directors of the Corporation at any
time when the right to elect Directors shall accrue to the holders of Series D
Preference Shares as herein provided, or who may be appointed as Directors
thereafter and before a meeting of shareholders shall have been held, shall
terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at Least one-tenth of the outstanding Series D Preference Shares. In default
of the calling of such general meeting by the Secretary within 15 days after
the making of such request, such meeting may be called by any holder of record
of Series D Preference Shares.

6.3 Any vacancy occurring among members of the Board elected by the holders of
Preference Shares may be filled by the Board of Directors with the consent and
approval of the remaining Director elected by the holders of Preference Shares.
Whether or not such vacancy is so filled by the Board, the holders of record of
at least one-tenth of the outstanding Series D Preference Shares shall have the
right to require the Secretary of the Corporation to call a meeting of the
holders of Preference Shares for the purpose of filling the vacancy or
replacing any person elected or appointed by the Board of Directors to fill
such vacancy and the provisions of paragraph 6.2 shall apply with respect to
the calling of any such meeting.

6.4 Notwithstanding anything contained in the by-laws of the Corporation upon
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

7. Rights on Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation
or other distribution of assets of the Corporation among shareholders for the
purpose of winding up its affairs, the holders of the Series D Preference
Shares shall be entitled to receive (i) the sum of $25.00 in United States
currency per share together with all accrued and unpaid dividends up to and
including the date of distribution, and (ii) if such liquidation, dissolution,
winding-up or distribution shall be voluntary, an additional amount equal to
the premium, if any, which would have been payable on the redemption of the

<PAGE>   27

Series D Preference Shares if they had been called for redemption by the
Corporation (a) on the date of distribution, or (b) if not then callable for
redemption, on the date of their first becoming redeemable, before any amount
shall be paid to, or any property or assets of the Corporation distributed
among, the holders of any shares of the Corporation ranking junior to the
Series D Preference Shares. After payment to the holders of the Series D
Preference Shares of the amounts so payable to them, they shall not be entitled
to share in any further distribution of the property or assets of the
Corporation.

8. Amendments

The rights, privileges, restrictions and conditions attaching to the Series D
Preference Shares may be repealed or amended in whole or in part but only with
the approval of the holders of the Series D Preference Shares, given as
hereinafter specified; provided, however, that the Directors of the Corporation
may at any time or from time to time, without such shareholder approval, but
subject to the provisions of any applicable law, attach the right, exercisable
at the option of the holder, to convert on such terms and conditions and in
such manner as the Directors shall determine each Series D Preference Share
into a Preference Share of another series.

9. Approvals

9.1 The approval of the holders of the Series D Preference Shares as to any and
all matters hereinbefore referred to may be given in writing by all the holders
of the outstanding Series D Preference Shares or by resolution passed or by-law
sanctioned at a meeting of holders of Series D Preference Shares duly called
for the purpose and held upon at least 21 days' notice at which the holders of
at least 50% of the outstanding Series D Preference Shares are present or
represented by proxy and carried by not less than two- thirds of the votes cast
on a poll at such meeting. If at any such meeting the holders of 50% of the
outstanding Series D Preference Shares are not present or represented by proxy
within half an hour after the time appointed for the meeting, then the meeting
shall be adjourned to such date being not less than 15 days later and to such
time and place as may be appointed by the shareholders present and at least ten
days  notice shall be given of such adjourned meeting, but it shall not be
necessary in such notice to specify the purpose for which the meeting was
originally called. At such adjourned meeting, the holders of Series D
Preference Shares present or represented by proxy may transact the business for
which the meeting was originally convened, and a resolution passed thereat by
not less than two-thirds of the votes cast on a poll at such adjourned meeting
shall constitute the approval of the holders of the Series D Preference Shares
referred to above.

9.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of Series D Preference Shares, shall not invalidate any
action taken at any meeting.

9.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of Series D Preference Shares and the conduct thereof shall
be those from time to time prescribed in the by-laws of the Corporation with
respect to meetings of shareholders.

10. Notices

Any notice required to be given under the provisions attaching to the Series D
Preference Shares to the holders thereof shall be given by posting the same in
a postage paid envelope addressed to each holder at the last address of such
holder as it appears on the books of the Corporation or, in the event of the
address of any such holder not so appearing, then to the address of such holder
last known to the Corporation; provided that accidental failure or omission to
give any notice as aforesaid to one or more of such holders shall not
invalidate any action or proceeding founded thereon. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall

<PAGE>   28

be given to registered holders of Series D Preference Shares by means of
publication twice in successive weeks in a daily newspaper of general
circulation in each of the cities of Halifax, Montreal, Toronto, Winnipeg,
Regina, Calgary and Vancouver. Publication in each week in each newspaper shall
be made within a period of seven days of publication in each other newspaper.
If at any time any notice is required under the provisions of this paragraph 10
to be published in a particular city and no newspaper of general circulation is
then being published and circulated on a daily basis in that city, the
Corporation shall not be required to publish in that city. Any notice given by
mail shall be deemed to be given on the day on which it is mailed. Any notice
given by publication shall be deemed to be given on the day on which the first
publication is completed in all of the cities in which publication is required.

11. Currency

11.1 Any holder of Series D Preference Shares shall be entitled to elect to
receive payment of dividends and the redemption price, or any of such payments,
in the equivalent in Canadian currency of the United States dollar amount
otherwise payable based upon the then applicable U.S. Dollar Exchange Rate by
written notice given to the Corporation in the case of a dividend prior to the
record date and in all other cases at least ten days prior to the date fixed
for payment of such amount.

11.2 Any cheques issued to the holders of Series D Preference Shares for the
payment of a dividend or for the ranking of any other payment on Series D
Preference Shares in United States currency shall be payable at par at a branch
in New York City and at such other branches in the United States of America of
a bank or banks from time to time selected by the Corporation in addition to
being so payable at any branch or branches of a bank or banks in Canada so
selected. In the event that the Corporation is precluded from paying a dividend
or making any other payment on Series D Preference Shares in United States
currency pursuant to any applicable law, it may satisfy such monetary
requirements by the equivalent in Canadian currency, based upon the then
applicable U.S. Dollar Exchange Rate.

11.3 For purposes of paragraphs 11.1 and 11.2, the "applicable U.S. Dollar
Exchange Rate" in respect of any payment shall mean the noon rate of exchange
in Canadian currency, as quoted by the Bank of Canada, for one dollar in United
States currency) on the record date in the case of a dividend and in all other
cases on a day fixed by the Corporation not more than five business days
preceding the date fixed for such payment.

<PAGE>   29

                                    PART B.3

PROVISIONS OF THE FIFTH SERIES OF PREFERENCE SHARES CONSISTING OF 1,500,000
FLOATING RATE CUMULATIVE REDEEMABLE PREFERENCE SHARES, SERIES C, 1985 ISSUE
(hereinafter referred to as "1985 Series C Preference Shares").

The 1985 Series C Preference Shares shall, in addition to the rights,
privileges, restrictions and conditions attaching to the Preference Shares as a
class, have the following rights, privileges, restrictions and conditions:

1. Issue Price

The 1985 Series C Preference Shares will have an issue price of $25.00 each.

2. Dividends

2.1 The holders of 1985 Series C Preference Shares will be entitled to receive
a quarterly cumulative preferential cash dividend, as and when declared by the
Board of Directors of the Corporation, on the 20th day of February, May, August
and November in each year ("Dividend Payment Dates") in an amount per share
determined by applying to the $25.00 issue price per share one-quarter of the
Annual Dividend Rate applicable to the Quarter preceding the Dividend Payment
Date for which the determination is being made. The record date for the payment
of dividends will be the 5th day of February, May, August and November or any
other day, chosen by the Board of Directors, which is not more than 30 days
preceding the Dividend Payment Date.

The initial dividend will be payable on August 20, 1985 to holders of record on
August 5, 1985 and will accrue from May 20, 1985.

"Annual Dividend Rate" applicable to a Quarter is the greater of (i) 72% of
Canadian Prime and (ii) the lesser of 7.5% and Canadian Prime.

"Quarter" is a period of three consecutive calendar months commencing on the
first day of any of January, April, July or October.

"Canadian Prime" for a Quarter is the average of the Prime Interest Rates in
effect on each day of that Quarter.

"Prime Interest Rate" is the average of the annual rates of interest announced
from time to time by The Royal Bank of Canada and The Toronto-Dominion Bank as
reference rates then in effect for determining interest rates on Canadian
dollar commercial loans in Canada. In the event that for any reason one of the
said banks does not have a Prime Interest Rate in effect during all of a
Quarter, then the Prime Interest Rate for such bank for such Quarter shall be
the Prime Interest Rate of the other bank. In the event that both of the said
banks do not have a Prime Interest Rate in effect during all of a Quarter, then
the Prime Interest Rate for that Quarter shall be equal to 1.65% per annum plus
the average during such Quarter of the average yields at weekly tender on
91-day Government of Canada Treasury Bills as reported by the Bank of Canada.

In any case where a dividend is payable for a period that ends on a date
("reference date") other than a Dividend Payment Date, the amount of such
dividend shall be determined by applying to $25.00 the Annual Dividend Rate
applicable to the Quarter preceding the reference date multiplied by the number
of days following the Dividend Payment Date preceding the reference date
through the reference date, all divided by 365.

<PAGE>   30

2.2 In these provisions, "accrued and unpaid dividends" means an amount
computed at the applicable rates as though dividends had been accruing on a
day-to-day basis from May 20, 1985 to the date to which the computation of
accrued dividends is to be made, after deducting all dividend payments made.

3. Redemption

The 1985 Series C Preference Shares shall not be redeemable before December 31,
1987, but thereafter shall be redeemable at the option of the Corporation on at
least 30 days' notice prior to the date fixed for redemption in whole at any
time or in part from time to time on payment of the following redemption prices
in United States currency for each share to be redeemed:

<TABLE>
<CAPTION>
If redeemed in the l2 months ending                                                         Redemption Price
-----------------------------------                                                         ----------------
<S>                                                                                                  <C>
December 31, 1988  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.50
December 31, 1989  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.20
December 31, 1990  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.90
December 31, 1991  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.60
December 31, 1992  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.30
and thereafter   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.00
</TABLE>

together in each case with an amount equal to all accrued and unpaid dividends
to the date fixed for redemption. In case a part only of the 1985 Series C
Preference Shares is to be redeemed, the shares to be redeemed shall be
selected by lot in such manner as the Board of Directors shall by resolution
determine.

4. Creation or Issue of Additional Shares

So long as any of the 1985 Series C Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the 1985
Series C Preference Shares given as hereinafter specified, create or issue any
shares ranking prior to or on a parity with the 1985 Series C Preference Shares
with respect to return of capital or payment of dividends, provided that the
Corporation may without such approval, if all dividends then payable on the
1985 Series C Preference Shares shall have been declared and paid or set apart
for payment, (i) issue additional series of Preference Shares and (ii) create
additional series of First Preferred Shares or Second Preferred Shares to be
issued upon the exercise of a right of conversion which may hereafter be
attached to the 1975 Series Preferred Shares or the Series B Second Preferred
Shares or Series C Second Preferred Shares, as the case may be, provided that
the date of retraction at the option of the holder attached to such additional
series shall not be earlier than December 31, 1989 except, with respect to the
additional Second Preferred Shares, in the circumstances referred to in
paragraph 5 of the provisions relating to the Series B and C Second Preferred
Shares.

5. Restrictions on Dividends, Retirement of Shares and Certain Investments

5.1 So long as any of the 1985 Series C Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the 1985
Series C Preference Shares given as hereinafter specified, declare any
dividends on any class of its Common Shares (other than dividends payable
solely in such shares) to, or make any payment on account of the purchase,
redemption or other retirement of any shares of any class to, or make any
distribution in respect thereof to, or make or permit any subsidiary to make
any investment in, or permit to exist any Extended Short-Term Investment in,
the Parent Corporation or any subsidiary thereof (other than the Corporation or
a Subsidiary) either directly or indirectly, unless any such dividends are
declared to be payable not more than 120 days after the day of declaration, and
unless (a) all dividends then payable on the 1985 Series C Preference Shares
shall have been declared and paid or set apart for payment and (b) after giving

<PAGE>   31

effect to such proposed dividend or other payment or distribution or Investment
and the application of the proceeds thereof and to any other dividends declared
but not yet paid, at the Computation Date, the sum of:

         (i) $350,000,000 in United States currency plus (or minus in the case
         of a deficit),

         (ii) the Consolidated Net Income of the Corporation and its
         Subsidiaries computed for the period commencing January 1, 1982 to and
         including a date not more than 135 days prior to the Computation Date,
         plus

         (iii) the aggregate amount of the net cash proceeds to the Corporation
         from sales subsequent to December 31, 1981 of shares of its capital
         stock,

shall be greater than the sum of the aggregate amount of all such dividends and
all such other payments and distributions declared or made during the period
commencing January 1, 1982 to and including the Computation Date, plus the Net
Amount of Investment outstanding on such date, provided however that with
regard to the foregoing restrictions of this paragraph 5.1, the Corporation may
purchase, redeem or retire any shares of any class by exchange for or out of
the proceeds of the substantially concurrent sale of other shares ranking
either (1) junior to the 1985 Series C Preference Shares, or (2) equally with
or junior to the shares being purchased, redeemed or retired and neither any
such purchase, redemption or retirement nor any such proceeds shall be included
in any computation provided for in this paragraph 5.1.

For the purposes of this paragraph 5.1, all sums shall be determined in United
States currency.

As used in this paragraph 5.1, the following terms shall have the meanings set
forth below:

"Computation Date" shall mean (i) in the case of a dividend, the date of the
declaration thereof, (ii) in the case of any payment on account of the
purchase, redemption, or retirement of, or any distribution with respect to,
shares, or any Investment, the date of the making thereof and (iii) in the case
of extended Short-Term Investment, any date.

"Consolidated Net Income" shall mean the Net Income of the Corporation and its
subsidiaries, all consolidated in accordance with generally accepted accounting
principles. The Consolidated Net Income of the Corporation and its Subsidiaries
computed for the period commencing January 1, 1982 to and including a date not
more than 135 days prior to any Computation Date shall conclusively be deemed
to be that shown by an interim statement of the Consolidated Net Income of the
Corporation and its Subsidiaries for such period prepared by the Corporation.

"Investment" shall mean all loans, advances and capital contributions in cash
to any Person, and all cash payments in respect of the purchase from any Person
of evidences of indebtedness, capital stock or other securities of such Person,
but shall not include any Short-Term Investment.

"Short-Term Investment" shall mean all Investments repayable on demand or
within one year from the making thereof. "Net Amount of Short-Term Investment"
outstanding on any day shall mean all Short-Term Investments by the Corporation
or any Subsidiary in the Parent Corporation or any subsidiary thereof (other
than a Subsidiary), less the aggregate amount of all cash received by the
Corporation or any Subsidiary as payment of principal or premium, returns of
capital, liquidation dividends or distributions, proceeds of sale or other
dispositions, or otherwise, in respect of such Short-Term Investments (except
to the extent any such cash has been included in the Consolidated Net Income of
the Corporation and its Subsidiaries), during the period commencing January 1,
1982 to and including such day. "Net Amount of Investment" outstanding on any
day shall mean all Investments by the Corporation or any Subsidiary in the
Parent Corporation or any subsidiary thereof (other than a Subsidiary), less
the aggregate amount of all cash received by the Corporation or any Subsidiary,
as payments of principal or premium, returns of capital, liquidation dividends

<PAGE>   32

or distributions, proceeds of sale or other dispositions, or otherwise, in
respect of such Investments (except to the extent any such cash has been
included in the Consolidated Net Income of the Corporation and its
Subsidiaries), during the period commencing January 1, 1982 to and including
such day, provided, however, that Net Amount of Investment shall include
Extended Short-Term Investment.  "Extended Short-Term Investment" shall mean
the highest Net Amount of Short-Term Investment outstanding during any period
of 30 consecutive days within the 12 months preceding the date of
determination, such 30-day period to be selected by the Corporation.

"Net Income" of any corporation for any period shall mean the net income (or
net deficit) of such corporation for such period, determined in accordance with
generally accepted accounting principles.

"Parent Corporation" shall mean any corporation which owns, together with its
subsidiaries, at least a majority of the outstanding Voting Stock of the
Corporation.

"Person" shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.

"Stock" shall include any and all shares, interests, participations or other
equivalents (however designated) of corporate stock, and the term "Voting
Stock", as applied to the stock of any corporation, shall mean Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the Board of Directors (or other
governing body) of such corporation, other than Stock having such power only by
reason of the happening of a contingency.

"subsidiary" shall mean any corporation at least a majority of whose
outstanding Voting Stock shall at the time be owned by another corporation or
by one or more subsidiaries of such other corporation or by such other
corporation and one or more subsidiaries thereof.

"Subsidiary" shall mean a subsidiary of the Corporation.

5.2 So long as any of the 1985 Series C Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the 1985
Series C Preference Shares given as hereinafter specified:

         (a) pay any dividends (other than stock dividends) or make any
         distributions on any shares of the Corporation ranking junior to the
         1985 Series C Preference Shares with respect to payment of dividends
         or return of capital, or

         (b)retire for value any shares of the Corporation ranking junior to
         the 1985 Series C Preference Shares with respect to payment of
         dividends or return of capital, or

         (c) except in connection with the exercise of the retraction privilege
         attaching thereto, retire less than all the 1985 Series C Preference
         Shares,

unless all dividends then payable on the 1985 Series C Preference Shares shall
have been declared and paid or set apart for payment.

6. Voting Rights

6.1 The holders of the 1985 Series C Preference Shares shall not be entitled as
such (except as hereinafter specifically provided) to receive notice of or to
attend any meeting of the shareholders of the Corporation or to vote at any
such meeting unless and until the Corporation from time to time

<PAGE>   33

shall fail to pay in the aggregate six quarterly dividends on the 1985 Series C
Preference Shares on the dividend payment dates whether or not consecutive and
whether or not such dividends have been declared and whether or not there are
any moneys of the Corporation properly applicable to the payment of dividends.
Thereafter, but only so long as any dividends on the 1985 Series C Preference
Shares remain in arrears, the holders of the 1985 Series C Preference Shares
shall be entitled to receive notice of and to attend, but not to vote at, all
meetings of shareholders of the Corporation and shall be entitled on any
election of Directors, together with holders of shares of all other series of
Preference Shares having the right to vote in similar circumstances, voting
separately and exclusively as a class, to elect two members of the Board of
Directors of the Corporation. Each holder of Preference Shares entitled to so
vote shall be entitled to one vote in respect of each dollar of issue price of
Preference Shares held by him whether such issue price is in Canadian or United
States currency. Nothing herein contained shall be deemed to limit the right of
the Corporation from time to time to increase or decrease the number of its
Directors.

6.2 Notwithstanding anything contained in the by-laws of the Corporation, the
term of office of all persons who may be Directors of the Corporation at any
time when the right to elect Directors shall accrue to the holders of 1985
Series C Preference Shares as herein provided, or who may be appointed as
Directors thereafter and before a meeting of shareholders shall have been held,
shall terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at least one-tenth of the outstanding 1985 Series C Preference Shares. In
default of the calling of such general meeting by the Secretary within 15 days
after the making of such request, such meeting may be called by any holder of
record of 1985 Series C Preference Shares.

6.3 Any vacancy occurring among members of the Board elected by the holders of
Preference Shares may be filled by the Board of Directors with the consent and
approval of the remaining Director elected by the holders of Preference Shares.
Whether or not such vacancy is so filled by the Board, the holders of record of
at least one-tenth of the outstanding 1985 Series C Preference Shares shall
have the right to require the Secretary of the Corporation to call a meeting of
the holders of Preference Shares for the purpose of filling the vacancy or
replacing any person elected or appointed by the Board of Directors to fill
such vacancy and the provisions of paragraph 6.2 shall apply with respect to
the calling of any such meeting.

6.4 Notwithstanding anything contained in the by-laws of the Corporation upon
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

7. Rights on Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation
or other distribution of assets of the Corporation among shareholders for the
purpose of winding-up its affairs, the holders of the 1985 Series C Preference
Shares shall be entitled to receive (i) the sum of $25.00 in Canadian currency
per share together with all accrued and unpaid dividends up to and including
the date of distribution, and (ii) if such liquidation, dissolution, winding-up
or distribution shall be voluntary, an additional amount equal to the premium,
if any, which would have been payable on the redemption of the 1985 Series C
Preference Shares if they had been called for redemption by The Corporation (a)
on the date of distribution, or (b) if not then callable for redemption, on the
date of their first becoming redeemable, before any amount shall be paid to, or
any property or assets of the Corporation distributed among, the holders of any
shares of the Corporation ranking junior to the 1985 Series C Preference
Shares. After payment to the holders of the 1985 Series C Preference Shares of
the amounts so payable to them, they shall not be entitled to share in any
further distribution of the property or assets of the Corporation.

<PAGE>   34

8. Amendments

The rights, privileges, restrictions and conditions attaching to the 1985
Series C Preference Shares may be repealed or amended in whole or in part but
only with the approval of the holders of the 1985 Series C Preference Shares,
given as hereinafter specified; provided, however, that the Directors of the
Corporation may at any time or from time to time, without such shareholder
approval, but subject to the provisions of any applicable law, attach the
right, exercisable at the option of the holder, to convert on such terms and
conditions and in such manner as the Directors shall determine each 1985 Series
C Preference Share into a Preference Share of another series.

9. Approvals

9.1 The approval of the holders of the 1985 Series C Preference Shares as to
any and all matters hereinbefore referred to may be given in writing by all the
holders of the outstanding 1985 Series C Preference Shares or by resolution
passed or by-law sanctioned at a meeting of holders of 1985 Series C Preference
Shares duly called for the purpose and held upon at least 21 days' notice at
which the holders of at least 50% of the outstanding 1985 Series C Preference
Shares are present or represented by proxy and carried by not less than
two-thirds of the votes cast on a poll at such meeting. If at any such meeting
the holders of 50% of the outstanding 1985 Series C Preference Shares are not
present or represented by proxy within half an hour after the time appointed
for the meeting, then the meeting shall be adjourned to such date being not
less than 15 days later and to such time and place as may be appointed by the
shareholders present and at least ten days' notice shall be given of such
adjourned meeting, but it shall not be necessary in such notice to specify the
purpose for which the meeting was originally called. At such adjourned meeting,
the holders of 1985 Series C Preference Shares present or represented by proxy
may transact the business for which the meeting was originally convened, and a
resolution passed thereat by not less than two-thirds of the votes cast on a
poll at such adjourned meeting shall constitute the approval of the holders of
the 1985 Series C Preference Shares referred to above.

9.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of 1985 Series C Preference Shares, shall not invalidate
any action taken at any meeting.

9.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of 1985 Series C Preference Shares and the conduct thereof
shall be those from time to time prescribed in the by-laws of the Corporation
with respect to meetings of shareholders.

10. Notices

Any notice required to be given under the provisions attaching to the 1985
Series C Preference Shares to the holders thereof shall be given by posting the
same in a postage-paid envelope addressed to each holder at the last address of
such holder as it appears on the books of the Corporation or, in the event of
the address of any such holder not so appearing, then to the address of such
holder last known to the Corporation; provided that accidental failure or
omission to give any notice as aforesaid to one or more of such holders shall
not invalidate any action or proceeding founded thereon. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall
be given to registered holders of 1985 Series C Preference Shares by means of
publication twice in successive weeks in a daily newspaper of general
circulation in each of the cities of Halifax, Montreal, Toronto, Winnipeg,
Regina, Calgary and Vancouver. Publication in each week in each newspaper shall
be made within a period of seven days of publication in each other newspaper.
If at any time any notice is required under the provisions of this paragraph 10
to be published in a particular city and no newspaper of general circulation is
then being published and circulated on a daily basis in that city, the
Corporation shall not be required to publish in that city. Any notice given by
mail shall be deemed to be given on the day on which it is mailed. Any notice

<PAGE>   35

given by publication shall be deemed to be given on the day on which the first
publication is completed in all of the cities in which publication is required.

<PAGE>   36

                                    PART B.4

Provisions of the sixth series of Preference Shares consisting of 400,000
Floating Rate cumulative Redeemable Preference Shares Series D, 1985 Issue
(hereinafter referred to as "1985 Series D Preference Shares")

The 1985 Series D Preference Shares shall, in addition to the rights,
privileges, restrictions and conditions attaching to the Preference Shares as a
class, have the following rights, privileges, restrictions and conditions:

1. Issue Price

The 1985 Series D Preference Shares will have an issue price of U.S. $25.00
each.

2. Dividends

2.1 The holders of 1985 Series D Preference Shares will be entitled to receive
a quarterly cumulative preferential cash dividend, as and when declared by the
Board of Directors of the Corporation, on the 20th day of February, May, August
and November in each year ("Dividend Payment Dates") in an amount per share
determined by applying to the U.S. $25.00 issue price per share one-quarter of
the Annual Dividend Rate applicable to the Quarter preceding the Dividend
Payment Date for which the determination is being made. The record date for the
payment of dividends will be the 5th day of February, May, August and November
or any other day, chosen by the Board of Directors, which is not more than 30
days preceding the Dividend Payment Date.

The initial dividend will be payable on August 20, 1985 to holders of record on
August 5, 1985 and will accrue from May 20, 1985.

"Annual Dividend Rate" applicable to a Quarter is the greater of (i) 72% of
U.S. Prime and (ii) the lesser of 7.5% and U.S. Prime.

"Quarter" is a period of three consecutive calendar months commencing on the
first day of any of January, April, July or October.

"U.S. Prime" for a Quarter is the average of the U.S. Prime Rates in effect on
each day of that Quarter.

"U.S. Prime Rate" is the average of the annual rates of interest announced from
time to time by The Royal Bank of Canada and The Toronto-Dominion Bank as
reference rates then in effect for determining interest rates on United States
dollar commercial loans made in the United States of America. In the event that
for any reason one of the said banks does not have a U.S. Prime Rate in effect
during all of a Quarter, then the U.S. Prime Rate for such bank for such
Quarter shall be the U.S. Prime Rate of the other bank. In the event that both
of the said banks do not have a U.S. Prime Rate in effect during all of a
Quarter, then the U.S. Prime Rate for that Quarter shall be equal to the
average of the rates of interest per annum announced from time to time by two
major reference banks in the United States of America, as selected by the
Corporation in its sole discretion, as their prime or reference interest rate
then in effect on United States dollar commercial loans made in the United
States of America.

In any case where a dividend is payable for a period that ends on a date
("reference date") other than a Dividend Payment Date, the amount of such
dividend shall be determined by applying to U.S. $25.00 the Annual Dividend
Rate applicable to the Quarter preceding the reference date

<PAGE>   37

multiplied by the number of days following the Dividend Payment Date preceding
the reference date through the reference date, all divided by 365.

2.2 In these provisions, "accrued and unpaid dividends" means an amount
computed at the applicable rates as though dividends had been accruing on a
day-to-day basis from May 20, 1985 to the date to which the computation of
accrued dividends is to be made, after deducting all dividend payments made.

3. Redemption

The 1985 Series D Preference Shares shall not be redeemable on or before
December 31, 1987, but thereafter shall be redeemable at the option of the
Corporation on at least 30 days' notice prior to the date fixed for redemption
in whole at any time or in part from time to time on payment of the following
redemption prices in United States currency for each share to be redeemed:

<TABLE>
<CAPTION>
If redeemed in the l2 months ending                                                         Redemption Price
-----------------------------------                                                         ----------------
<S>                                                                                                   <C>
December 31,1988  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.50
December 31,1989  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $26.20
December 31,1990  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.90
December 31,1991  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   $25.60
December 31,1992  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.30
and thereafter  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $25.00
</TABLE>

together in each case with an amount equal to all accrued and unpaid dividends
to the date fixed for redemption. In case a part only of the 1985 Series D
Preference Shares is to be redeemed, the shares to be redeemed shall be
selected by lot in such manner as the Board of Directors shall by resolution
determine.

4. Creation or Issue of Additional Shares

So long as any of the 1985 Series D Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the 1985
Series D Preference Shares given as hereinafter specified, create or issue any
shares ranking prior to or on a parity with the 1985 Series D Preference Shares
with respect to return of capital or payment of dividends, provided that the
Corporation may without such approval, if all dividends then payable on the
1985 Series D Preference Shares shall have been declared and paid or set apart
for payment, (i) issue additional series of Preference Shares and (ii) create
additional series of First Preferred Shares or Second Preferred Shares to be
issued upon the exercise of a right of conversion which may hereafter be
attached to the 1975 Series Preferred Shares or the Series B Second Preferred
Shares or Series C Second Preferred Shares, as the case may be, provided that
the date of retraction at the option of the holder attached to such additional
series shall not be earlier than December 31, 1989 except, with respect to the
additional Second Preferred Shares, in the circumstances referred to in
paragraph 5 of the provisions relating to the Series B and C Second Preferred
Shares.

5. Restrictions on Dividends, Retirement of Shares and Certain Investments

5.1 So long as any of the 1985 Series D Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the 1985
Series D Preference Shares given as hereinafter specified, declare any
dividends on any class of its Common Shares (other than dividends payable
solely in such shares) to, or make any payment on account of the purchase,
redemption or other retirement of any shares of any class to, or make any
distribution in respect thereof to, or make or permit any subsidiary to make
any investment in, or permit to exist any Extended Short-Term Investment in,
the Parent Corporation or any subsidiary thereof (other than the Corporation or
a Subsidiary) either directly or indirectly, unless any such dividends are

<PAGE>   38

declared to be payable not more than 120 days after the day of declaration, and
unless (a) all dividends then payable on the 1985 Series D Preference Shares
shall have been declared and paid or set apart for payment and (b) after giving
effect to such proposed dividend or other payment or distribution or Investment
and the application of the proceeds thereof and to any other dividends declared
but not yet paid, at the Computation Date, the sum of:

         (i) $350,000,000 in United States currency plus (or minus in the case
         of a deficit),

         (ii) the Consolidated Net Income of the Corporation and its
         Subsidiaries computed for the period commencing January 1, 1982 to and
         including a date not more than 135 days prior to the Computation Date,
         plus

         (iii) the aggregate amount of the net cash proceeds to the Corporation
         from sales subsequent to December 31, 1981 of shares of its capital
         stock,

shall be greater than the sum of the aggregate amount of all such dividends and
all such other payments and distributions declared or made during the period
commencing January 1, 1982 to and including the Computation Date, plus the Net
Amount of Investment outstanding on such date, provided however that with
regard to the foregoing restrictions of this paragraph 5.1, the Corporation may
purchase, redeem or retire any shares of any class by exchange for or out of
the proceeds of the substantially concurrent sale of other shares ranking
either (1) junior to the 1985 Series D Preference Shares, or (2) equally with
or junior to the shares being purchased, redeemed or retired and neither any
such purchase, redemption or retirement nor any such proceeds shall be included
in any computation provided for in this paragraph 5.1.

For the purposes of this paragraph 5.1, all sums shall be determined in United
States currency.

As used in this paragraph 5.1, the following terms shall have the meanings set
forth below:

"Computation Date" shall mean (i) in the case of a dividend, the date of the
declaration thereof, (ii) in the case of any payment on account of the
purchase, redemption or retirement of, or any distribution with respect to,
shares, or any Investment, the date of the making thereof and (iii) in the case
of Extended Short-Term Investment, any date.

"Consolidated Net Income" shall mean the Net Income of the Corporation and its
Subsidiaries, all consolidated in accordance with generally accepted accounting
principles. The Consolidated Net Income of the Corporation and its Subsidiaries
computed for the period commencing January 1, 1982 to and including a date not
more than 135 days prior to any Computation Date shall conclusively be deemed
to be that shown by an interim statement of the Consolidated Net Income of the
Corporation and its Subsidiaries for such period prepared by the Corporation.

"Investment" shall mean all loans, advances and capital contributions in cash
to any Person, and all cash payments in respect of the purchase from any Person
of evidences of indebtedness, capital stock or other securities of such Person,
but shall not include any Short-Term Investment.

"Short-Term Investment" shall mean all Investments repayable on demand or
within one year from the making thereof. "Net Amount of Short-Term Investment"
outstanding on any day shall mean all Short-Term Investments by the Corporation
or any Subsidiary in the Parent Corporation or any subsidiary thereof (other
than a Subsidiary), less the aggregate amount of all cash received by the
Corporation or any Subsidiary as payments of principal or premium, returns of
capital, liquidation dividends or distributions, proceeds of sale or other
dispositions, or otherwise, in respect of such Short-Term Investments (except
to the extent any such cash has been included in the Consolidated Net Income of
the Corporation and its Subsidiaries), during the period commencing January 1,
1989. to and including such day. "Net Amount of Investment" outstanding on any

<PAGE>   39

day shall mean all Investments by the Corporation or any Subsidiary in the
Parent Corporation or any subsidiary thereof (other than a Subsidiary), less
the aggregate amount of all cash received by the Corporation or any Subsidiary,
as payments or principal or premium, returns of capital, liquidation dividends
or distributions, proceeds of sale or other dispositions, or otherwise, in
respect of such Investments (except to the extent any such cash has been
included in the Consolidated Net Income of the Corporation and its
Subsidiaries), during the period commencing January 1, 1982 to and including
such day, provided, however, that Net Amount of Investment shall include
Extended Short-Term Investment.  "Extended Short-Term Investment" shall mean
the highest Net Amount of Short-Term Investment outstanding during any period
of 30 consecutive days within the 12 months preceding the date of
determination, such 30-day period to be selected by the Corporation.

"Net Income" of any corporation for any period shall mean the net income (or
net deficit) of such corporation for such period, determined in accordance with
generally accepted accounting principles.

"Parent Corporation" shall mean any corporation which owns, together with its
subsidiaries, at least a majority of the outstanding Voting Stock of the
Corporation.

"Person" shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.

"Stock" shall include any and all shares, interests, participations or other
equivalents (however designated) of corporate stock, and the term "Voting
Stock", as applied to the stock of any corporation, shall mean Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the Board of Directors (or other
governing body) of such corporation, other than Stock having such power only by
reason of the happening of a contingency.

"subsidiary" shall mean any corporation at least a majority of whose
outstanding Voting Stock shall at the time be owned by another corporation or
by one or more subsidiaries of such other corporation or by such other
corporation and one or more subsidiaries thereof.

"Subsidiary" shall mean a subsidiary of the Corporation.

5.2 So long as any of the 1985 Series D Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the 1985
Series D Preference Shares given as hereinafter specified:

         (a) pay any dividends (other than stock dividends) or make any
distributions on any shares of the Corporation ranking junior to the 1985
Series D Preference Shares with respect to payment of dividends or return of
capital, or
        
         (b) retire for value any shares of the Corporation ranking junior to
the 1985 Series D Preference Shares with respect to payment of dividends or
return of capital, or
        
         (c) except in connection with the exercise of the retraction privilege
attaching thereto. retire less than all the 1985 Series D Preference Shares,
        
unless all dividends then payable on the 1985 Series D Preference Shares shall
have been declared and paid or set apart for payment.

<PAGE>   40

6. Voting Rights

6.1 The holders of the 1985 Series D Preference Shares shall not be entitled as
such (except as hereinafter specifically provided) to receive notice of or to
attend any meeting of the shareholders of the Corporation or to vote at any
such meeting unless and until the Corporation from time to time shall fail to
pay in the aggregate six quarterly dividends on the 1985 Series D Preference
Shares on the dividend payment dates whether or not consecutive and whether or
not such dividends have been declared and whether or not there are any moneys
of the Corporation properly applicable to the payment of dividends. Thereafter,
but only so long as any dividends on the 1985 Series D Preference Shares remain
in arrears, the holders of the 1985 Series D Preference Shares shall be
entitled to receive notice of and to attend, but not to vote at, all meetings
of shareholders of the Corporation and shall be entitled on any election of
Directors, together with holders of shares of all other series of Preference
Shares having the right to vote in similar circumstances, voting separately and
exclusively as a class, to elect two members of the Board of Directors of the
Corporation. Each holder of Preference Shares entitled to so vote shall be
entitled to one vote in respect of each dollar of issue price of Preference
Shares held by him whether such issue price is in Canadian or United States
currency. Nothing herein contained shall be deemed to limit the right of the
Corporation from time to time to increase or decrease the number of its
Directors.

6.2 Notwithstanding anything contained in the by-laws of the Corporation, the
term of office of all persons who may be Directors of the Corporation at any
time when the right to elect Directors shall accrue to the holders of 1985
Series D Preference Shares as herein provided, or who may be appointed as
Directors thereafter and before a meeting of shareholders shall have been held,
shall terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at least one-tenth of the outstanding 1985 Series D Preference Shares. In
default of the calling of such general meeting by the Secretary within 15 days
after the making of such request, such meeting may be called by any holder of
record of 1985 Series D Preference Shares.

6.3 Any vacancy occurring among members of the Board elected by the borders of
Preference Shares may be filled by the Board of Directors with the consent and
approval of the remaining Director elected by the holders of Preference Shares.
Whether or not such vacancy is so filled by the Board, the holders of record of
at least one-tenth of the outstanding 1985 Series D Preference Shares shall
have the right to require the Secretary of the Corporation to call a meeting of
the holders of Preference Shares for the purpose of filling the vacancy or
replacing any person elected or appointed by the Board of Directors to fill
such vacancy and the provisions of paragraph 6.2 shall apply with respect to
the calling of any such meeting.

6.4 Notwithstanding anything contained in the by-laws of the Corporation upon
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

7. Rights on  Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation
or other distribution of assets of the Corporation among shareholders for the
purpose of winding-up its affairs, the holders of the 1985 Series D Preference
Shares shall be entitled to receive (i) the sum of $25.00 in United States
currency per share together with all accrued and unpaid dividends up to and
including the date of distribution, and (ii) if such liquidation, dissolution,
winding-up or distribution shall be voluntary, an additional amount equal to
the premium, if any, which would have been payable on the redemption of the
1985 Series D Preference Shares if they had been called for redemption by the
Corporation (a) on the date of distribution, or (b) if not then callable for
redemption, on the date of their first becoming redeemable, before any amount

<PAGE>   41

shall be paid to, or any property or assets of the Corporation distributed
among, the borders of any shares of the Corporation ranking junior to the 1985
Series D Preference Shares.  After payment to the holders of the 1985 Series D
Preference Shares of the amounts so payable to them, they shall not be entitled
to share in any further distribution of the property or assets of the
Corporation.

8. Amendments

The rights, privileges, restrictions and conditions attaching to the 1985
Series D Preference Shares may be repealed or amended in whole or in part but
only with the approval of the holders of the 1985 Series D Preference Shares,
given as hereinafter specified; provided, however, that the Directors of the
Corporation may at any time or from time to time, without such shareholder
approval, but subject to the provisions of any applicable law, attach the
right, exercisable at the option of the holder, to convert on such terms and
conditions and in such manner as the Directors shall determine each 1985 Series
D Preference Share into a Preference Share of another series.

9. Approvals

9.1 The approval of the holders of the 1985 Series D Preference Shares as to
any and all matters hereinbefore referred to may be given in writing by all the
holders of the outstanding 1985 Series D Preference Shares or by resolution
passed or by-law sanctioned at a meeting of borders of 1985 Series D Preference
Shares duly called for the purpose and held upon at least 21 days' notice at
which the holders of at least 50% of the outstanding 1985 Series D Preference
Shares are present or represented by proxy and carried by not less than
two-thirds of the votes cast on a poll at such meeting. If at any such meeting
the holders of 50% of the outstanding 1985 Series D Preference Shares are not
present or represented by proxy within half an hour after the time appointed
for the meeting, then the meeting shall be adjourned to such date being not
less than 15 days later and to such time and place as may be appointed by the
shareholders present and at least ten days' notice shall be given of such
adjourned meeting, but it shall not be necessary in such notice to specify, the
purpose for which the meeting was originally called. At such adjourned meeting,
the holders of 1985 Series D Preference Shares present or represented by proxy
may transact the business for which the meeting was originally convened, and a
resolution passed thereat by not less than two-thirds of the votes cast on a
poll at such adjourned meeting shall constitute the approval of the holders of
the 1985 Series D Preference Shares referred to above.

9.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of 1985 Series D Preference Shares, shall not invalidate
any action taken at any meeting.

9.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of 1985 Series D Preference Shares and the conduct thereof
shall be those from time to time prescribed in the by-laws of the Corporation
with respect to meetings of shareholders.

10. Notices

Any notice required to be given under the provisions attaching to the 1985
Series D Preference Shares to the holders thereof shall be given by posting the
same in a postage-paid envelope addressed to each holder at the last address of
such holder as it appears on the books of the Corporation or, in the event of
the address of any such holder not so appearing, then to the address of such
holder last known to the Corporation; provided that accidental failure or
omission to give any notice as aforesaid to one or more of such holders shall
not invalidate any action or proceeding founded thereon. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall
be given to registered holders of 1985 Series D Preference Shares by means of
publication twice in successive weeks in a daily newspaper of general
circulation in each of the cities of Halifax, Montreal, Toronto, Winnipeg,

<PAGE>   42

Regina, Calgary and Vancouver. Publication in each week in each newspaper shall
be made within a period of seven days of publication in each other newspaper.
If at any time any notice is required under the provisions of this paragraph 10
to be published in a particular city and no newspaper of general circulation is
then being published and circulated on a daily basis in that city, the
Corporation shall not be required to publish in that city. Any notice given by
mail shall be deemed to be given on the day on which it is mailed. Any notice
given by publication shall be deemed to be given on the day on which the first
publication is completed in all of the cities in which publication is required.

11. Currency

11.1 Any holder of 1985 Series D Preference Shares shall be entitled to elect
to receive payment of dividends and the redemption price, or any of such
payments, in the equivalent in Canadian currency of the United States dollar
amount otherwise payable based upon the then applicable U.S. Dollar Exchange
Rate by written notice given to the Corporation in the case of a dividend prior
to the record date and in all other cases at least ten days prior to the date
fixed for payment of such amount.

11.2 Any cheques issued to the holders of 1985 Series D Preference Shares for
the payment of a dividend or for the making of any other payment on 1985 Series
D Preference Shares in United States currency shall be payable at par at a
branch in New York City and at such other branches in the United States of
America of a bank or banks from time to time selected by the Corporation in
addition to being so payable at any branch or branches of a bank or banks in
Canada so selected. In the event that the Corporation is precluded from paying
a dividend or making any other payment on 1985 Series D Preference Shares in
United States currency pursuant to any applicable law, it may satisfy such
monetary requirements by the equivalent in Canadian currency based upon the
then applicable U.S. Dollar Exchange Rate.

11.3 For purposes of paragraphs 11.1 and 11.2, the "applicable U.S. Dollar
Exchange Rate" in respect of any payment shall mean the noon rate of exchange
in Canadian currency, as quoted by the Bank of Canada, for one dollar in United
States currency on the record date in the case of a dividend and in all other
cases on a day fixed by the Corporation not more than five business days
preceding the date fixed for such payment.
<PAGE>   43
                                    PART B.5

PROVISIONS OF THE SEVENTH SERIES OF PREFERENCE SHARES CONSISTING OF 3,000,000
CUMULATIVE REDEEMABLE PREFERENCE SHARES, SERIES E (hereinafter referred to as
"Series E Preference Shares")

The Series E Preference Shares shall, in addition to the rights, privileges.
restrictions and conditions attaching to the Preference Shares as a class, have
the following rights, privileges, restrictions and conditions:

1. Issue Price

The 1985 Series D Preference Shares Will have an issue price of U.S. $25.00
each.

<PAGE>   44

2. Dividends

The holders of Series E Preference Shares shall be entitled to receive and the
Corporation shall pay thereon, as and when declared by the Board of Directors
of the corporation, cumulative preferential cash dividends which shall be as
follows:

         (i) An initial dividend in respect of the period from and including
         the date of issue of the Series E Preference Shares to but excluding
         January 31, 1987 (the "Initial Dividend Period", payable on January
         31, 1987 in an amount per Series E Preference Share equal to the
         amount obtained when $2.16 is multiplied by the number of days in the
         Initial Dividend Period, all divided by 365;

         (ii) Fixed quarterly dividends in an amount per share equal to $0.54
         ($2.16 per annum) payable on the last day of each o9f the months of
         January, April, July and October in each year (the "Dividend Payment
         Dates") the first such dividend being paid on the Dividend Payment
         Date of April 30, 1987 and the last such dividend being paid on the
         Dividend Payment Date of October 31, 1991; and

         (iii) Quarterly dividends, the first of which shall be payable on the
         Dividend Payment Date of January 31, 1992, each in an amount per
         Series E Preference Share determined by applying to the $25.00 issue
         p[rice per share one-quarter of the Annual Dividend Rate applicable to
         the Quarter preceding the Dividend Payment Date for which the
         determination is being made.

The record date for the payment of dividends will be the 15th day of January,
April, July and October or any other day chosen by the Board of Directors which
is not more than 30 days preceding the Dividend Payment Date.

"Annual Dividend Rate" applicable to a Quarter is 75% of Canadian Prime.

"Quarter" is a period of three consecutive calendar months commencing on the
first day of any January, April, July or October.

"Canadian Prime" for a Quarter is the average of the Prime Interest Rates in
effect on each day of that Quarter.

"Prime Interest Rate" is the average of the annual rates of interest announced
from time to time by The Royal Bank of Canada ands the Toronto-Dominion Bank as
reference rates then in effect for determining interest rates on Canadian
dollar commercial loans in Canada. In the event that for any reason one of the
said banks does not have a Prime Interest Rate in effect during all of a
Quarter then the Prime Interest Rate for such bank for such Quarter shall be
the Prime Interest Rate of the other bank. In the event that both of the said
banks do not have a Prime Interest Rate in effect during all of a Quarter, then
the Prime Interest Rate for that Quarter shall be equal to 1.65% per annum plus
the average during such Quarter of the average yields at weekly tender on
91-day Government of Canada Treasury Bills as reported by the Bank of Canada.

In the case where a dividend is payable for a period that ends on a date other
than a Dividend Payment Date, a dividend ("Short Dividend") shall be paid in an
amount per Series E Preference Share determined by applying to $25.00:

         (iv) 8.64% in the case of dividends payable prior to October 31, 1991,
         or

         (v) the Annual Dividend Rate applicable to the Quarter preceding such
         date,

<PAGE>   45

multiplied by the number of days from and including the Dividend Payment Date
preceding such date to and excluding such date, all divided by 365.

The portion of the amount payable to a holder of a Series E Preference Share on
a redemption or purchase for cancellation thereof, or on the liquidation,
dissolution or winding-up of the Corporation or other distribution of assets of
the Corporation among its shareholders for the purpose of winding-up its
affairs, equal to all accrued and unpaid dividends thereon up to and excluding
the date of such redemption, purchase, liquidation, dissolution, winding-up or
other distribution of assets ("Specified Date") shall consist of:

         (vi) the accrued and unpaid initial dividend thereon, if any payable
pursuant to (i) above and all accrued and unpaid quarterly dividends thereon,
if any, payable pursuant to paragraphs (ii) and (iii) above, plus

         (vii) if the Specified Date is other than a Dividend Payment Date, an
amount equal to the Short Dividend that would be payable thereon.

3. Redemption

The Series E Preference Shares shall not be redeemable prior to October 31,
1991, however on or after that date such shares shall be redeemable at the
option of the Corporation on at least 30 days' notice prior to the date fixed
for redemption in whole at any time or in part from time to time on payment for
each share held of an amount of $25.00 per share together with all accrued and
unpaid dividends thereon up to and excluding the date of such redemption (which
for such purpose shall be calculated as provided in paragraph 2 hereof). In
case a part only of the Series E Preference Shares is to be redeemed, the
shares to be redeemed shall be selected by lot in such manner as the Board of
Directors shall by resolution determine.
        
4. Creation or Issue of Additional Shares

So long as any of the Series E Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
E Preference Shares given as hereinafter specified, create or issue any shares
ranking prior to or on a parity with the Series E Preference Shares with
respect to return of capital or payment of dividends, provided that the
Corporation may without such approval, if all dividends then payable on the
Series E Preference Shares shall have been declared and paid or set apart for
payment;

         (i) issue additional series of Preference Shares; and

         (ii) create additional series of First Preferred Shares to be issued
upon the exercise of a right of conversion which may hereafter be attached to
the 1975 Series Preferred Shares, provided that the date of retraction at the
option of the holder attached to such additional series shall not be earlier
than December 31, 1989.

5. Restrictions on Dividends, Retirement of Shares and Certain Investments

5.1 So long as any of the Series E Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
E Preference Shares given as hereinafter specified, declare any dividends on
any class of its Common Shares (other than dividends payable solely in such
shares) to, or make any payment on account of the purchase, redemption or other
retirement of any shares of any class to, or make any distribution in respect
thereof to, or make or permit any Subsidiary to make any Investment in, or
permit to exist any Extended Short-Term Investment in, the Parent Corporation
or any subsidiary thereof (other than the Corporation or a Subsidiary) either
directly or indirectly, unless any such dividends are declared to be payable

<PAGE>   46

not more than 120 days after the day of declaration, and unless (a) all
dividends then payable on the Series E Preference Shares shall have been
declared and paid or set apart for payment and (b) after giving effect to such
proposed dividend or other payment or distribution or Investment and the
application of the proceeds thereof and to any other dividends declared but not
yet paid, at the Computation Date, the sum of:

         (i) $350,000,000 in United States currency plus (or minus in the case
         of a deficit),

         (ii) the Consolidated Net Income of the Corporation and its
         Subsidiaries computed for the period commencing January 1, 1982 to
         and including a date not more than 135 days prior to the
         Computation Date, plus

         (iii) the aggregate amount of the net cash proceeds to the Corporation
         from sales subsequent to December 31, 1981 of shares of its capital
         stock,

shall be greater than the sum of the aggregate amount of all such dividends and
all such other payments and distributions declared or made during the period
commencing January 1, 1982 to and including the Computation Date, plus the Net
Amount of Investment outstanding on such date, provided however that with
regard to the foregoing restrictions of this paragraph 5.1, the Corporation may
purchase, redeem or retire any shares of any class by exchange for or out of
the proceeds of the substantially concurrent sale of other shares ranking
either ( 1 ) junior to the Series E Preference Shares, or (2) equally with or
junior to the shares being purchased, redeemed or retired and neither any such
purchase, redemption or retirement nor any such proceeds shall be included in
any computation provided for in this paragraph 5.1.

For the purposes of this paragraph 5.1 all sums shall be determined in United
States currency.

As used in this paragraph 5.1, the following terms shall have the meanings set
forth below:

"Computation Date" shall mean (i) in the case of a dividend, the date of the
declaration thereof, (ii) in the case of any payment on account of the
purchase, redemption, or retirement of, or any distribution with respect to,
shares, or any Investment, the date of the making thereof and (iii) in the case
of Extended Short-Term Investment, any date.

"Consolidated Net Income" shall mean the Net Income of the Corporation and its
subsidiaries, all consolidated in accordance with generally accepted accounting
principles. The Consolidated Net Income of the Corporation and its Subsidiaries
computed for the period commencing January 1, 1982 to and including a date not
more than 135 days prior to any Computation Date shall conclusively be deemed
to be that shown by an interim statement of the Consolidated Net Income of the
Corporation and its Subsidiaries for such period prepared by the Corporation.

"Investment" shall mean all loans, advances and capital contributions in cash
to any Person, and all cash payments in respect of the purchase from any Person
of evidences of indebtedness, capital stock or other securities of such Person,
but shall not include any Short-Term Investment.

"Short-Term Investment" shall mean all Investments repayable on demand or
within one year from the making thereof. "Net Amount of Short-Term Investment"
outstanding on any day shall mean all Short-Term Investments by the Corporation
or any Subsidiary in the Parent Corporation or any subsidiary thereof (other
than a Subsidiary), less the aggregate amount of all cash received by the
Corporation or any Subsidiary as payments of principal or premium, returns of
capital, liquidation dividends or distributions, proceeds of sale or other
dispositions, or otherwise, in respect of such Short-Term Investments (except
to the extent any such cash has been included in the Consolidated 

<PAGE>   47

Net Income of the Corporation and its Subsidiaries), during the period 
commencing January 1, 1982 to and including such day. "Net Amount of 
Investment" outstanding on any day shall mean all Investments by the 
Corporation or any Subsidiary in the Parent Corporation or any subsidiary 
thereof (other than a Subsidiary), less the aggregate amount of all cash 
received by the Corporation or any Subsidiary, as payments of principal or 
premium, returns of capital, liquidation dividends or distributions, proceeds 
of sale or other dispositions, or otherwise, in respect of such Investments 
(except to the extent any such cash has been included in the Consolidated Net 
Income of the Corporation and its Subsidiaries), during the period commencing 
January 1, 1982 to and including such day, provided, however, that Net Amount 
of Investment shall include Extended Short-Term Investment.  "Extended 
Short-Term Investment" shall mean the highest Net Amount of Short-Term 
Investment outstanding during any period of 30 consecutive days within the 
12 months preceding the date of determination, such 30-day period to be 
selected by the Corporation.

"Net Income" of any corporation for any period shall mean the net income (or
net deficit) of such corporation for such period, determined in accordance with
generally accepted accounting principles.

"Parent Corporation" shall mean any corporation which owns together with its
subsidiaries, at least a majority of the outstanding Voting Stock of the
Corporation.

"Person" shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.

"Stock" shall include any and all shares, interests, participation or other
equivalents (however designated) of corporate stock, and the term "Voting
Stock", as applied to the stock of any corporation, shall mean Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the Board of Directors (or other
governing body) of such corporation, other than Stock having such power only by
reason of the happening of a contingency.

"subsidiary" shall mean any corporation at least a majority of whose
outstanding Voting Stock shall at the time be owned by another corporation or
by one or more subsidiaries of such other corporation or by such other
corporation and one or more subsidiaries thereof.

"Subsidiary" shall mean a subsidiary of the Corporation.

5.2 So long as any of the Series E Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
E Preference Shares given as hereinafter specified:

(i) pay any dividends (other than stock dividends) or make any distributions on
any shares of the Corporation ranking junior to the Series E Preference Shares
with respect to payment of dividends or return of capital, or

(ii) retire for value any shares of the Corporation ranking junior to the
Series E Preference Shares with respect to payment of dividends or return of
capital, or

(iii) retire less than all the Series E Preference Shares,

unless all dividends then payable on the Series E Preference Shares shall have
been declared and paid or set apart for payment.

6. Voting Rights

<PAGE>   48

6.1 The holders of the Series E Preference Shares shall not be entitled as such
(except as hereinafter specifically provided) to receive notice of or to attend
any meeting of the shareholders of the Corporation or to vote at any such
meeting unless and until the Corporation from time to time shall fail to pay in
the aggregate six quarterly dividends on the Series E Preference Shares on
the dividend payment dates whether or not consecutive and whether or not such
dividends have been declared and whether or not there are any moneys of the
Corporation properly applicable to the payment of dividends. Thereafter, but
only so long as any dividends on the Series E Preference Shares remain in
arrears, the holders of the Series E Preference Shares shall be entitled to
receive notice of and to attend, but not to vote at, all meetings of
shareholders of the Corporation and shall be entitled on any election of
Directors, together with holders of shares of all other series of Preference
Shares having the right to vote in similar circumstances, voting separately and
exclusively as a class, to elect two members of the Board of Directors of the
Corporation. Each holder of Preference Shares entitled to so vote shall be
entitled to one vote in respect of each dollar of issue price of Preference
Shares held by him whether such issue price is in Canadian or United States
currency. Nothing herein contained shall be deemed to limit the right of the
Corporation from time to time to increase or decrease the number of its
Directors.

6.2 Notwithstanding anything contained in the by-laws of the Corporation, the
term of office of all persons who may be Directors of the Corporation at any
time when the right to elect Directors shall accrue to the holders of Series E
Preference Shares as herein provided, or who may be appointed as Directors
thereafter and before a meeting of shareholders shall have been held, shall
terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at least one-tenth of the outstanding Series E Preference Shares. In default
of the calling of such general meeting by the Secretary within 15 days after
the making of such request, such meeting may be called by any holder of record
of Series E Preference Shares.

6.3 Any vacancy occurring among members of the Board elected by the holders of
Preference Shares may be filled by the Board of Directors with the consent and
approval of the remaining Director elected by the holders of Preference Shares.
Whether or not such vacancy is so filled by the Board, the holders of record of
at least one-tenth of the outstanding Series E Preference Shares shall have the
right to require the Secretary of the Corporation to call a meeting of the
holders of Preference Shares for the purpose of filling the vacancy or
replacing any person elected or appointed by the Board of Directors to fill
such vacancy and the provisions of paragraph 6.2 shall apply with respect to
the calling of any such meeting.

6.4 Notwithstanding anything contained in the by-laws of the Corporation upon
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

7. Rights on Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation
or other distribution of assets of the Corporation among shareholders for the
purpose of winding-up its affairs, the holders of the Series E Preference
Shares shall be entitled to receive the sum of $25.00 per share together with
all accrued and unpaid dividends thereon up to and excluding the date of
distribution, (which for such purpose shall be calculated as provided in
paragraph 2 hereof) before any amount shall be paid to, or any property or
assets of the Corporation distributed among, the holders of any shares of the
Corporation ranking junior to the Series E Preference Shares. After payment to
the holders of the Series E Preference Shares of the amounts so payable to
them, they shall not be entitled to share in any further distribution of the
property or assets of the Corporation.

<PAGE>   49

8. Amendments

The rights, privileges, restrictions and conditions attaching to the Series E
Preference Shares may be repealed or amended in whole or in part but only with
the approval of the holders of the Series E Preference Shares, given as
hereinafter specified; provided, however, that the Directors of the Corporation
may at any time or from time to time, without such shareholder approval, but
subject to the provisions of any applicable law, attach the right, exercisable
at the option of the holder, to convert on such terms and conditions and in
such manner as the Directors shall determine each Series E Preference Share
into a Preference Share of another series.

9. Approvals

9.1 The approval of the holders of the Series E Preference Shares as to any and
all matters hereinbefore referred to may be given in writing by all the holders
of the outstanding Series E Preference Shares or by resolution passed or by-law
sanctioned at a meeting of holders of Series E Preference Shares duly called
for the purpose and held upon at least 21 days' notice at which the holders of
at least 50% of the outstanding Series E Preference Shares are present or
represented by proxy and carried by not less than two-thirds of the votes cast
on a poll at such meeting. If at any such meeting the holders of 50% of the
outstanding Series E Preference Shares are not present or represented by proxy
within half an hour after the time appointed for the meeting, then the meeting
shall be adjourned to such date being not less than 15 days later and to such
time and place as may be appointed by the shareholders present and at least ten
days' notice shall be given of such adjourned meeting, but it shall not be
necessary in such notice to specify the purpose for which the meeting was
originally called. At such adjourned meeting the holders of Series E Preference
Shares present or represented by proxy may transact the business for which the
meeting was originally convened, and a resolution passed thereat by not less
than two-thirds of the votes cast on a poll at such adjourned meeting shall
constitute the approval of the holders of the Series E Preference Shares
referred to above.

9.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of Series E Preference Shares, shall not invalidate any
action taken at any meeting.

9.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of Series E Preference Shares and the conduct thereof shall
be those from time to time prescribed in the by-laws of the Corporation with
respect to meetings of shareholders.

10. Notices

Any notice required to be given under the provisions attaching to the Series E
Preference Shares to the holders thereof shall be given by posting the same in
a postage-paid envelope addressed to each holder at the last address of such
holder as it appears on the books of the Corporation or, in the event of the
address of any such holder not so appearing, then to the address of such holder
last known to the Corporation; provided that accidental failure or omission to
give any notice as aforesaid to one or more of such holders shall not
invalidate any action or proceeding founded thereon. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall
be given to registered holders of Series E Preference Shares by means of
publication twice in successive weeks in a daily newspaper of general
circulation in each of the cities of Halifax, Montreal, Toronto, Winnipeg,
Regina, Calgary and Vancouver. Publication in each week in each newspaper shall
be made within a period of seven days of publication in each other newspaper.
If at any time any notice is required under the provisions of this paragraph 10
to be published in a particular city and no newspaper of general circulation is

<PAGE>   50

then being published and circulated on a daily basis in that city, the
Corporation shall not be required to publish in that city. Any notice given by
mail shall be deemed to be given on the day on which it is mailed. Any notice
given by publication shall be deemed to be given on the day on which the first
publication is completed in all of the cities in which publication is required.

<PAGE>   51


                                    PART B.6

PROVISIONS OF THE EIGHTH SERIES OF PREFERENCE SHARES CONSISTING OF 400,000
CUMULATIVE REDEEMABLE RETRACTABLE PREFERENCE SHARES, SERIES F (hereinafter
referred to as "Series F Preference Shares")

The Series F Preference Shares shall, in addition to the rights, privileges,
restrictions and conditions attaching to the Preference Shares as a class, have
the following rights, privileges, restrictions and conditions:

1. Dividends

1.1 The Series F Preference Shares shall carry the right to fixed cumulative
cash dividends, as and when declared by the Board of Directors of the
Corporation, at the rate of $2.00 per share per annum and no more, payable by
quarterly installments of $0.50 each on the last day of March, June, September
and December in each year (each of such days, a "dividend payment date"),
except that no dividend shall be payable on March 31, 1987. Assuming the
400,000 Series F Preference Shares are issued on March 12, 1987 and provided
the Board of Directors have adopted a resolution declaring a dividend on such
shares, the initial dividend payment will be payable on June 30, 1987 and will
be in the amount of $0.603 per share provided that, if the Series F Preference
Shares are issued after March 12, 1987, the dividend payable on June 30, 1987
shall be such lesser amount per share as the Corporation shall determine to be
payable on the basis of an annual rate of $2.00.

1.2 In these provisions, "accrued and unpaid dividends" means an amount
computed at the aforesaid rate as though dividends had been accruing on a
day-to-day basis from and including the date of issue to and excluding the date
to which the computation of accrued dividends is to be made, after deducting
all dividend payments made.

2. Retraction Privilege

2.1 A holder of Series F Preference Shares shall have the privilege
("Retraction Privilege") of requiring the Corporation to purchase all or any of
the holder's Series F Preference Shares on March 31, 1992 ("Series F Retraction
Date") at a price ("Series F Retraction Price") of $25.00 per share plus
accrued and unpaid dividends to and excluding the date of payment.

2.2 On or before January 15, 1992 and not earlier than October 3, 1991, the
Corporation shall give to each person who is then a registered holder of Series
F Preference Shares a written notice ("Retraction Notice") of such person's
right to exercise the retraction Privilege on the Series F Retraction Date. The
Retraction Notice shall also contain, if the Corporation determines pursuant to
paragraph 2.4 that it will not be permitted to purchase all the Series F
Preference Shares then outstanding, the statement required under paragraph 2.4.

2.3 A holder of Series F Preference Shares desiring to exercise the Retraction
Privilege shall, no earlier than October 3, 1991 but not later than February
14, 1992, complete the retraction panel on the certificate(s) representing the
Series F Preference Shares to be purchased by specifying the number of Series F
Preference Shares which he desires to be purchased and depositing such
certificate(s) with the transfer agent of the Corporation for the Series F
Preference Shares at any office where transfers of Series F Preference Shares
may be registered. Such deposit shall be irrevocable unless the Corporation
otherwise agrees, or (a) the Corporation shall fail to make payment on or
before the Series F Retraction Date of the Retraction Price for the Series F
Preference Shares in respect of which the Retraction Privilege is made, in
which event such holder shall be entitled to revoke his retraction in respect
of all or part of his Series F Preference Shares not so purchased by the

<PAGE>   52

Corporation by delivering a notice to that effect to the transfer agent at the
office where his Series F Preference Shares were deposited at least five
business days prior to any succeeding dividend payment date on which such
Series F Preference Shares are required to be purchased as set forth in
paragraph 2.5, or (b) the Corporation agrees and offers on or before the Series
F Retraction Date to convert as set forth in paragraph 3 the Series F
Preference Shares into a further series of Preference Shares, in which event
the holder may revoke his retraction in respect of all or part of his Series F
Preference Shares by delivering a notice to that effect to the transfer agent
at the office where his Series F Preference Shares were deposited on or before
five business days prior to the Series F Retraction Date.

2.4 Subject as provided below, the Corporation shall on the Series F Retraction
Date purchase all Series F Preference Shares in respect of which holders shall
have duly exercised the Retraction Privilege. Payment of the purchase price
shall be made by cheque payable at par at any branch or branches of a bank or
banks in Canada selected by the Corporation and mailed to such holders. Upon
payment of the Series F Retraction Price for the Series F Preference Shares so
purchased, the Series F Preference Shares purchased shall cease to be entitled
to dividends or any other participation in the assets of the Corporation and
the holders shall not be entitled to exercise any of the rights of shareholders
in respect thereof. If prior to the giving of the Retraction Notice, the
Corporation determines that it will not be permitted under paragraph 4 to
purchase all the Series F Preference Shares then outstanding, the Corporation
shall include in the Retraction Notice a statement of the maximum number of
Series F Preference Shares which it then believes it will be permitted to
purchase on the Series F Retraction Date and, provided that the Corporation has
acted in good faith in making such determination, the Corporation shall have no
liability in the event that such determination proves inaccurate. If the
purchase by the Corporation of all Series F Preference Shares in respect of
which the holders thereof have exercised their rights under the Retraction
Privilege would not be permitted under paragraph 4, the maximum sum of money
that may be applied to such purchase shall be rounded to the next lower
multiple of $1,000 and the shares to be purchased shall be selected pro rata,
disregarding fractions.

2.5 If because of the application of paragraph 4 the Corporation fails to
purchase all of the Series F Preference Shares in respect of which the holders
thereof have exercised the Retraction Privilege, thereafter the Corporation
shall be required to purchase pro rata on each succeeding dividend payment date
on the basis set forth in paragraph 2.4 such further number of such shares as
it is permitted to purchase until all shares required to be purchased have been
purchased. Notwithstanding the foregoing, if at any date the Corporation is
obliged to purchase any Series F Preference Shares pursuant to this paragraph
2.5 but cannot purchase all such shares without being in breach of the
provisions of paragraph 4 and the maximum number of such shares it can then so
purchase is less than 1,000 it need not purchase any such shares.

3. Conversion into Further Series

The Series F Preference Shares shall be convertible into shares of one or more
series of Preference Shares upon the amendment of the Articles of the
Corporation or the enactment of a resolution by the Board of Directors setting
out the terms and conditions of such conversion and the time or times during
which such conversion shall be effected.

4. Purchase Restrictions

The Corporation shall not be obliged to purchase any Series F Preference Shares
under paragraph 2 to the extent that such purchase:

i) would be contrary to any applicable law; or

<PAGE>   53

ii) would constitute a breach by the Corporation of the rights, privileges,
restrictions and conditions attaching to the 1975 Series Preferred Shares.

5. Redemption

The Series F Preference Shares shall not be redeemable before March 31, 1992,
but shall be redeemable on or after that date at the option of the Corporation
on at least 30 days' notice prior to the date fixed for redemption in whole at
any time or in part from time to time on payment of the $25.00 per share
together with all accrued and unpaid dividends to and excluding the date fixed
for redemption. In case a part only of the Series F Preference Shares is to be
redeemed, the shares to be so redeemed shall be selected by lot in such manner
as the Board of Directors shall by resolution determine.

6. Purchase for cancellation

The Corporation shall have the right at its option at any time and from time to
time to purchase for cancellation the whole or any part of the Series F
Preference Shares, at a price per share not exceeding $25.00 plus accrued and
unpaid dividends to and excluding the date of purchase and costs of purchase.

7. Creation or Issue of Additional Shares

So long as any of the Series F Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
F Preference Shares given as hereinafter specified, create or issue any shares
ranking prior to or on a parity with the Series F Preference Shares with
respect to return of capital or payment of dividends, provided that the
Corporation may without such approval, if all dividends then payable on the
Series F Preference Shares shall have been declared and paid or set apart for
payment:

         i) issue additional series of Preference Shares; and

         ii) create additional series of First Preferred Shares to be issued
         upon the exercise of a right of conversion which may hereafter be 
         attached to the 1975 Series Preferred Shares provided that the date 
         of retraction at the option of the holder attached to such additional 
         series shall not be earlier than the Series F Retraction Date.

8. Restriction on Dividends, Retirement of Shares and Certain Investments

8.1 So long as any of the Series F Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
F Preference Shares given as hereinafter specified, declare any dividends on
any class of its Common Shares (other than dividends payable solely in such
shares) to, or make any payment on account of the purchase, redemption or other
retirement of any shares of any class to, or make any distribution in respect
thereof to, or make or permit any Subsidiary to make any Investment in, or
permit to exist any Extended Short-Term Investment in, the Parent Corporation
or any subsidiary thereof (other than the Corporation or a Subsidiary) either
directly or indirectly, unless any such dividends are declared to be payable
not more than 120 days after the day of declaration, and unless (a) all
dividends then payable on the Series F Preference Shares shall have been
declared and paid or set apart for payment and (b) after giving effect to such
proposed dividend or other payment or distribution or Investment and the
application of the proceeds thereof and to any other dividends declared but not
yet paid, at the Computation Date, the sum of:
        
         (i) $350,000,000 in United States currency plus (or minus in the case
         of a deficit),

<PAGE>   54

         (ii) the Consolidated Net Income of the Corporation and its
         Subsidiaries computed for the period commencing January 1, 1982 to and
         including a date not more than 135 days prior to the Computation Date,
         plus

         (iii) the aggregate amount of the net cash proceeds to the Corporation
         from sales subsequent to December 31, 1981 of shares of its capital
         stock,

shall be greater than the sum of the aggregate amount of all such dividends and
all such other payments and distributions declared or made during the period
commencing January 1, 1982 to and including the Computation Date, plus the Net
Amount of Investments outstanding on such date, provided however that with
regard to the foregoing restrictions of this paragraph 8.1, the Corporation may
purchase, redeem or retire any shares of any class by exchange for or out of
the proceeds of the substantially concurrent sale of other shares ranking
either (1) junior to the Series F Preference Shares, or (2) equally with or
junior to the shares being purchased, redeemed or retired and neither any such
purchase, redemption or retirement nor any such proceeds shall be included in
any computation provided for in this paragraph 8.1.

For the purposes of this paragraph 8.1 all sums shall be determined in United
States currency.

As used in this paragraph 8.1, the following terms shall have the meanings set
forth below:

"Computation Date" shall mean (i) in the case of a dividend, the date of the
declaration thereof, (ii) in the case of any payment on account of the
purchase, redemption, or retirement of, or any distribution with respect to,
shares, or any Investment, the date of the making thereof and (iii) in the case
of Extended Short-Term Investment, any date.

"Consolidated Net Income" shall mean the Net Income of the Corporation and its
Subsidiaries, all consolidated in accordance with generally accepted accounting
principles. The Consolidated Net Income of the Corporation and its Subsidiaries
computed for the period commencing January 1, 1982 to and including a date not
more than 135 days prior to any Computation Date shall conclusively be deemed
to be that shown by an interim statement of the Consolidated Net Income of the
Corporation and its Subsidiaries for such period prepared by the Corporation.

"Investment" shall mean all loans, advances and capital contributions in cash
to any Person, and all cash payments in respect of the purchase from any Person
of evidences of indebtedness, capital stock or other securities of such Person,
but shall not include any Short-Term Investment.

"Short-Term Investment" shall mean all Investments repayable on demand or
within one year from the making thereof. "Net Amount of Short-Term Investment"
outstanding on any day shall mean all Short-Term Investments by the Corporation
or any Subsidiary in the Parent Corporation or any subsidiary thereof (other
than a Subsidiary), less the aggregate amount of all cash received by the
Corporation or any Subsidiary as payments of principal or premium, returns of
capital, liquidation dividends or distributions, proceeds of sale or other
dispositions, or otherwise, in respect of such Short-Term Investments (except
to the extent any such cash has been included in the Consolidated Net Income of
the Corporation and its Subsidiaries), during the period commencing January 1,
1982 to and including such day. "Net Amount of Investment" outstanding on any
day shall mean all investments by the Corporation or any Subsidiary in the
Parent Corporation or any subsidiary thereof (other than a Subsidiary), less
the aggregate amount of all cash received by the Corporation or any Subsidiary,
as payments of principal or premium, returns of capital, liquidation dividends
or distributions, proceeds of sale or other dispositions, or otherwise, in
respect of such Investments (except to the extent any such cash has been
included in the Consolidated Net Income of the Corporation and its
Subsidiaries), during the period commencing January 1, 1982 to and including
such day, provided however, that Net Amount of Investment shall include

<PAGE>   55

Extended Short-Term Investment. "Extended Short-Term Investment" shall mean the
highest Net Amount of Short-Term Investment outstanding during any period of
30 consecutive days within the 12 months preceding the date of determination,
such 30-day period to be selected by the Corporation.

"Net Income" of any corporation for any period shall mean the net income (or
net deficit) of such corporation for such period, determined in accordance with
generally accepted accounting principles.

"Parent Corporation" shall mean any corporation which owns together with its
subsidiaries, at least a majority of the outstanding Voting Stock of the
Corporation.

"Person" shall mean any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.

"Stock" shall include any and all shares, interests, participations or other
equivalents (however designated) of corporate stock, and the term "Voting
Stock", as applied to the stock of any corporation, shall mean Stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the members of the Board of Directors (or other
governing body) of such corporation, other than Stock having such power only by
reason of the happening of a contingency.

"subsidiary" shall mean any corporation at least a majority of whose
outstanding Voting Stocks shall at the time be owned by another corporation or
by one or more subsidiaries of such other corporation or by such other
corporation and one or more subsidiaries thereof.

"Subsidiary" shall mean a subsidiary of the Corporation.

8.2 So long as any of the Series F Preference Shares are outstanding, the
Corporation shall not, without the prior approval of the holders of the Series
F Preference Shares given as hereinafter specified:

(i) pay any dividends (other than stock dividends) or make any other
distributions on any shares of the Corporation ranking junior to the Series F
Preference Shares with respect to payment of dividends or return of capital, or

(ii) retire for value any shares of the Corporation ranking junior to the
Series F Preference Shares with respect to payment of dividends or return of
capital, or

(iii) except in connection with the exercise of the Retraction Privilege
attaching thereto, retire less than all the Series F Preference Shares,

unless all dividends then payable on the Series F Preference Shares shall have
been declared and paid or set apart for payment.
        
9. Voting Rights

9.1 The holders of the Series F Preference Shares shall not be entitled as such
(except as hereinafter specifically provided) to receive notice of or to attend
any meeting of the shareholders of the Corporation or to vote at any such
meeting unless and until the Corporation from time to time shall fail to pay in
the aggregate six quarterly dividends on the Series F Preference Shares on the
dividend payment dates whether or not consecutive and whether or not such
dividends have been declared and whether or not there are any moneys of the
Corporation properly applicable to the payment of dividends. Thereafter, but
only so long as any dividends on the Series F Preference Shares remain in
arrears, the holders of the Series F Preference Shares shall be entitled to
receive notice of and to attend, but not to vote at, all meetings of
shareholders of the Corporation and shall be entitled on any election of
Directors, together with holders of shares of all other series of Preference
Shares having the right to vote in similar circumstances, voting separately and
exclusively as a class, to elect two members of the Board of Directors of the
Corporation. Each holder of Preference Shares entitled to so vote shall be

<PAGE>   56

entitled to one vote in respect of each dollar of issue price of Preference
Shares held by him whether such issue price is in Canadian or United States
currency. Nothing herein contained shall be deemed to limit the right of the
Corporation from time to time to increase or decrease the number of its
Directors.

9.2 Notwithstanding anything contained in the by-laws of the Corporation, the
term of office of all persons who may be Directors of the Corporation at any
time when the right to elect Directors shall accrue to the holders of Series F
Preference Shares as herein provided, or who may be appointed as Directors
thereafter and before a meeting of shareholders shall have been held, shall
terminate upon the election of Directors at the next annual meeting of
shareholders or at an earlier general meeting of shareholders which may be held
for the purpose of electing Directors and which shall be called by the
Secretary of the Corporation upon the written request of the holders of record
of at least one-tenth of the outstanding Series F Preference Shares. In default
of the calling of such general meeting by the Secretary within 15 days after
the meeting of such request, such meeting may be called by any holder of record
of Series F Preference Shares.

9.3 Any Vacancy occurring among members of the Board elected by the holders of
Preference Shares may be filled by the Board of Directors with the consent and
approval of the remaining Director elected by the holders of Preference Shares.
Whether or not such vacancy is so filled by the Board, the holders of record of
at least one-tenth of the outstanding Series F Preference Shares shall have the
right to require the Secretary, of the Corporation to call a meeting of the
holders of Preference Shares for the purpose of filling the vacancy or
replacing any person elected or appointed by the Board of Directors to fill
such vacancy and the provisions of paragraph 9.2 shall apply with respect to
the calling of any such meeting.
        
9.4 Notwithstanding anything contained in the by-laws of the Corporation upon
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

10. Rights on Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation
or other distribution of assets of the Corporation among shareholders for the
purpose of winding-up its affairs, the holders of the Series F Preference
Shares shall be entitled to receive the sum of $25.00 per share together with
all accrued and unpaid dividends up to and excluding the date of distribution,
before any amount shall be paid to, or any property or assets of the
Corporation distributed among, the holders of any shares of the Corporation
ranking junior to the Series F Preference Shares. After payment to the holders
of the Series F Preference Shares of the amounts so payable to them, they shall
not be entitled to share in any further distribution of the property or assets
of the Corporation.

11. Amendments

The rights, privileges, restrictions and conditions attaching to the Series F
Preference Shares may be repealed or amended in whole or in part but only with
the approval of the holders of the Series F Preference Shares, given as
hereinafter specified; provided, however, that the Directors of the Corporation
may at any time or from time to time, without such shareholder approval, but
subject to the provisions of any applicable law, attach the right, exercisable
at the option of the holder, to convert on such terms and conditions and in
such manner as the Directors shall determine each Series F Preference Share
into a Preference Share of another series.

<PAGE>   57

12. Approvals

12.1 The approval of the holders of the Series F Preference Shares as to any
and all matters hereinbefore referred to may be given in writing by all the
holders of the outstanding Series F Preference Shares or by resolution passed
or by-law sanctioned at a meeting of holders of Series F Preference Shares duly
called for the purpose and held upon at least 21 days' notice at which the
holders of at least 50% of the outstanding Series F Preference Shares are
present or represented by proxy and carried by not less than two-thirds of the
votes cast on a poll at such meeting. If at any such meeting the holders of 50%
of the outstanding Series F Preference Shares are not present or represented by
proxy within half an hour after the time appointed for the meeting, then the
meeting shall be adjourned to such date being not less than 15 days later and
to such time and place as may be appointed by the shareholders present and at
least ten days' notice shall be given of such adjourned meeting, but it shall
not be necessary in such notice to specify the purpose for which the meeting
was originally called. At such adjourned meeting the holders of Series F
Preference Shares present or represented by proxy may transact the business for
which the meeting was originally convened, and a resolution passed thereat by
not less than two-thirds of the votes cast on a poll at such adjourned meeting
shall constitute the approval of the holders of the Series F Preference Shares
referred to above.

12.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of Series F Preference Shares, shall not invalidate any
action taken at any meeting.

12.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of Series F Preference Shares and the conduct thereof
shall be those from time to time prescribed in the by-laws of the Corporation
with respect to meetings of shareholders.

13. Notices

Any notice required to be given under the provisions attaching to the Series F
Preference Shares to the holders thereof shall be given by posting the same in
a postage-paid envelope addressed to each holder at the last address of such
holder as it appears on the books of the Corporation or, in the event of the
address of any such holder not so appearing, then to the address of such holder
last known to the Corporation; provided that accidental failure or omission to
give any notice as aforesaid to one or more of such holders shall not
invalidate any action or proceeding founded thereon. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall
be given to registered holders of Series F Preference Shares by advertisement
twice in successive weeks in a newspaper published or distributed in the place
where the Corporation has its registered office and in each place in Canada
where the Corporation has a transfer agent for the Series F Preference Shares
or where a transfer of Series F Preference Shares may be recorded. Publication
in each week in agent for the Series F Preference Shares or where a transfer
each newspaper shall be made within a period of seven days of publication in
each other newspaper. Any notice given by mail shall be deemed to be given on
the day on which it is mailed. Any notice given by publication shall be deemed
to be given on the day on which the first publication is completed in all of
the cities in which publication is required.

<PAGE>   58


                                   PART B . 7

PROVISIONS OF THE NINTH SERIES OF PREFERENCE SHARES CONSISTING OF 300 FLOATING
RATE CUMULATIVE REDEEMABLE PREFERENCE SHARES, SERIES G (hereinafter referred to
as "Series G Preference Shares")

The Series G Preference Shares shall, in addition to the rights, privileges,
restrictions and conditions attaching to the Preference Shares as a class, have
the following rights, privileges, restrictions and conditions:

1. Issue Price

The Series G Preference Shares will have an issue price of U.S. $500,000 each.

2. Dividends

The holders of the Series G Preference Shares shall be entitled to receive and
the Corporation shall pay thereon, as and when declared by the Board of
Directors of the Corporation, cumulative preferential cash dividends payable in
U.S. currency as set forth below:

         (i) An initial dividend in respect of the Initial Dividend Period,
         payable on August 20, 1992 in an amount per Series G Preference Share
         determined by applying to the U.S. $500,000 issue price per share the
         Annual Dividend Rate multiplied by the number of days in the Initial
         Dividend Period, all divided by 360;

         (ii) Quarterly dividends in respect of each Dividend Period falling
         within the Initial Term, payable on the Dividend Payment Date
         immediately following the end of such Dividend Period, in an amount
         per Series G Preference Share determined by applying to the U.S.
         $500,000 issue price per share the Annual Dividend Rate applicable to
         the Dividend Period preceding the Dividend Payment Date for which the
         determination is being made multiplied by the number of days in the
         Dividend Period, all divided by 360;

         (iii) After the expiry of the Initial Term, quarterly dividends in
         respect of each Dividend Period falling within a Corporation
         Determined Term, payable on the Dividend Payment Date immediately
         following the end of such Dividend Period, in an amount per Series G
         Preference Share determined by applying to the U.S. S500,000 issue
         price per share the Corporation Determined Dividend Rate for such
         Dividend Period determined in accordance with Schedule I hereof
         multiplied by the number of days in the Dividend Period, all divided
         by 360;

         (iv) After the expiry of the Initial Term, quarterly dividends in
         respect of each Dividend Period falling within a Dealer Determined
         Term, payable on the Dividend Payment Date immediately following the
         end of such Dividend Period, in an amount per Series G Preference
         Share determined by applying to the U.S. S500,000 issue price per
         share the Dealer Determined Dividend Rate for such Dividend Period
         determined in accordance with Schedule II hereof multiplied by the
         number of days in the Dividend Period, all divided by 360;

         (v) After the expiry of the Initial Term, quarterly dividends in
         respect of each Auction Dividend Period, payable on the Auction
         Dividend Payment Date immediately following the end of such Auction
         Dividend Period, in an amount per Series G Preference Share determined
         by applying to the U.S. S500,000 issue price per share the Auction

<PAGE>   59

         Dividend Rate for such Auction Dividend Period determined in
         accordance with Schedule III multiplied by the number of days in the
         Auction Dividend Period, all divided by 360.

The record date for the payment of dividends will be the fifth day preceding
the applicable Dividend Payment Date and, in respect of any Auction Dividend
Payment Date, the day preceding the Auction Date.

In any case where a dividend is payable for a period that ends on a date 
("reference date") other than the last day of a Dividend Period or Auction
Dividend Period, as the case may be, the amount of such dividend shall be
determined by applying to U.S. $500,000 the dividend rate applicable to such
Dividend Period or Auction Dividend Period preceding the reference date
multiplied by the number of days in such reduced period preceding the reference
date and excluding the reference date, all divided by 360.

The provisions of Schedule I hereto with respect to the fixing of a Corporation
Determined Dividend Rate for a Corporation Determined Term may be initiated by
the Corporation, not earlier than 60 days and not later than 45 days before the
expiry of the Initial Term and, thereafter, may be used by the Corporation from
time to time during a Corporation Determined Term or a Dealer Determined Term
or any Auction Dividend Period, as the case may be, provided that, in such
circumstances, such provisions are initiated not earlier than 60 days and not
later than 45 days before the expiry of the then current Corporation Determined
Term or Dealer Determined Term or Auction Dividend Period, as the case may be.

The provisions of Schedule II hereto with respect to solicitation of Dealer
Offers for the purpose of fixing a Dealer Determined Dividend Rate for a Dealer
Determined Term may be initiated by the Corporation, unless at any such time a
Corporation Determined Dividend Rate has been accepted in accordance with the
provisions of Schedule I, not earlier than 30 days and not later than 25 days
before the expiry of the Initial Term and, thereafter, may be used by the
Corporation from time to time during a Corporation Determined Term, a Dealer
Term or any Auction Dividend Period, as the case may be, provided that in such
circumstances, such provisions are initiated not earlier than 30 days and not
later than 25 days before the expiry of such Corporation Determined Term or
Dealer Determined Term or Auction Dividend Period, as the case may be.

The provisions of Schedule III hereto shall apply from and after the end of the
Initial Term and from and after the end of any Corporation Determined Term,
Dealer Determined Term or Auction Dividend Period, as the case may be, unless
at any such time a Corporation Determined Dividend Rate for a Corporation
Determined Term has been accepted and fully implemented in accordance with the
provisions of Schedule I hereto or a Dealer Determined Dividend Rate for a
Dealer Determined Term has been accepted in accordance with the provisions of
Schedule II hereto and the provisions of paragraph 2(7) of Schedule II hereto
are fully implemented in accordance with the terms of that paragraph.
        
Any defined terms in the Articles relating to the Series G Preference Shares
including the Schedules thereto shall have the meaning ascribed thereto
throughout such Articles and Schedules.

"accrued and unpaid dividends" means an amount computed at the applicable rates
as though dividends had been accruing on a day-to-day basis from and including
the date of issue to and excluding the date to which the computation of accrued
dividends is to be made, after deducting all dividend payments made;

"Annual Dividend Rate" means 60% of LIBOR plus 2.25% per annum;

"Auction" means the periodic operation of the procedures set forth in Schedule
III hereto;

<PAGE>   60

"Auction Date" means the last Tuesday of any Dividend Period or any Auction
Dividend Period which Tuesday is at least two Business Days prior to the 20th
of February, May, August or November, as the case may be, or if such Tuesday is
not a Business Day, the next preceding Business Day, regardless of whether an
Auction is in fact conducted;

"Auction Dividend Period" means the period from and including a Settlement Date
to but excluding the next succeeding Settlement Date except for the first
Auction Dividend Period following a Dividend Period in which case "Auction
Dividend Period" shall mean the period from and including the Dividend Payment
Date for and immediately following such Dividend Period to and excluding the
Settlement Date immediately following the Auction Date occurring during the
Auction Dividend Period;

"Auction Dividend Payment Date" means the first Business Day following the
Settlement Date;

"Business Day" means a day on which all of The Montreal Exchange and The
Toronto Stock Exchange or any successor facilities and the Auction Manager, if
and when appointed, are open for business;

"Corporation Determined Term" has the meaning ascribed to that term in Schedule
I hereto;

"Dealer Determined Term" has the meaning ascribed to that term in Schedule II
hereto;

"Dividend Payment Date" means the 20th day of February, May, August and
November in each year;

"Dividend Period" means the period from and including each Dividend Payment
Date to but excluding the next succeeding Dividend Payment Date except for the
first Dividend Period following an Auction Dividend Period in which case
"Dividend Period" shall mean the period from and including the Settlement Date
immediately following such Auction Dividend Period to but excluding the next
succeeding Dividend Payment Date which falls at least three calendar months
after the said Settlement Date;

"Initial Dividend Period" means the period from and including the date of issue
of a Series G Preference Share to but excluding August 20, 1992;

"Initial Term" means the period from the date of issue of the Series G
Preference Shares to but excluding August 20, 1995; "LIBOR" in respect of the
Initial Dividend Period, a Dividend Period or Auction Dividend Period means the
rate for U.S. LIBOR which appears on page 3750 of Telerate at approximately
11:00 a.m. (London time) two Business Days prior to the commencement of the
Initial Dividend Period, a Dividend Period or an Auction Dividend Period, as
the case may be, for a period substantially equal to that of such dividend
period and for an amount substantially equal to the aggregate issue price of
the total outstanding Series G Preference Shares or if no such rate is
available the average (rounded upward to the nearest 1/16th percent as
necessary) of the respective annual interest rates quoted by the principal
London branches of two prime banks, designated by the Corporation, as being
that at which each such bank is offering deposits in U.S. dollars to prime
banks in the London Inter Bank Market at approximately 11:00 a.m.  (London
time) two business days prior to the commencement of the Initial Dividend
Period, a Dividend Period or an Auction Dividend Period, as the case may be,
for a period substantially equal to that of such dividend period and for an
amount substantially equal to the aggregate issue price of the total
outstanding Series G Preference Shares; and
        
"Settlement Date" means the Business Day immediately following the Auction
Date.

<PAGE>   61
 
3. Redemption

The Series G Preference Shares shall not be redeemable before August 20, 1995, 
but thereafter shall be redeemable on August 20, 1995, or any Dividend Payment 
Date following a Corporation Determined Term or a Dealer Determined Term or on 
any Settlement Date following an Auction Dividend Period during which the 
procedures set out in Schedule III hereto have been implemented at the option 
of the Corporation on at least 30 days' notice before the date fixed for 
redemption in whole at any time or in part from time to time on payment for each
share held of an amount of U.S. $500,000 per share together with all accrued 
and unpaid dividends thereon up to and excluding the date of such redemption 
(which for such purpose shall be calculated as provided in paragraph 2 hereof).
In case a part only of the Series G Preference Shares is to be redeemed, the 
shares to be redeemed shall be selected by lot in such manner as the Board of 
Directors shall by resolution determine.

4. Conversion into Common Shares at Option of the Holder

4.1 A holder of Series G Preference Shares shall have the privilege 
("Conversion Privilege") of converting all or any of the holder's Series G 
Preference Shares on May 21, 2002 into that number of Common Shares of the 
Corporation determined by dividing the aggregate issue price of the Series G 
Preference shares surrendered for conversion, together with all accrued and
unpaid  dividends thereon to and excluding May 21, 2002, by the greater of (i)
95% of  the weighted average trading price of such Common Shares of the
Corporation  reported as New York Stock Exchange-Consolidated Trading, for the
20 trading  days ending two trading days prior to May 21, 2002 adjusted as
necessary for  (a) any subdivision, consolidation or reclassification of the
Common Shares of  the Corporation, (b) any distribution, payment or dividend,
any of which is  capital or extraordinary, on or in respect of the outstanding
Common Shares of  the Corporation or (c) any amalgamation, reorganization or
merger, occurring  during the period from the first of such trading days to and
including May 21,  2002 and (ii) U.S. $l. Only whole Common Shares of the
Corporation will be  issued and the Corporation shall pay, in U.S. dollars, to
or to the order of a  holder, a cash amount equal to the value of any fraction
of a Common Share of the Corporation calculated in accordance with the same
formula.
        
4.2 Not more than 120 days and not less than 90 days prior to May 21, 2002 the 
Corporation shall give to each person who is then a registered holder of Series 
G Preference Shares a written notice of such person's right to exercise the 
Conversion Privilege on May 21, 2002.

4.3 A holder of Series G Preference Shares desiring to exercise the Conversion 
Privilege shall, not more than 90 days and not less than 60 days prior to May 
21, 2002, complete the conversion panel on the certificate(s) representing the 
Series G Preference Shares to be converted by specifying the number of Series G 
Preference Shares which he desires to be converted and depositing such 
certificate(s) with the transfer agent and registrar of the Corporation for the 
Series G Preference Shares at any office where transfers of Series G Preference 
Shares may be registered. Such deposit shall be irrevocable unless the 
Corporation otherwise agrees.

4.4 The Corporation may by notice, given not later than 23 Business Days prior 
to May 21, 2002, to all holders who have given a conversion notice either (i) 
redeem on May 21, 2002 all or a portion of the Series G Preference Shares 
forming the subject matter of the applicable conversion notices; or (ii) cause 
the holders of such Series G Preference Shares to sell on May 21, 2002 all or a 
portion of such Series G Preference Shares to another purchaser or purchasers. 
Any such redemption or purchase shall be made by the payment of an amount of 
U.S. $500,000 per/share, together with all accrued and unpaid dividends thereon 
to and excluding May 21, 2002. The Series G Preference Shares to be so redeemed 
or purchased shall not be converted on May 21, 2002.

<PAGE>   62
5. Creation or Issue of Additional Shares

So long as any of the Series G Preference Shares are outstanding, the 
Corporation shall not, without the prior approval of the holders of the Series 
G Preference Shares given as hereinafter specified, create or issue any shares 
ranking prior to or on a parity with the Series G Preference Shares with 
respect to return of capital or payment of dividends, provided that the 
Corporation may without such approval issue additional series of Preference
Shares, if all dividends then payable on the Series G Preference Shares shall
have been declared and paid or set apart for payment.

6. Restrictions on Dividends and Retirement of Shares

6.1 So long as any of the Series G Preference Shares are outstanding, the 
Corporation shall not, without the prior approval of the holders of the Series 
G Preference Shares given as hereinafter specified:

         (i) pay any dividends (other than stock dividends) or make any 
         distributions on any shares of the Corporation ranking junior to the 
         Series G Preference Shares with respect to payment of dividends or 
         return of capital, or

        (ii) retire for value any shares of the corporation ranking junior to 
        the Series G Preference Shares with respect to payment of dividends or 
        return of capital, or

        (iii) retire less than all the Series G Preference Shares,

unless all dividends then payable on the Series G Preference Shares shall have 
been declared and paid or set apart for payment.

7. Voting Rights

7.1 The holders of the Series G Preference Shares shall not be entitled as 
such (except as hereinafter specifically provided) to receive notice of or to 
attend any meeting of the shareholders of the Corporation or to vote at any 
such meeting unless and until the Corporation from time to time shall fail to 
pay in the aggregate, six quarterly dividends on the Series G Preference 
Shares on a Dividend Payment Date or Auction Dividend Payment Date whether or 
not consecutive and whether or not such dividends have been declared and 
whether or not there are any moneys of the Corporation properly applicable to 
the payment of dividends. Thereafter, but only so long as any dividends on the 
Series G Preference Shares remain in arrears, the holders of the Series G 
Preference Shares shall be entitled to receive notice of and to attend, but 
not to vote at, all meetings of shareholders of the Corporation and shall be 
entitled on any election of Directors, together with holders of shares of all 
other series of Preference Shares having the right to vote in similar 
circumstances, voting separately and exclusively as a class, to elect two 
members of the Board of Directors of the Corporation, provided that in
the event that there are fewer than three other members of the Board of
Directors, the holders of the Series G Preference Shares shall not be entitled
to vote in any such election. Each holder of Preference Shares entitled to so
vote shall be entitled to one vote in respect of each dollar of issue price of
Preference Shares held by him whether such issue price is in Canadian or United
States currency. Nothing herein contained shall be deemed to limit the right of
the Corporation from time to time to increase or decrease the number of its
Directors.

7.2 Notwithstanding anything contained in the by-laws of the Corporation, the 
term of office of all persons who may be Directors of the Corporation at any 
time when the right to elect Directors shall accrue to the holders of Series G 
Preference Shares as herein provided, or who may be appointed as Directors 
thereafter and before a meeting of shareholders shall have been held, shall 
terminate upon the election of Directors at the next annual meeting of 
shareholders or at an earlier general meeting of shareholders which may be 
held for the purpose of electing Directors and which shall be called by the 
Secretary of the Corporation upon the written request of the holders of record 
of at least one-tenth of the outstanding Series G Preference Shares. In default 
of the calling of such general meeting by the Secretary within 15 days after 
the making of such request, such meeting may be called by any holder of record 
of Series G Preference Shares.
<PAGE>   63

7.3 Any vacancy occurring among members of the Board elected by the holders of 
Preference Shares may be filled by the Board of Directors with the consent and 
approval of the remaining Director elected by the holders of Preference Shares. 
Whether or not such vacancy is so filled by the Board, the holders of record of 
at least one-tenth of the outstanding Series G Preference Shares shall have the 
right to require the Secretary of the Corporation to call a meeting of the 
holders of Preference Shares for the purpose of filling the vacancy or 
replacing any person elected or appointed by the Board of Directors to fill 
such vacancy and the provisions of paragraph 7.2 shall apply with respect to 
the calling of any such meeting.

7.4 Notwithstanding anything contained in the by-laws of the Corporation upon 
any termination of the said right to elect Directors, the term of office of the
Directors elected or appointed to represent the holders of Preference Shares
exclusively shall forthwith terminate.

8. Rights on Liquidation

In the event of the liquidation, dissolution or winding-up of the Corporation or
other distribution of assets of the Corporation among shareholders for the
purpose of winding-up its affairs, the holders of the Series G Preference Shares
shall be entitled to receive the sum of U.S. S500,000 per share together with
all accrued and unpaid dividends thereon up to and excluding the date of
distribution, (which for such purpose shall be calculated as provided in
paragraph 2 hereof) before any amount shall be paid to, or any property or
assets of the Corporation distributed among, the holders of any shares of the
Corporation ranking junior to the Series G Preference Shares. After payment to
the holders of the Series G Preference Shares of the amounts so payable to them,
they shall not be entitled to share in any further distributions of the property
or assets of the Corporation.


9. Amendments

The rights, privileges, restrictions and conditions attaching to the Series G
Preference Shares may be repealed or amended in whole or in part but only with
the approval of the holders of the Series G Preference Shares, given as
hereinafter specified; provided, however, that the Directors of the Corporation
may at any time or from time to time, without such shareholder approval, but
subject to the provisions of any applicable law, attach the right, exercisable
at the option of the holder, to convert on such terms and conditions and in
such manner as the Directors shall determine each Series G Preference Share
into a Preference Share of another series provided that any such right shall
not permit the conversion of the Series G Preference Shares into "Short-Term
Preferred Shares" or "Term Preferred Shares" within the meaning of the Income
Tax Act (Canada).

10. Approvals

10.1 The approval of the holders of the Series G Preference Shares as to any
and all matters hereinbefore referred to or any other matter requiring the
consent of the holders of the Series G Preference Shares may be given in
writing by all the holders of the outstanding Series G Preference Shares or by
resolution passed or by-law sanctioned at a meeting of holders of Series G
Preference Shares duly called for the purpose and held upon at least 21 days'
notice at which the holders of at least 50% of the outstanding Series G
Preference Shares are present or represented by proxy and carried by not less
than two-thirds of the votes cast on a poll at such meeting. If at any such
meeting the holders of 50% of the outstanding Series G Preference Shares are
not present or represented by proxy within half an hour after the time
appointed for the meeting, then the meeting shall be adjourned to such date
being not less than 15 days later and to such time and place as may be
appointed by the shareholders present and at least ten days' notice shall be
given of such

<PAGE>   64

adjourned meeting, but it shall not be necessary in such notice
to specify the purpose for which the meeting was originally called. At such
adjourned meeting the holders of Series G Preference Shares present or
represented by proxy may transact the business for which the meeting was
originally convened, and a resolution passed thereat by not less than
two-thirds of the votes cast on a poll at such adjourned meeting shall
constitute the approval of the holders of the Series G Preference Shares
referred to above. Each holder of Preference Shares entitled to so vote shall
be entitled to one vote in respect of each dollar of issue price of Preference
Shares held by him whether such issue price is in Canadian or United States
currency.

10.2 Irregularities in the notice or in the giving thereof as well as the
accidental omission to give notice of any meeting to, or the non-receipt of any
notice by, any holder of Series G Preference Shares, shall not invalidate any
action taken at any meeting.

10.3 The formalities to be observed with respect to the giving of notice of any
meeting of holders of the Series G Preference Shares and the conduct thereof
shall be those from time to time prescribed in the by-laws of the Corporation
with respect to meetings of shareholders.

11. Notices

Any notice required to be given under the provisions attached to the Series G
Preference Shares to the holders hereof shall be in writing and shall be
sufficiently given if delivered, sent by telecopier or by posting the same in a
postage-paid envelope addressed to each holder at the last address of such
holder as it appears on the books of the Corporation or, in the event of the
address of any such holder not so appearing, then to the address of such holder
last known to the Corporation; provided that accidental failure or omission to
give any notice as aforesaid to one or more of such holders shall not
invalidate any action or proceeding founded thereon but, upon such failure or
omission being discovered, the notice or other communication, as the case may
be, shall be given forthwith to such holder or holders. In the event of a
threatened or actual disruption in the mail service, notice as aforesaid shall
be given to registered holders of Series G Preference Shares by delivery or by
telecopier or by means of publication twice in successive weeks in a daily
newspaper of general circulation in each of the cities of Montreal and Toronto.
Publication in each week in each newspaper shall be made within a period of
seven days of publication in each other newspaper. If at any time any notice is
required under the provisions of this paragraph 11 to be published in a
particular city and no newspaper of general circulation is then being published
and circulated on a daily basis in that city, the Corporation shall not be
required to publish in that city.  Any notice given by mail shall be deemed to
be given on the day on which it is mailed except notices given pursuant to
Schedule I and Schedule 11 hereto in which case notice shall be deemed to have
been given two Business Days after the day on which it is mailed. Notice given
by telecopier shall be deemed to have been given on the day on which it is
sent. Any notice given by publication shall be deemed to be given on the day on
which the first publication is completed in all of the cities in which
publication is required.

All notices or other communications relating to the auction procedures set
forth in Schedule III hereto shall be sent by telecopy or delivered.

12. Tax Election

The Corporation shall make the election provided under sub-section 191.2(1) of
the Income Tax Act (Canada) or any successor or replacement provision of
similar effect in the manner described therein and within the time provided by
paragraph (a) thereof, and take all other necessary action under such Act such
that no holder of the Series G Preference Shares will be required to pay tax,
on dividends received on the Series G Preference Shares, under section 187.2 of
Part IV.1 of such Act or any successor or replacement provision of similar
effect.


<PAGE>   65

                                   SCHEDULE I

                     CORPORATION DETERMINED RATE PROCEDURES

1. Definitions

"Corporation Determined Percentage" means a percentage of LIBOR to be selected
by the Corporation and to be set forth in the notice referred to in paragraph 2
of this Schedule I;

"Corporation Determined Dividend Rate" means the annual dividend rate specified
by the Corporation in its notice pursuant to paragraph 2 of this Schedule I,
which shall be one of:

         (i) The Corporation Determined Percentage of LIBOR for the Dividend
Period for which such determination is being made, or

         (ii) a fixed annual percentage rate;

"Corporation Determined Term" means a term, selected by the Corporation,
consisting of one or more consecutive Dividend Periods commencing on a Dividend
Payment Date or a Settlement Date on or after the expiry of the Initial Term
and terminating on the last day of the last Dividend Period selected by the
Corporation, to which the provisions of this Schedule I shall apply for the
purpose of determining the dividend to be paid on each Dividend Payment Date
relating to such term, provided that such term and the dividend rate applicable
thereto have been approved by the holders of the Series G Preference Shares in
accordance with paragraph 2 of this Schedule I.

2. Determination of New Dividend Rate

At least 45 and not more than 60 days before the expiry of the Initial Term or
the then current Corporation Determined Term, Dealer Determined Term or Auction
Dividend Period, as the case may be, the Corporation may notify the holders of
the Series G Preference Shares of a proposed Corporation Determined Dividend
Rate for a proposed Corporation Determined Term. Such notification to such
holders shall also:

         (a) specify a date by which each holder must notify the Corporation in
         writing of its acceptance of the proposed Corporation Determined
         Dividend Rate and the Corporation Determined Term, if such holder
         intends to accept such terms, which date shall be at least 35 days
         before the expiry of the Initial Term or the then current Corporation
         Determined Term, Dealer Determined Term or Auction Dividend Period, as
         the case may be; and

         (b) specify that the proposed Corporation Determined Dividend Rate and
         proposed Corporation Determined Term shall become effective for the
         purposes of determining the dividends to be paid on the Dividend
         Payment Dates for Dividend Periods during such proposed Corporation
         Determined Term only if all of the holders of Series G Preference
         Shares accept such terms.

3. Acceptance of Corporation Determined Dividend Rate

If,

         (a) by the time prescribed in paragraph 2(a) of this Schedule I, all
         of the holders of the Series G Preference Shares have accepted the
         Corporation Determined Dividend Rate and the Corporation Determined
         Term as evidenced by notice in writing to the Corporation, and

         (b) at least 30 days before the expiry of the Initial Term or the then
         current Corporation Determined Term, Dealer Determined Term or Auction
         Dividend Period, as the case may be, the Corporation has notified all
         of such holders that each of them has agreed with the Corporation on
         such terms;
<PAGE>   66

such Corporation Determined Dividend Rate and Corporation Determined Term shall
apply for the purposes of determining the dividend to be paid to the holders of
Series G Preference Shares, from time to time, on each of the Series G
Preference Shares on each Dividend Payment Date for Dividend Periods during
such Corporation Determined Term.
<PAGE>   67

                                  SCHEDULE II

                             DEALER BIDS PROCEDURES

1. Definitions

"Dealer" means any registered investment dealer or other entity permitted by
law to perform the functions required of a dealer in this Schedule II;

"Dealer Determined Percentage" means a percentage of LIBOR to be selected by
each Dealer and to be set forth in each Dealer Offer in accordance with
paragraph 2 of this Schedule II;

"Dealer Determined Dividend Rate" means the annual dividend rate specified by
the Dealer in the Accepted Dealer Offer (as defined in sub-paragraph 2(3) of
this Schedule II) which shall be one of:

         (i) the Dealer Determined Percentage of LIBOR for the Dividend Period
         for which such determination is being made, or

         (ii) a fixed annual percentage rate;

"Dealer Determined Term" means a term, selected by a Dealer, consisting of one
or more consecutive Dividend Periods commencing on a Dividend Payment Date or
Settlement Date on or after the expiry of the Initial Term and terminating on
the last day of the Last Dividend Period selected by such Dealer, to which the
provisions of this Schedule II shall apply for the purpose of determining the
dividend to be paid on each Dividend Payment Date relating to such term;

"Dealer Offer" means a written irrevocable and unconditional offer from a
Dealer in response to a Notice Requesting Bids to purchase all of the Series G
Preference Shares on the day of expiry of the Initial Term or the then current
Corporation Determined Term, Dealer Determined Term or on the Settlement Date
immediately following the expiry of the then current Auction Dividend Period,
as the case may be, at a purchase price per Series G Preference Share equal to
U.S. $500,000 (except in the ease of a purchase on the Settlement Date
immediately following the expiry of the then current Auction Dividend Period,
less an amount that is calculated by (i) multiplying U.S. $500,000 by the
applicable annual rate at which dividends are accruing on the Series G
Preference Shares for the Dividend Period ending on the date of purchase and
(ii) multiplying the product thereof by a fraction of which the numerator is
that number of days from and including the date of purchase to and excluding
the Dividend Payment Date and the denominator is 360) and containing the
information specified in sub-paragraph 2(2) of this Schedule II;

"Dealer Response Date" has the meaning ascribed thereto in sub-paragraph 2(1)
of this Schedule II;

"Notice Requesting Bids" means a notice from the Corporation to one or more
Dealers requesting them to submit Dealer Offers as provided for in
sub-paragraph 2(1) of this Schedule II; and

"Notification to Holders" means the notification from the Corporation to
holders of Series G Preference Shares of the acceptance of a Dealer Offer as
provided for in sub-paragraph 2(4) of this Schedule II.

2. Bids by Dealers

         (1) At least 25 and not more than 30 days before expiry of the Initial
Term, the then current Corporation Determined Term, Dealer Determined Term or
Auction Dividend Period, as the case may be, the Corporation may solicit bids
from one or more Dealers for the purchase of all of the

<PAGE>   68

Series G Preference Shares. Such solicitation shall be contained in a notice
("Notice Requesting Bids") to be sent by the Corporation to such Dealers, which
notice shall:

         (a) invite each Dealer to submit to the Corporation a Dealer Offer;
         and

         (b) specify a date (the "Dealer Response Date"), which shall be not
         more than five days after the giving of such notice, by which any such
         offer must be received by the Corporation.

         (2) Each Dealer receiving a Notice Requesting Bits may submit a Dealer
Offer provided such Dealer does so by the Dealer Response Date and provided
that such Dealer Offer specifies:

         (a) a Dealer Determined Dividend Rate (and, in connection therewith,
         unless a fixed annual percentage rate is specified, the Dealer
         Determined Percentage of LIBOR;

         (b) a Dealer Determined Term for which the Dealer Determined Dividend
         Rate referred to in sub-paragraph 2(2)(a) of this Schedule II will
         apply; and

         (c) the amount of any fee to be paid by the Corporation to the Dealer
         in connection with the purchase of Series G Preference Shares in the
         event the Dealer Offer is accepted by the Corporation.

         (3) If the Corporation wishes to accept a Dealer Offer, it shall
signify such acceptance on or before 15 days before the expiry of the Initial
Term or the then current Corporation Determined Term, Dealer Determined Term or
Auction Dividend Period, as the case may be, by notice to the Dealer whose
Dealer Offer it accepts ("Accepted Dealer Offer"). The Dealer Determined
Dividend Rate and Dealer Determined Term specified in the Accepted Dealer Offer
shall apply for the purposes of determining the dividends to be paid to the
holders of the Series G Preference Shares, from time to time, on each Dividend
Payment Date for Dividend Periods during such Dealer Determined Term, provided
the provisions of this Schedule II are fully implemented in accordance with the
terms of this Schedule II. The Dealer whose Dealer Offer is accepted will be
required to purchase all of the Series G Preference Shares not retained by the
existing holders upon the expiry of the Initial Term or the then current
Corporation Determined Term, Dealer Determined Term or on the Settlement Date
immediately following the current Auction Dividend Period, as the case may be,
on the terms contained in the Accepted Dealer Offer.

         (4) Concurrently with its acceptance of a Dealer Offer, and in any
event not later than 15 days before the expiry of the Initial Term or the then
current Corporation Determined Term, Dealer Determined Term or Auction Dividend
Period, as the case may be, the Corporation shall notify ("Notification to
Holders") each existing holder of Series G Preference Shares that the
Corporation has accepted a Dealer Offer. Such notification shall:

         (a) specify the Dealer Determined Dividend Rate to apply to the Series
         G Preference Shares;

         (b) specify the Dealer Determined Term for which the Dealer Determined
         Dividend Rate referred to in sub-paragraph 2(4) (a) of this Schedule II
         will apply;

         (c) notify such holders of the right of each holder either to sell all
         or some of the Series G Preference Shares it holds to such Dealer or
         to continue to hold all or some of the Series G Preference Shares it
         then holds;

         (d) notify such holders of the date (which shall be not more than 10
         days nor less than six days before the expiry of the Initial Term or
         the then current Corporation Determined Term or Dealer Determined Term
         or on or before the second day before the expiry of the then current
         Auction Dividend Period, as the case may be) by which the Corporation
         must have received written notice from such holder of its decision to
         sell some or all of the Series G Preference Shares it holds as
         provided for in sub-paragraph 2(5) of this Schedule II; and
<PAGE>   69

         (e) identify the Dealer whose Dealer Offer has been accepted.

         (5) Upon receipt of the Notification to Holders, an existing holder of
Series G preference Shares may elect to sell Series G Preference Shares in
accordance with the terms specified in such Notification to Holders by
notifying the Corporation at its registered office in writing, to the
Corporation to the attention of the Treasurer, of such decision and the number
of shares to be sold. Each holder of Series G Preference Shares who elects to
sell all or a part of its holdings of Series G Preference Shares shall, together
with such notice, deposit the certificate or certificates representing Series G
Preference Shares which such holder desires to sell (with the transfer panel on
such certificate duly completed and signed or, in the alternative, with a duly
completed stock transfer power of attorney accompanying such certificate or
certificates) at the registered office of the Corporation, or at any place
where the Series G Preference Shares may be transferred or at any other place
or places in Canada specified by the Corporation to the holders of the Series G
Preference Shares in the Notification to Holders. If a holder of Series G
Preference Shares wishes to sell only some of the Series G Preference Shares
represented by any share certificate or certificates, the holder may deposit
the certificate or certificates with the Corporation, as aforementioned, and the
Corporation shall issue and deliver to such holder, at the expense of the
Corporation, a new share certificate representing the Series G Preference
Shares which are not being delivered for sale. Any holder of Series G
Preference Shares that fails to respond to the Notification to Holders by the
date specified for response therein will be deemed to have elected to continue
to hold all of the Series G Preference Shares then held by it subject to the
terms and conditions as to the Dealer Determined Dividend Rate and the Dealer
Determined Term which are set forth in the Notification to holders. The
corporation shall have all such powers and authority as may be necessary to
determine finally the adequacy of all transfer instruments and related matters
with respect to the sale of shares by an existing holder of the Series G
Preference Shares to a Dealer hereunder. Any determination by the Corporation
to the effect that any instrument of transfer is incomplete or ineffective
shall bind the Holder intending to sell any of its Series G Preference Shares
pursuant to the provisions of this Schedule II and shall also bind the Dealer
in question.

         (6) At least one Business Day before the expiry of the Initial Term, or
the then current Corporation Determined Term, Dealer Determined Term or Auction
Dividend Period, as the case may be, the Corporation shall notify the Dealer
submitting the Accepted Dealer Offer of the number of shares to be purchased by
such Dealer in accordance with sub-paragraph 2(7) of this Schedule II and of the
identity of the vendor or vendors thereof.

         (7) On the day of the expiry of the Initial Term, the then current
Corporation Determined Term, the Dealer Determined Term or on the Settlement
Date immediately following the expiry of the then current Auction Dividend
Period, as the case may be, the Dealer submitting the Accepted Dealer Offer
shall purchase the Series G Preference Shares from the holders referred to in
sub-paragraph 2(6) of this Schedule II at the purchase price as set out in the
definition of "Dealer Offer" in paragraph I of this Schedule II. For the
purposes of completing such purchase, the Dealer submitting the Accepted Dealer
Offer shall deposit with the Corporation, at its registered office, on or before
noon (Montreal time) on such date, a certified cheque payable to the
Corporation, as agent for the vendors referred to in sub-paragraph 2(6) of this
Schedule II, representing the aggregate purchase price of the Series G
Preference Shares to be purchased pursuant to this sub-paragraph 2(7) together
with a direction as to registration particulars with respect to such Series G
Preference Shares to be purchased upon receipt of such certified cheque as
aforesaid, the Corporation shall deliver to the vendor or vendors at the
registered office of the Corporation cheques payable to the vendor or vendors in
payment of the purchase price for such Series G Preference Shares and delivery
of such cheques shall be deemed to be payment and shall satisfy and discharge
all liability for such purchase price to the extent of the amount represented by
such cheques, unless
<PAGE>   70

such cheques are not paid on due presentation. In the event that the date
specified for the closing of a Dealer Offer is not a Business Day, the date of
closing thereof shall be the immediately preceding Business Day.

3. Termination of Application

Notwithstanding the acceptance of a Dealer Offer as provided for in this
Schedule II, the Corporation may notify the holders that the Corporation does
not intend to proceed to implement application of the Dealer Determined
Dividend Rate and Dealer Determined Term as set forth in the Notification to
Holders provided that such notification is given by the Corporation to existing
holders on or before the expiry of the Initial Term or the then current
Corporation Determined Term, Dealer Determined Term or Auction Dividend Period,
as the case may be. In such circumstances, the provisions of Schedule III to
the rights, privileges, restrictions and conditions attaching to the Series G
Preference Shares shall be applied in accordance with such Schedule and, for
greater certainty, the Dealer whose Dealer Offer has been accepted shall not be
obliged to purchase any Series G Preference Shares pursuant to such Dealer
Offer. Any such notification shall not limit or restrict the right of the
Corporation, before the expiry of any subsequent Corporation Determined Term,
Dealer Determined Term or Auction Dividend Period, as the case may be, to
implement the provisions of this Schedule II by forwarding a Notice Requesting
Bids to one or more Dealers.
<PAGE>   71


                                  SCHEDULE III

                               AUCTION PROCEDURES

1. Definitions

"Auction Dividend Rate" means the rate per annum which the Auction Manager
advises the Corporation has been determined in accordance with paragraph 1.3(b)
of this Schedule III;

"Auction Manager" means the Corporation, or a trust company registered under
appropriate legislation or any successor thereto, entering into an Auction
Manager Agreement with the Corporation in respect of the Series G Preference
Shares;

"Auction Manager Agreement" means an agreement made between the Auction Manager
and the Corporation which provides, among other things, that the Auction
Manager will follow the procedures set forth in this Schedule III for the
purpose of determining the Auction Dividend Rate for the Series G Preference
Shares as long as any of the Series G Preference Shares remain outstanding or
if the Corporation is the Auction Manager an undertaking by the Corporation to
follow the procedures set out therein;

"Available Shares" shall have the meaning specified in sub-paragraph (i) of
paragraph 1.3(a) of this Schedule III;

"Bid" and "Bids" shall have the respective meanings specified in paragraph 1.1
(a) of this Schedule III;

"Bidder" and "Bidders" shall have the respective meanings specified in
paragraph 1.1 (a) of this Schedule III;

"Dealer" means any registered investment dealer or other entity permitted by
law to perform the functions required of a dealer in this Schedule III that has
entered into a Dealer Agreement with the Auction Manager that remains
effective;

"Dealer Agreement" means an agreement between the Auction Manager and a Dealer
pursuant to which the Dealer agrees to participate in Auctions in compliance
with the procedures set forth in this Schedule III;

"Existing Holder" means a holder of Series G Preference Shares (i) who has
signed a Purchaser's Letter, (ii) who has delivered or caused to be delivered
such Purchaser's Letter to the Auction Manager and to any Dealer to which such
Existing Holder submits information pursuant to paragraph l.l(a) of this
Schedule III and (iii) who is registered in the ledger maintained by the
Auction Manager in respect of holders of Series G Preference Shares;

"Hold Order" and "Hold Orders" shall have the respective meanings specified in
paragraph l.l(a) of this Schedule III;

"Maximum Rate" with respect to any Auction Dividend Period shall mean 60% of
LIBOR plus 2.85% per annum when LIBOR is less than 5.625% per annum, and, LIBOR
plus 0.60% per annum when LIBOR is equal to or greater than 5.625% per annum;

"Order" and "Orders" shall have the respective meanings specified in paragraph
1.1(a) of this Schedule III;

<PAGE>   72


"Potential Holder" means any person, including any Existing Holder, (i) who has
executed a Purchaser's Letter, (ii) who has delivered or caused to be delivered
such Purchaser's Letter to the Auction Manager and to any Dealer to which such
Potential Holder submits information pursuant to paragraph 1.1 (a) of this
Schedule III and (iii) who may be interested in acquiring Series G Preference
Shares (or, in the case of an Existing Holder, additional Series G Preference
Shares);

"Purchaser's Letter" means a letter addressed to the Auction Manager and a
Dealer in which a person agrees, among other things, to be bound by the
procedures set forth in this Schedule III in the event such person participates
in an Auction;

"Remaining Shares" shall have the meaning specified in sub-paragraph (iv) of
paragraph 1.4(a) of this Schedule III;

"Sell Order" and "Sell Orders" shall have the respective meanings specified in
paragraph l.l(a) of this Schedule III;

"Submission Deadline" means 11:00 a.m. Montreal time, on any Auction Date or
such later time on any Auction Date, as specified by the Auction Manager from
time to time, by which Dealers are required to submit Orders to the Auction
Manager;

"Submitted Bid" and "Submitted Bids" shall have the respective meanings
specified in paragraph 1.3(a) of this Schedule III;

"Submitted Hold Order" and "Submitted Hold Orders" shall have the respective
meanings specified in paragraph 1.3(a) of this Schedule III;


"Submitted Order" and "Submitted Orders" shall have the respective meanings
specified in paragraph 1.3(a) of this Schedule III;

"Submitted Sell Order" and "Submitted Sell Orders" shall have the respective
meanings specified in paragraph 1.3(a) of this Schedule III;

"Sufficient Clearing Bids" shall have the meaning specified in paragraph 1.3(a)
of this Schedule III; and

"Winning Bid Rate" means the rate per annum determined in accordance with
paragraph 1.3(a) of this Schedule III.

1.1 Orders by Existing Holders and Potential Holders

(a) Before the Submission deadline of each Auction Date:

    (i) each Existing Holder may submit to a Dealer information as to the
    number of Series G Preference Shares, if any, held by such Existing Holder
    which such Existing Holder:

         (A) desires to continue to hold without regard to the Auction Dividend
             Rate for the next succeeding Auction Dividend Period; and/or

         (B) desires to continue to hold, provided that the Auction Dividend
             Rate for the next succeeding Auction Dividend Period shall not be
             less than the dividend rate per annum specified by such Existing
             Holder; and/or


<PAGE>   73


         (C) offers to sell without regard to the Auction Dividend Rate for the
             next succeeding Auction Dividend Period;

    and

    (ii) Potential Holders may submit to a Dealer offers to purchase Series G
    Preference Shares, provided that any such offer shall be effective only if
    the Auction Dividend Rate for the next succeeding Auction Dividend Period
    shall not be less than the dividend rate per annum specified by such
    Potential Holder.
        
The communication to a Dealer of the information referred to in this paragraph
l.l(a) is an "Order" and, collectively, are "Orders", and each Existing Holder
and each Potential Holder placing an Order is a "Bidder" and, collectively, are
"Bidders"; an Order containing the information referred to in sub-paragraph
(i)(A) of this paragraph 1.1 (a) is a "Hold Order" and, collectively, are "Hold
Orders"; an Order containing the information referred to in sub-paragraph (i)
(B) or paragraph (ii) of this paragraph 1.1 (a) is a "Bid" and, collectively,
are "Bids"; and an Order containing the information referred to in
sub-paragraph (i) (C) of this paragraph 1.1 (a) is a "Sell Order" and,
collectively, are "Sell Orders".

(b) (i) A Bid by an Existing Holder shall constitute an irrevocable offer to
        sell at a price of U.S. $500,000 per Series G Preference Share:

         (A) the number of Series G Preference Shares specified in such Bid if
             the Winning Bid Rate determined on such Auction Date is less than
             the specified rate; or

         (B) the specified number of Series G Preference Shares or a lesser
             number to be determined as set forth in sub-paragraph (iv) of
             paragraph 1.4(a) of this Schedule III if the Winning Bid Rate
             determined on such Auction Date is equal to the specified rate; or

         (C) the number of Series G Preference Shares specified in such Bid if
             the specified rate is higher than the Maximum Rate and Sufficient
             Clearing Bids do exist; or

         (D) a lesser number of Series G Preference Shares to be determined as
             set forth in sub-paragraph (iii) of paragraph 1.4(b) of this
             Schedule III if the specified rate is higher than the Maximum Rate
             and Sufficient Clearing Bids do not exist.

    (ii) A Sell Order by an Existing Holder shall constitute an irrevocable
         offer to sell at a price of U.S. $500,000 per Series G Preference
         Share:
                
         (A) the number of Series G Preference Shares specified in such Sell
             Order provided Sufficient Clearing Bids exist; or

         (B) a lesser number of Series G Preference Shares to be determined as
             set forth in sub-paragraph (iii) of paragraph 1.4(b) of this
             Schedule III if Sufficient Clearing Bids do not exist.

    (iii) A Bid by a Potential Holder shall constitute an irrevocable offer to
          purchase at a price of U.S. $500,000 per Series G Preference Share:
        
         (A) the number of Series G Preference Shares specified in such Bid if
             the Winning Bid Rate determined on the applicable Auction Date is
             higher than the specified rate; or

         (B) the specified number or a lesser number of Series G Preference
             Shares to be determined as set forth in sub-paragraph (v) of
             paragraph 1.4(a) of this Schedule III if the Winning Bid Rate
             determined on such Auction Date is equal to the specified rate; or

<PAGE>   74



         (C) the specified number of Series G Preference Shares if the
             specified rate is equal to or lower than the Maximum Rate and
             Sufficient Clearing Bids do not exist.

(c) A rate specified by an Existing Holder or Potential Holder in any Bid shall
be a fixed annual percentage rate or a specified percentage of LIBOR.

1.2 Submission of Orders by Dealers to Auction Manager

(a) Each Dealer shall submit to the Auction Manager in writing in accordance
with its Dealer Agreement before the Submission Deadline on each Auction Date
all Orders obtained by such Dealer and specifying with respect to each Order;

    (i) the name of the Bidder placing such Order;

    (ii) the aggregate number of Series G Preference Shares that are the
    subject of the Order,

    (iii) to the extent that the Bidder is an Existing Holder, the number of
    Series G Preference Shares, if any, subject to any:

         (A) Hold Order placed by such Existing Holder;

         (B) Bid placed by such Existing Holder and the rate specified in such
             Bid; and/or

         (C) Sell Order placed by such Existing Holder;
    
    and

    (iv) to the extent the Bidder is a Potential Holder, the rate specified in
    the Bid of such Potential Holder.

(b) If any rate specified in any Bid contains more than three figures to the
right of the decimal point, the Auction Manager shall round such rate up to the
next highest one-thousandth of one percent.

(c) If for any reason an Order or Orders covering in the aggregate all the
Series G Preference Shares held by any Existing Holder are not submitted to the
Auction Manager before the Submission Deadline, the Auction Manager shall deem
a Hold Order to have been submitted on behalf of such Existing Holder covering
the number of Series G Preference Shares held by such Existing Holder and not
subject to Orders submitted to the Auction Manager.

(d) If one or more Orders covering in the aggregate more than the number of
Series G Preference Shares held by any Existing Holder are submitted to the
Auction Manager, such Orders shall be considered valid as follows and in the
following order of priority:

    (i) all Hold Orders shall be considered valid, but only up to and
    including, in the aggregate, the number of Series G Preference Shares held
    by such Existing Holder, and, solely for purposes of allocating
    compensation among the Dealers submitting Hold Orders, if the number of
    Series G Preference Shares subject to such Hold Orders exceeds the number
    of Series G Preference Shares held by such Existing Holder, the number of
    Series G Preference Shares subject to each such Hold Order shall be reduced
    pro rata to cover the number of Series G Preference Shares held by such
    Existing Holder;


<PAGE>   75





    (ii) (A) any Bid shall be considered valid, but only up to and including,
    in the aggregate, the excess of the number of Series G Preference Shares
    held by such Existing Holder over the number of Series G Preference Shares
    subject to any Hold Order referred to in sub-paragraph (i) of this
    paragraph 1.2(d), (B) subject to sub-paragraph (A) hereof, if more than one
    Bid with the same rate is submitted on behalf of such Existing Holder and
    the Number of Series G Preference Shares subject to such Bids is greater
    than such excess, such Bids shall be considered valid up to the amount of
    such excess, and, solely for purposes of allocating compensation among the
    Dealers submitting Bids with the same rate, the number of Series G
    Preference Shares subject to each Bid with the same rate shall be reduced
    pro rata to cover the number of Series G Preference Shares equal to such
    excess, (C) subject to sub-paragraph (A) hereof, if more than one Bid with
    different rates if submitted on behalf of such Existing Holder, such Bids
    shall be considered valid in the ascending order of their respective rates
    up to the amount of such excess, and (D) in any such event, the number, if
    any, of such Series G Preference Shares subject to Bids not valid under
    this sub-paragraph (ii) shall be treated as the subject of a Bid by a
    Potential Holder, and

    (iii) all Sell Orders shall be considered valid, but only up to and
    including, in the aggregate, the excess of the number of Series G
    Preference Shares held by such Existing Holder over the sum of the Series G
    Preference Shares subject to Hold Orders referred to in sub-paragraph (i)
    of paragraph 1.2(d) of this Schedule III and valid Bids by Existing Holders
    referred to in sub-paragraph (ii) of paragraph 1.2(d) of this Schedule
    III.

(e) If more than one Bid is submitted on behalf of any Potential Holder, each
Bid submitted shall be a separate Bid with the rate therein specified.

1.3 Determination of Sufficient Clearing Bids, Winning Bid Rate and Auction
Dividend Rate

(a) On the Submission Deadline on each Auction Date, the Auction Manager shall
assemble all Orders submitted or deemed to it by the Dealers (each such Order
as submitted or deemed submitted by a Dealer being individually a "Submitted
Hold Order", a "Submitted Bid" or a "Submitted Sell Order", as the case may be,
or a "Submitted Order" and collectively "Submitted Hold Orders", "Submitted
Bids" or "Submitted Sell Orders", as the case may be, or "Submitted Orders") and
shall determine:

    (i) the excess of (A) the total number of Series G Preference Shares issues
    and outstanding held by Existing Holders over (B) the number of Series G
    Preference Shares that are the subject of Submitted Hold Orders (such
    excess being the "Available Shares");

    (ii) from the Submitted Orders, whether

         (A) the number of Series G Preference Shares that are the subject of
             Submitted Bids by Potential Holders specifying one or more rates
             equal to or lower than the Maximum Rate;

             exceeds or is equal to the sum of:

         (B) (I) the number of Series G Preference Shares that are the
                 subject of Submitted Bids by Existing Holders specifying one
                 or  more rates higher than the Maximum Rate; and
        
             (II) the number of Series G Preference Shares that are the subject
                  of Submitted Sell Orders;

<PAGE>   76



    and if such excess or equality exists (other than because all of the Series
    G Preference Shares held by Existing Holders are the subject of Submitted
    Hold Orders), then such Submitted Bids in sub-paragraph (A) hereof shall be
    "Sufficient Clearing Bids"; and
        
    (iii) if Sufficient Clearing Bids exist, the lowest rate per annum
    specified in the Submitted Bids which if the Auction Manager accepted:
        
         (A) (I) each Submitted Bid from Existing Holders specifying that
             lowest rate, and (II) all other Submitted Bids from Existing
             Holders specifying lower rates, thus entitling those Existing
             Holders to continue to hold the Series G Preference Shares that
             are the subject of those Submitted Bids; and

         (B) (I) each Submitted Bid from Potential Holders specifying that
             lowest rate, and (II) all other Submitted Bits from Potential
             Holders specifying lower rates, thus entitling those Potential
             Holders to purchase the Series G Preference Shares that are the
             subject of those Submitted Bids,

    would result in such Existing Holders described in sub-paragraph (A) hereof
    continuing to hold an aggregate number of Series G Preference Shares which,
    when added to the aggregate number of Series G Preference Shares to be
    purchased by such Potential Holders described in sub-paragraph (B) hereof,
    would equal not less than the number of Available Shares. This lowest rate
    is the "Winning Bid Rate".
        
(iv) Promptly after the Auction Manager has made the determinations pursuant to
paragraph 1.3(a) of this Schedule III, the Auction Manager shall advise the
Corporation of LIBOR and, based on such determinations, of the dividend rate
applicable to the Series G Preference Shares for the next succeeding Dividend
Period (the "Auction Dividend Rate") as follows:

         (i) if Sufficient Clearing Bids exist, that the Auction Dividend Rate
         for the next succeeding Auction Dividend Period shall be equal to the
         Winning Bid Rate so determined;

         (ii) if Sufficient Clearing Bids to not exist (other than because all
         of the Series G Preference Shares held by Existing Holders are the
         subject of Submitted Hold Orders or there are no Existing Holders),
         that the Auction Dividend Rate for the next succeeding Auction
         Dividend Period shall be equal to the Maximum Rate; or

         (iii) if all of the Series G Preference Shares held by Existing
         Holders are the subject of Submitted Hold Orders or there are no
         Existing Holders, that the Auction Dividend Rate for the next
         succeeding Auction Dividend Period shall be equal to 50% of LIBOR.

1.4    Acceptance and Rejection of Submitted Bids and Submitted Sell Orders and
       Allocation of Shares

Based on the determinations made pursuant to paragraph 1.3(a) of this Schedule
III, the Submitted Bids and Submitted Sell Orders shall be accepted or rejected
and the Auction Manager shall take such other action as set forth below:

(a) If Sufficient Clearing Bids have been made, subject to the provisions of
paragraphs 1.4(c) and 1.4(d) of this Schedule III, Submitted Bids and Submitted
Sell Orders shall be accepted and rejected in the following order of priority
and all other Submitted Bids shall be rejected:

         (i) (A) the Submitted Sell Order of each Existing Holder shall be
         accepted and (B) the Submitted Bid of each Existing Holder specifying
         any rate that is higher than the Winning Bid Rate shall be rejected,
         thus requiring each such Existing Holder to sell the Series G
         Preference Shares that are the subject of such Submitted Sell Order
         and such Submitted Bid;


<PAGE>   77


         (ii) the Submitted Bid of each Existing Holder specifying any rate
         that is lower than the Winning Bid Rate shall be accepted, thus
         entitling each such Existing Holder to continue to hold the Series G
         Preference Shares that are the subject of such Submitted Bid;

         (iii) the Submitted Bid of each Potential Holder specifying any rate
         that is lower than the Winning Bid Rate shall be accepted, thus
         requiring each such Potential Holder to purchase the Series G
         Preference Shares that are the subject of such Submitted Bid;

         (iv) the Submitted Bid of each Existing Holder specifying a rate that
         is equal to the Winning Bid Rate shall be accepted, thus entitling
         each such Existing Holder to continue to hold the Series G Preference
         Shares that are the subject of such Submitted Bid, unless the number
         of Series G Preference Shares subject to all such Submitted Bids is
         greater than the total number of Available Shares minus the number of
         Series G Preference Shares subject to Submitted Bids described in sub-
         paragraphs (ii) and (iii) of this paragraph 1.4(a) (the "Remaining
         Shares"). In this event, the Submitted Bids of each such Existing
         Holder described in this sub-paragraph (iv) shall be rejected, and
         each such Existing Holder shall be required to sell Series G
         Preference Shares, but only in an amount equal to the difference
         between (A) the number of Series G Preference Shares then held by
         such Existing Holder subject to such Submitted Bid and (B) the number
         of Series G Preference Shares obtained by multiplying (x) the number
         of Remaining Shares by (y) a fraction, the numerator of which shall be
         the number of Series G Preference Shares held by such Existing Holder
         subject to such Submitted Bid, and the denominator of which shall be
         the sum of the number of Series G Preference Shares subject to such
         Submitted Bids made by all such Existing Holders who specified a rate
         equal to the Winning Bid Rate; and

         (v) the Submitted Bid of each Potential Holder specifying a rate that
         is equal to the Winning Bid Rate shall be accepted but only in an
         amount equal to the number of Series G Preference Shares obtained by
         multiplying (A) the excess, if any, of the total number of Available
         Shares over the number of Series G Preference Shares subject to
         Submitted Bids described in sub-paragraphs (ii), (iii) and (iv) of
         this paragraph 1.4(a) by (B) a fraction, the numerator of which shall
         be the number of Series G Preference Shares subject to such Submitted
         Bid and the denominator of which shall be the sum of the number of
         Series G Preference Shares subject to such Submitted Bids made by all
         Potential Holders who specified rates equal to the Winning Bid Rate;

(b) If Sufficient Clearing Bids have not been made (other than because all of
the Series G Preference Shares held by Existing Holders are subject to
Submitted Hold Orders or there are no Existing Holders), subject to the
provisions of paragraphs 1.4(c) and 1.4(d) of this Schedule III, Submitted Bids
and Submitted Sell Orders shall be accepted or rejected in the following order
of priority and all other Submitted Bids shall be rejected:

         (i) the Submitted Bid of each Existing Holder specifying any rate that
         is equal to or lower than the Maximum Rate shall be accepted, thus
         entitling that Existing Holder to continue to hold the Series G
         Preference Shares that are the subject of such Submitted Bid;
        
         (ii) the Submitted Bid of each Potential Holder specifying any rate
         that is equal to or lower than the Maximum Rate shall be accepted,
         thus requiring such Potential Holder to purchase the Series G
         Preference Shares that are the subject of such Submitted Bid; and

<PAGE>   78


        
         (iii) the Submitted Bid of each Existing Holder specifying any rate
         that is higher than the Maximum Rate shall be rejected and the
         Submitted Sell Order of each Existing Holder shall be accepted, in
         both cases only in an amount equal to the difference between (A) the
         number of Series G Preference Shares then held by such Existing Holder
         subject to such Submitted Bid or Submitted Sell Order and (B) the
         number of Series G Preference Shares obtained by multiplying (x) the
         difference between the total number of Available Shares and the
         aggregate number of Series G Preference Shares subject to Submitted
         Bids described in sub-paragraphs (i) and (ii) of this paragraph 1.4(b)
         by (y) a fraction, the numerator of which shall be the number of
         Series G Preference Shares held by such Existing Holder subject to
         such Submitted Bid or Submitted Sell Order and the denominator of
         which shall be the number of Series G Preference Shares subject to all
         such Submitted Bids and Submitted Sell Orders.
        
(c) If, as a result of the procedures described in paragraphs 1.4(a) or 1.4(b)
of this Schedule III, any Existing Holder would be entitled or required to sell
a fraction of a Series G Preference Share on any Auction Date, the Auction
Manager shall, in such manner as it shall determine in its sole discretion,
round up or down the number of Series G Preference Shares to be sold by any
Existing Holder on such Auction Date so that the number of shares sold by each
Existing Holder shall be a whole number of Series G Preference Shares;

(d) If, as a result of the procedures described in paragraphs 1.4(a) and 1.4(b)
of this Schedule III, any Potential Holder would be entitled or required to
purchase a fraction of a Series G Preference Share on any Auction Date, the
Auction Manager shall, in such manner as it shall determine in its sole
discretion, allocate shares for purchase among Potential Holders so that only
whole Series G Preference Shares are purchased on such Auction Date by any
Potential Holder, even if such allocation results in one or more of such
Potential Holders not purchasing Series G Preference Shares on such Auction
Date; and

(e) Based on the results of each Auction, the Auction Manager shall determine
to which Potential Holder or Potential Holders purchasing Series G Preference
Shares an Existing Holder or Existing Holders shall sell Series G Preference
Shares being sold by such Existing Holder or Existing Holders. Such purchases
and sales of Series G Preference Shares shall be completed on the Settlement
Date by payment by such Potential Holder purchasing Series G Preference Shares
of the aggregate purchase price of the Series G Preference Shares to be
purchased (at U.S. $500,000 per share) against delivery by each Existing Holder
selling Series G Preference Shares of certificates for the number of Series G
Preference Shares being sold.

1.5 Miscellaneous

Notwithstanding the provisions of this Schedule III, the Auction Manager shall
not follow the auction procedures contained in this Schedule III on the Auction
Date immediately preceding the Redemption Date in the event that written notice
of redemption of all the outstanding Series G Preference Shares has been
given.

<PAGE>   79


                                     PART C

AN UNLIMITED NUMBER OF COMMON SHARES WITHOUT NOMINAL OR PAR VALUE

The Common Shares shall be subject to the prior rights, privileges,
restrictions and conditions attached to the Preferred Shares and the Preference
Shares and the holders of the Common Shares shall, amongst other things, be
entitled:

(a) to vote at all meetings of Shareholders of the Corporation except meetings
at which only holders of other classes of shares are entitled to vote; and

(b) to receive the remaining property of the Corporation upon dissolution.

<PAGE>   80


                                     PART D

JUNIOR PREFERRED SHARES

THE RIGHTS, PRIVILEGES, RESTRICTIONS AND CONDITIONS ATTACHING TO THE JUNIOR
PREFERRED SHARES SHALL BE AS FOLLOWS:

         (a) The Junior Preferred Shares shall rank after the First Preferred
Shares and Preference Shares with respect to payment of dividends and
distribution of assets in the event of the liquidation, dissolution or
winding-up of the Corporation, whether voluntary or involuntary, or any other
distribution of the assets of the Corporation among its shareholders for the
purpose of winding-up its affairs.

         (b) The holders of record of the Junior Preferred Shares shall be
entitled to receive in each financial year of the Corporation, when and as
declared by the Board of Directors, fixed, cumulative preferential dividends at
the rate of but not exceeding $4.95 per share per annum. Such dividends shall
accrue and be cumulative from the date of change of the Corporation's
13,691,325 common shares into 13,691,325 Junior Preferred Shares. Such
dividends shall be payable in semi-annual installments on the first days of
January and July in each year. Cheques of the Corporation payable at par at any
branch of the Corporation's bankers in Canada shall be issued in respect of
such dividends (less any taxes required to be deducted) and the mailing of such
a cheque to any holder shall satisfy the dividend represented thereby. If on
any dividend payment date the Corporation shall not have paid the said
dividends in full on all Junior Preferred Shares then outstanding, such
dividends or the unpaid part thereof shall be paid on a subsequent date or dates
in priority to dividends on the common shares and on any shares of any other
class ranking junior as to the payment of dividends to the Junior Preferred
Shares.

         (c) The Corporation may redeem in the manner hereinafter provided all
or from time to time any part of the outstanding Junior Preferred Shares on
payment to the holders thereof for each share to be redeemed of the amount of
$55.199716 per share ("redemption price") together with all unpaid cumulative
dividends whether or not earned or declared which shall have accrued thereon
and which for such purpose shall be treated as accruing up to the date of such
redemption.
        
         (d) Before redeeming any Junior Preferred Shares the Corporation shall
mail to each person who, at the date of such mailing, is a registered holder of
shares to be redeemed notice of the intention of the Corporation to redeem such
shares held by such registered holder. Such notice shall be mailed by ordinary
prepaid post addressed to the last address of such holder as it appears on the
registers of the Corporation or, in the event of the address of any such holder
not appearing on the registers of the Corporation, then to the last known
address of such holder, at least 30 days before the date specified for
redemption. Such notice shall set out the redemption price. The date on which
redemption is to take place and, if part only of the shares held by the person
to whom it is addressed is to be redeemed the number thereof so to be redeemed.
In case a part only of the then outstanding Junior Preferred Shares is at any
time to be redeemed, the shares so to be redeemed shall be selected by lot in
such manner as the Directors in their discretion shall decide or, if the
Directors so determine, may be redeemed pro rata disregarding fractions, and
the Directors may make such adjustments as may be necessary to avoid the
redemption of fractional parts of shares. On and after the date so specified for
redemption the Corporation shall pay or cause to be paid to the registered
holders the redemption price of the shares to be redeemed, on presentation and
surrender of the certificates for the shares so called for redemption at the
registered office of the Corporation or at such other place or places as may be
specified in such notice, and the certificates for such shares shall thereupon
be canceled and the shares represented thereby shall thereupon be and be deemed
to be redeemed. From and after the date specified in such notice for
redemption, the holders of such


<PAGE>   81


shares called for redemption shall cease to be entitled to dividends and shall
not be entitled to any rights in respect thereof, except to receive the
redemption price, unless payment of the redemption price shall not be made by
the Corporation in accordance with the foregoing provisions, in which case the
rights of the holders of such shares shall remain unimpaired. On or before the
date specified for redemption the Corporation shall have the right to deposit
the redemption price of the shares called for redemption in a special account
with any chartered bank or trust company named in the notice of redemption to be
paid, without interest, to or to the order of the respective holders of such
shares called for redemption upon presentation and surrender of the certificates
representing the same and, upon such deposit being made, the shares in respect
whereof such deposit shall have been made shall be deemed to be redeemed and the
rights of the several holders thereof, after such deposit, shall be limited to
receiving, out of the moneys so deposited, without interest, the redemption
price payable with respect to their respective shares against presentation and
surrender of the certificates representing such shares.

         (e) The Corporation shall have the right at its option at any time and
from time to time to purchase for cancellation the whole or any part of the
Junior Preferred Shares, pursuant to tenders received by the Corporation soon
request for tenders addressed to all holders of Junior Preferred Shares or with
the unanimous consent of the holders of all Junior Preferred Shares by private
contract at the lowest price at which, in the opinion of the Directors, such
shares are obtainable, but not exceeding the redemption price per share
together with all unpaid cumulative dividends, whether or not earned or
declared, which shall have accrued thereon and which, for such purpose shall be
treated as accruing up to the date of such purchase. If in response to an
invitation for tenders, two or more shareholders submit tenders at the same
price and if such tenders are accepted by the Corporation in whole or in part,
then, unless the Corporation accepts all such tenders in whole, the Corporation
shall accept such tenders in proportion as nearly as may be to the number of
shares offered in each such tender.

         (f) The holders of the Junior Preferred Shares may at any time and
from time to time call upon the Corporation, by written request, to purchase or
redeem all or part of such shares and, subject to Section 34 of the Canada
Business Corporation Act, the Corporation within 30 days of receipt of such
request, shall purchase or redeem such shares at an amount equal to the
redemption price per share together with all unpaid cumulative dividends,
whether or not earned or declared, which shall have accrued thereon and which
for such purpose shall be treated as accruing up to the date of such purchase.

         (g) In the event of the liquidation, dissolution or winding-up of the
Corporation, whether voluntary or involuntary, after distribution to the
holders of the First Preferred Shares and the Preference Shares, the holders of
the Junior Preferred Shares shall be entitled to receive before any
distribution of any part of the assets of the Corporation among the holders of
any other shares, an amount equal to the redemption price per share together
with all unpaid cumulative dividends, whether or not earned or declared, which
shall have accrued thereon and which, for such purpose shall be treated as
accruing up to the date of such purchase.

         (h) The holders of the Junior Preferred Shares are entitled to one vote
for each share held at all meetings of shareholders prior to the issue of a
certificate of amendment giving effect to an arrangement whereby each
shareholder of Alcan Aluminium Limited would receive, in exchange for each
Common Share of Alcan Aluminium Limited owned by such shareholder, a Common
Share of the Corporation and shall not be entitled to vote, except as provided
by law, at any meeting of shareholders held after the issue of such certificate
of amendment.