September 9, 1999

Consoltex Group Inc.
8555 route Transcanadienne
Saint-Laurent, Quebec
H4S 1Z6
Canada

Attention: Richard H. Willett, Chairman of the Board,
          President and Chief Executive Officer

Dear Sirs:

     This   letter   agreement,   including   all  schedules  hereto,  (the
"Agreement")  sets  out  the terms and conditions  upon  which  AIP/CGI  NB
Acquisition  Corp.,  a corporation  incorporated  under  the  laws  of  New
Brunswick  (the  "Offeror"),   will   make   an  offer  (the  "Offer"),  on
substantially the terms and conditions summarized  in  Schedule  A  forming
part  of  this  Agreement,  to  purchase  all of the issued and outstanding
subordinate voting shares (including any subordinate  voting  shares  which
may  become outstanding pursuant to the exercise of outstanding options  to
acquire  subordinate  voting  shares)  (the "SV Shares") of Consoltex Group
Inc. (the "Company").  The term "Offer" shall include any amendments to, or
extensions  of,  the  Offer  made in accordance  with  the  terms  of  this
Agreement, including, without limitation, removing or waiving any condition
or extending the date by which  SV  Shares  may  be deposited.  The Offeror
has,  concurrently  with the execution of this Agreement,  entered  into  a
lock-up agreement with  Clairvest  Group  Inc.  ("CGI"), a holder of the SV
Shares  (the  "Lock-Up  Agreement"),  a  shareholders  agreement  with  the
Company, Les Gantiers Holding B.V., the sole  holder of the multiple voting
shares (the "MV Shares") of the Company, Les Gantiers  Limited  and The Big
Sky  Trust  (the "Stockholders Agreement"), a loan purchase agreement  with
Les Gantiers  Holding  B.V.,  Les  Gantiers  Limited,  Richard Willett, the
Company  and  CGI (the "Loan Purchase Agreement"), a guaranty  of  American
Industrial Partners  Capital  Fund  II L.P. in favour of the Company and an
option agreement with the Company pursuant  to  which  the Offeror has been
granted  the  option to purchase SV Shares (the "Option Agreement").   This
Agreement also  sets  out  the terms and conditions of the agreement by the
Company, among other things, to recommend that the holders of the SV Shares
accept the Offer and not to  solicit expressions of interest for, or assist
or encourage competing offers for, the SV Shares or the MV Shares.

     All references to dollar  amounts  in  this  Agreement are to Canadian
dollars,  unless  otherwise stated.  The definitions  for  the  capitalized
terms used and not  otherwise defined in the body of this Agreement are set
out in Schedule B hereto.

1.   COVENANTS OF THE  OFFEROR.   Upon  execution  of  this  Agreement, the
Offeror will:

     (a)  as soon as practicable, and in any event not later than September
          24,  1999,  make  a  take-over  bid  (the  date of such bid,  the
          "Proposed Offer Date") to purchase 100% of the  SV  Shares issued
          and outstanding as of such date, on substantially the  terms  and
          conditions   summarized  in  Schedule  A  forming  part  of  this
          Agreement;

     (b)  subject to the  satisfaction  of  the terms and conditions of the
          Offer, take-up and  pay for SV Shares tendered under the Offer in
          accordance  with  Canadian  securities  laws  and  United  States
          securities laws, if applicable; and

     (c)  upon the last  take-up and payment  of SV Shares under the Offer,
          proceed expeditiously with a compulsory  acquisition  transaction
          whereby holders of SV Shares will receive cash consideration  per
          Share at least equal to the consideration payable pursuant to the
          Offer.

     The  Offeror  will  mail  the  Offer  and  accompanying  take-over bid
circular (such circular, together with the Offer, being referred  to herein
as the "Bid Circular") in accordance with applicable laws to each holder of
SV Shares (a "Shareholder") as soon as reasonably practicable and not later
than  11:59  p.m.  (Toronto time) on September 24, 1999 (such time on  such
date being referred  to  herein  as  the  "Latest Mailing Time"); provided,
however, that if the mailing of the Offer is  delayed  by (i) an injunction
or  order made by a Governmental Entity of competent jurisdiction  or  (ii)
the Offeror  not having obtained any regulatory waiver, consent or approval
which is necessary  to permit it to mail the Offer then, provided that such
injunction or order is  being  contested  or  appealed  or  such regulatory
waiver,  consent  or approval is being actively sought, as applicable,  the
Latest Mailing Time  shall  be  extended  for  a period ending on the fifth
business day following the date on which such injunction or order ceases to
be  in  effect  or  such  waiver,  consent  or  approval  is  obtained,  as
applicable,  provided  however  that  if  such event has  not  occurred  by
November 30, 1999 this Agreement will terminate.

     The Company and its financial and legal  advisors  shall  be  given  a
reasonable  opportunity to review the Bid Circular prior to it being mailed
to holders of  record  of  SV  Shares  and filed with applicable securities
regulatory authorities.  The Offeror shall  provide  each registered holder
of SV Shares and the company with a final copy of the  Bid  Circular  to be
mailed to all registered holders of SV Shares.  The Offeror shall file  the
Bid  Circular on a timely basis with the appropriate securities commissions
and other  required Entities.  The Bid Circular, when filed with
the appropriate  securities  commissions  and  other  required Governmental
Entities, shall contain all information which is required  to  be  included
therein  in accordance with applicable Laws, including, without limitation,
the CBCA and  the  Securities  Act  (and  all rules, regulations, published
policies and notices thereunder) and shall  comply in all material respects
with  the  requirements  of  applicable  Law.  The  Bid  Circular  and  all
information to be supplied by the Offeror  for  inclusion in the Director's
Circular  (as  defined  in  section  3) and any amendments  or  supplements
thereto,   at  the  time  filed  with  applicable   securities   regulatory
authorities  or first published, sent or given to Shareholders, as the case
may  be, shall  not  contain  any  misrepresentation  (as  defined  in  the
Securities  Act) or contain any untrue statement of a material fact or omit
to state any  material  fact  required to be stated therein or necessary in
order to make the statements therein,  in  the light of circumstances under
which they were made, not misleading.  The Offeror  shall  comply  with all
Laws  of  the Province of Quebec relating to the use of the French language
in connection  with  the  Bid  Circular  to  be delivered to the registered
holders  of  SV Shares.  The terms of the Offer  as  set  out  in  the  Bid
Circular shall comply with the terms of this Agreement.  The Offeror agrees
to correct promptly  any  information  in  the Bid Circular that shall have
become false or misleading in any material respect.

     The Offer will be made in accordance with applicable Laws and shall be
open for acceptance for an initial period of  21  calendar days.  The Offer
shall not expire or be withdrawn and shall be extended  for  successive  10
day  periods  until the earlier of (i) 75 days after the date of the Offer,
and (ii) the date which is 10 days after the Offeror has publicly announced
that the conditions  set  out  in  sections 3(b), (c) and (l) of Schedule A
have been satisfied or waived, and may be extended from time to time at the
option of the Offeror as permitted in Schedule A.  The final date of expiry
of the Offer in accordance with the  foregoing is herein referred to as the
"Expiry Time".  Subject to the terms and  conditions  hereof,  the  Offeror
shall  use  all  reasonable  efforts  to consummate the Offer including (i)
making timely filings to satisfy the conditions  set  out  in sections 3(b)
and (c) of Schedule A hereto, and (ii) retaining a Canadian  dealer manager
to  solicit tenders to the Offer.  Any and all filing fees required  to  be
paid  in connection with the premerger notification pursuant to the HSR Act
shall be borne and paid by the Company.

     The  Offeror  will permit any Shareholder to deposit SV Shares through
the deposit (the "Holdco Alternative") of all of the issued and outstanding
shares  (the  "Holdco  Shares")  of  any  single-purpose  holding  company,
constituted or continued under the laws of Canada or any province of Canada
on or after 1992,  which has not carried on any activity or business of any
nature whatsoever (other  than  the  acquisition  and holding of SV Shares)
which is a resident of Canada for purposes of the INCOME  TAX ACT (Canada),
which holds SV Shares as capital property and which has no  liabilities  (a
"Special  Holdco"), provided that all of the following terms and conditions
are satisfied:

     (a)  The Shareholder provides the Offeror with a certified copy of the
          Special Holdco's articles or constating documents;

     (b)  The  Shareholder  advises  the Offeror in writing, with a copy to
          the depository under the Offer,  on or before 5:00 p.m. not later
          than 10 Business Days after the date of the Offer, that it wishes
          to take advantage of the Holdco Alternative;

     (c)  The Shareholder properly completes  and  duly signs the letter of
          transmittal (in a form to be provided by the  Offeror) in respect
          of  its  Holdco  Shares  and  deposits the letter of  transmittal
          together with the certificates representing the Holdco Shares and
          the SV Shares held by the Special  Holdco,  with  the  depository
          prior to the Expiry Time;

     (d)  The Shareholder enters into a Share Purchase Agreement (a  "Share
          Purchase Agreement") with the Offeror in the form attached hereto
          as  Schedule D not later than 10 Business Days after the date  of
          the Offer;

     (e)  The Special  Holdco  will  not declare or pay any dividends other
          than  stock  dividends  or  make   any   other   redemptions   or
          distributions other than stock dividends;

     (f)  Where the Shareholder is a non-resident of Canada for purposes of
          the  INCOME  TAX  ACT  (Canada),  the Shareholder provides to the
          Offeror:

          (i)  evidence sufficient that the Special Holdco has withheld and
               remitted,  on  a timely basis, the  amount  required  to  be
               withheld and remitted  pursuant  to  Part XIII of the INCOME
               TAX  ACT  (Canada) prior to the acquisition  of  the  Holdco
               Shares by the Offeror; and

          (ii) a certificate  under  section  116  of  the  INCOME  TAX ACT
               (Canada)  (and, where applicable, the equivalent certificate
               under section 1098 of the TAXATION ACT (Quebec)) in form and
               substance satisfactory to the Offeror; and

     (g)  Where there is more than one Shareholder in a Special Holdco, all
          such Shareholders  shall  elect to avail themselves of the Holdco
          Alternative with respect to all their Holdco Shares;

2.   CONDITIONS   PRECEDENT   TO   THE   OBLIGATIONS    OF   THE   OFFEROR.
Notwithstanding the foregoing, the obligations of the Offeror  to  make the
Offer shall be subject to the satisfaction, on the Proposed Offer Date,  of
each of the following conditions precedent:

          (i)  each  of  the conditions set forth in paragraphs (d) through
               (k) of section  3  of  Schedule  A  hereto  shall  have been
               satisfied; and

          (ii) the Offeror shall have received a certificate of the Company
               addressed to the Offeror and dated the Proposed Offer  Date,
               signed  on  behalf  of  the  Company by two senior executive
               officers of the Company, confirming  the condition set forth
               in paragraph (e) of section 3 of Schedule A hereto as at the
               Proposed Offer Date.

     The  foregoing conditions precedent are for the sole  benefit  of  the
Offeror and may be waived by the Offeror in whole or in part at any time or
from time to time.

3.   DIRECTORS'  CIRCULAR.   The Company hereby approves of and consents to
the Offer and to the inclusion  in  the  Bid  Circular  of reference to the
determinations,  approvals  and recommendations of the Company's  board  of
directors (the "Board") and of Salomon Smith Barney Canada Inc. referred to
in sections 6(cc) and (dd) hereof.   The Company agrees to prepare and file
in accordance with all applicable Laws  and  make  available  for  mailing,
concurrently  and  together  with the Bid Circular, sufficient copies of  a
directors' circular meeting the  requirements  of Canadian securities laws,
in both the English and French languages as circumstances  may require, and
a Schedule 14D-1F meeting the requirements of U.S. securities laws relating
to the Offer (collectively, the "Directors' Circular").  Prior to the final
approval of the Directors' Circular by the Board, the Company shall provide
the Offeror with a reasonable opportunity to review and comment on the form
of the Directors' Circular, the Offeror recognizing that whether  any  such
comments   are   appropriate  will  be  determined  by  the  Board,  acting
reasonably.  The Company  agrees  to provide the Offeror and its counsel in
writing with any comments that the  Company  receives  from  the applicable
securities  regulatory authorities in Canada or the U.S. on the  Directors'
Circular or in  connection with the Offer.  The Directors' Circular and all
information supplied  by  the Company for inclusion in the Bid Circular and
any amendments or supplements  thereto,  at  the time filed with applicable
securities  regulatory authorities or first published,  sent  or  given  to
Shareholders,  as  the case may be, shall not contain any misrepresentation
(as defined in the Securities  Act)  or  contain  any untrue statement of a
material  fact  or omit to state any material fact required  to  be  stated
therein or necessary  in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.

4.   MUTUAL COVENANTS.   Each  of  the  parties  covenants and agrees that,
except as contemplated in this Agreement, between  the  date hereof and the
Expiry Time or the day on which this Agreement is terminated,  whichever is
earlier:

     (a)  it shall use its reasonable efforts to comply promptly  with  all
          requirements  which  applicable  Laws may impose on it or, in the
          case  of  the  Company, its subsidiaries,  with  respect  to  the
          transactions contemplated by this Agreement;

     (b)  it shall use its reasonable best efforts, and, in the case of the
          Company, shall cause  its  subsidiaries  to  use their reasonable
          best efforts, to perform all obligations required or desirable to
          be  performed by it or, in the case of the Company,  any  of  its
          subsidiaries  under  this Agreement, it shall not take any action
          or  shall  refrain  from   taking   any   action  that  would  be
          inconsistent  with  this Agreement or which would  reasonably  be
          expected  to  significantly   impede   the  consummation  of  the
          transactions contemplated in this Agreement,  and it shall do all
          such other acts and things as may be necessary  or  desirable  in
          order  to  consummate  and  make effective, as soon as reasonably
          practicable, the transactions contemplated in this Agreement and,
          without limiting the generality  of  the  foregoing, it shall and
          where  appropriate,  in  the  case  of  the  Company,  cause  its
          subsidiaries to:

          (i)  apply   for  and  use  reasonable  efforts  to  obtain   all
               Appropriate  Regulatory  Approvals relating to it or, in the
               case of the Company, any of its subsidiaries;

          (ii) defend  all lawsuits or other  legal,  regulatory  or  other
               proceedings  challenging  or affecting this Agreement or the
               consummation of the transactions contemplated hereby;

          (iii)  use  reasonable  commercial  efforts  to  have  lifted  or
               rescinded any injunction or restraining order or other order
               which may adversely  affect  the  ability  of the parties to
               consummate the transactions contemplated hereby;

          (iv) effect all necessary registrations, filings  and submissions
               of  information required by Governmental Entities  from  the
               parties or any of their subsidiaries;

          (v)  cooperate  with  the  other  parties  to  this  Agreement in
               connection with the performance by them of their obligations
               hereunder;

          (vi) subject to applicable Laws, make and cooperate in the making
               of   all   filings   and  applications  and  submissions  of
               information  under  all   Laws   which   are  applicable  in
               connection  with  the transactions contemplated  herein  and
               take  all  reasonable   actions   in  connection  therewith,
               including  without  limitation,  in  connection   with   the
               Appropriate  Regulatory  Approvals  and by participating and
               appearing  in  any  proceedings  of  either   party   before
               Governmental  Entities,  and use reasonable best efforts  to
               coordinate the parties' discussions  with  and  responses to
               all Governmental Entities where both parties are  seeking to
               obtain material approvals or make material filings; and

     (c)  it  shall have performed and satisfied, in all material respects,
          all covenants  and  agreements  required  by this Agreement to be
          performed or satisfied by it prior to the Expiry Time.

5.   COVENANTS OF THE COMPANY.  The Company hereby covenants  that from the
date hereof, until the earlier of: (i) the Offeror having taken up and paid
for  SV  Shares deposited under the Offer or withdrawn the Offer;  or  (ii)
this Agreement having been terminated pursuant to section 14 hereof:

     (a)  it shall and shall cause each of its subsidiaries to, conduct its
          and  their respective businesses only in, and not take any action
          except  in, the ordinary and usual course of business, consistent
          with past practice;

     (b)  it shall  not,  without  the prior written consent of the Offeror
          (which consent shall not be  unreasonably  withheld), directly or
          indirectly, do or permit to occur any of the following:

          (i)  allot, reserve, set aside or issue, authorize or propose the
               allotment,  reservation, setting aside or  issuance  of  any
               shares in its  capital stock or of any subsidiary thereof or
               any class or securities convertible or exchangeable into, or
               rights, warrants  or  options to acquire, any such shares or
               other   convertible  or  exchangeable   securities,   except
               pursuant  to  the  exercise  (but not the granting) of stock
               options  or  currently  outstanding  rights  under  existing
               compensation-related  share   issuance   plans   other  than
               pursuant to the Option Agreement;

          (ii) amend or propose to amend its articles or by-laws;

          (iii)  fail to pay any fee to maintain the registrations  of  the
               Intellectual   Property   of  the  Company  or  any  of  its
               subsidiaries;

          (iv) split,  combine  or reclassify  any  outstanding  shares  or
               declare, set aside or pay any dividends on or make any other
               distributions on or in respect of its outstanding shares;

          (v)  redeem, purchase or  offer  to purchase any of its shares or
               any  shares  or  other  securities   convertible   into   or
               exchangeable  for  SV  Shares or MV Shares, unless otherwise
               permitted or required by the terms of such securities;

          (vi) authorize  or  propose,  or   enter   into   any  agreement,
               arrangement or understanding (or permit any subsidiary to do
               so)  with  respect  to  (A)  any  acquisition of businesses,
               assets  or  securities  the value of the  consideration  for
               which (including assumed  debt  or  other obligations) would
               exceed $2,500,000 individually (including  in  a  series  of
               related transactions), or (B) any disposition of businesses,
               assets  or  securities  the  value  of the consideration for
               which  (including assumed debt or other  obligations)  would
               exceed $2,500,000  individually  (including  in  a series of
               related transactions);

          (vii)  except  in  the  ordinary  course  of business, grant  any
               license to or otherwise transfer or encumber any interest in
               the  Intellectual  Property of the Company  or  any  of  its
               subsidiaries;

          (viii) make or change any  election,  change an annual accounting
               period,  adopt  or change any accounting  method,  file  any
               amended Tax Return, enter into any closing agreement, settle
               any Tax claim or  assessment  relating to the Company or any
               of its subsidiaries, surrender  any  right to claim a refund
               of Taxes, or take any similar action relating  to the filing
               of any Tax Return or the payment of any Tax, if  such action
               would have a Material Adverse Effect on the Tax liability of
               the Company or any of its subsidiaries for any period ending
               after the Proposed Offer Date;

          (ix) enter  into  any  amendments,  extensions  or renewals  with
               respect  to  any  material  Lease  nor  enter into  any  new
               material Lease or other material agreement  for  the  use or
               occupancy of real property; or

          (x)  otherwise  engage  in any practice, take any action or enter
               into any transaction of the sort described in section 6 (h);

     (c)  it shall:

          (i)  use  its reasonable best  efforts  and  cause  each  of  its
               subsidiaries  to use its reasonable best efforts to preserve
               intact  their  respective  present  business  organizations,
               Intellectual Property  and  goodwill,  to keep available the
               services   of   their  present  officers  and  to   maintain
               satisfactory   relationships    with    suppliers,   agents,
               distributors, customers and others having  business dealings
               with it or its subsidiaries;

          (ii) promptly upon any of the Executive Officers having knowledge
               advise the Offeror orally and, if then requested, in writing
               of  any  change,  effect,  event or occurrence which  has  a
               Material Adverse Effect, or  any  change,  effect, event  or
               occurrence  which  would reasonably be expected  to  have  a
               Material Adverse Effect,  in  respect  of  its or any of its
               subsidiaries'  businesses  and of any material  Governmental
               Entity's  or  third  party's complaints,  investigations  or
               hearings (or communications  indicating that the same may be
               contemplated);

          (iii) promptly deliver to the Offeror  interim  unaudited monthly
               and quarterly financial statements prepared  in the ordinary
               course of business;

          (iv) provide  written  notice  to  the  Offeror of any change  in
               accounting methods or practices used  by  the Company or its
               subsidiaries; and

          (v)  have performed or satisfied, in all material  respects,  all
               covenants  and  agreements  required by this Agreement to be
               performed or satisfied by it  prior  to  the  Proposed Offer
               Date;

     (d)  it  shall  not  settle  or  compromise any claim brought  by  any
          present, former or purported  holder  of any of its securities in
          connection with the transactions contemplated  in  this Agreement
          prior  to  the Effective Date without the prior written  consent,
          which consent shall not be unreasonably withheld, of the Offeror;

     (e)  it shall continue  to provide the Offeror and its Representatives
          with information as  reasonably  requested  by  them from time to
          time concerning its business, assets, liabilities and affairs and
          its   subsidiaries  subject  to  and  in  accordance  with   this
          Agreement,  and  with  access  (on  a basis that does not detract
          unreasonably from normal business operations)  to  all  premises,
          properties, personnel, books, records, contracts and documents of
          or  pertaining  to  the  Company  and  its  subsidiaries,  to the
          management and employees of the Company and to the management and
          employees of the Company's subsidiaries;

     (f)  neither it nor any of its subsidiaries will enter into, amend  or
          terminate   any   employment   agreement,  collective  bargaining
          agreement,   consulting   services   agreement,   non-competition
          agreement, severance agreement or arrangement with respect to the
          termination of employment or any arrangement  with respect to the
          increase  of  compensation or fringe benefits, with  any  of  its
          directors, officers or CGI or any of its affiliates;

     (g)  neither it nor any of its subsidiaries shall authorize, commit or
          propose or agree  to  take  any  action which could reasonably be
          expected to make any of the representations  or warranties of the
          Company  contained  in  this  Agreement  materially   untrue   or
          materially  incorrect,  or  which could reasonably be expected to
          result in any of the conditions  of  the  Offer  (as set forth in
          section 3 of Schedule A hereto) not being satisfied;

     (h)  prior  to the Expiry Time, use all reasonable efforts  (including
          obtaining  applicable  regulatory  or  Shareholder  approvals) to
          amend the Company stock option plan, if necessary, to  accelerate
          the vesting of any unvested Company Options so that such unvested
          Company Options may be exercised prior to the Expiry Time;

     (i)  use  all  reasonable  efforts  to  cause  each  holder of Company
          Options to exercise their respective Company Options prior to the
          Expiry Time;

     (j)  it and its affiliates, officers and employees will take no action
          that,  together  with  the  transactions  contemplated   by  this
          Agreement,  would  give  rise  to  any  right  of  termination or
          acceleration   of   indebtedness,   or   cause  any  third  party
          indebtedness to come due before its stated  maturity or cause any
          available credit to cease to be available;

     (k)  it shall provide lists of holders of SV Shares of the Company and
          a list of holders of stock options and any other rights, warrants
          or  convertible or exchangeable securities currently  outstanding
          (with  full  particulars as to the number held, date of purchase,
          grant or acquisition,  exercise  or conversion price, vesting and
          expiry date) prepared by the Company or the transfer agent of the
          Company  (as  well  as  security  position   listing   from  each
          depository,  including without limitation The Canadian Depository
          for Securities  Limited)  and  deliver  such lists to the Offeror
          within two (2) business days after execution  of  this  Agreement
          and  obtain  and  deliver  to  the  Offeror  thereafter on demand
          supplemental  lists  setting  out any changes thereto,  all  such
          deliveries  to  be  both in printed  form  and  if  available  in
          computer-readable format.  The Company shall, if requested by the
          Offeror, in connection  with  the Offer, permit its registrar and
          transfer  agent  to  act as the Offeror's  depository  under  the
          Offer.  The Company shall otherwise co-operate in good faith with
          the Offeror to facilitate the mailing of the Offer;

     (l)  it and its subsidiaries  shall  participate and co-operate in all
          reasonable  respects  with  the  Offeror   and  shall  use  their
          respective reasonable best efforts to take all appropriate action
          or  to  do  or cause to be done all things necessary,  proper  or
          advisable under  applicable Laws to consummate and make effective
          the transactions contemplated  by  this  Agreement,  including to
          diligently  make all required regulatory filings and applications
          (including, without  limitation,  filings  and applications under
          the HSR Act, if necessary) and to obtain all  licenses,  permits,
          consents, approvals, authorizations, qualification and orders  of
          Governmental  Entities  and parties to contracts with the Company
          and its subsidiaries as are necessary for the consummation of the
          transactions contemplated  by  this  Agreement and to fulfill the
          conditions  to  the  Offer.   The Company  will  participate  and
          cooperate in all reasonable respects  with  the  Offeror  in  the
          preparation  and filing of the Bid Circular and the Schedule
          14D-1F relating thereto;

     (m)  it agrees to use  its  reasonable  best efforts to cooperate with
          the  Offeror in structuring a transaction  or  carrying  out  any
          necessary  reorganization  immediately prior to the completion of
          the Offer that is beneficial  to  the Offeror and not detrimental
          to the Shareholders, provided such  transaction or reorganization
          shall not delay the completion of the Offer and provided that the
          Offeror shall have first agreed in writing  with  the Company and
          have  publicly  announced that all conditions to the  Offer  have
          been satisfied or waived;

     (n)  upon the take-up  and  payment  for  SV  Shares  by  the  Offeror
          pursuant  to the Offer, and provided the Offeror thereby acquires
          at least 90%  of  the  outstanding  SV  Shares,  it shall use its
          reasonable  best  efforts  to  assist  the  Offeror  in acquiring
          pursuant  to  a  compulsory  acquisition  transaction,  or  other
          transaction  proposed  by  the  Offeror, all of the SV Shares not
          tendered to the Offer; and

     (o)  it and its subsidiaries will consult  on  an  ongoing  basis with
          representatives  of the Offeror to report on operational  matters
          and as to the general  status  of the business, and in order that
          the representatives of the Offeror will become more familiar with
          the   philosophy  and  techniques  of   the   Company   and   its
          subsidiaries,  as  well  as  with  their  business  and financial
          affairs,  and  in  order  to  provide  experience as a basis  for
          ongoing relationships in connection with  the  acquisition of the
          Company by the Offeror.

     Nothing  contained  in  this  Agreement  shall  give  to the  Offeror,
directly   or  indirectly,  rights  to  control  or  direct  the  Company's
operations prior  to  the completion of the Offer.  Prior to the completion
of the Offer, the Company  shall  exercise,  consistent  with the terms and
conditions  of  this  Agreement,  complete control and supervision  of  its
operations.

6.   REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  The Company represents
and warrants to the Offeror, except  as  otherwise provided or disclosed in
the Company Disclosure Letter, as follows:

     (a)  ORGANIZATION.

          (i)  Each of the Company and its  subsidiaries  is  a corporation
               which  has  been  duly  incorporated  or  formed  under  its
               jurisdiction  of  incorporation  or formation and is validly
               subsisting  and  has  full  corporate  or  legal  power  and
               capacity to own its properties and to conduct its businesses
               as  currently  owned  and  conducted  by  it.   All  of  the
               outstanding  shares of capital  stock  and  other  ownership
               interests of the  Company  and  each of its subsidiaries are
               validly issued, fully paid and non-assessable  and  all  the
               shares  and  other  ownership  interests  of  the  Company's
               subsidiaries   are  owned  directly  or  indirectly  by  the
               Company, free and  clear  of all material Security Interests
               and there are no outstanding  options, rights, entitlements,
               understandings  or commitments (pre-emptive,  contingent  or
               otherwise) regarding the right to acquire any such shares of
               capital stock or  other  ownership  interests  in any of the
               Company's  subsidiaries.  The Company has made available  to
               the Offeror  correct and complete copies of the charters and
               by-laws of the  Company  and  each of its subsidiaries.  The
               Company has disclosed in the Company  Disclosure  Letter the
               names and jurisdictions of incorporation, and the number  of
               authorized,  issued and outstanding shares of capital stock,
               the holders thereof  and  the  number of shares held by each
               such holder, of each of its subsidiaries  and  the  names of
               the  directors  and officers of the Company and each of  its
               subsidiaries as of the date hereof.

          (ii) Other than the Material  Subsidiaries,  the Company does not
               have any subsidiaries which are material  in relation to the
               business  and  financial  condition  of  the  Company  on  a
               consolidated  basis.  For the purposes hereof, a  subsidiary
               and  its  subsidiaries   shall  be  considered  material  in
               relation  to  the Company if  (A)  the  investments  in  and
               advances to the  subsidiary  and  its  subsidiaries  by  the
               Company  and  its  other subsidiaries exceed five percent of
               the total assets of  the  Company  and its subsidiaries on a
               consolidated basis as at June 30, 1999, or (B) the equity of
               the Company and its other subsidiaries  in  the  income from
               continuing  operations before income taxes and extraordinary
               items of the  subsidiary  and  its subsidiaries exceeds five
               percent of such income of the Company  and  its subsidiaries
               on  a consolidated basis for the six months ended  June  30,
               1999.

          (iii) The  Company  does  not  have any ownership interest in any
               other Person.

     (b)  CAPITALIZATION.  The authorized  equity  capital  of  the Company
          consists  of  (i) an unlimited number of first preferred  shares,
          (ii) an unlimited  number  of  second  preferred shares, (iii) an
          unlimited number of SV Shares, and (iv) an unlimited number of MV
          Shares.  As of the date hereof, there were  13,901,051  SV Shares
          and  3,140,000  MV  Shares  issued  and  outstanding and no first
          preferred   shares   or   second  preferred  shares   issued   or
          outstanding.  An aggregate  of  not more than 4% of the SV Shares
          are  held  of  record  by 5 Persons in  the  United  States.   In
          addition,  as  of  the date  hereof,  1,194,000  SV  Shares  were
          reserved,  in the aggregate,  for  issuance  in  respect  of  the
          Company Options.  The Company Disclosure Letter sets forth a list
          of all the Company  Options granted by the Company, including the
          name of each option holder,  the  date of grant, the expiry date,
          the number of options granted, the exercise price and the vesting
          period.  Other than in connection with  the  Option Agreement and
          except  as  described  herein,  there  are no options,  warrants,
          conversion  privileges or other rights, agreements,  arrangements
          or commitments  (pre-emptive, contingent or otherwise) obligating
          the Company or any  of  its  subsidiaries  to  issue  or sell any
          shares of the Company or any of its subsidiaries or securities or
          obligations of any kind convertible into or exchangeable  for any
          shares  of  the  Company,  any  of  its subsidiaries or any other
          Person, and there are no outstanding  stock  appreciation rights,
          phantom  equity  or similar rights, agreements,  arrangements  or
          commitments based  upon  the  book  value,  income  or  any other
          attribute  of  the  Company  or  any  of  its  subsidiaries.  All
          outstanding SV Shares have been duly authorized  and  are validly
          issued  and outstanding as fully paid and non-assessable  shares,
          free of pre-emptive  rights.  There  are  no  outstanding  bonds,
          debentures  or other evidences of indebtedness of the Company  or
          any subsidiary  having the right to vote (or that are convertible
          for or exercisable into securities having the right to vote) with
          the  holders of the  SV  Shares  on  any  matter.  There  are  no
          outstanding  contractual obligations of the Company or any of its
          subsidiaries to  repurchase,  redeem  or otherwise acquire any of
          its  outstanding  securities or with respect  to  the  voting  or
          disposition  of  any   outstanding   securities  of  any  of  its
          subsidiaries,  other  than the Option Agreement.   No  holder  of
          securities issued by the  Company  has  any  right  to compel the
          Company  to  register  or  otherwise qualify such securities  for
          public sale in Canada or the United States.

     (c)  AUTHORITY AND NO VIOLATION.

          (i)  The Company has the requisite  corporate power and authority
               to enter into this Agreement, the  Option  Agreement and the
               Shareholders  Agreement,  and  to  perform  its  obligations
               hereunder  and  thereunder.   The execution and delivery  of
               this Agreement, the Option Agreement  and  the  Shareholders
               Agreement  by  the  Company  and  the  consummation  of  the
               transactions contemplated herein and therein, have been duly
               authorized  by  the Board and no other corporate proceedings
               on its part are necessary  to  authorize this Agreement, the
               Option  Agreement  or  the Shareholders  Agreement,  or  the
               transactions contemplated  hereby  or thereby, other than as
               contemplated by this Agreement.

          (ii) Each  of  this  Agreement,  the  Option  Agreement  and  the
               Shareholders Agreement has been duly executed  and delivered
               by  the  Company and constitutes a legal, valid and  binding
               obligation,  enforceable  against  it in accordance with its
               terms, subject to bankruptcy, insolvency  and  other similar
               Laws affecting creditors' rights generally, and  to  general
               principles of equity.

          (iii)  The  approval of this Agreement, the Option Agreement  and
               the Shareholders Agreement by the Company, the execution and
               delivery  by  the  Company  of  this  Agreement,  the Option
               Agreement   and   the   Shareholders   Agreement,   and  the
               performance   by   it   of  its  obligations  hereunder  and
               thereunder and the completion  by  it  of  the Offer and the
               transactions contemplated thereby, will not:

               (A)  result in a violation or breach of, require any consent
                    to  be  obtained  under  or  give rise to any  material
                    termination rights or material payment obligation under
                    any provision of:

                    (I)  its  certificate of incorporation,  articles,
                        by-laws or other constating documents;

                    (II) subject  to  obtaining  the Appropriate Regulatory
                         Approvals  relating  to  the  Company,  any  Laws,
                         regulation, order, judgment or decree; or

                    (III)  any  Material  Contract  or   material  license,
                         franchise  or  permit to which the  Company  is  a
                         party or by which the Company is bound;

               (B)  individually  or  in  the  aggregate  have  a  Material
                    Adverse Effect on the Company, result in the imposition
                    of any Security Interest  upon  any  of  its assets, or
                    restrict,  hinder, impair or limit the ability  of  the
                    Company to carry  on the business of the Company as and
                    where it is now being carried on; or

               (C)  result   in   any   payment    (including    severance,
                    unemployment  compensation, golden parachute, bonus  or
                    otherwise) becoming  due to any director or employee of
                    the Company or any subsidiary  or increase any benefits
                    otherwise payable under the Employee Plans or result in
                    the acceleration of time of payment  or  vesting of any
                    such benefits, including the time of exercise  of stock
                    options.

          No  consent,  approval, order or authorization of, or declaration
          or filing with  or  notice  to,  any Governmental Entity or other
          Person  is  required  to  be obtained  by  the  Company  and  its
          subsidiaries in connection  with  the  execution  and delivery of
          this   Agreement,   the  Option  Agreement  or  the  Shareholders
          Agreement by the Company  or  the  consummation by the Company of
          the transactions contemplated hereby  or  thereby  other than (i)
          the Appropriate Regulatory Approvals relating to the Company, and
          (ii)  any  other  consents,  approvals,  orders,  authorizations,
          declarations  or filings of or with a Governmental Entity  which,
          if not obtained,  would not individually or in the aggregate have
          a Material Adverse Effect.

     (d)  NO DEFAULTS OR ACCELERATION.   Neither the Company nor any of its
          subsidiaries is in default under,  and  there  exists  no  event,
          condition  or occurrence which, after notice or lapse of time  or
          both,  would  constitute  such  a  default  under  any  Contract,
          agreement,  license  or  franchise  to  which it is a party which
          would,  if  terminated  due  to such default,  cause  a  Material
          Adverse Effect.  As of the date  hereof,  no  event  has occurred
          which would give rise to any right of termination or acceleration
          of  indebtedness, or cause any third party indebtedness  to  come
          due before  its  stated maturity or cause any available credit to
          cease to be available.

     (e)  YEAR 2000 COMPLIANCE.   To  the knowledge of the Company, none of
          the   Company's   systems   (including,    without    limitation,
          telecommunications,  automation  and computer related systems  of
          the  Company),  assets  (including  those  assets  with  embedded
          software)  or  technology  (including,  without  limitation,  all
          computer  software  (including  embedded software)  and  hardware
          owned or licensed by the Company  or  its subsidiaries or used by
          any of them) has or will have any Year 2000 Error (as hereinafter
          defined).  For the purposes hereof, "Year  2000  Error" means (a)
          any  failure  of  computer  hardware  or  software  products   or
          technology  to  properly  record,  store,  process,  calculate or
          present  calendar dates in and between the twentieth and
          twenty-first centuries  as  a  result  of the occurrence, or use
         of data consisting of, such dates; (b) any  failure  of computer
         hardware or software products or technology to calculate  any
         information dependent  on  or  relating to dates in and between
         the twentieth and twenty-first centuries  in the same manner,
         and with the same functionality, data integrity  and  performance,
          as such computer hardware  or  software  products or technology
         records,  stores, processes, calculates and  presents  calendar
         dates on or before the date hereof, or information dependent
        on or  relating to such dates;  or  (c)  any  loss  of
         functionality or performance  with respect to the introduction
        of  records  or  processing  of  date related data.

     (f)  OSC REPORTS.

          (i)  The  Company  has furnished or made available to the Offeror
               true and complete  copies  of all forms, reports, schedules,
               prospectuses, statements and  other  documents  filed  by it
               with  the OSC since January 1, 1997 and, prior to the Expiry
               Time, the  Company  will have furnished or made available to
               the  Offeror true and  complete  copies  of  any  additional
               documents  filed  with  the  OSC by the Company prior to the
               Expiry Time (such forms, reports,  schedules,  prospectuses,
               statements  and  other  documents,  including  any financial
               statements  or  other  documents,  including  any  schedules
               included  therein,  are  referred  to  as  the  "the Company
               Documents").

          (ii) The  Company  Documents  are  all forms, reports, schedules,
               prospectuses, statements or other  documents  required to be
               filed  by  the Company with the OSC since January  1,  1997.
               The Company  Documents,  at  the  time  filed,  (i)  did not
               contain  any misrepresentation (as defined in the Securities
               Act) and (ii)  complied  in  all  material respects with the
               requirements of applicable securities Laws.

          (iii) The Company has not filed any confidential  material change
               report  with  the  OSC or any other securities authority  or
               regulator or any stock  exchanges  or  other self-regulatory
               authority which at the date hereof remains confidential.

          (iv) The Company has publicly disclosed in the  Company Documents
               any information regarding any event, circumstance  or action
               taken   or  failed  to  be  taken  by  the  Company  or  its
               subsidiaries  which  could  individually or in the aggregate
               reasonably be expected to have a Material Adverse Effect.

     (g)  FINANCIAL STATEMENTS.  The financial  statements  of the Company,
          including  the  notes thereto, included in the Company  Documents
          (the "Company Financial  Statements")  comply  as  to form in all
          material  respects  with  applicable accounting requirements  and
          with   the  published  rules  and   regulations   of   applicable
          Governmental  Entities  and  the  OSC  with respect thereto as of
          their respective dates, and have been prepared in accordance with
          Canadian generally accepted accounting principles  applied  on  a
          basis  consistent throughout the periods indicated and consistent
          with each  other (except as may be indicated in the notes thereto
          or, in the case  of unaudited statements, in quarterly reports to
          shareholders).   The   Company   Financial   Statements  and  the
          unaudited  interim monthly financial statements  for  the  months
          through July,  1999  present  fairly in all material respects the
          consolidated financial position  and results of operations of the
          Company and its subsidiaries at the  dates and during the periods
          indicated therein (subject, in the case  of quarterly and monthly
          unaudited  financial  statements, to normal,  recurring  year-end
          adjustments  and  the  absence  of  notes  thereto)  and  reflect
          appropriate  and  adequate  reserves  in  respect  of  contingent
          liabilities, if any,  of  the  Company  and its subsidiaries on a
          consolidated basis.  The results of operations of the Company and
          its subsidiaries for such periods are complete  and  correct  and
          are  consistent with the books and records of the Company and its
          subsidiaries.    There  has  been  no  change  in  the  Company's
          accounting policies since January 1, 1997.

     (h)  ABSENCE OF CERTAIN  CHANGES.   Except  as  disclosed  in publicly
          available reports filed by the Company with the OSC prior  to the
          date  hereof  or  as  disclosed  to  the  Offeror through monthly
          financial  data prior to the execution of this  Agreement,  since
          December 31,  1998  (the  "the  Company Balance Sheet Date"), the
          Company has conducted its business  in  the  ordinary  and  usual
          course  consistent  with  past practice and none of the following
          has occurred:

          (i)  any  change  in its affairs  or  in  its  business,  assets,
               liabilities, financial  condition,  results of operations or
               prospects caused by the actions of the Company or any of its
               subsidiaries which could reasonably be  expected  to  have a
               Material Adverse Effect;

          (ii) any  acquisition, sale or transfer of any material asset  of
               the Company or any of its subsidiaries;

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

          (iv) any declaration, setting aside  or  payment of a dividend or
               other  distribution  with  respect  to  the  shares  of  the
               Company, or any direct or indirect redemption,  purchase  or
               other  acquisition  by  the  Company of any of its shares of
               capital stock;

          (v)  any Material Contract entered  into by the Company or any of
               its  subsidiaries,  other than in  the  ordinary  course  of
               business, or any material  amendment  or  termination of, or
               default under, any Material Contract to which the Company or
               any of its subsidiaries is a party or by which  any  of them
               is bound;

          (vi) any  action  taken by the Company or any of its subsidiaries
               causing  the  acceleration,   termination,  modification  or
               cancellation of any agreement,  contract,  lease  or license
               (or  series  of  related  agreements,  contracts, leases  or
               licenses)  involving  more  than  $2,500,000  to  which  the
               Company or any of its subsidiaries  is  a  party or by which
               any of them is bound;

          (vii) any action taken by the Company or any of its  subsidiaries
               causing  the  imposition  of  any material Security Interest
               upon  any  of the assets, tangible  or  intangible,  of  the
               Company or its subsidiaries;

          (viii) any action taken by the Company or any of its subsidiaries
               relating to  the  issuance  of  any note, bond or other debt
               security, the creation, incurring,  assumption  or guarantee
               of   any   indebtedness   for   borrowed   money,   or   the
               capitalization  of  any  lease  obligation, either involving
               more  than  $2,500,000 individually  or  $2,500,000  in  the
               aggregate;

          (ix) any action taken  by  the Company or any of its subsidiaries
               causing the delay or postponement of the payment of accounts
               payable and other liabilities outside the ordinary course of
               business;

          (x)  any action taken by the  Company  or any of its subsidiaries
               to cancel, compromise, waive or release  any  right or claim
               (or series of rights or claims) either involving  more  than
               $2,500,000 or outside the ordinary course of business;

          (xi) any  action  taken by the Company or any of its subsidiaries
               granting any license  or  sublicense  of any rights under or
               with respect to any Intellectual Property;

          (xii) the entering into of any agreement by the Company or any of
               its subsidiaries to do any of the things  described  in  the
               preceding  clauses (i) through (xi) (other than negotiations
               with  the Offeror  and  its  Representatives  regarding  the
               transactions contemplated by this Agreement); or

          (xiii) any agreement  or arrangement to take any action which, if
               taken  prior  to  the  date  hereof,  would  have  made  any
               representation  or warranty  set  forth  in  this  Agreement
               materially untrue or incorrect as of the date when made.

     (i)  ABSENCE OF UNDISCLOSED  LIABILITIES.  Neither the Company nor any
          of its subsidiaries has any  material  obligations or liabilities
          of any nature (matured or unmatured, fixed or contingent) and, to
          the knowledge of the Company, there is no  basis  for any present
          or  future  action,  suit,  proceeding,  hearing,  investigation,
          charge,  complaint,  claim  or demand against any of them  giving
          rise to any such material obligations or liabilities, other than:

          (i)  those set forth or adequately  provided  for  in the balance
               sheet included in the Company's audited financial statements
               as  at  and  for  the  period  ended December 31, 1998  (the
               "Company Balance Sheet");

          (ii) those incurred in the ordinary course  of business since the
               Company  Balance  Sheet  Date  and  consistent   with   past
               practice, none of which results from, arises out of, relates
               to,  is  in  the  nature  of  or was caused by any breach of
               contract,   breach  of  warranty,  tort,   infringement   or
               violation of law; and

          (iii) those incurred  in  connection  with  the execution of this
               Agreement.

     (j)  MATERIAL CONTRACTS.  None of the Company, its subsidiaries or, to
          the knowledge of the Company, any of the other  parties  thereto,
          is  in default or breach of, in any material respect, and neither
          the Company  nor  any of its subsidiaries has received any notice
          of material default  or  termination under, any Material Contract
          and, to the knowledge of the  Company,  there  exists no state of
          facts  which  after  notice  or  lapse  of  time  or  both  would
          constitute  such  a  material default or breach.  Except for  the
          Material Contracts disclosed  in  the  Company Disclosure Letter,
          neither the Company nor any of its subsidiaries is a party to any
          (i) Contract which involves the payment  to  or by the Company or
          its subsidiaries of more than $2,500,000 during  the remainder of
          the Contract, or (ii) Contract not made in the ordinary course of
          business  or which creates liabilities or obligations  which  are
          not in the  ordinary course of business.  Descriptions of each of
          the Company's  Material  Contracts  are  set forth in the Company
          Disclosure Letter.

     (k)  CUSTOMERS AND SUPPLIERS. The Company Disclosure Letter sets forth
          the  names of the top 20 customers by dollar  volume  ("Principal
          Customers")  and top 20 suppliers by dollar volume of the Company
          and its subsidiaries  on a consolidated basis for the fiscal year
          ended  on the Company Balance  Sheet  Date.   Since  the  Company
          Balance Sheet Date, there has been no termination or cancellation
          of, and  no  material  modification  or  material  change in, the
          business relationship with any of the Principal Customers.  As of
          the  date hereof, the Company has no knowledge that the  benefits
          of any relationship with any of the customers or suppliers of the
          Company  and  its subsidiaries will not continue after the Expiry
          Time in substantially  the  same  manner  as  prior  to  the date
          hereof.

     (l)  INSURANCE.   The  Company has furnished or made available to  the
          Offeror  accurate  particulars   of  the  policies  of  insurance
          maintained by the Company and its  subsidiaries  as  of  the date
          hereof,  including  the  name  of  the insurer, the risks insured
          against and the amount of coverage.   All  such  policies  are in
          full  force  and effect.  None of the Company or its subsidiaries
          or, to the knowledge  of  the  Company,  any of the other parties
          thereto, is in default or breach of, whether as to the payment of
          premiums or otherwise, and neither the Company  nor  any  of  its
          subsidiaries  has  received  any  notice  of  material default or
          termination under, any such policy and, to the  knowledge  of the
          Company,  there  exists  no  state of facts which after notice or
          lapse of time or both would constitute such a material default or
          breach.  There is no reason to  believe  that any of the existing
          insurance policies of the Company and each  of  its  subsidiaries
          will not be renewed by the insurer upon the scheduled  expiry  of
          the  policy  or  will be renewed by the insurer only on the basis
          that there will be a material increase in the premiums payable in
          respect of the policy.   True  and  complete copies of all of the
          existing insurance policies of the Company  and  its subsidiaries
          have been made available to the Offeror.

     (m)  BOOKS  AND  RECORDS.   The  books,  records and accounts  of  the
          Company  and  each  of its subsidiaries  (in  the  case  of  each
          subsidiary, since such  subsidiary was acquired by the Company or
          a subsidiary of the Company),  in all material respects, (i) have
          been maintained in accordance with  good  business practices on a
          basis consistent with prior years, (ii) are  stated in reasonable
          detail  and  accurately  and fairly reflect the transactions  and
          dispositions of the assets  of  the Company and its subsidiaries,
          and (iii) accurately and fairly reflect the basis for the Company
          consolidated  financial  statements.   The  Company  maintains  a
          system  of internal accounting  controls  sufficient  to  provide
          reasonable  assurances  that  (i)  transactions  are  executed in
          accordance  with  management's general or specific authorization;
          and (ii) transactions are recorded as necessary (A) to permit the
          preparation of financial  statements  in conformity with Canadian
          generally accepted accounting principles  or  any  other criteria
          applicable to such statements, and (B) to maintain accountability
          for assets.

     (n)  LITIGATION, ETC.  There is no claim, action, proceeding,  charge,
          complaint,   grievance   or  investigation  pending  or,  to  the
          knowledge of the Company,  threatened  against or relating to the
          Company  or  any  of  its  subsidiaries affecting  any  of  their
          businesses, properties, Intellectual Property, licenses or assets
          before  any court or Governmental  Entity  or  which  could  come
          before any  arbitrator,  that,  if  adversely  determined,  could
          reasonably  be  expected  to  have  a Material Adverse Effect, or
          prevent or materially delay or materially hinder the consummation
          of  the  transactions  contemplated by this  Agreement,  and  the
          Company has no knowledge of any basis for any such claim, action,
          proceeding or investigation.   Neither the Company nor any of its
          subsidiaries,  nor  their  respective   assets,   properties   or
          Intellectual  Property,  is  subject to any outstanding judgment,
          order, writ, injunction, decree or settlement obligation that has
          had or is reasonably likely to  have  a  Material Adverse Effect,
          that involves or may involve, or restricts  or  may  restrict, or
          requires or may require, the expenditure of a material  amount of
          money  as  a condition to or a necessity for the right or ability
          of the Company  or  any of its Material Subsidiaries, as the case
          may be, to conduct its  or  their business in any manner in which
          such business has been carried  on  prior  to the date hereof, or
          prevent or materially delay or materially hinder the consummation
          of the transactions contemplated by this Agreement.

     (o)  ENVIRONMENTAL.    All   operations   of  the  Company   and   its
          subsidiaries have been conducted, and are now in compliance with,
          all  Environmental  Laws.  Neither the Company  nor  any  of  its
          subsidiaries is subject to:

          (i)  any governmental  or  regulatory remedial or control action,
               proceeding, application, order or directive which relates to
               environmental, health or safety matters or any investigation
               or evaluation concerning  environmental,  health  or  safety
               matters; or

          (ii) any  demand  or  notice  with  respect  to the breach of, or
               liability under, any Environmental Laws and  the Company has
               no  knowledge  of  any  facts  or  circumstances that  could
               reasonably  be  expected  to  result  in  any  such  action,
               proceeding, application, order, directive, demand, or notice
               to  which  the Company or any of its subsidiaries  would  be
               subject.

     (p)  ZONING AND OTHER MATTERS RELATING TO REAL PROPERTY.

          (i)  The Company  Disclosure  Letter  lists the address and legal
               description of all of the Owned Real  Property.  The Company
               or  one  of  its  subsidiaries  has  good,  marketable   and
               indefeasible  fee  simple  title  to  all  of its Owned Real
               Property,  free  and clear of all Security Interests;  there
               are no Leases or other agreements (written or oral) granting
               to any person the  right  to  use  or  occupy such parcel or
               portion  thereof;  and  there  are  no outstanding  options,
               rights  of  first  refusal to purchase such  parcel  or  any
               portion thereof or interest therein.

          (ii) The Company Disclosure  Letter  sets  forth  a  list  of all
               Leases   and   other  occupancy  agreements,  including  all
               amendments, extensions  and  other  modifications for Leased
               Real  Property  to  which  the  Company  or   any   of   its
               subsidiaries  is  a  party.   The  Company  or  one  of  its
               subsidiaries  has a good and valid leasehold interest in and
               to all of the Leased  Real  Property, subject to no Security
               Interests.  Each Lease is in  full  force  and effect and is
               enforceable in accordance with its terms.  There  exists  no
               default  under  any  Lease.   No  party  to  any  Lease  has
               repudiated any term thereof, and there are no disputes, oral
               agreements or forbearance programs in effect with respect to
               the  Leased  Real  Property.  No security deposit or portion
               thereof deposited with  respect  to any Leased Real Property
               has been redeposited in full.  Neither  the  Company nor any
               of  its  subsidiaries  has  assigned,  subleased, mortgaged,
               deeded in trust or otherwise transferred  or  encumbered any
               Leased Real Property or any interest therein.   There are no
               outstanding options or rights of first refusal with  respect
               to  the  purchase or use of any of the Leased Real Property,
               any  portion  thereof  or  interest  therein.   Neither  the
               Company nor any of its subsidiaries is obligated to purchase
               or lease  any real property.  The Company has made available
               to the Offeror true and complete copies of all the Leases.

          (iii) The buildings  and  other  structures  located  on the real
               property  owned,  leased or operated by the Company  or  its
               subsidiaries (the "Company  Property") and the operation and
               maintenance thereof, as now operated  and maintained, comply
               in all material respects with all applicable Laws, municipal
               or  otherwise.  None of such buildings or  other  structures
               encroaches  upon any land not owned or leased by the Company
               or its subsidiaries  and there are no restrictive covenants,
               municipal by-laws or other Laws which in any way restrict or
               prohibit the use of the  Company  Property or such buildings
               or structures for the purposes for  which they are presently
               being used.

          (iv) There are no expropriation or similar proceedings, actual or
               threatened,  of  which the Company or its  subsidiaries  has
               received notice against  any  of the Company Property or any
               part thereof.

          (v)  No  buildings or other structures  located  on  the  Company
               Property contain any friable asbestos or any other substance
               containing    asbestos   and   deemed   hazardous   by   any
               Environmental  Laws   applicable   to  the  Company  or  its
               subsidiaries.

     (q)  NO CONTAMINANTS.  To the knowledge of the  Company,  the  Company
          Property has not been and is not now used as a landfill or  waste
          disposal   site,   there  has  been  no  hazardous  substance  or
          contaminant deposited  in or disposed of on, in, under or at, the
          Company  Property,  or at  any  other  property  or  facility  in
          connection with or as  a  result  of operations of the Company or
          any  of  its subsidiaries and there has  not  been  any  release,
          spill, emission  or  discharge  of any contaminant at or from the
          Company Property which would give  rise to any action or claim by
          a third party or a Governmental Entity  relating  to violation of
          or  give rise to any liability under any such Environmental  Laws
          or other requirements.

     (r)  TAX MATTERS.

          (i)  The  Company and each of its subsidiaries have timely filed,
               or caused  to be filed, all Tax Returns required to be filed
               by them (all  of  which returns were correct and complete in
               all material respects)  and have paid, or caused to be paid,
               all  Taxes that are due and  payable  and  the  Company  has
               provided  adequate  accruals  in  accordance  with  Canadian
               generally   accepted   accounting  principles  in  its  most
               recently published financial statements for any Taxes of the
               Company and each of its  subsidiaries for the period covered
               by  such  financial statements  that  have  not  been  paid,
               whether or  not  shown as being due on any Tax Returns.  The
               Company and each of  its  subsidiaries  have  made  adequate
               provision  in  their  respective  books  and records for any
               Taxes which have accrued in respect of any period subsequent
               to  the period covered by such financial statements.   Since
               the date of such published financial statements, no material
               Tax liability  not reflected in such statements or otherwise
               provided for has  been  assessed,  proposed  to be assessed,
               incurred  or  accrued other than in the ordinary  course  of
               business.  The  Company  and  each  of its subsidiaries have
               withheld  from  all  payments  made  by them,  or  otherwise
               collected, all material amounts in respect of Taxes required
               to  be withheld therefrom or collected  by  them,  and  have
               remitted  same  to the applicable Governmental Entity within
               the required time  periods.   Neither the Company nor any of
               its subsidiaries has any liability  for  the  Taxes  of  any
               other Person.

          (ii) Neither the Company nor any of its subsidiaries has received
               any  notice  of  deficiency  or  proposed adjustments or any
               written  notification  that any material  issues  have  been
               raised (and are currently  pending)  by  Revenue Canada, the
               United  States  Internal  Revenue  Service  or   any   other
               Governmental  Entity,  including,  without  limitation,  any
               sales   tax   authority,  and  no  waivers  of  statutes  of
               limitations have been given or requested with respect to the
               Company or any subsidiary.  No claim has ever been made by a
               taxing authority in a jurisdiction where neither the Company
               nor any of its  subsidiaries  files  tax  returns  that  the
               Company  or  any of its subsidiaries is or may be subject to
               taxes assessed by such jurisdiction and, to the knowledge of
               the Company, neither the Company nor any of its subsidiaries
               is liable for  taxes  in  any  jurisdiction where it has not
               filed a tax return.  All Tax liability  of  the  Company and
               its subsidiaries has been assessed for all fiscal  years  up
               to  and  including  the fiscal year ended December 31, 1998.
               To  the knowledge of the  Company,  there  are  no  material
               proposed (but unassessed) additional Taxes and none has been
               asserted.  No Tax liens have been filed other than for Taxes
               not yet due and payable.  Neither the Company nor any of its
               subsidiaries  is  a  party  to  or  bound  by  (i)  any  tax
               allocation  or  tax sharing agreement or (ii) any agreement,
               contract, arrangement  or  plan  that  has resulted or would
               result, separately or in the aggregate,  in  the  payment of
               any "excess parachute payment" within the meaning of section
               280G  of  the  United  States Internal Revenue Code (or  any
               corresponding provision of state, local or foreign tax law).
               Neither the Company nor  any  of its subsidiaries has been a
               member of any group filing a combined, consolidated, unitary
               or similar tax return.

     (s)  NON-ARMS LENGTH TRANSACTIONS.

          (i)  None of the Company or its subsidiaries  has any outstanding
               payment  or payments, which is or are material  individually
               or in the aggregate, owing from, or loan to, or has borrowed
               any monies  from  or  is otherwise indebted to, any officer,
               director, employee or shareholder  of  the Company or any of
               its subsidiaries or any Person not dealing  with it at arm's
               length (within the meaning of the INCOME TAX  ACT  (Canada))
               or  any  affiliate  of  any  of  the  foregoing,  except  as
               disclosed in the Company Financial Statements and except for
               usual  compensation  paid in the ordinary course of business
               consistent with past practice.

          (ii) Except for Contracts made solely between the Company and its
               subsidiaries and except for contracts of employment, none of
               the Company or any of  its  subsidiaries  is  a party to any
               Contract with any officer, director, employee or shareholder
               of the Company or any of its subsidiaries or any  Person not
               dealing with it at arm's length (within the meaning  of  the
               INCOME  TAX  ACT  (Canada))  or  any affiliate of any of the
               foregoing.

     (t)  EMPLOYEES.   The Company Disclosure Letter  lists  all  employees
          employed by, and all individuals engaged on, a formal contractual
          basis (for greater certainty, a formal contractual basis does not
          include  hire letters  and  similar  correspondence  between  the
          Company, its  subsidiaries and any of their employees) to provide
          services to the Company or any of its subsidiaries as at the date
          hereof (the "Employees").   For each of the Employees compensated
          as at September 1, 1999, the Company Disclosure Letter lists such
          employee's date of hire, title or classification, rate of salary,
          commission or bonus entitlements  (if any) and any other material
          benefits  extended,  or  circumstances   unique,   to  each  such
          employee. The Company Disclosure Letter sets out the name of each
          Employee  who  is entitled to a sales incentive or other  payment
          from the Company  in connection with the Offeror making the Offer
          or the other transactions contemplated in this Agreement, and the
          amount of such payment.

     (u)  EMPLOYEE BENEFIT PLANS.

          (i)  The Company Disclosure  Letter  lists  all  of  the employee
               benefit,  health, welfare, supplemental employment  benefit,
               bonus, pension,  supplementary  executive  retirement  plan,
               profit  sharing,  deferred compensation, stock compensation,
               stock  option  or  purchase,   retirement,   hospitalization
               insurance,  medical, dental, legal, disability  and  similar
               plans  or  arrangements   or  practices  applicable  to  the
               Employees or to former employees  of  the  Company or any of
               its   subsidiaries   which   are  currently  maintained   or
               participated in by the Company  or its subsidiaries and each
               loan to a non-officer Employee in  excess  of  $20,000,  and
               each  loan  to  an  officer  or director of the Company (the
               "Employee Plans").

          (ii) All of the Employee Plans are  registered where required by,
               and are in good standing under, all applicable Laws or other
               legislative,   administrative   or  judicial   promulgations
               applicable to the Employee Plans  and  there are no actions,
               claims,  proceedings or governmental audits  pending  (other
               than routine claims for benefits) relating to the Company or
               any of its subsidiaries.

          (iii) All of the Employee Plans have been administered and funded
               in material  compliance  with their terms and all applicable
               Laws  or  other  legislative,   administrative  or  judicial
               promulgations applicable to the Employee Plans and there are
               no unfunded liabilities in respect of the Employee Plans and
               all  required contributions thereunder  have  been  made  in
               accordance  with  all  applicable Laws or other legislative,
               administrative or judicial  promulgations  applicable to the
               Employee Plans and the terms of such Employee Plans.

          (iv) No amendments to any Employee Plan have been promised and no
               amendments  to  any Employee Plan will be made  or  promised
               prior to the Expiry Time.

          (v)  True and complete  copies  of  all  the  Employee  Plans  as
               amended  as  of  the  date hereof and, if available, current
               plan summaries and employee  booklets  in respect thereof as
               are  applicable to the Employees and all  related  documents
               or, where oral, written summaries of the terms thereof, have
               been made  available  to  Offeror.   For  the purpose of the
               foregoing,   related   documents  means  all  current   plan
               documentation and amendments  relating thereto, summary plan
               descriptions  and  summaries of material  modifications,  if
               any, all related trust  agreements,  funding  agreements and
               similar  agreements,  the  most recent annual reports  filed
               with  any Governmental Entity  and  the  three  most  recent
               actuarial reports, if any, related thereto.

          (vi) There are  no  agreements  or undertakings by the Company or
               any  of its subsidiaries to provide  post-retirement  profit
               sharing,  medical,  health, life insurance or other benefits
               to Employees or any former employee of the Company or any of
               its subsidiaries.

          (vii) The assets of each Employee  Plan  which  is  a  registered
               pension   plan  are  at  least  equal  to  the  liabilities,
               contingent  or otherwise, of such plan on a plan termination
               basis and each  such plan is fully funded on a going concern
               and solvency basis  in accordance with its terms, applicable
               actuarial assumptions and applicable Laws.

     (v)  LABOUR MATTERS.

          (i)  The Company Disclosure  Letter sets forth a complete list of
               all collective bargain agreements  or  other  agreements  or
               commitments   with   any   trade  union  or  other  employee
               bargaining     representatives    (together,     "collective
               agreements")  and   neither  the  Company  nor  any  of  its
               subsidiaries  is  in  default   of   any   of  its  material
               obligations under such collective agreements.

          (ii) There are no outstanding labour tribunal proceedings  of any
               kind,  including  any  proceedings  which  could  result  in
               certification  of  a trade union as bargaining agent for any
               Employees not already covered by a collective agreement.

          (iii) There are no union organizing or decertification activities
               pending,  or to the knowledge  of  the  Company,  threatened
               involving Employees  not  already  covered  by  a collective
               agreement.  No labour representatives hold bargaining rights
               with  respect to any Employees and no labour representatives
               have applied  to have the Company or any of its subsidiaries
               declared a related employer pursuant to the LABOUR RELATIONS
               ACT (Ontario).

          (iv) Neither the Company  nor  any  of  its  subsidiaries has any
               material   unresolved   grievances   or   material   pending
               arbitration cases outstanding.  Neither the  Company nor any
               of  its  subsidiaries  has any serious labour problems  that
               might materially affect  the  value  of  the  Company or its
               subsidiaries,  taken  as a whole, or lead to an interruption
               of its operations at any  location.   There  is  no  strike,
               dispute,   slowdown,   lockout,   shutdown,  work  stoppage,
               unresolved  material labour union grievance,  unfair  labour
               practice or successor  rights  or  other concerted action or
               formal grievance existing, pending or,  to  the knowledge of
               the Company, threatened against the Company or  any  of  its
               subsidiaries.

     (w)  COMPLIANCE  WITH  LAWS.   Each  of  the  Company and its Material
          Subsidiaries (in the case of each such Material Subsidiary, since
          such  Material  Subsidiary  was  acquired  by the  Company  or  a
          subsidiary  of  the  Company) has complied with  and  is  not  in
          violation of any applicable  Laws, orders, judgments, settlements
          and decrees.  Without limiting  the  generality of the foregoing,
          all securities of the Company (including, without limitation, all
          options, rights or other convertible or  exchangeable securities)
          have  been  issued  in compliance with all applicable  securities
          Laws and all securities  to  be  issued upon exercise of any such
          options, rights and other convertible  or exchangeable securities
          will be issued in compliance with all applicable securities Laws.

     (x)  RESTRICTIONS  ON  BUSINESS ACTIVITIES.  There  is  no  agreement,
          judgment, injunction, order or decree binding upon the Company or
          any of its subsidiaries  that has or could reasonably be expected
          to  have  the effect of prohibiting,  restricting  or  materially
          impairing any  business  practice  of  the  Company or any of its
          Material Subsidiaries, any use of the Company's owned or licensed
          Intellectual Property, any acquisition of property by the Company
          or any of its Material Subsidiaries or the conduct of business by
          the  Company  or  any of its Material Subsidiaries  as  currently
          conducted.

     (y)  REPRESENTATIONS  COMPLETE.    None   of  the  representations  or
          warranties  made  by  the  Company  herein   or  in  the  Company
          Disclosure Letter, when all such documents are  read  together in
          their entirety, contains any untrue statement of a material fact,
          or  omits to state any material fact necessary in order  to  make
          the statements  contained  herein or therein, in the light of the
          circumstances  under  which  such   statements   were  made,  not
          misleading.

     (z)  INTELLECTUAL PROPERTY.

          (i)  The  Company  Disclosure  Letter  contains  a  complete  and
               accurate  listing  of all (A) registrations and applications
               relating to Intellectual  Property  that  are  owned  by the
               Company   or   its  subsidiaries  (the  "Owned  Intellectual
               Property"), and  (B) licensed Intellectual Property material
               to  the  Company's  business   (the  "Licensed  Intellectual
               Property") and for each the governing license agreements and
               (C) all licenses or similar agreements  or  its arrangements
               covering Intellectual Property rights to which  the  Company
               or  any of its subsidiaries is a party, either as a licensee
               or licensor, or a third party beneficiary;

          (ii) The Company  or  one  of its subsidiaries owns and possesses
               all  right,  title  and  interest   in   and  to  the  Owned
               Intellectual  Property or has a valid and enforceable  right
               or license to use the Licensed Intellectual Property used in
               the Company's business as currently conducted;

          (iii) The Company or  one of its subsidiaries is the owner of all
               of the Owned Intellectual Property, with good and marketable
               title thereto, free  and clear of any and all liens.  To the
               knowledge of the Company,  all  of  the  Owned  Intellectual
               Property is duly and validly registered, where applicable;

          (iv) To  the  knowledge  of  the  Company, the Owned and Licensed
               Intellectual Property and the conduct of the business of the
               Company and its subsidiaries do  not  infringe upon, violate
               or  breach  the Intellectual Property rights  of  any  other
               Person;

          (v)  There has been  no  unauthorized  or  improper  use  by  the
               Company  or  its  subsidiaries  of  the  Owned  or  Licensed
               Intellectual  Property that has affected or could reasonably
               be  expected  to  affect  the  validity  or  distinctiveness
               thereof or rights therein;

          (vi) To the knowledge  of the Company, no Person is infringing or
               misappropriating any  of  the Licensed or Owned Intellectual
               Property;

          (vii)  Neither  the  Company  nor any  of  its  subsidiaries  has
               received any written notice or claim challenging the Company
               or any of its subsidiaries  respecting  the validity, use or
               ownership  of  the  Owned or Licensed Intellectual  Property
               and, to the knowledge  of  the  Company,  there are no facts
               upon which such a challenge could be made;

          (viii) The consummation of the transactions contemplated  by this
               Agreement  will  not  affect  the  availability or terms and
               conditions of any material software  license  to  which  the
               Company or any of its subsidiaries is a party;

          (ix) The  Company  has obtained any third-party consents required
               relating   to   Owned    Intellectual   Property,   Licensed
               Intellectual Property and Material Contracts; and

          (x)  The Owned Intellectual Property  and  Licensed  Intellectual
               Property  will  be  available for use immediately after  the
               consummation  of  the  transactions   contemplated  by  this
               Agreement in the same manner as they were  available for use
               by the Company and its subsidiaries immediately prior to the
               consummation  of  the  transactions  contemplated   by  this
               Agreement.

     (aa) COMPETITION  ACT (CANADA).  The aggregate value of the assets  in
          Canada of the  Company  together  with each of its affiliates (as
          such term is defined in the COMPETITION ACT (Canada)), determined
          in accordance with the COMPETITION  ACT (Canada), does not exceed
          $250 million.  The aggregate gross revenues  from  sales in, from
          or  into  Canada  of  the  Company  together  with  each  of  its
          affiliates  (as  such  term  is  defined  in  the COMPETITION ACT
          (Canada)),  determined  in  accordance  with the COMPETITION  ACT
          (Canada), does not exceed $250 million.

     (bb) NO  BROKER.   Except  as  specifically  noted   in   the  Company
          Disclosure Letter and section  12(b), the Company has  carried on
          all  negotiations relating to this Agreement and the transactions
          contemplated  in this Agreement directly and without intervention
          on its behalf by  any  other party in such manner as to give rise
          to any valid claim for a  brokerage  commission,  finder's fee or
          other like payment.

     (cc) RECOMMENDATION OF THE OFFER.  The Board, after consultation  with
          its  advisers  and  after receiving the report of the independent
          committee of the Board, by a resolution of Board, has unanimously
          (i) determined that the Offer is fair to the SV Shareholders from
          a financial point of  view and that the transactions contemplated
          hereby  are  in  the  best  interests  of  the  Company  and  the
          Shareholders, (ii) approved  this  Agreement and the transactions
          contemplated hereby, and (iii) resolved  to  recommend  that  the
          Shareholders accept and tender their SV Shares to the Offer.

     (dd) FAIRNESS  OPINION  AND  VALUATION.   The  Company  has received a
          valuation prepared by its financial advisor, Salomon Smith Barney
          Canada Inc., to the effect that the fair market value  of  the SV
          Shares  is  in  the  range  of  $4.25 to $6.50, and an opinion of
          Salomon Smith Barney Canada Inc.  to  the  effect  that,  in  the
          context  of  the transactions contemplated by this Agreement, the
          Offer is fair to the Shareholders from a financial point of view.
          Salomon Smith  Barney  Canada  Inc. has authorized the Company to
          permit references to such valuation  and  fairness  opinion to be
          included in the Bid Circular.

     (ee) SUPPORT  OF DIRECTORS.  Each of the directors of the Company  has
          advised the  Company  that he or she intends to tender his or her
          SV Shares to the Offer.

     (ff) No event has occurred that  would  cause the MV Shares to convert
          to SV Shares.

7.   REPRESENTATIONS AND WARRANTIES OF THE OFFEROR.  The Offeror represents
and warrants to the Company as follows:

     (a)  ORGANIZATION.  The Offeror is, and the  Offeror  will  be  at the
          date  of  the  Offer,  a  corporation  duly organized and validly
          existing under the laws of its jurisdiction of incorporation.

     (b)  AUTHORITY.   The Offeror has all requisite  corporate  power  and
          authority to enter  into this Agreement, the Option Agreement and
          the Shareholders Agreement  and the Offeror will have at the date
          of the Offer all necessary corporate  power and authority to make
          the Offer and to carry out the transactions  contemplated  hereby
          and thereby and by the Offer.  The execution and delivery of this
          Agreement,  the  Option  Agreement and the Shareholders Agreement
          and the consummation of the  transactions contemplated hereby and
          thereby have been duly and validly  authorized  by  all necessary
          corporate  action  on  the  part  of  the  Offeror,  and no other
          corporate proceedings on the part of the Offeror are necessary to
          authorize   this   Agreement,   the   Option  Agreement  and  the
          Shareholders  Agreement.   Each  of  the  Agreement,  the  Option
          Agreement and the Shareholders Agreement has  been  duly executed
          and delivered by the Offeror and constitutes a legal,  valid  and
          binding  agreement enforceable by the Company against the Offeror
          in accordance  with  its terms, subject to bankruptcy, insolvency
          and other similar Laws affecting creditors' rights generally, and
          to general principles of equity.

     (c)  NO  CONFLICT.   Neither   the  execution  and  delivery  of  this
          Agreement nor the consummation  of  the transactions contemplated
          hereby  nor  compliance with any of the  provisions  hereof  will
          result in a violation  of  breach  of,  require any consent to be
          obtained under or give rise to any material termination rights or
          material  payment  obligations  under any provision  of  (i)  the
          certificate constating documents  of the Offeror; (ii) subject to
          obtaining the Appropriate Regulatory  Approvals  relating  to the
          Offeror,  any  Laws,  regulations,  order, judgment or decree; or
          (iii)  any material contract or material  license,  franchise  or
          permit to which the Offeror is a party or by which the Offeror is
          bound.

     (d)  FINANCING.  The Offeror has entered into a binding agreement (the
          "Commitment  Letter")  with  American Industrial Partners Capital
          Fund II L.P. (the "Fund") pursuant  to  which the Fund has agreed
          to provide the required funds to effect the  full  payment by the
          Offeror of the cash consideration payable pursuant to  the  Offer
          and  the  Offeror  has  provided  to  the  Company  a copy of the
          executed Commitment Letter.

     (e)  LITIGATION,  ETC.   There  is  no  claim,  action, proceeding  or
          investigation  pending  or,  to  the  knowledge of  the  Offeror,
          threatened against or relating to the Offeror or affecting any of
          its  properties,  licenses  or  assets  before   any   court   or
          Governmental   Entity   that,   if  adversely  determined,  could
          reasonably be expected to materially  hinder  or materially delay
          consummation of the transactions contemplated by  this  Agreement
          or  the Offer, and the Offeror has no knowledge of any basis  for
          any such claim, action, proceeding or investigation.  Neither the
          Offeror  nor  any  of its assets and properties is subject to any
          outstanding judgment,  order, writ, injunction or decree that may
          materially  hinder  or  materially   delay  consummation  of  the
          transactions contemplated by this Agreement or the Offer.

     (f)  REPRESENTATIONS  COMPLETE.   None  of  the   representations   or
          warranties  made  by  the  Offeror  herein, when read together in
          their entirety, contains any untrue statement of a material fact,
          or omits to state any material fact necessary  in  order  to make
          the  statements contained herein or therein, in the light of  the
          circumstances   under   which  such  statements  were  made,  not
          misleading.

     (g)  COMPETITION ACT (CANADA).   The  aggregate value of the assets in
          Canada of the Offeror together with  each  of  its affiliates (as
          such term is defined in the COMPETITION ACT (Canada)), determined
          in accordance with the COMPETITION ACT (Canada),  does not exceed
          $50 million.  The aggregate gross revenues from sales in, from or
          into  Canada of the Offeror together with each of its  affiliates
          (as such  term  is  defined  in  the  COMPETITION  ACT (Canada)),
          determined in accordance with the COMPETITION ACT (Canada),  does
          not exceed $50 million.

     (h)  NO  BROKER.  The Offeror has carried on all negotiations relating
          to this Agreement and the Offer and the transactions contemplated
          in this Agreement directly and without intervention on its behalf
          by any  other  party  in such manner as to give rise to any valid
          claim for a brokerage commission,  finder's  fee  or  other  like
          payment.

8.   EXCLUSIVITY.

     (a)  The  Company  shall  not,  directly  or  indirectly,  through any
          officer, director, employee, Representative, financial advisor or
          agent,  or  any  of  its  subsidiaries, (i) solicit, initiate  or
          knowingly encourage (including  by  way of furnishing information
          or   entering  into  any  form  of  agreement,   arrangement   or
          understanding)  the  initiation  of  any  Acquisition Proposal or
          inquiries or proposals in connection therewith,  (ii) participate
          in  any  discussions  or  negotiations  regarding any Acquisition
          Proposal, (iii) withdraw or modify the approval  of  the Board of
          the transactions contemplated hereby in a manner adverse  to  the
          Offeror,  (iv)  approve or recommend any Acquisition Proposal, or
          (v) enter into any agreement related to any Acquisition Proposal;
          PROVIDED, HOWEVER,  that,  subject  to compliance with section 9,
          but notwithstanding the preceding part  of  this  section 8(a) or
          any other provision of this Agreement, nothing shall  prevent the
          Board  from considering, negotiating, approving, recommending  to
          its shareholders  or  entering into an agreement in respect of an
          unsolicited bona fide written  Acquisition  Proposal (x) that the
          Board  determines in good faith, after receiving  (i)  a  written
          opinion  from  its  financial  advisors (a copy of which shall be
          provided  to  the Offeror) that the  Acquisition  Proposal  would
          reasonably be expected  to, if consummated in accordance with its
          terms, result in a transaction  more  favourable  to Shareholders
          from a financial point of view than the transaction  contemplated
          by this Agreement, and (ii) a written opinion of outside  counsel
          (a  copy of which shall be provided to the Offeror) to the effect
          that  it  is appropriate that the Board take such action in order
          to discharge  properly  its fiduciary duties, would reasonably be
          expected to, if consummated  in accordance with its terms, result
          in a transaction more favourable  to  its  Shareholders  than the
          transaction  contemplated  by  this  Agreement,  and  (y) that is
          received prior to the Expiry Time (any such Acquisition  Proposal
          being referred to herein as a "Superior Proposal").

     (b)  The  Company  shall forthwith notify the Offeror, at first orally
          and  then in writing,  of  all  current  and  future  Acquisition
          Proposals of which its directors or senior officers are or become
          aware,  or  any  amendments  to the foregoing, or any request for
          non-public information relating  to  the  Company  or  any of its
          subsidiaries  in connection with an Acquisition Proposal  or  for
          access to the properties,  books or records of the Company or any
          of its subsidiaries by any Person.   Such  notice shall include a
          description of the material terms and conditions  of any proposal
          and provide such details of the proposal, inquiry or  contact  as
          the  Offeror may reasonably request including the identity of the
          Person making such proposal, inquiry or contact.

     (c)  If  the  Company  receives  a  request  for  material  non-public
          information  from  a  Person who proposes a bona fide Acquisition
          Proposal in respect of  the Company (the existence and content of
          which  have  been  disclosed  to  the  Offeror),  and  the  Board
          determines that such  proposal  would  be likely to be a Superior
          Proposal  pursuant  to section 8(a) having  received  the  advice
          referred to therein,  then, and only in such case, the Board may,
          subject to the execution  by  such  Person  of  a  non-disclosure
          agreement,   provide  such  Person  with  access  to  information
          regarding the  Company  and its subsidiaries;  PROVIDED, HOWEVER,
          that the Person making the  Acquisition  Proposal  shall  not  be
          precluded  under  such  non-disclosure  agreement from making the
          Acquisition Proposal, and provided further that the Company sends
          a  copy  of  any  such non-disclosure agreement  to  the  Offeror
          immediately upon its execution and the Offeror is provided with a
          list or copies of the  information  provided  to  such Person and
          immediately provided with access to similar information  to which
          such Person was provided.

     (d)  The  Company  shall  ensure  that  its  officers,  directors  and
          employees  and its subsidiaries and their officers, directors and
          employees  and  any  financial  advisors  or  other  advisors  or
          Representatives  retained  by  it  are aware of the provisions of
          this section 8 and, for greater certainty,  the  Company shall be
          responsible  for  any  breach of this section 8 by its  financial
          advisors or other advisors or Representatives.

9.   NOTICE OF SUPERIOR PROPOSAL DETERMINATION

     (a)  The Company shall not accept,  approve,  recommend  or enter into
          any  agreement,  arrangement  or understanding in respect  of  an
          Acquisition Proposal (other than  a  non-disclosure  agreement as
          contemplated  by  section  8(c))  unless (i) it has provided  the
          Offeror with a copy of the Acquisition  Proposal  document  which
          the  Board  has determined would be a Superior Proposal, and (ii)
          five Business  Days shall have elapsed from the later of the date
          the  Offeror  received   notice   of   the   Company's   proposed
          determination  to  accept,  approve,  recommend or enter into  an
          agreement in respect of such Acquisition  Proposal,  and the date
          the   Offeror  received  a  copy  of  the  Acquisition  Proposal.
          Information  provided  under  this  section 9(a) shall constitute
          Information for the purposes of section 10(b).

     (b)  During such five Business Day period,  the  Company  acknowledges
          that  the  Offeror  shall  have  the  opportunity,  but  not  the
          obligation, to offer to amend the terms of this Agreement and the
          Offer.   The  Board will review any offer by the Offeror to amend
          the terms of this  Agreement and the Offer in good faith in order
          to determine, in its  discretion in the exercise of its fiduciary
          duties, whether the  Offer,  as  amended,  upon acceptance by the
          Company  would  result in the Acquisition Proposal  not  being  a
          Superior Proposal.   If  the  Board  so determines, it will enter
          into an amended agreement with the Offeror reflecting the amended
          proposal.  If the Board continues to believe,  in  good faith and
          after  consultation  with  its  financial  advisors  and  outside
          counsel,  that the Acquisition Proposal is nonetheless a Superior
          Proposal and  therefore rejects the amended proposal, the Company
          shall terminate  the Agreement under section 14(b)(iii) forthwith
          and pay to the Offeror  the  compensation  payable to the Offeror
          under section 15.

     (c)  The  Company  also acknowledges and agrees that  each  successive
          modification of  any  Acquisition Proposal shall constitute a new
          Acquisition Proposal for purposes of the requirement under clause
          (ii) of section 9(a) to  initiate an additional five Business Day
          notice period.

10.  ACCESS TO INFORMATION

     (a)  Subject to sections 10(b)  to  and including 10(i) and applicable
          Laws, upon reasonable notice, the  Company shall (and shall cause
          each   of   its   subsidiaries  to)  continue   to   afford   the
          Representatives of  the  Offeror  access,  during normal business
          hours from the date hereof and until the earlier  of  the  Expiry
          Time  or  the  termination  of this Agreement, to its properties,
          books,  contracts  and records  as  well  as  to  its  management
          personnel, and, during  such  period, each party shall (and shall
          cause each of its subsidiaries  to) furnish promptly to the other
          party all information concerning  its  business,  properties  and
          personnel as such party may reasonably request, including monthly
          financial information.

     (b)  The Information will be kept strictly confidential and shall not,
          without the prior written consent of the Company, be disclosed by
          the Offeror, or by its Representatives, in any manner whatsoever,
          in  whole or in part, and shall not be used by the Offeror or its
          Representatives   other   than  in  connection  with  the  Offer.
          Moreover, the Offeror agrees  to  reveal  the Information only to
          its  Representatives  who  have  a reasonable need  to  know  the
          Information for the purposes of evaluating  the  Offer,  who  are
          informed  by it of the confidential nature of the Information and
          who  have  agreed  to  act  in  accordance  with  the  terms  and
          conditions of  this  Agreement.   Notwithstanding such agreement,
          the Offeror shall continue to be responsible  for  any  breach of
          this  Agreement  by  its Representatives and shall indemnify  and
          save  the  Company  harmless  from  any  breach  by  any  of  its
          Representatives.

     (c)  All copies of the Information,  except  for  that  portion of the
          Information which consists of analyses, compilations,  forecasts,
          studies  or  other  documents  prepared  by  the  Offeror  or its
          Representatives, will be returned to the Company immediately upon
          the   termination   of  this  Agreement.   That  portion  of  the
          Information which consists  of analyses, compilations, forecasts,
          studies  or  other  documents prepared  by  the  Offeror  or  its
          Representatives, will be destroyed upon the Company's request and
          any oral Information  will continue to be subject to the terms of
          this Agreement.  Upon the  request  of  the  Company, the Offeror
          shall provide a certificate certifying as to the  complete return
          and destruction of all Information in accordance with  the  terms
          of this paragraph.

     (d)  The Offeror acknowledges that the Information is confidential and
          a valuable asset of the Company and all right, title and interest
          in  and  to  the Information is and at all times shall remain the
          exclusive property of the Company.

     (e)  The Offeror acknowledges  that,  other  than as contained in this
          Agreement, none of the Company, its Representatives or any of its
          or  their  respective  affiliates makes any  express  or  implied
          representation or warranty  as to the accuracy or completeness of
          the Information.

     (f)  If  the  Offeror  or anyone to whom  the  Offeror  transmits  the
          Information pursuant  to this Agreement becomes legally compelled
          to disclose any of the Information, the Offeror shall provide the
          Company  with prompt notice  so  that  the  Company  may  seek  a
          protective   order  or  other  appropriate  remedy  and/or  waive
          compliance with  the  provisions  of  this  Agreement.   If  such
          protective  order  or other remedy is not obtained or the Company
          waives compliance with  the  provisions  of  this  Agreement, the
          Offeror shall furnish only that portion of the Information  which
          it  is  advised,  by  written opinion of counsel addressed to the
          Offeror  and  to  the Company,  is  legally  required  and  shall
          exercise  commercially  reasonable  efforts  to  obtain  reliable
          assurance  that  confidential  treatment  will  be  accorded  the
          Information.

     (g)  Without the  prior  written  consent  of  the  Company, until the
          earlier  of  the  acquisition by the Offeror of 100%  of  the  SV
          Shares  pursuant  to   the   transactions  contemplated  by  this
          Agreement and December 31, 2000,  neither  the Offeror nor any of
          its  affiliates  shall,  directly  or  indirectly,   solicit  for
          employment any person who is then employed or who, within  the 90
          day  period  prior to the date of such solicitation, was employed
          (either as an  employee or a consultant) by the Company or any of
          its subsidiaries.

     (h)  The Offeror acknowledges  that  disclosure of any Information may
          cause significant damage and harm to the Company, its affiliates,
          subsidiaries and shareholders and  that  remedies  at  law may be
          inadequate to protect against breach of this Agreement,  and  the
          Offeror  hereby  in  advance agrees to the granting of injunctive
          relief in favour of the  Company without proof of actual damages,
          in addition to any other remedy the Company may be entitled to.

     (i)  The provisions of sections  10(b) to and including 10(i) and this
          section 9 shall survive for a  period  of  two  years  after  the
          termination of this Agreement.

     (j)  Each of the Offeror and the Company shall deliver, at the closing
          of   the   transactions   contemplated   hereby,  such  customary
          certificates, resolutions and other closing  documents  as may be
          required by the other parties hereto, acting reasonably.

11.  STANDSTILL.   Until  the earlier of (i) the acquisition by the Offeror
of 100% of the SV Shares pursuant  to the transactions contemplated by this
Agreement, and (ii) the date which is  the second anniversary of the day on
which this Agreement is terminated, the  Offeror  agrees  that it will not,
otherwise  than pursuant to this Agreement, the Offer and the  transactions
contemplated  hereby  and  thereby (including, for greater certainty, those
contemplated by the Option Agreement) or with the prior written approval of
the Company (which approval  may  be given on such terms as the Company may
determine):

     (a)  in any manner acquire, agree  to  acquire or make any proposal or
          offer  to  acquire,  directly or indirectly,  any  securities  or
          property of the Company;

     (b)  propose  or offer to enter  into,  directly  or  indirectly,  any
          merger or  business  combination  involving  the  Company  or  to
          purchase,  directly  or  indirectly,  a  material  portion of the
          assets of the Company;

     (c)  directly or indirectly, solicit or participate or join  with  any
          Person  in  the  solicitation  of any proxies to vote, to seek to
          advise or to influence any Person  with  respect to the voting of
          any voting securities of the Company;

     (d)  otherwise act alone or in concert with others  to seek to control
          or to influence the management, Board or policies of the Company;

     (e)  make  any  public  or  private  disclosure  of any consideration,
          intention,  plan  or  arrangement inconsistent with  any  of  the
          foregoing; or

     (f)  advise, assist or encourage  any  of  the  foregoing  or  work in
          concert with others in respect of the foregoing.

For  the  purpose of this section 11, each reference to the Offeror or  the
Company shall include its affiliates and its successors.

12.  FEES AND EXPENSES.

     (a)  Subject  to sections 1 and 15, the parties agree that all
          out-of-pocket expenses  of  the  parties  relating  to the Offer
          and the transactions contemplated hereby, including legal fees,
          accounting fees, financial advisory fees, regulatory filing fees,
          all  disbursements  of  advisors and printing and mailing  costs,
          shall be paid by the party incurring such expenses.

     (b)  The  Offeror and the Company  acknowledge  and  agree  that  $1.5
          million  (plus  applicable taxes) owing by the Company to Salomon
          Smith Barney Canada  Inc.  upon the delivery of its valuation and
          fairness opinion shall be paid  out by the Company on or prior to
          the Expiry Time.

13.  BINDING NATURE. The parties acknowledge that this Agreement represents
the binding and legally enforceable obligations  of the parties hereto with
respect of the matters covered hereby.  The parties  each  agree to proceed
in good faith to cause their respective counsel, accountants  and personnel
to  obtain  any and all necessary authorizations, regulatory approvals  and
consents as may be required or desirable to consummate the Offer.

14.  TERMINATION.

     (a)  If  any  condition  contained in section 2 is not satisfied at or
          before  the  Proposed Offer  Date  to  the  satisfaction  of  the
          Offeror, then  the Offeror may by notice to the Company terminate
          this Agreement and  the  obligations  of  the  parties  hereunder
          except as otherwise herein provided.

     (b)  This Agreement may, until the Expiry Time:

          (i)  be terminated by the mutual agreement of the Company and the
               Offeror;

          (ii) be  terminated  by the Company if the Offeror breaches  this
               Agreement in any material respect;

          (iii) be terminated by  the Company, provided that the Company is
               not then in breach or default in any material respect of any
               of its obligations hereunder,  upon any determination by the
               Board at the conclusion of the process set out in sections 8
               and 9 that an Acquisition Proposal  constitutes  a  Superior
               Proposal,  and  further  provided  the  Company has paid the
               compensation payable to the Offeror under section 15;

          (iv) be  terminated by the Offeror if the Company  breaches  this
               Agreement in any material respect;

          (v)  be terminated  by  the Offeror if at any time after the date
               hereof:

               (A)  the  Board  shall  have  approved  or  recommended  any
                    Superior Proposal,  or  determined at the conclusion of
                    the  process  set out in sections  8  and  9  that  any
                    Acquisition  Proposal   is   a  Superior  Proposal,  or
                    resolved to take any of the foregoing actions,

               (B)  the Board  shall have withdrawn or modified in a manner
                    adverse  to  the  Offeror  or shall  have  failed  upon
                    request  by  the  Offeror to confirm  its  approval  or
                    recommendation of the  Offer  (other  than  as a direct
                    result  of and in direct response to a material  breach
                    by  the  Offeror  of  its  obligations  hereunder),  or
                    resolved to take any of the foregoing actions,

               (C)  the Offer  has  been  outstanding  for at least 10 days
                    after  the  Offeror  has  publicly announced  that  the
                    conditions  set  out  in  sections   3(b)  and  (c)  of
                    Schedule A have been satisfied or waived,  and upon the
                    Expiry  Time,  the  minimum share tender condition  (as
                    such term is defined  in section 3(a) of Schedule A) is
                    not met, or

               (D)  an   Acquisition  Proposal   is   publicly   announced,
                    proposed,  offered  or  made  by  a  third party to the
                    Shareholders  and  at the Expiry Time such  Acquisition
                    Proposal has not expired  or  been  withdrawn  and  the
                    minimum  share  tender condition (as defined in section
                    3(a) of Schedule A) has not been satisfied or waived by
                    the Offeror,

          subject to the payment by the Company of the compensation payable
          to the Offeror under section 15.

     (c)  If the Offeror has not taken  up  and  paid  for  the  SV  Shares
          deposited  under  the  Offer  on  or  before the date that is the
          earliest of (i) the date by which the Offeror is required to take
          up and pay for SV Shares tendered to the  Offer  pursuant  to the
          provisions  of  the  SECURITIES ACT,(ii) 10 days after the Expiry
          Time and (iii) the 75{th}  day  after the date of the Offer if no
          Acquisition Proposal has been made  or  publicly  announced  by a
          third  party  prior  to  such  75{th}  day  and when the Offer is
          outstanding,  then this Agreement shall automatically  terminate,
          provided that the  Company  and the Offeror may mutually agree to
          extend the date for termination of the Agreement.

     (d)  If this Agreement is terminated  in accordance with the foregoing
          provisions of this section 14, no  party  shall  have any further
          liability   to  perform  its  obligations  hereunder  except   as
          otherwise  expressly  contemplated  hereby,  and  provided  that,
          subject to section  15, neither the termination of this Agreement
          nor anything contained  in  this  section 14(d) shall relieve any
          party from any liability for any breach  by it of this Agreement,
          including   from  any  inaccuracy  in  its  representations   and
          warranties and  any  non-performance  by it of its covenants made
          herein.

15.  OFFEROR'S COMPENSATION.

     (a)  If the Agreement is terminated pursuant  to  section  14(b)(iii),
          section 14(b)(v)(A) or section 14(b)(v)(B), provided the  Offeror
          is not in material breach of its obligations to make the Offer in
          accordance with this Agreement, then the Company shall pay to the
          Offeror  an  amount  equal  to  the  Cash  Compensation Amount in
          immediately  available  funds  to  an account designated  by  the
          Offeror.  Such cash payment shall be paid, in case of termination
          by  the Company, prior to any such termination  and  in  case  of
          termination   by   the  Offeror,  forthwith  following  any  such
          termination.

     (b)  If the Agreement is  terminated  pursuant to section 14(b)(v)(D),
          provided the Offeror is not in material breach of its obligations
          to make the Offer in accordance with  this  Agreement,  then  the
          Company shall pay forthwith to the Offeror an amount equal to the
          Cash  Compensation  Amount  in  immediately available funds to an
          account designated by the Offeror.

     (c)  If the Agreement is terminated pursuant  to  section 14(b)(v)(C),
          provided the Offeror is not in material breach of its obligations
          to  make  the Offer in accordance with this Agreement,  then  the
          Company shall  pay  to  the  Offeror  the amount of the aggregate
          out-of-pocket  costs  and  expenses  of  the   Offeror   and  its
          affiliates  in  connection with the transactions contemplated  by
          this  Agreement  to  a  maximum  of  $2,085,190,  in  immediately
          available funds to  an  account  designated by the Offeror.  Such
          payment  shall be due on the first  Business  Day  following  the
          receipt by  the  Company  of  documentation  satisfactory  to it,
          acting  reasonably,  substantiating  the incurrence of such costs
          and expenses.

     (d)  For  greater  certainty,  the  parties  hereto   agree  that  the
          compensation to be received pursuant to section 15(a) or 15(b) is
          the sole remedy of the party receiving such payment provided that
          nothing shall preclude a party from seeking injunctive  relief to
          restrain  any  breach  or  threatened breach of the covenants  or
          agreements set forth in this  Agreement  (including  pursuant  to
          section 10) or otherwise to obtain specific performance of any of
          such  act,  covenants  or  agreements,  without  the necessity of
          posting bond or security in connection therewith.

16.  NOTICE AND CURE PROVISIONS.

     (a)  The  Offeror  and  the  Company shall give prompt notice  to  the
          other, after obtaining knowledge of the occurrence, or failure to
          occur, at any time until  the  Expiry Time, of any event or state
          of facts which occurrence or failure  would,  or  would be likely
          to:

          (i)  cause any of the representations or warranties  of the other
               contained herein to be untrue or inaccurate in any  material
               respect on the date made; or

          (ii) result  in  the  failure  to  comply  with  or  satisfy  any
               covenant,  condition  or  agreement  to  be complied with or
               satisfied by the other hereunder prior to  the  Expiry  Time
               which is susceptible to being cured.

     (b)  Neither the Offeror nor the Company may elect not to complete the
          transactions  contemplated  hereby  pursuant  to  the  conditions
          contained  herein  including  in  section 3(e) of Schedule A,  or
          exercise   any  termination  right  arising   therefrom,   unless
          forthwith and  in any event prior to the Expiry Time, the Offeror
          or the Company has,  as  the  case  may  be,  delivered a written
          notice to the other specifying in reasonable detail  all breaches
          of  covenants,  representations  and warranties or other  matters
          which  the  Offeror  or  the Company is,  as  the  case  may  be,
          asserting as the basis for  the non-fulfillment of the applicable
          condition precedent or the exercise  of the termination right, as
          the case may be.  If any such notice is  delivered, provided that
          the  Offeror or the Company is, as the case  may  be,  proceeding
          diligently  to cure such matter, if such matter is susceptible to
          being cured, the other may not terminate this Agreement until the
          earlier of the  Expiry  Time and the expiration of a period of 10
          days from such notice.

17.  PUBLICATION/DISCLOSURE.  Except as may otherwise be required by law or
by regulatory authorities or stock  exchanges  having  discretion over such
matters, each party hereto agrees that it will not publish,  file  with any
securities  commission  or  other  regulatory  authority, or otherwise make
public or make any public disclosure with respect  to this Agreement or the
negotiations  related  to this Agreement, in each case  without  the  prior
approval of the other party  not to be unreasonably withheld.  If any party
deems that it is required by law  or  such regulatory authority to make any
public announcement or release concerning this Agreement, such party agrees
to provide a written copy thereof to the other party in advance of any such
announcement  or  release  and  to  reasonably   consider   any   suggested
modifications,  which  will  be  provided  by  the  other party in a timely
manner.  The parties acknowledge that the terms of this  Agreement  will be
summarized in the Bid Circular and in the Directors' Circular.

18.  INSURANCE, INDEMNITY AND RELEASE.

     (a)  In the event the condition set out in section 3(a) of Schedule  A
          is  satisfied  or  waived  and  the  Offeror  acquires  SV Shares
          pursuant  to  the  transactions  contemplated  by this Agreement,
          there shall be maintained in effect, for not less  than six years
          from the Expiry Time, coverage equivalent to that in effect under
          the  current  policies of the directors' and officers'  liability
          insurance maintained by the Company which is no less advantageous
          and with no gaps  or  lapses in coverages with respect to matters
          occurring prior to the  Expiry  Time,  provided  that in no event
          shall the Offeror be obliged to pay premiums in respect  of  such
          coverage  which are in excess of 200% of the premiums paid by the
          Company as of the date of the Agreement.

     (b)  In the event  that  the  condition  set  out  in  section 3(a) of
          Schedule  A  is  satisfied or waived and the Offeror acquires  SV
          Shares  pursuant  to   the   transactions  contemplated  by  this
          Agreement, the Offeror shall, and shall cause the Company (or its
          successor)  to,  indemnify  the directors  and  officers  of  the
          Company and its subsidiaries  to  the fullest extent to which the
          Offeror and the Company are permitted to indemnify such directors
          and officers under their respective  charter,  by-law, applicable
          law  and  contracts  of indemnity.  The Offeror agrees  that  all
          rights to indemnification  or  exculpation now existing in favour
          of the directors or officers of  the Company or any subsidiary as
          provided  in  its  articles  of  incorporation   or   by-laws  or
          indemnification  agreements in effect on the date hereof,  copies
          of which have been  provided  to  the Offeror, shall survive this
          Agreement  and shall continue in full  force  and  effect  for  a
          period of not  less  than  six years from the Expiry Time and the
          Offeror  hereby  assumes,  effective  upon  consummation  of  the
          transactions contemplated by  this  Agreement, all such liability
          with respect to any matters arising prior to the Expiry Time.

     (c)  In  the  event  that the condition set out  in  section  3(a)  of
          Schedule A is satisfied  or  waived  and  the Offeror acquires SV
          Shares  pursuant  to  the  transactions  contemplated   by   this
          Agreement, the Offeror shall, and shall cause the Company (or its
          successor)  to, on the one hand, and the directors of the Company
          on the date of  this  Agreement shall, on the other hand, remise,
          release and forever discharge  each other and, in the case of the
          Offeror  and  the  Company,  its present  and  former  directors,
          officers, agents, servants and  employees (the "Releasees", which
          term  includes  their  respective  successors,   assigns,  heirs,
          executors,   estate   trustees,   personal  representatives   and
          administrators) of and from all actions, causes of action, suits,
          debts, dues, accounts, bonds, covenants,  contracts,  claims  and
          demands  whatsoever,  known  or unknown, suspected or unsuspected
          (collectively, the "claims") which  the  respective individual or
          entity  ever  had,  now  has or may hereafter  have  against  the
          Releasees, or any of them,  for  or  by  reason of, or in any way
          arising out of any cause, matter or thing  other  than  any claim
          for  unlawful  conduct  or  fraud and the obligations set out  in
          section 18(a) and section 18(b) of this Agreement.

19.  NOTICES.  Any notice required or permitted to be given hereunder shall
be written, and shall be either (i) personally  delivered,  (ii)  sent by a
reputable common carrier guaranteeing next business day delivery, or  (iii)
sent  by  facsimile,  to  the respective addresses of the parties set forth
below, or to such other place  as  any  party hereto may by notice given as
provided  herein  designate for receipt of  notices  hereunder.   Any  such
notice shall be deemed  given  and  effective  upon  receipt  or refusal of
receipt thereof by the primary party to whom it is to be sent.

          If to the Company:

               Consoltex Group Inc.
               8555 route Transcanadienne
               Saint-Laurent, Quebec
               Canada
               H4S 1Z6

               Attention: Richard H. Willett
               Facsimile: (514) 335-7020



<PAGE>



                                   - 2 -





          With a copy to:

               Osler, Hoskin & Harcourt
               280 Park Avenue
               30W
               New York, NY 10017

               Attention: John W. Stevens
               Facsimile: (212) 867-5802

          and to:

               Goodman Phillips & Vineberg
               1501 McGill College Ave.
               26{th} Floor
               Montreal, Quebec
               H3A 3N9

               Attention: Sidney Horn
               Facsimile: 9514) 841-6499

          and to:

               Clairvest Group Inc.
               22 St. Clair Avenue East
               Suite 1700
               Toronto, Ontario
               M4T 2S3

               Attention: Heather Crawford
               Facsimile: (416) 925-5753

          If to the Offeror:

               AIP/CGI Acquisition Corp.
               One Maritime Plaza, Suite 2525
               San Francisco, CA  94111

               Attention: Kim Marvin, Managing Director
               Facsimile: (415) 788-5302



<PAGE>



                                   - 3 -





          With a copy to:

               Kirkland & Ellis
               655 15{th} Street NW
               Washington, DC  20005

               Attention: Jack Feder
               Facsimile: (202) 879-5200

20.  NOTIFICATION OF CERTAIN MATTERS.  Each of the Company and  the Offeror
agrees  to  give  prompt  notice to the other of, and to use its reasonable
best efforts to prevent or  promptly  remedy, (a) the occurrence or failure
to occur, or the impending or threatened occurrence of failure to occur, of
any event which would be likely to cause  any  of  its  representations  or
warranties  in  this  Agreement to be untrue or inaccurate at any time from
the date hereof to the  date  of  termination of this Agreement and (b) any
failure on its part to comply with  or  satisfy  any covenant, condition or
agreement  to  be  complied  with  or satisfied by it hereunder;  provided,
however, that the delivery of any notice  pursuant to this section 20 shall
not limit or otherwise affect the remedies available hereunder to the party
receiving such notice.

21.  NON-SURVIVAL  OF  REPRESENTATIONS,  WARRANTIES  AND  AGREEMENTS.   The
representations,  warranties and agreements  contained  in  this  Agreement
shall terminate on  the  Expiry  Time  or  upon  the  termination  of  this
Agreement  pursuant  to  section  14,  as  the case may be, except that the
agreements set forth in section 4 (further action, reasonable best efforts)
and section 17 shall survive the Expiry Time  indefinitely  and  those  set
forth  in  section  10,  section  11,  section  12, section 15, section 17,
section  18  and  section  24  shall survive termination  indefinitely  (in
accordance with the terms of such provisions).

22.  KNOWLEDGE.  In this Agreement,  references  to  "to  the knowledge of"
means the actual knowledge of any of the Executive Officers  of the Company
or  the  Offeror,  as the case may be, after reasonable inquiry,  and  such
Executive  Officers shall  make  such  inquiry  as  is  reasonable  in  the
circumstances.

23.  PRINCIPLES  OF  INTERPRETATION.   The  division of this Agreement into
sections  and  other  portions  and  the  insertion  of  headings  are  for
convenience  of reference only and shall not  affect  the  construction  or
interpretation  hereof.   Unless  otherwise  indicated, all references to a
"section" or "Schedule" followed by a number and/or  a  letter refer to the
specified  section  or  Schedule  of  this  Agreement.   The  terms   "this
Agreement",  "hereof",  "herein"  and  "hereunder"  and similar expressions
refer to this Agreement (including the Schedules hereto)  and  not  to  any
particular  section  or  other  portion hereof and include any agreement or
instrument supplementary or ancillary hereto.  Unless the context otherwise
requires, words importing the singular  shall  include  the plural and vice
versa  and  words importing any gender shall include all genders.   In  the
event that any  date  on which any action is required to be taken hereunder
by any of the parties hereto  is  not  a Business Day, such action shall be
required to be taken on the next succeeding day which is a Business Day.

24.  GOVERNING LAW.  This Agreement shall  be  governed by and construed in
accordance with the laws of the Province of Ontario  and the laws of Canada
applicable  therein.   The parties hereto irrevocably submit  to  the
non-exclusive jurisdiction of  the courts of the Province of Ontario in
respect of the interpretation and enforcement of this Agreement.

25.  COUNTERPARTS.  This Agreement  may be executed by facsimile signature,
or otherwise, in two or more counterparts, all of which taken together will
constitute one binding agreement.

26.  ENTIRE AGREEMENT. This Agreement  constitutes and comprises the entire
agreement and understanding between the Company and the Offeror with regard
to  the  subject  matter hereof and supersedes  all  prior  agreements  and
undertakings, both  written  and  oral,  among the parties, or any of them,
with respect to the subject matter hereof.

27.  BENEFICIARIES.  Except as expressly provided  herein,  no  third party
shall  be  entitled to enforce any provision hereof, and no third party  is
intended to benefit from this Agreement.

28.  AUTHORSHIP.   The  parties hereto agree that the terms and language of
this Agreement and all agreements  contemplated  hereby were the results of
negotiations  between  the  parties and, as a result,  there  shall  be  no
presumption that any ambiguity  in this Agreement shall be resolved against
either party.

29.  SEVERABILITY.  If any term or  other  provision  of  this Agreement is
invalid,  illegal  or  incapable of being enforced by any rule  of  law  or
public policy, all other  conditions and provisions of this Agreement shall
nevertheless remain in full  force  and  effect  so long as the economic or
legal substance of the transactions contemplated hereby  is not affected in
any  manner materially adverse to any party.  Upon such determination  that
any term  or  other  provision  is  invalid,  illegal or incapable of being
enforced, the parties hereto shall negotiate in  good  faith to modify this
Agreement so as to effect the original intent of the parties  as closely as
possible  in  an  acceptable  manner  to  the  end  that  the  transactions
contemplated hereby are fulfilled to the fullest extent possible.

30.  ASSIGNMENT.  This Agreement shall not be assigned by operation  of law
or  otherwise,  except that the Offeror may assign all or any of its rights
and obligations hereunder to any direct or indirect wholly-owned subsidiary
of the Offeror, PROVIDED  that no such assignment shall relieve the Offeror
of  its obligations hereunder  if  such  assignee  does  not  perform  such
obligations.

31.  AMENDMENT; WAIVER.  This Agreement may not be modified, amended,
altered or supplemented except upon the execution and delivery of a written
agreement executed by each of the parties hereto.  Any party hereto may (a)
extend the time for the performance of any of the obligations or other acts
of the other party hereto, (b) waive any inaccuracies in the
representations and warranties contained herein or in any document
delivered pursuant hereto and (c) waive compliance with any of the
agreements or conditions contained herein.  Any such extension or waiver
shall be valid if set forth in an instrument in writing signed by the party
or parties to be bound thereby.



<PAGE>



                                   - 4 -





If the  foregoing  accurately  expresses  the  Company's  understanding and
agreement with respect to the matters described herein, please execute this
letter below and return it to us.

                              AIP/CGI NB ACQUISITION CORP.


                              By:  _________________________________
                                  Name:
                                  Title:


Accepted and Agreed as of September                , 1999.

CONSOLTEX GROUP INC.

By:  _________________________________

     Name:
     Title:


<PAGE>




                                   - 2 -









                                SCHEDULE A

                            TERMS OF THE OFFER

1.   GENERAL  TERMS.  The  Offer shall be made to purchase all  of  the  SV
     Shares by way of a take-over  bid circular prepared in compliance with
     the  Securities Act and other applicable  provincial  securities  laws
     and, if  necessary,  in  accordance  with  the  applicable laws of the
     United States.  The Offer shall be made on the terms  set forth in the
     Offer Agreement including this Schedule and upon such other  terms and
     conditions  as  are required by law.  Take-up and payment pursuant  to
     the Offer shall occur simultaneously.

The Offeror shall have  the  right to vary the terms of the Offer to effect
one or more of the following:

     (a)  increase the consideration offered for the SV Shares;

     (b)  subject to the following two paragraphs, extend the period during
          which SV Shares may be deposited to the Offer;

     (c)  waive any condition  of  the  Offer or reduce the minimum deposit
          condition contained in paragraph 3(a) hereof; and

     (d)  comply with applicable securities laws.

Except as described in the following paragraph,  the Offeror shall no later
than 75 calendar days from the date of the Offer either:

     (a)  withdraw the Offer and return all SV Shares deposited thereunder;
          or

     (b)  waive any conditions that have not been  satisfied,  if  any, and
          take up and pay for all SV Shares deposited under the Offer.

The  Offer  may  be  extended  by  the  Offeror beyond the date which is 75
calendar days from the date the Offer (the  "75{th}  Day"),  from
time-to-time, in the event that the Offeror first takes up and pays for all
deposited  SV Shares.  If there has been an Acquisition  Proposal  made  or
publicly announced  by  a  third  party on or before the 75{th} Day and the
conditions of the Offer have not been  satisfied  or  waived  at  the  then
current  expiry  date  of  the  Offer  ,  the  Offeror may extend the Offer
(without having to first take up and pay for all deposited SV Shares), from
time to time, beyond the 75{th} Day until the earlier  of:  (i) the date on
which all conditions under the Offer have been satisfied  or waived or (ii)
a date which is not later than 10 days after such Acquisition  Proposal has
expired or been withdrawn.

1.   PRICE  OF  THE OFFER.  The Offeror shall offer to pay, for each  whole
     Share validly  deposited  under  the Offer and not withdrawn, $5.60 in
     cash.

2.   CONDITIONS  OF THE OFFER.  The Offer  shall  not  be  subject  to  any
     conditions other than the following:

     (a)  there shall  have  been validly deposited and not withdrawn under
          the Offer as at the  expiry  time  of the Offer such number of SV
          Shares (calculated on a fully diluted basis) which represents not
          less than 90% of the SV Shares outstanding  (on  a  fully diluted
          basis)  as at the expiry time of the Offer other than  SV  Shares
          held on the date of the Offer by or on behalf of the Offeror, its
          affiliates and associates (the "minimum share tender condition");

     (b)  all government  or regulatory consents or approvals (including in
          Canada, the United States or elsewhere) which the Offeror, in its
          sole judgment, views  as being necessary to enable the Offeror to
          acquire the Company shall  have  been  received by the Offeror on
          terms and conditions satisfactory to the  Offeror  including  the
          expiration or early termination of any applicable waiting periods
          under the INVESTMENT CANADA ACT (Canada) and the HSR Act;

     (c)  the  Offeror  shall have obtained such orders or exemptive relief
          from the appropriate  governmental  or  regulatory authorities in
          each applicable jurisdiction as are necessary  in connection with
          completing the Offer and the transactions contemplated thereby;

     (d)  there shall not exist any prohibition at law against  the Offeror
          making the Offer or taking up and paying for SV Shares  deposited
          under   the   Offer,  or  completing  any  subsequent  compulsory
          acquisition or going private transaction;

     (e)  as of the date of this Agreement, each of the representations and
          warranties of the  Company  set forth in this Agreement which are
          qualified  by  materiality shall  be  true  and  correct  in  all
          respects, each of the other representations and warranties of the
          Company set forth  in  the  Offer  Agreement  shall  be  true and
          correct  in  all material respects, and, with respect to breaches
          of representation  or  warranty  resulting  from events occurring
          between  the  date  of this Agreement and the Expiry  Time,  such
          breach(es) shall not,  either  individually  or in the aggregate,
          have  a  Material  Adverse  Effect,  and the Company  shall  have
          performed in all material respects any  covenant  or  complied in
          all  material respects with any agreement to be performed  by  it
          under this Agreement;

     (f)  the Offeror  shall  have determined in its sole judgment that (i)
          no act, action suit or  proceeding  shall have been threatened or
          taken before or by any domestic or foreign  court  or tribunal or
          governmental    agency   or   other   regulatory   authority   or
          administrative agency  or  commission,  or  by  any  Governmental
          Entity or private Person in Canada or elsewhere, whether  or  not
          having  the  force  of  law, and (ii) no law, regulation, policy,
          directive or order, whether or not having the force of law, shall
          have been proposed, enacted,  promulgated or applied, in the case
          of either (i) or (ii):

          (A)  to  cease  trade,  enjoin,  prohibit   or   impose  material
               limitations or conditions on the purchase by  or the sale to
               the  Offeror of the SV Shares, the right of the  Offeror  to
               own SV Shares or exercise full rights of ownership of the SV
               Shares  or the right of the Offeror to complete a compulsory
               acquisition transaction;

          (B)  which,  if   the  Offer  were  consummated,  could,  in  the
               Offeror's sole  judgment,  be  reasonably expected to have a
               Material Adverse Effect;

     (g)  there  shall not have occurred any actual  or  threatened  change
          (including   any   announcement,   governmental   or   regulatory
          initiative, condition, event or development involving a change or
          a  prospective  change)  that the Offeror determines, based  upon
          written advice from its tax  advisors,  a  copy of which has been
          delivered  to  the  Company,  could  reasonably  be  expected  to
          materially  increase  the  effective tax cost to the  Offeror  of
          acquiring,  holding or disposing  of  the  SV  Shares  or  making
          distributions  or  interest  payments  from  the  Company and its
          subsidiaries;

     (h)  there shall not exist or have occurred (or, if there  does  exist
          or  shall  have  previously  occurred,  there shall not have been
          disclosed  or the Offeror shall not otherwise  discover,  if  not
          previously disclosed  to  the  Offeror  in  writing  prior to the
          commencement of the Offer), any condition, event, development  or
          change  (or  any  condition,  event  or  development  involving a
          prospective   change)   in   the  business,  operations,  assets,
          capitalization, condition (financial  or  otherwise),  results of
          operations, cash flows, prospects, properties, licenses, permits,
          rights,   privileges   or  liabilities,  whether  contractual  or
          otherwise,  of  or  relating   to  the  Company  or  any  of  its
          subsidiaries  which,  in  the  Offeror's   sole  judgment,  could
          reasonably  be  expected  to  be  adverse  and significant  to  a
          purchaser of SV Shares;

     (i)  the Offeror shall not have become aware of any  untrue  statement
          of material fact, or an omission to state a material fact that is
          required  to  be  stated or that is necessary to make a statement
          not misleading in the  light of the circumstances in which it was
          made and at the date it  was  made  (after  giving  effect to all
          subsequent filings in relation to all matters covered  in earlier
          filings)  in  any  document  filed by or on behalf of the Company
          with any securities commission  or  similar securities regulatory
          authority in any of the provinces of  Canada  of  in  the  United
          States, including without limitation any annual information form,
          financial  statement,  material change report or management proxy
          circular or in any document  so  filed or released by the Company
          to the public;

     (j)  there shall not have occurred, developed or come into effect any
          occurrence of national or international consequence, or any law,
          regulation, action, government regulation, inquiry or other
          occurrences  of  any nature whatsoever, which seriously adversely
          affects, or may seriously adversely affect, the financial markets
          in Canada or the United States, generally which could reasonably
          be expected to prevent or  materially impair the ability of the
          Company to refinance the indebtedness outstanding under the
          Credit Facilities and Senior Notes upon maturity on commercially
          reasonable terms;

     (k)  the Offeror shall not have the right  under  this  Agreement, the
          Loan Purchase Agreement, the Stockholders Agreements or the
          Lock-Up Agreement to terminate any such agreement; and

     (l)  the  Company shall have amended the Credit Facilities  to  extend
          the term  of  the  Tranche B term loan facility and the revolving
          credit facility to October  31,  2000,  and  otherwise the Credit
          Facilities shall be on substantially the terms and conditions set
          out  in the term sheet dated September 9, 1999  executed  by  the
          Company  and Bank of America, N.A. and National Bank of Canada, a
          copy of which has been presented to the Offeror.

The foregoing conditions  are  for the exclusive benefit of the Offeror and
may be asserted by the Offeror regardless  of  the circumstances (including
any action or inaction by the Offeror) giving rise to such assertion or may
be waived by the Offeror in whole or in part at  any  time and from time to
time,  in  its sole discretion and shall be exclusive of  any  other  right
which the Offeror  may have under the Offer.  The failure by the Offeror at
any time to exercise  or  assert  any  of the foregoing rights shall not be
deemed to constitute a waiver of any such  right,  the  wavier  of any such
right with respect to particular facts or other circumstances shall  not be
deemed a waiver with respect to any other facts and circumstances and  each
such  right  shall be deemed an on-going right which may be asserted at any
time and from  time  to  time  by  the  Offeror.   Any determination by the
Offeror concerning the foregoing conditions shall be final and binding upon
all parties.



<PAGE>


                                SCHEDULE B

                                DEFINITIONS

"Acquisition Proposal" means (i) any sale of material assets of the Company
or  any  of  its Material Subsidiaries, other than sales  of  inventory  or
accounts receivable  or  sales  in the ordinary course, or any lease,
long-term  supply agreement or any other  agreement  having  the  same
economic effect as such a sale, (ii) any amalgamation, merger,consolidation,
take-over   bid, reorganization, dissolution, recapitalization, business
combination  or  similar transaction involving the Company or any of the SV
Shares or the MV Shares (or rights to acquire such shares), or (iii) a sale
or transfer, directly  or  indirectly,  of  any  of the SV Shares or the MV
Shares held by CGI or LGBV other than as provided  for  or permitted by the
Lock-Up Agreement and the Shareholders Agreement;

"APPROPRIATE   REGULATORY   APPROVALS"  means  those  sanctions,   rulings,
consents, orders, exemptions,  permits  and  other approvals (including the
lapse,  without  objection,  of  a  prescribed  time  under  a  statute  or
regulation  that  states  that  a  transaction  may  be  implemented  if  a
prescribed time lapses following the giving of notice  without an objection
being   made)   of   any   Governmental   Entity,   regulatory  agency   or
self-regulatory organisation, as set out on Schedule "C" hereto;

"BUSINESS  DAY"  means  any  day  on which commercial banks  are  open  for
business in New York, New York and  Toronto, Ontario other than a Saturday,
a Sunday or a day observed as a holiday  in Toronto, Ontario under the laws
of the Province of Ontario or the federal laws of Canada applicable therein
or in New York, New York under the laws of  the  State  of  New York or the
federal laws of the United States of America applicable therein;

"CASH COMPENSATION AMOUNT" means $4,170,381;

"CBCA" means the CANADA BUSINESS CORPORATIONS ACT (Canada) as now in effect
and as it may be amended from time to time prior to the Expiry Time;

"COMPANY BALANCE SHEET" has the meaning ascribed thereto in section 5(i);

"COMPANY  BALANCE SHEET DATE" has the meaning ascribed thereto  in  section
5(h);

"COMPANY DISCLOSURE LETTER" means that certain letter dated the date hereof
and delivered by Company to the Offeror;

"COMPANY DOCUMENTS" has the meaning ascribed thereto in section 5(f);

"COMPANY FINANCIAL  STATEMENTS" has the meaning ascribed thereto in section
5(g);

"COMPANY OPTIONS" means  the  outstanding  stock  options providing for the
issuance of 1,207,666 SV Shares upon the exercise thereof  as  set forth in
the  Company  Disclosure  Letter, disclosing the names of the holders,  the
number of SV Shares underlying  each  such  option  and  the exercise price
thereof;

"COMPANY PROPERTY" has the meaning ascribed thereto in section 5(p);

"CONTRACT"   means   any  pending  and/or  executory  contract,  agreement,
arrangement  or  understanding   to   which  the  Company  or  any  of  its
subsidiaries is a party or by which the  Company or any of its subsidiaries
or any of their respective assets is bound or affected;

"CREDIT FACILITIES" means the credit facilities  under the credit agreement
dated  March  19,  1996 among, INTER ALIA, the Company,  National  Bank  of
Canada and NationsBank, National Association;

"EMPLOYEE" has the meaning ascribed thereto in section 5(t);

"EMPLOYEE PLANS" has the meaning ascribed thereto in section 5(u);

"ENVIRONMENTAL LAWS" means all applicable Laws, including applicable common
laws, relating to the protection of the environment and employee and public
health and safety, including  any  such  environmental  laws  relating to a
discharge,  spill, emission or other release, whether actual or  potential,
of  any contaminant   (as  defined  in  the  ENVIRONMENTAL  PROTECTION  ACT
(Ontario))  and  any  other  applicable legislation, regulation, guideline,
policy or by-law as well as any  order,  directive  or decision rendered by
any Governmental Entity;

"EXECUTIVE OFFICERS" in the case of the Company means the individuals named
for such purpose in the Company Disclosure Letter and  in  the  case of the
Offeror means Kim Marvin, Theodore Rogers and Kenneth Diekroeger;

"EXPIRY TIME" has the meaning ascribed thereto in section 1;

"GOVERNMENTAL  ENTITY"  means  any  (a) multinational, federal, provincial,
state,  regional, municipal, local or  other  government,  governmental  or
public  department,   central   bank,   court,   tribunal,  arbitral  body,
commission, board, bureau or agency, whether domestic  or  foreign, (b) any
subdivision,  agent,  commission,  board,  or  authority  of  any  of   the
foregoing,  or  (c)  any  quasi-governmental or private body exercising any
regulatory, expropriation or  taxing  authority under or for the account of
any of the foregoing;

"HSR ACT" means the Hart-Scott-Rodino Antitrust  Improvements  Act  of 1976
(United States);

"INFORMATION"  means  all information furnished under section 10(a) by  the
Company relating to the  business,  assets,  corporate structure, financial
position and operations of the Company, including,  without limitation, all
documentation,  business  plans, Intellectual Property,  studies,  records,
knowledge, systems, ideas,  know-how,  source  codes, object codes, manuals
and  other  tangible or intangible information relating  to  the  Company's
business, products  or  services  together  with all financial information,
plans,  corporate  records,  product information,  analyses,  compilations,
forecasts,  studies or other documents  prepared  by  the  Company  or  its
Representatives  which  contain or otherwise reflect such information.  The
term "Information" shall  not  include  such  portions  of  the Information
which: (i) are or become generally available to the public other  than as a
result  of  a  disclosure  by  the  Offeror, one of its affiliates or their
Representatives; or (ii) are received  from  an independent third party who
had  obtained  such information lawfully and was  under  no  obligation  of
secrecy or confidentiality;  (iii)  were  independently  developed  by  the
Offeror  or on the Offeror's behalf, or (iv) the Offeror shows was lawfully
in the possession  of  the  Offeror  or  one  of  its affiliates before the
Offeror received such information from the Company;

"INTELLECTUAL   PROPERTY"   means  industrial  and  intellectual   property
including:

     (i)  all registered or unregistered trade-marks, trade names, business
          names,  domain  names,   brand  names,  brands,  designs,  logos,
          identifying indicia and  service  marks,  including  any goodwill
          attached thereto and all registrations and applications  relating
          thereto;

     (ii) all  inventions,  patents,  patent  rights,  patent  applications
          (including all reissues, divisions, continuations,
          continuations-in-part  and  extensions  of  any patent or patent
          applications), industrial   designs  and  applications   for
          registration   of  industrial designs;

     (iii) all copyrights,  registrations and applications for registration
          of copyrights and works  of  authorship  including  all  computer
          programs  (including  source codes), databases and related works;
          and

     (iv) all processes, data, trade  secrets,  designs,  know-how, product
          information,   manuals,   technology,  research  and  development
          reports,  technical  information,  technical  assistance,  design
          specifications  and similar  materials  recording  or  evidencing
          expertise or proprietary information;

"LAWS" means all statutes, regulations, statutory rules, principles of law,
orders, published policies  and guidelines, and terms and conditions of any
grant  of  approval,  permission,   authority  or  licence  of  any  court,
Governmental Entity, statutory body (including  The  Toronto Stock Exchange
or  the  Montreal  Exchange)  or self-regulatory authority,  and  the  term
"applicable" with respect to such  Laws  and  in the context that refers to
one or more Persons, means that such Laws apply  to  such Person or Persons
or its or their business, undertaking, property or securities  and  emanate
from  a  Person  having  jurisdiction  over the Person or Persons or its or
their business, undertaking, property or securities;

"LGBV" means Les Gantiers Holding B.V.,  a  corporation  incorporated under
the laws of the Netherlands;

"LEASED  REAL PROPERTY" means all land, building, fixtures  or  other  real
property in  which the Company or any of its subsidiaries holds a leasehold
or subleasehold  estate, or is granted a licence, concession or other right
of use or occupancy.

"LEASEHOLD  IMPROVEMENTS"   means   all   buildings,   fixtures  and  other
improvements located on each Leased Real Property which  are  owned  by the
Company  or  any of its subsidiaries, regardless of whether such buildings,
fixtures or improvements  are subject to reversion to the landlord or other
third party upon the expiration or termination of the Lease for such Leased
Real Property.

"LEASES"  means all leases,  subleases,  licences,  concessions  and  other
agreements  (written  or  oral),  together with all amendments, extensions,
renewals guaranties and other agreements  with  respect  thereto,  for  any
Leased Real Property.

"MATERIAL  ADVERSE EFFECT" means any effect that is, or would reasonably be
expected to  be, material and adverse to the business, assets, liabilities,
financial condition,  results of operations or prospects of the Company and
its subsidiaries taken  as a whole, or to the value of the SV Shares to the
Offeror,  other  than  any effect  resulting  from  (i)  general  economic,
financial or market conditions;  (ii) conditions or circumstances generally
affecting the industries in which the Company and its subsidiaries operate;
or (iii) any event or item identified  in  the Company Disclosure Letter as
having a Material Adverse Effect;

"MATERIAL CONTRACT" means any Contract:

     (i)  for the purchase and sale of goods  or  services for an aggregate
          cumulative purchase price in excess of $2,500,000; or

     (ii) for the purpose of analyzing, developing, purchasing or providing
          goods  or  services  or  for  any  business  arrangement,   asset
          acquisition or potential investment in excess of $2,500,000;

     (iii)  for  the purchase or sale of real property or any Lease of real
          property; or

     (iv) which is a collective bargaining agreement;

"MATERIAL SUBSIDIARY"  means  each  of  the  subsidiaries identified in the
Company Disclosure Letter as a material subsidiary;

"OSC" means the Ontario Securities Commission;

"OWNED REAL PROPERTY" means all land, together with all buildings, fixtures
and other improvements located thereon, including,  without limitation, all
electrical,   mechanical,   plumbing  and  other  building  systems   (fire
protection,   security   and  surveillance   systems,   telecommunications,
computer,  wiring  and cable  installations,  irrigation  and  other  water
distribution systems),  easements and other rights and interest appurtenant
thereto, owned by the Company or any of its subsidiaries;

"PERSON" includes any individual, firm, partnership, joint venture, venture
capital fund, association,  trust,  trustee, executor, administrator, legal
personal  representative,  estate,  group,   body  corporate,  corporation,
unincorporated association or organization, Governmental  Entity, syndicate
or other entity, whether or not having legal status;

"REPRESENTATIVES"   means  all  employees,  directors,  officers,   agents,
lawyers, accountants  and  financial advisers of a party including, but not
limited to, Salomon Smith Barney  Canada  Inc.  and CGI, in the case of the
Company,  and  BT  Alex  Brown,  Bank  of America and Donaldson,  Lufkin  &
Jenrette, in the case of Offeror;

"SECURITIES ACT" means the SECURITIES ACT (Ontario) as now in effect and as
it may be amended from time to time prior to the Expiry Time;

"SECURITY INTEREST" means any mortgage,  pledge,  lien, encumbrance, charge
or  other security interest, other than (i) mechanics',  materialmen's  and
similar  liens,  (ii)  liens for Taxes not yet due and payable, (iii) money
purchase liens and liens  securing  rental  payments  under  capital  lease
arrangements,  and  (iv)  other liens arising out of the ordinary course of
business and not incurred in connection with the borrowing of money;

"SENIOR NOTES" means the notes  governed  by  the  indenture  dated  as  of
September  30, 1993 among, INTER ALIA, the Company and First Trust National
Association;

"SHAREHOLDERS" means the holders of the SV Shares;

"SUBSIDIARY"  has  the  meaning  ascribed  thereto  in  the  SECURITIES ACT
(Ontario);

"SUPERIOR PROPOSAL" has the meaning ascribed thereto in section 7(a);

"TAX"  and "TAXES" means, with respect to any entity, (i) all income  taxes
(including  any  tax  on  or based upon net income, gross income, income as
specially defined, earnings,  profits or selected items of income, earnings
or  profits) and all capital taxes,  gross  receipts  taxes,  environmental
taxes,  sales  taxes,  use  taxes,  ad  valorem  taxes,  value added taxes,
transfer taxes, franchise taxes, licence taxes, withholding  taxes, payroll
taxes, employment taxes, Canada or Qu<e'>bec Pension Plan premiums, excise,
severance,   social  security  premiums,  workers'  compensation  premiums,
unemployment insurance  or  compensation  premiums, stamp taxes, occupation
taxes, premium taxes, property taxes, windfall  profits  taxes, alternative
or  add-on minimum taxes, goods and services tax, customs duties  or  other
taxes,  fees,  imports,  assessments  or  charges  of  any kind whatsoever,
together with any interest and any penalties or additional  amounts imposed
by  any  taxing  authority  (domestic or foreign) on such entity,  and  any
interest, penalties, additional  taxes  and  additions  to tax imposed with
respect  to the foregoing, and (ii) any liability for the  payment  of  any
amount of  the  type described in the immediately preceding clause (i) as a
result of being a  "transferee"  (within the meaning of section 6901 of the
United  States Internal Revenue Code  or  any  other  applicable  Laws)  of
another entity or a member of an affiliated or combined group;

"TAX RETURNS" means all returns, declarations, reports, information returns
and statements  required  to be filed with any Governmental Entity relating
to Taxes (including any attached schedules), including, without limitation,
any information return, claim for refund, amended return and declaration of
estimated Tax;

"YEAR 2000 ERROR" shall have the meaning ascribed thereto in section 5(e).



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                                SCHEDULE C

                     APPROPRIATE REGULATORY APPROVALS

(i)  Approval under the Investment Canada Act (Canada)



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                                SCHEDULE D
              FORM OF SPECIAL HOLDCO SHARE PURCHASE AGREEMENT

<PAGE>