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                                                                   Exhibit 10.27



                                                                December 5, 2001

Regal Greetings & Gift Corporation
7035 Ordan Drive
Mississauga, ON
L5T 1T1


Dear Sir:

         We confirm that subject to acceptance by you, The Bank of Nova Scotia
(the "Bank") will make available to Regal Greetings & Gift Corporation (the
"Borrower"), credit facilities on the terms and conditions set out in the
attached Terms and Conditions Sheet and Schedule "A".

         If the arrangements set out in this letter, and in the attached Terms
and Conditions Sheet and Schedule "A" (collectively the "Commitment Letter") are
acceptable to you, please sign the enclosed copy of this letter in the space
indicated below and return the letter, together with the balance of the
"Commitment Fee", to us by the close of business on December 12, 2001, after
which date this offer will lapse.

                                                     Yours very truly,


         ------------------------                    ---------------------------
         Jeff Zelikovitz                             Colin Cook
         Senior Account Manager                      Director-Commercial Banking


         The arrangements set out above and in the attached Terms and Conditions
Sheet and Schedule "A" (collectively the "Commitment Letter") are hereby
acknowledged and accepted by:

REGAL GREETINGS & GIFT CORPORATION
----------------------------------
Name


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

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

Date:
     ------------------------------

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                                                                          Page 1


                              TERMS AND CONDITIONS

CREDIT NUMBER: 01                                 AUTHORIZED AMOUNT: $10,000,000
--------------------------------------------------------------------------------


TYPE

         Operating

PURPOSE

         To assist in financing general operating requirements.

CURRENCY

         Canadian and/or U.S. dollar equivalent thereof, unless specifically
         stated to be in US Dollars.

AVAILMENT

         The Borrower may avail the credit by way of Agreement Re: Operating
         Credit Line and/or Commercial Letters of Credit at sight and/or up to
         90 days sight and/or Letters of Credit Acceptances. Availments by way
         of Commercial Letters of Credit and/or Letters of Credit Acceptances
         are limited to US$1,500,000 and subject to the maximum combined
         availments under Credit Number 1 not exceeding CAD$10,000,000.

INTEREST RATE

         CANADIAN DOLLARS
         The Bank's Prime rate from time to time plus 3.00% per annum with
         interest payable monthly.

         U.S. DOLLARS
         The Bank's U.S. Dollar Base Rate in Canada , from time to time plus
         3.00% per annum with interest payable monthly.

LETTER OF CREDIT FEES

         The applicable fee or fees charged by the Bank for Letters of Credit as
         agreed between the Borrower and the Bank from time to time.

REPAYMENT

         Advances are repayable on demand.

SPECIFIC SECURITY

         The following security, in addition to the general security outlined
         hereinafter, evidenced by documents in form satisfactory to the Bank
         and registered or recorded as required by the Bank, is to be provided
         prior to any advances or availment being made under the Credit:

                  Agreement re Operating Credit Line.

                  Agreements For Commercial Letters of Credit.


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                                                                          Page 2


SPECIFIC CONDITIONS

         Until all debts and liabilities under the Credit have been discharged
         in full, the following conditions will apply in respect of the Credit:

                  Letters of Credit are issued subject to terms and conditions
                  of Agreements For Commercial Letters of Credit duly executed
                  by the Borrower.

                  At least once for a consecutive 20 calendar day period
                  commencing November 20th and ending February 10th of the
                  following year, no outstanding amounts are permitted under
                  this facility with the exception of Letters of Credit and
                  Letters of Credit Acceptances.

                  Operating loans and Letters of Credit Acceptances, are not to
                  exceed at any time the "Borrowing Base" which is defined as
                  the aggregate of 75% of good quality accounts receivable of
                  the Borrower and Guarantor (excluding accounts over 90 days,
                  accounts due by employees, offsets and inter-company accounts)
                  plus 35 % of net inventory, less security interests or charges
                  held by other parties and specific payables which have or may
                  have priority over the Bank's security.

                  Net Inventory is defined as the sum of finished goods of the
                  Borrower and subsidiary valued at the lower of cost or market,
                  less unpaid inventory received from suppliers during the past
                  30 days.

CREDIT NUMBER: 02                                 AUTHORIZED AMOUNT: $13,000,000
--------------------------------------------------------------------------------


TYPE

         Non-Revolving

PURPOSE

         Granted to assist in financing the purchase of substantially all the
         equity and assets of Regal Greetings & Gifts (A Division of MDC
         Corporation Inc., the "Vendor"), at a price of $39,000,000.

CURRENCY

         Canadian dollars.

AVAILMENT

         The Borrower may avail the credit by way of Term Promissory Notes.

INTEREST RATE

         The Bank's Prime rate from time to time plus 3.00% per annum with
         interest payable monthly.

DRAWDOWN

         Loans are to be fully drawn down by January 31, 2002.
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                                                                          Page 3


REPAYMENT

         Advances are repayable by quarterly payments of principal of $500,000
         per quarter, commencing March 31, 2002 through to December 31, 2003 and
         increasing to $750,000 principal per quarter commencing March 31, 2004
         with a final payment of the balance of principal and interest then
         outstanding due December 31, 2006. The term and amortization of the
         loan is 5 years.

         CASH SWEEP
         In addition to scheduled instalments of principal, the Borrower is
         required to make an annual cash payment equal to 25% of Net Free Cash
         Flow as at December 31st, commencing with December 31, 2003 period end,
         to be applied as a permanent reduction to Credit 2 loans. Net Free Cash
         Flow is defined as the greater of (i) cash (including cash equivalents,
         and money market instruments, and having made all working capital
         adjustments) at December 31st less scheduled principal payments on
         senior and subordinated debt for the next twelve month period and (ii)
         net income after taxes for the twelve month period ending December 31st
         plus depreciation, amortization and deferred income tax expense less
         scheduled principal payments on senior and subordinated debt for the
         next twelve month period less cash interest paid for the previous
         twelve month period, cash taxes paid for the previous twelve month
         period and capital expenditures incurred for the previous twelve month
         period.

         Net Free Cash Flow is to be calculated annually based upon the
         Borrower's preliminary December 31 financial statements (subject to
         further adjustment, as the Bank deems necessary, on receipt of the
         final annual audited or 6 month review (as applicable) financial
         statements as at December 31, and the cash payment paid no later than
         45 days after December 31 in each year.

         The Bank acknowledges commencing with receipt of the December 31, 2004
         financial statement the Vendor will participate in the Cash Sweep on
         the same basis with the Bank subject to an aggregate maximum repayment
         to the Vendor of $2,000,000 under the vendor take back obligation
         "VTB".

PREPAYMENT

         Provided 10 business days prior written notice has been given to the
         Bank, prepayment is permitted without penalty at any time in whole or
         in part.

         Prepayments are to be applied against installments of principal in the
         inverse order of their maturities.

CREDIT NUMBER: 03                               AUTHORIZED AMOUNT: US$15,000,000
--------------------------------------------------------------------------------

         Under Credit Number 03, subject to availability and execution of
         mutually satisfactory documentation the Borrower may enter into Forward
         Exchange Contracts with the Bank for maximum terms of up to one year.

         Maximum aggregate Forward Exchange Contracts outstanding at any one
         time are not to exceed face amount US$15,000,000, or the equivalent
         thereof in other approved currencies.

FEES

         A Commitment Fee of $440,000, of which $50,000 is earned upon
         presentation of this commitment and the balance is earned and is
         payable upon acceptance of this commitment of which $220,000 is
         refundable if this transaction does not close for reasons beyond the
         Borrower's control.
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                                                                          Page 4


         If Borrower defaults in closing the transaction, the Bank's remedy
         against Borrower and its affiliates will be to retain the Commitment
         Fees.

GENERAL SECURITY

         The following security, evidenced by Security Documents in form
         satisfactory to the Bank and registered or recorded as required by the
         Bank, supported by satisfactory legal opinion, is to be provided prior
         to any advances or availment being made under the Credits:

                  General Security Agreement (and hypothec as to assets in
                  Quebec) over all present and future personal property
                  including charges over the Borrower trademarks, registered in
                  all applicable jurisdictions, with insurance coverage,
                  including business interruption insurance, to reasonable
                  commercial standards, and loss payable endorsed to the Bank,
                  with an ICC insurance clause endorsement.

                  Hypothecation of all the issued and outstanding shares of
                  Regal Greetings & Gift Corporation and Primes de Luxe Inc. to
                  be held by McGuggan LLC as result of this acquisition.

                  Guarantee and Postponement Agreement given by the following
                  (with corporate seal and resolution as applicable) in the
                  amount shown:

                           NAME                               AMOUNT
                           ----                               ------
                           Primes de Luxe Inc.                Unlimited

                           Supported by:

                                    A movable hypothec (and general security
                                    agreement as t assets outside Quebec) in the
                                    amount of $23,000,000 on all present and
                                    future movable property with appropriate
                                    insurance coverage, loss, if any, payable to
                                    the Bank.

                  Assignment (but not the obligations) of the purchase and sale
                  agreement between the Borrower and the Vendor, acknowledged by
                  the Vendor.

                  Consent and Agreement of the Landlord of the primary Toronto
                  warehouse facility, on a best efforts basis.

                  Consent of the minority shareholder to the Bank's security.

                  Priority and/or Subordination agreements, including
                  appropriate standstill provisions, with other secured
                  creditors of the Borrower including the sub-debt lender and
                  the Vendor, as may be required to give the Bank's security
                  first priority over the secured property.

                  Such other security instruments as deemed appropriate by the
                  Bank and/or its solicitors to perfect its security interest
                  over all of the assets of the Borrower and its subsidiaries.

CONDITIONS PRECEDENT

         Prior to any availment under the Credit the following conditions must
         be met and documentation provided, all in form and substance
         satisfactory to the Bank and the Bank's solicitors:
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                                                                          Page 5


                  There has not occurred a material adverse change in the
                  financial condition, operations, assets, business, properties
                  or prospects of any of the Borrower and/or Guarantor or in the
                  ability of the Borrower and/or Guarantor to perform its
                  obligations under this agreement or the Security or in the
                  ability of the Bank to enforce any such obligations.

                  A copy of the executed purchase and sale agreement covering
                  the acquisition of the assets of Regal Greetings & Gifts ( A
                  division of MDC Corporation Inc.) for total consideration of
                  $39,000,000 which is to contain appropriate non-competition
                  language and provision for a VTB of $6,000,000 along with
                  confirmation by a certificate, copy of the review checklist,
                  and copy of any report, to the Bank that the Borrower has
                  completed their due diligence review which certificate will
                  outline issues and/or adverse information identified, and the
                  process taken to resolve such.

                  Evidence that (i) at least $11,765,000 in common share equity
                  has been contributed to the Borrower; (ii) $7,000,000 in
                  subordinated debt has been, or is being, closed; and (iii) the
                  opening cash balance of the Borrower is at least $2,500,000.

                  Written confirmation from the Borrower's auditor as to the
                  following:

                  (i)      That the Borrower's EBITDA calculated on a rolling
                           twelve month basis to the latest month-end preceding
                           closing is at least $7,500,000 ;

                  (ii)     That the Borrower's sales levels, post September 11,
                           2001, have recovered to previous historical and
                           projected levels;

                  (iii)    Confirmation the physical inventory count undertaken
                           by the auditor as at the end of August, 2001 was
                           consistent in all material respects with the
                           corporate records;

                  (iv)     The accuracy and reliability of the reporting under
                           of the Borrower's Management Information Systems.

                  A copy of the Shareholders Agreement of the Borrower.

                  Financial Statements of Primes de Luxe Inc. as at their fiscal
                  year end Dec. 31, 2000.

                  Financial statement of Regal Greetings and Gifts to the latest
                  month-end preceding closing, if available and the prior month
                  if not yet produced.

                  Compliance certificate confirming that all conditions are
                  onside as at the closing of the transaction.

                  Such other information that the Bank may, in accordance with
                  its general commercial lending practice, reasonably require
                  with respect to the transaction.

GENERAL CONDITIONS

         Until all debts and liabilities under the Credits have been discharged
         in full, the following conditions will apply in respect of the Credits
         and will be tested quarterly based on the consolidated financial
         statements of the Borrower and all of it's subsidiaries which are at
         all times to be prepared in accordance with Generally Accepted
         Accounting Principles "GAAP":

                  The ratio of current assets to current liabilities is to be
                  maintained at all times at 1.75:1 or better.
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                                                                          Page 6


                  Current Assets and Current Liabilities mean, at any particular
                  time, the aggregate amount of the accounts which would, in
                  accordance with GAAP, be classified upon the balance sheet, as
                  at such time, as current assets and current liabilities,
                  respectively.

                  The ratio of Funded Senior Debt to EBITDA, calculated on a
                  rolling twelve month basis, is not to exceed 2.00:1 increasing
                  to 2.75:1 by June 30, 2002 and reducing to 1.75:1 by December
                  31, 2002 and thereafter.

                  The ratio of Total Funded Debt to EBITDA, calculated on a
                  rolling twelve month basis, is not to exceed 3.00:1 increasing
                  to 3.75:1 by June 30, 2002 and reducing to 2.75:1 by December
                  31, 2002 and thereafter.

                  Funded Senior Debt is defined as all interest bearing debt,
                  both short term and long term, including capital leases.

                  Total Funded Debt is defined as all interest bearing debt,
                  both short term and long term, including capital leases, owing
                  to the Bank, other financial institutions or any other parties
                  (other then the VTB resulting from the acquisition).

                  EBITDA is defined as net income before extraordinary and other
                  non-recurring items plus interest, income tax, depreciation
                  and amortization expenses during the period.

                  The Debt Service Coverage ratio of EBITDA less capital
                  expenditures to interest expenses plus the current portion of
                  long term debt and capital leases, (calculated on a rolling
                  twelve month basis, using proforma numbers for the periods
                  prior to Closing as if the credit had been advanced to the
                  amount of the average in the month of calculation for each
                  such month, and using the actual figures for those months in
                  the which the credit was available being those after Closing ,
                  is to be maintained at all times at 1.45:1 or better improving
                  to 1.60:1 by December 31, 2002 and thereafter.

                  The Borrower agrees that without the Bank's prior written
                  consent:

                           No change in voting control is permitted.

                           No mergers, acquisitions or change in Borrower's
                           principal lines of business are permitted.

                           Cumulative capital expenditures are not to exceed
                           $1,300,000 per fiscal year.

                           Management fees are not to exceed $500,000 per fiscal
                           year.

                           Guarantees or other contingent liabilities, are not
                           to be entered into and assets are not to be further
                           encumbered.

                           A change in the fiscal year-end (December 31) of the
                           Borrower is permitted, provided prior notice is given
                           to the Bank.

                  The Borrowers shall permit the Bank, or its agents, access, at
                  any time, to all premises where the collateral covered by the
                  Bank's security may be located and the Bank or its agents may
                  inspect such collateral and all related documents and records.
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                                                                          Page 7


                  For ongoing Credit Risk management purposes, all operating
                  accounts of the Borrower, Guarantor and any other subsidiaries
                  shall be maintained with the Bank as long as the Borrower has
                  any loan facilities with the Bank.

                  In addition to the acceleration events in schedule A, any
                  default that is not cured prior to the expiration of any
                  applicable grace period under any credit, loan or security
                  agreement to which the Borrower, Guarantor and/or any other
                  subsidiary of Borrower or Guarantor is a party will constitute
                  a default under this Commitment Letter.

GENERAL BORROWER REPORTING CONDITIONS

         Until all debts and liabilities under the Credits have been discharged
         in full the Borrower will provide the Bank with the following, all
         certificates to be in form agreed with the Bank:

                  Audited Consolidated of the Borrower and Unaudited Financial
                  Statements of each of its subsidiaries within 90 days of
                  fiscal year end, with a certificate calculating the Net Free
                  Cash Flow sweep.

                  Monthly Interim Consolidated Financial Statements of the
                  Borrower within 45 days from period end.

                  Monthly Compliance Certificate.

                  Borrowing Base Statement monthly within 20 days of month end
                  to include aged accounts receivable and payable figures.

                  Business Plan and Capital Expenditures budget for the next
                  following fiscal year to be provided annually not less than 60
                  days prior to fiscal year end.

                  Other information which the Bank may, in accordance with its
                  general commercial lending practice, reasonably request with
                  respect to Borrower.


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                                                                          Page 8



                                   SCHEDULE A
                                   ----------

                   ADDITIONAL TERMS AND CONDITIONS APPLICABLE
                   ------------------------------------------
                                 TO ALL CREDITS
                                 --------------

CALCULATION AND PAYMENT OF INTEREST

1.       Interest on loans/advances made in Canadian dollars will be calculated
         on a daily basis and payable monthly on the 22nd day of each month
         (unless otherwise stipulated by the Bank). Interest shall be payable
         not in advance on the basis of a calendar year for the actual number of
         days elapsed both before and after demand of payment or default and/or
         judgment.

2.       Interest on loans/advances made in U.S. dollars will be calculated on a
         daily basis and payable monthly on the 22nd day of each month, (unless
         otherwise stipulated by the Bank). Interest shall be payable not in
         advance on the basis of a 360 day year for the actual number of days
         elapsed both before and after demand of payment or default and/or
         judgment. The rate of interest based on a 360 day year is equivalent to
         a rate based on a calendar year of 365 days of 365/360 times the rate
         of interest that applies to the U.S. dollar loans/advances.

INTEREST ON OVERDUE INTEREST

3.       Interest on overdue interest shall be calculated at the same rate as
         interest on the loans/advances in respect of which interest is overdue,
         but shall be compounded monthly and be payable on demand, both before
         and after demand and judgment.

INDEMNITY PROVISION

4.       If the introduction or implementation of, or any change in, or in the
         interpretation of, or any change in its application to the Borrower of,
         any law or any regulation or guideline issued by any central bank or
         other governmental authority (whether or not having the force of law),
         including, without limitation, any reserve or special deposit
         requirement or any tax (other than tax on the Bank's general income) or
         any capital requirement, has due to the Bank's compliance the effect,
         directly or indirectly, of (i) increasing the cost to the Bank of
         performing its obligations hereunder or under any availment hereunder;
         (ii) reducing any amount received or receivable by the Bank or its
         effective return hereunder or in respect of any availment hereunder or
         on its capital; or (iii) causing the Bank to make any payment or to
         forgo any return based on any amount received or receivable by the Bank
         hereunder or in respect of any availment hereunder, then upon demand
         from time to time the Borrower shall pay such amount as shall
         compensate the Bank for any such cost, reduction, payment or forgone
         return (collectively "Increased Costs") as such amounts are calculated
         in a certificate reasonably prepared by the Bank.

         In the event of the Borrower becoming liable for such Increased Costs,
         the Borrower shall have the right to prepay in full, without penalty,
         the outstanding principal balance under the affected credit other than
         the face amount of any document or instrument issued or accepted by the
         Bank for the account of the Borrower, including, without limitation, a
         Letter of Credit, a Letter of Guarantee or a Bankers' Acceptance. Upon
         any such prepayment, the Borrower shall also pay the then accrued
         interest on the amount prepaid and the Increased Costs to the date of
         prepayment together with such amount as will compensate the Bank for
         the cost of any early termination of its funding arrangements in
         accordance with its normal practices, as such amounts are calculated in
         a certificate reasonably prepared by the Bank.


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                                                                          Page 9


ENVIRONMENT

5.       The Borrower agrees:

         (a)      to obey all applicable laws and requirements of any federal,
                  provincial, or any other governmental authority relating to
                  the environment and the operation of the business activities
                  of the Borrower;

         (b)      to allow the Bank access at all times to the business premises
                  of the Borrower to monitor and inspect all property and
                  business activities of the Borrower;

         (c)      to notify the Bank from time to time of any business activity
                  conducted by the Borrower which involves the use or handling
                  of hazardous materials or wastes or which increases the
                  environmental liability of the Borrower in any material
                  manner;

         (d)      to notify the Bank of any proposed change in the use or
                  occupation of the property of the Borrower prior to any change
                  occurring;

         (e)      to provide the Bank with prompt written notice of any
                  environmental problem and any hazardous materials or
                  substances which have an adverse effect on the property,
                  equipment, or business activities of the Borrower and with any
                  other environmental information requested by the Bank from
                  time to time.

         (f)      to conduct all environmental remedial activities which a
                  commercially reasonable person would perform in similar
                  circumstances to meet its environmental responsibilities and
                  if the Borrower fails to do so, the Bank may perform such
                  activities; and

         (g)      to pay for any environmental investigations, assessments or
                  remedial activities with respect to any property of the
                  Borrower that may be performed for or by the Bank from time to
                  time.

         If the Borrower notifies the Bank of any specified activity or change
         or provides the Bank with any information pursuant to subsections (c),
         (d), or (e), or if the Bank receives any environmental information from
         other sources, the Bank, in its sole discretion, may decide that an
         adverse change in the environmental condition of the Borrower or any of
         the property, equipment, or business activities of the Borrower has
         occurred which decision will constitute, in the absence of manifest
         error, conclusive evidence of the adverse change. Following this
         decision being made by the Bank, the Bank shall notify the Borrower of
         the Bank's decision concerning the adverse change.

         If the Bank decides or is required to incur expenses in compliance or
         to verify the Borrower's compliance with applicable environmental or
         other regulations, the Borrower shall indemnify the Bank in respect of
         such expenses, which will constitute further advances by the Bank to
         the Borrower under this Agreement.

NOTICE OF DRAWDOWN/PAYMENTS

6.       The Borrower shall give the Bank prior notice of a drawdown or payment
         of any loan/advance as follows:

         -        two bank business days when the amount is $5 million dollars
                  or more but less than $50 million dollars.




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                                                                         Page 10


INITIAL DRAWDOWN

7.       The right of the Borrower to obtain the initial drawdown under the
         Credits is subject to the condition precedent that there shall not have
         been any material adverse changes in the financial condition or the
         environmental condition of the Borrower or any guarantor of the
         Borrower.

PERIODIC REVIEW

8.       The obligation of the Bank to make further advances or other
         accommodation available under any Credit(s) of the Borrower under which
         the indebtedness or liability of the Borrower is payable on demand, is
         subject to periodic review and to no adverse change occurring in the
         financial condition or the environmental condition of the Borrower or
         any guarantor.

EVIDENCE OF INDEBTEDNESS

9.       The Bank's accounts, books and records constitute, in the absence of
         manifest error, conclusive evidence of the advances made under this
         Credit, repayments on account thereof and the indebtedness of the
         Borrower to the Bank.

ACCELERATION

10.      (a)      All indebtedness and liability of the Borrower to the Bank
                  payable on demand, is repayable by the Borrower to the Bank at
                  any time on demand;

         (b)      All indebtedness and liability of the Borrower to the Bank not
                  payable on demand, shall, at the option of the Bank, become
                  immediately due and payable, the security held by the Bank
                  shall immediately become enforceable, and the obligation of
                  the Bank to make further advances or other accommodation
                  available under the Credits shall terminate, if any one of the
                  following Events of Default occurs:

                  (i)      the Borrower or any guarantor fails to make when due,
                           whether on demand or at a fixed payment date, by
                           acceleration or otherwise, any payment of interest,
                           principal, fees, commissions or other amounts payable
                           to the Bank and such failure continues for two
                           Business Days;

                  (ii)     there is a breach by the Borrower or any guarantor of
                           any other term or condition contained in this
                           Commitment Letter or in any other agreement to which
                           the Borrower and/or any guarantor and the Bank are
                           parties, and such breach is not remedied to the
                           satisfaction of the Bank within ten (10) Business
                           Days of the occurrence of such breach;

                  (iii)    any default occurs under any security listed in this
                           Commitment Letter under the headings "Specific
                           Security" or "General Security" or under any other
                           credit, loan or security agreement to which the
                           Borrower and/or any guarantor is a party;

                  (iv)     any bankruptcy, re-organization, compromise,
                           arrangement, insolvency or liquidation proceedings or
                           other proceedings for the relief of debtors are
                           instituted by or against the Borrower or any
                           guarantor and, if instituted against the Borrower or
                           any guarantor, are allowed against or consented to by
                           the Borrower or any guarantor or are not dismissed or
                           stayed within 60 days after such institution;
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                                                                         Page 11


                  (v)      a receiver is appointed over any property of the
                           Borrower or any guarantor or any judgement or order
                           or any process of any court becomes enforceable
                           against the Borrower or any guarantor or any property
                           of the Borrower or any guarantor or any creditor
                           takes possession of any property of the Borrower or
                           any guarantor;

                  (vi)     any course of action is undertaken by the Borrower or
                           any guarantor or with respect to the Borrower or any
                           guarantor which would result in the Borrower's or
                           guarantor's reorganization, amalgamation or merger
                           with another corporation or the transfer of all or
                           substantially all of the Borrower's or any
                           guarantor's assets;

                  (vii)    any guarantee of indebtedness and liability under the
                           Credit Line is withdrawn, determined to be invalid or
                           otherwise rendered ineffective;

                  (viii)   any material adverse change occurs in the financial
                           condition of the Borrower or any guarantor, it being
                           the intention of the parties that a "material adverse
                           change" means an event or series of events (whether
                           related or not) that is, in the opinion of the Bank,
                           reasonably likely to be material adverse to the
                           ability of Borrower or such guarantor, or both, to
                           perform its obligations to the Bank under any of the
                           Bank's Security Documents.

                  (ix)     any material adverse change occurs in the
                           environmental condition of:

                           (A)      the Borrower or any guarantor of the
                                    Borrower; or

                           (B)      any property, equipment, or business
                                    activities of the Borrower or any guarantor
                                    of the Borrower.

COSTS

11.      All costs, including legal and appraisal fees incurred by the Bank
         relative to security and other documentation and the enforcement
         thereof, shall be for the account of the Borrower, whether or not the
         financing hereunder is completed, will be payable on demand, and may be
         charged to the Borrower's deposit account when submitted.

12. REPRESENTATIONS AND WARRANTIES

         To induce the Bank to grant the credits outlined herein, the Borrower,
         by its acceptance and acknowledgement, represents and warrants to the
         Bank, as at the date of this Commitment Letter and as at the date of
         each extension of credit hereunder, as follows and acknowledges and
         confirms the Bank is relying upon such representations and warranties
         in executing this Commitment Letter and in extending credit hereunder:

                  (a)      The Borrower is a corporation duly established and
                           organized under the laws of the Province of Ontario.
                           The Borrower is duly qualified, registered or
                           licensed in all jurisdictions where such
                           qualification, registration or licensing is required
                           except where the failure to be so qualified,
                           registered or licensed would not have a material
                           adverse effect. The Borrower has all requisite
                           capacity, power and authority to carry on its
                           business as now conducted and to otherwise enter
                           into, and carry out the transactions contemplated by
                           the documents to which it is a signatory.

                  (b)      There are no actions, suits, enquiries, claims or
                           proceedings (whether or not purportedly on behalf of
                           the Borrower) pending or threatened in writing
                           against or affecting the Borrower before any
                           government, parliament, legislature,

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                                                                         Page 12


                           regulatory authority, agency, commission, board or
                           court or before any private arbitrator, mediator or
                           referee which in any case or in the aggregate could
                           reasonably be expected to have a material adverse
                           effect.

                  (c)      All necessary action, corporate or otherwise, has
                           been taken to authorize the execution, delivery and
                           performance of the documents by the Borrower. The
                           Borrower has duly executed and delivered this
                           agreement and the Borrower will duly execute and
                           deliver the documents. The documents are, or will be
                           upon their execution, legal, valid and binding
                           obligations of the Borrower, enforceable against the
                           Borrower by the Bank in accordance with their
                           respective terms, except to the extent that the
                           enforceability thereof may be limited by applicable
                           bankruptcy, insolvency, moratorium, reorganization
                           and other laws of general application limiting the
                           enforcement of credits' rights generally and the fact
                           that the courts may deny the granting or enforcement
                           of equitable remedies.

                  (d)      The execution, delivery and performance by the
                           Borrower of the documents and the consummation of the
                           transactions contemplated herein and therein do not
                           and will not conflict with, result in any material
                           breach or violation of, or constitute a material
                           default under, the terms, conditions or provisions of
                           the charter or constating documents or bylaws of, or
                           any material agreement relating to the Borrower or of
                           any law, regulation, judgment, decree or order
                           binding on or applicable to the Borrower or to which
                           its property is subject and do not require the
                           consent or approval of any governmental body, agency
                           or authority or any other party.

                  (e)      The Borrower has a good and marketable title to all
                           of its property, assets and undertaking, free from
                           any lien, charge, encumbrance or security interest,
                           other than for liens, charges, encumbrances, or
                           security interests held by the Bank, RoyNat Capital
                           Inc., and MDC Corporation.

                  (f)      The information provided by the Borrower to the Bank,
                           including all financial information, is full, true
                           and accurate in all material respects.

                  (g)      The Borrower is not in default of the terms of this
                           Commitment, in any material respect.


                  13. COVENANTS

                  Positive Covenants

                  (a)      Borrower will maintain, and cause the Guarantor to
                           maintain, its corporate existence.

                  (b)      Borrower will pay, to current status, all taxes and
                           claims which might have priority over the security
                           interest of the Bank.

                  (c)      Borrower will at all times be in compliance with the
                           terms of all material agreements and licences, and
                           with all applicable laws, regulations, bylaws,
                           consents, permits and licences .

                  (d)      For ongoing risk management purposes, all operating
                           accounts of the borrower and Guarantor shall be
                           maintained with the Bank as long as the credits
                           remain available.
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                                                                         Page 13


                  Negative Covenants

                  (a).     No liens, charges or encumbrances on the assets of
                           the Borrower or the Guarantor unless subject to a
                           subordination agreement satisfactory to the Bank.

                  (b)      No further funded indebtedness unless subject to a
                           subordination agreement satisfactory to the Bank.

                  (c)      No asset sales out of the ordinary curse of business
                           except on terms and conditions satisfactory to the
                           Bank.

                  (d)      No financial assistance to or investments in other
                           entities, except for the Guarantor.

                  (e)      No subsidiary formation or acquisition, unless a
                           guarantee and general security is provided.

                  (f)      Restrictions on amalgamations, consolidation,
                           mergers, reorganizations or alteration of share
                           capital unless approved by the Bank.

                  (g)      No corporate distributions, including by dividend,
                           bonus, fee or otherwise, except with the approval of
                           the Bank.