Document:

EXHIBIT 4.3

                                WARRANT INDENTURE

THIS INDENTURE made this 27th day of September, 2004.

B E T W E E N:

                  ADSERO  CORP.,  a corporation  incorporated  under the laws of
                  Delaware

                  (hereinafter called the "CORPORATION")

                                                               OF THE FIRST PART
                                     - and -

                  BEARD WINTER LLP, a partnership  constituted under the laws of
                  the Province of Ontario

                  (hereinafter called the "WARRANT AGENT")

                                                              OF THE SECOND PART
WITNESSES THAT:

WHEREAS the Corporation  proposes to issue Special  Warrants (as defined herein)
each of which is exercisable,  for no additional  consideration,  to acquire one
Common Share (as defined herein) and one Warrant;

AND  WHEREAS  the  Warrants  will be  exercisable  by the  holders  on the terms
hereinafter set out for the acquisition of Common Shares (as defined herein);

AND WHEREAS the  Corporation is duly authorized to create and issue the Warrants
to be issued as herein provided;

AND  WHEREAS  all  things  necessary  have been done and  performed  to make the
Warrants,  when  certified by the Warrant Agent and issued as in this  Indenture
provided, legal, valid and binding upon the Corporation with the benefits of and
subject to the terms of this Indenture;

AND  WHEREAS the Warrant  Agent has agreed to enter into this  Indenture  and to
hold all rights,  interests and benefits  contained  herein for and on behalf of
those persons who become  holders of Warrants from time to time issued  pursuant
to this Indenture;

AND WHEREAS each whole  Warrant  shall  entitle the holder  thereof to purchase,
subject to  adjustment,  one  Warrant  Share,  at a price and upon the terms and
conditions herein set forth;

AND WHEREAS for such  purpose the  Corporation  deems it necessary to create and
issue the Warrants constituted and issued in the manner hereinafter appearing;

The foregoing recitals are made as representations and statements of fact by the
Corporation and not by the Warrant Agent;

NOW THEREFORE in consideration of the premises and the covenants of the parties,
the   Corporation   hereby   appoints  the  Warrant   Agent  as  agent  for  the
Warrantholders  (as  hereinafter  defined)  to hold all  rights,  interests  and
benefits  contained herein for and on behalf of those persons who are holders of

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Warrants  from time to time issued  pursuant to this  Indenture and it is hereby
agreed and declared as follows:

ARTICLE 1   INTERPRETATION

1.1      DEFINITIONS.

In this Indenture and in the Warrant Certificates,  unless there is something in
the subject matter or context inconsistent therewith:

         (a) "AFFILIATE" has the meaning  ascribed  thereto under the Securities
         Act (Ontario), as amended from time to time;

         (b)  "APPLICABLE  LEGISLATION"  means such provisions of any statute of
         the  United  States  (as  subsequently  defined),  Canada,  and or of a
         province thereof,  and of regulations under any such statute,  relating
         to  trust  indentures  or to the  rights,  duties  and  obligations  of
         corporations and of agents under trust indentures,  as are from time to
         time in force and applicable to this Indenture;

         (c) "BUSINESS  DAY" means a day on which  chartered  banks are normally
         open for business in the City of Toronto, excluding Saturdays,  Sundays
         and any statutory or civic holiday;

         (d)  "CLOSING  DATE" means  September  27, 2004 or such other date upon
         which the Special Warrants are first issued and sold;

         (e) "COMMON SHARES" means the fully-paid and  non-assessable  shares of
         common stock (US$0.001 par value) in the capital of the Corporation;

         (f)  "CORPORATION"  means  Adsero  Corp.,  the party of the first  part
         hereunder,  and  includes  any  successor  corporation  to  or  of  the
         Corporation  which shall have complied  with the  provisions of Section
         y8.2 hereof;

         (g)  "CORPORATION'S  AUDITORS" means the firm of chartered  accountants
         appointed by the shareholders of the Corporation as the auditors of the
         Corporation  in  accordance  with the  applicable  laws of the State of
         Delaware;

         (h)  "COUNSEL"  means  such  law  firm  who  may  be  counsel  for  the
         Corporation, acceptable to the Warrant Agent;

         (i)  "CURRENT  MARKET  PRICE" has the meaning  ascribed to that term in
         Subsection y4.8(a)(i);

         (j)  "DIRECTOR"  means a director of the  Corporation  and reference to
         action  by  the  directors   means  action  by  the  directors  of  the
         Corporation  as a  board  or,  whenever  duly  empowered,  action  by a
         committee of the board;

         (k) "EXERCISE DATE" means with respect to any Warrant  exercised by the
         holder thereof pursuant to Subsection  y4.1(a) hereof, the day on which

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         the Warrant  Certificate  evidencing such Warrant is surrendered to the
         Warrant Agent in accordance with the provisions of Section y4.1 hereof;

         (l) "EXERCISE PRICE" means US$1.50 per Warrant exercised, as adjusted;

         (m) "EXPIRY DATE" means, with respect to a Warrant, September 27, 2006;

         (n) "EXPIRY TIME" means 5:00 p.m. (Toronto time) on the Expiry Date;

         (o)  "EXTRAORDINARY  RESOLUTION" has the meaning  attributed thereto in
         Sections 7.12 and 7.15 hereof;

         (p) "OTCBB" means the NASDAQ over-the-counter bulletin board;

         (q) "PERSON" means an individual, corporation,  partnership, trustee or
         unincorporated organization, and words importing persons have a similar
         extended meaning;

         (r)  "QUALIFYING   JURISDICTIONS"  means  the  jurisdictions  in  which
         purchasers of the Warrants reside;

         (s)  "RIGHTS  OFFERING"  has  the  meaning  ascribed  to  that  term in
         Subsection y4.8(c) hereof;

         (t) "RIGHTS PERIOD" has the meaning ascribed to that term in Subsection
         y4.8(c) hereof;

         (u) "SECURITIES REGULATORY  AUTHORITIES" means the security commissions
         and  similar  securities  regulating   authorities  of  the  Qualifying
         Jurisdictions;

         (v)  "SPECIAL  DISTRIBUTION"  has the meaning  ascribed to that term in
         Subsection y4.8(d) hereof;

         (w) "SPECIAL WARRANTS" means those securities issued by the Corporation
         on the Closing Date providing the holder with the right to acquire, for
         no additional consideration,  one A unit consisting of one Common Share
         and one Warrant.

         (x)  "SUBSIDIARY"  has the meaning  ascribed to that term as defined in
         the Securities Act (Ontario);

         (y) "TRADING  DAY" has the meaning  ascribed to that term in Subsection
         y4.8(a)(ii);

         (z) "U.S.  PERSON" has the meaning  ascribed  thereto in  Regulation  S
         under the U.S. Securities Act;

         (aa) "U.S.  SECURITIES  ACT" means the United States  Securities Act of
         1933, as amended;

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         (bb)  "UNITED   STATES"  means  the  United  States  of  America,   its
         territories  or  possessions,  any state  thereof  or the  District  of
         Columbia collectively;

         (cc)  "VOTING  SHARES" of any  corporation  means shares of one or more
         classes  or series of a class of  shares of such  corporation  carrying
         voting  rights  under  all  circumstances  (and  not by  reason  of the
         happening of a contingency) sufficient if exercised to elect all of the
         directors of such corporation, provided that such shares will be deemed
         not to cease to be  Voting  Shares  solely by reason of a right to vote
         for the election of one or more of the  directors  of such  corporation
         accruing  to shares of another  class or series of a class of shares of
         such corporation by reason of the happening of a contingency;

         (dd) "WARRANT AGENT" means Beard Winter LLP, and its successors;

         (ee) "WARRANT  CERTIFICATE" means a certificate  evidencing one or more
         Warrants, substantially in the form attached hereto as Schedule "A";

         (ff)   "WARRANT   INDENTURE",   "INDENTURE",   "HERETO",   "HEREUNDER",
         "HEREOF'",  "HEREIN", "HEREBY" and similar expressions mean or refer to
         this  Warrant   Indenture  and  any   indenture,   deed  or  instrument
         supplemental  or  ancillary  hereto,  and  the  expressions  "Article",
         "Section",  "Subsection" and "paragraph"  followed by a number mean the
         specified Article, Section, Subsection or paragraph of this Indenture;

         (gg) "WARRANT  SHARES" means,  subject to Section  y4.8(r),  the Common
         Shares to be  issued  by the  Corporation  to  Warrantholders  upon the
         exercise of Warrants hereunder;

         (hh) "WARRANTHOLDERS" or "holders" means the persons for the time being
         entered in the register of holders  described in Section y3.1(a) hereof
         as holders of Warrants;

         (ii)  "WARRANTHOLDERS'  REQUEST" means an instrument,  signed in one or
         more counterparts by Warrantholders  who hold in the aggregate not less
         than 20% of the total number of Warrants then  outstanding,  requesting
         the Warrant Agent to take some action or proceeding specified therein;

         (jj) "WARRANTS"  means the whole common share purchase  warrants of the
         Corporation  issued hereunder  entitling  registered holders thereof to
         receive upon exercise in accordance with Section y4.1 one Warrant Share
         (or such kind and amount of shares or other  securities  or property as
         may be determined pursuant to yArticle 4 hereof); and

         (kk)  "WRITTEN  ORDER  OF THE  CORPORATION",  "Written  Request  of the
         Corporation",  "Written Consent of the Corporation", "Written Direction
         of  the  Corporation"  and  "Certificate  of  the  Corporation"   mean,
         respectively,   a  written  order,  request,  consent,   direction  and
         certificate  signed in the name of the  Corporation  by any director or
         officer  of the  Corporation  or by any other  individual  to whom such

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         signing  authority is delegated by the directors from time to time, and
         may consist of one or more instruments so executed.

1.2      WORDS IMPORTING THE SINGULAR.

Words  importing  the  singular  include  the  plural  and vice  versa and words
importing a particular gender include both genders.

1.3      INTERPRETATION NOT AFFECTED BY HEADINGS, ETC.

The division of this Indenture into Articles, Sections, Subsections, paragraphs,
subparagraphs,  clauses and subclauses, the provision of a table of contents and
the insertion of headings are for  convenience  of reference  only and shall not
affect the construction or interpretation of this Indenture or the Warrants.

1.4      DAY NOT A BUSINESS DAY.

If the day on or before which any action that would  otherwise be required to be
taken hereunder is not a Business Day in Toronto,  Ontario, that action shall be
required to be taken on or before the requisite time on the next  succeeding day
that is a Business Day.

1.5      TIME OF THE ESSENCE.

Time shall be of the essence in all respects in this  Indenture  and the Warrant
Certificates.

1.6      CURRENCY.

Except as  otherwise  stated,  all  dollar  amounts  herein  and in the  Warrant
Certificates are expressed in the United States dollars.

1.7      APPLICABLE LAW.

This Indenture and the Warrant  Certificates  shall be construed and enforced in
accordance  with the laws of the  Province of Ontario  and the  federal  laws of
Canada  applicable  therein  and shall be  treated  in all  respects  as Ontario
contracts.

1.8      SEVERABILITY.

In the event that any  provision  hereof  shall be  determined  to be invalid or
unenforceable in any respect such determination  shall not affect such provision
in any other respect or any other provision hereof, all of which shall remain in
full force and effect.

1.9      CONFLICTS.

In the event  there is any  conflict  between  this  Indenture  and any  Warrant
Certificates, the provisions herein shall govern and prevail.

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1.10     MEANING OF "OUTSTANDING".

Every Warrant represented by a Warrant  Certificate  countersigned and delivered
by the Warrant Agent hereunder shall be deemed to be outstanding  until it shall
be cancelled or delivered  to the Warrant  Agent for  cancellation  or until the
Expiry  Time;  provided  that where a new  Warrant  Certificate  has been issued
pursuant to Section y2.7 hereof to replace one which has been  mutilated,  lost,
stolen  or  destroyed,  the  Warrants  represented  by only one of such  Warrant
Certificates  shall be counted  for the  purpose of  determining  the  aggregate
number of Warrants outstanding.

ARTICLE 2   THE WARRANTS

2.1      CREATION AND ISSUE OF WARRANTS.

         (a) CREATION AND ISSUE OF WARRANTS.  A total of up to 750,000  Warrants
         entitling the registered  holders thereof to acquire an aggregate of up
         to 750,000  Warrant  Shares,  subject to the  adjustment  provisions in
         Section y4.8 of this Indenture, are hereby created and authorized to be
         issued hereunder upon the terms and conditions herein set forth.

         (b) CERTIFICATION OF WARRANTS. Upon the issue of the Warrants,  Warrant
         Certificates  shall be executed by the Corporation and delivered to the
         Warrant Agent, certified by the Warrant Agent upon the Written Order of
         the  Corporation  and delivered by the Warrant Agent to the Corporation
         or to the order of the Corporation  pursuant to a Written  Direction of
         the Corporation, without any further act of or formality on the part of
         the   Corporation   and  without  the  Warrant   Agent   receiving  any
         consideration  therefor.  The Warrant  Certificates will be in the form
         attached hereto as Schedule "A".

2.2      TERMS OF WARRANTS.

         (a)  EXERCISE  TERMS.  At any time  commencing  on the Closing Date and
         terminating  at the Expiry Time,  each Warrant issued  hereunder  shall
         entitle the holder thereof,  upon the exercise  thereof and the payment
         of $1.50 in accordance with the provisions of yArticle 4 hereof,  to be
         issued one Warrant Share.

         (b)  ADJUSTMENT.  The number of Warrant Shares which may be issued upon
         exercise  of the  Warrants  will be  adjusted  in the events and in the
         manner specified in Section y4.8 hereof.

         (c)  PURCHASE BY  CORPORATION.  The  Corporation  may from time to time
         purchase  Warrants,  by private  agreement  or  otherwise  and any such
         purchase may be made in such manner,  from such persons, at such prices
         and on  such  terms  as the  Corporation  in its  sole  discretion  may
         determine.   Warrant  Certificates   representing   Warrants  purchased
         pursuant to this Section shall be  surrendered to the Warrant Agent for
         cancellation  and shall be  accompanied  by a Written  Direction of the
         Corporation to cancel the Warrants represented thereby.

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2.3      FORM OF WARRANT CERTIFICATES.

         (a) FORM. The Warrant  Certificates  (including the  certificate of the
         Warrant  Agent  endorsed  thereon)  will be  substantially  in the form
         attached  hereto as Schedule  "A", will be dated as of the Closing Date
         (regardless  of the  actual  dates  of their  issue),  will  bear  such
         distinguishing  letters  and  numbers  as  the  Corporation,  with  the
         approval of the Warrant  Agent,  may  prescribe and such legends as the
         Corporation  may  prescribe  and will be issuable  in any whole  number
         denomination.

         (b) PRODUCTION. The Warrant Certificates may be engraved,  lithographed
         or printed (the expression "printed" including for purposes hereof both
         original  typewritten  material as well as mimeographed,  mechanically,
         photographically,   photostatically   or   electronically   reproduced,
         typewritten  or other  written  material),  or  partly  in one form and
         partly in another, as the Corporation may determine.

         (c) WARRANT  CERTIFICATES.  Upon the  original  issuance of Warrants to
         purchasers,   the  Warrant  Certificates  and  certificates  issued  in
         exchange therefor or in substitution thereof,  shall bear the following
         legends until the expiration of the  applicable  hold period in respect
         of the Warrants or until  counsel to the  Corporation  advises that the
         legend is no longer required or an alternative legend is required:

                  "The  securities  represented  hereby have not been registered
                  under the United  States  Securities  Act of 1933,  as amended
                  (the "US Securities  Act"),  or any state  securities  laws in
                  reliance on  Regulation S and may be offered,  sold,  pledged,
                  transferred  or  otherwise  disposed of only (A) pursuant to a
                  registration  statement with respect to such securities  which
                  has been declared  effective  under the US Securities Act; (B)
                  in an offshore  transaction  meeting the  requirements of Rule
                  904 of  Regulation  S  under  the  US  Securities  Act  and in
                  compliance  with any  applicable  securities  laws; (C) for so
                  long  as  the  securities  represented  hereby  or  underlying
                  securities  are eligible  for resale  pursuant to Rule 144; or
                  (E)  pursuant  to  any  other  available  exemption  from  the
                  registration requirements under the US Securities Act."

                  "THE WARRANTS  EVIDENCED  HEREBY ARE  EXERCISABLE ON OR BEFORE
                  5:00 P.M.  (TORONTO  TIME) ON SEPTEMBER 27, 2006,  AFTER WHICH
                  TIME THE WARRANTS  EVIDENCED HEREBY SHALL BE DEEMED TO BE VOID
                  AND OF NO FURTHER FORCE OR EFFECT."

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2.4      SIGNING OF WARRANT CERTIFICATES.

         (a) SIGNING OFFICERS. The Warrant Certificates will be signed by one of
         the  Chairman,  Chief  Executive  Officer,  President,  Vice-President,
         Finance,  a  Vice-President  or Secretary of the  Corporation or by any
         other  individual  to whom such  signing  authority is delegated by the
         directors of the Corporation from time to time,  subject to delivery to
         the Warrant  Agent of a certified  copy of a resolution of the board of
         directors,  delegating  such  authority and a certificate of incumbency
         relating to those persons authorized thereunder.

         (b)  SIGNATURES.  The  signatures of any of the officers or individuals
         referred  to in  Subsection  y2.4(a)  hereof may be manual  signatures,
         engraved, lithographed or printed in facsimile and Warrant Certificates
         bearing such facsimile signatures will, subject to Section y2.5 hereof,
         be binding on the  Corporation  as if they had been manually  signed by
         such officers or individuals.

         (c) NO LONGER OFFICER.  Notwithstanding that any person whose manual or
         facsimile  signature  appears  on a Warrant  Certificate  as one of the
         officers or  individuals  referred to in Subsection  y2.4(a)  hereof no
         longer holds the same or any other office with the  Corporation  at the
         date  of  issue  of  any  Warrant   Certificate   or  at  the  date  of
         certification  or delivery  thereof,  such  Warrant  Certificate  will,
         subject  to  Section  y2.5   hereof,   be  valid  and  binding  on  the
         Corporation.

2.5      CERTIFICATION BY WARRANT AGENT.

         (a) CERTIFICATION. No Warrant Certificate will be issued or, if issued,
         will be valid or entitle the holder to the benefits hereof until it has
         been certified by manual signature by or on behalf of the Warrant Agent
         substantially  in  the  form  of the  certificate  attached  hereto  as
         Schedule  "A" or in such other form as may be  approved  by the Warrant
         Agent. The certification by the Warrant Agent on a Warrant  Certificate
         will be  conclusive  evidence  as  against  the  Corporation  that such
         Warrant  Certificate  has been  issued  hereunder  and that the  holder
         thereof is entitled to the benefits hereof.

         (b) CERTIFICATION NO  REPRESENTATION.  The certification by the Warrant
         Agent on any Warrant Certificate issued hereunder will not be construed
         as a representation or warranty by the Warrant Agent as to the validity
         of this Warrant Indenture or such Warrant  Certificate  (except the due
         certification  thereof) or as to the  performance by the Corporation of
         its obligations under this Warrant Indenture and the Warrant Agent will
         in no respect be liable or  answerable  for the use made of any Warrant
         Certificate  or of the  consideration  therefor,  except  as  otherwise
         specified herein.

2.6      WARRANTS TO RANK PARI PASSU.

All Warrants will rank pari passu,  whatever may be the actual dates of issue of
the Warrant Certificates by which they are evidenced.

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2.7      ISSUE IN SUBSTITUTION FOR LOST CERTIFICATES, ETC.

         (a) SUBSTITUTION.  If any Warrant  Certificate  becomes mutilated or is
         lost,  destroyed or stolen, the Corporation,  subject to applicable law
         and to Subsection y2.7(b) hereof, will issue, and thereupon the Warrant
         Agent will certify and deliver, a new Warrant Certificate of like tenor
         as the one mutilated,  lost, destroyed or stolen in exchange for and in
         place  of  and  on  surrender  and   cancellation   of  such  mutilated
         certificate or in lieu of and in substitution for such lost,  destroyed
         or stolen certificate.

         (b) COST OF SUBSTITUTION.  The applicant for the issue of a new Warrant
         Certificate pursuant to this Section y2.7 will bear the reasonable cost
         of the issue thereof and in the case of loss,  mutilation,  destruction
         or theft will, as a condition precedent to the issue thereof:

                  (i) furnish to the  Corporation  and to the Warrant Agent such
                  evidence of ownership and of the loss, mutilation, destruction
                  or theft  of the  Warrant  Certificate  to be  replaced  as is
                  satisfactory  to the  Corporation  and to the Warrant Agent in
                  their discretion, acting reasonably;

                  (ii) furnish an indemnity in amount and form  satisfactory  to
                  the Corporation and to the Warrant Agent in their  discretion,
                  acting reasonably; and

                  (iii) pay the reasonable  charges of the  Corporation  and the
                  Warrant Agent in connection therewith.

2.8      CANCELLATION OF SURRENDERED WARRANTS.

All Warrant Certificates surrendered to the Warrant Agent in accordance with the
provisions of this Warrant Indenture will be cancelled by the Warrant Agent and,
if requested in writing in advance by the  Corporation,  the Warrant  Agent will
furnish the Corporation with a cancellation certificate identifying each Warrant
Certificate so cancelled.

2.9      WARRANTHOLDER NOT A SHAREHOLDER.

Nothing in this Warrant  Indenture or in the holding of a Warrant evidenced by a
Warrant  Certificate,  or  otherwise,  will be  construed as  conferring  on any
Warrantholder  any  right  or  interest  whatsoever  as  a  shareholder  of  the
Corporation,  including  but not  limited  to any right to vote at,  to  receive
notice of, or to attend any meeting of shareholders  or any other  proceeding of
the  Corporation  or any right to receive any  dividend  or other  distribution,
including the rights to be issued pursuant to a Rights Offering.

ARTICLE 3    REGISTRATION, TRANSFER, EXCHANGE AND OWNERSHIP OF WARRANTS

3.1      REGISTRATION AND TRANSFER OF WARRANTS.

         (a)  REGISTER.  The  Corporation  will cause to be kept by the  Warrant
         Agent at the office of the Warrant Agent in Toronto, Ontario:

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                  (i) a  register  of  holders  in  which  shall be  entered  in
                  alphabetical  order the names and  addresses of the holders of
                  Warrants and particulars of the Warrants held by them; and

                  (ii) a  register  of  transfers  in  which  all  transfers  of
                  Warrants and the date and other  particulars  of each transfer
                  shall be entered.

         (b) TRANSFER.  No transfer of any Warrant will be valid unless  entered
         on the register of transfers referred to in Subsection y3.1y(a) hereof,
         and on any branch registers  maintained  pursuant to Subsection y3.1(g)
         hereof,  upon surrender to the Warrant Agent of the Warrant Certificate
         evidencing such Warrant,  duly endorsed by, or accompanied by a Form of
         Transfer in the form attached to such Warrant  Certificate  executed by
         the registered  holder or his executors,  administrators or other legal
         representatives   or  his  or  their  attorney  duly  appointed  by  an
         instrument in writing in form and executed in a manner  satisfactory to
         the Warrant Agent, and, upon compliance with such requirements and such
         other reasonable  requirements as the Warrant Agent and the Corporation
         may prescribe,  such transfer will be duly noted on such register(s) of
         transfers by the Warrant Agent.

         (c) REGISTER OF TRANSFERS.  The  transferee of any Warrant will,  after
         surrender to the Warrant  Agent of the Warrant  Certificate  evidencing
         such  Warrant  as  required  by  Subsection  y3.1(b)  hereof  and  upon
         compliance  with all other  conditions in respect  thereof  required by
         this  Warrant  Indenture  or by law,  be  entitled to be entered on the
         register of holders referred to in Subsection  y3.1y(a) hereof,  and on
         any branch  registers  of holders  maintained  pursuant  to  Subsection
         y3.1(g) hereof,  as the owner of such Warrant free from all equities or
         rights of set-off  or  counterclaim  between  the  Corporation  and the
         transferor or any previous holder of such Warrant, except in respect of
         equities of which the Corporation is required to take notice by statute
         or by order of a court of competent jurisdiction.

         (d) REFUSAL OF REGISTRATION.  The Corporation will be entitled, and may
         direct the Warrant Agent, to refuse to recognize any transfer, or enter
         the name of any transferee, of any Warrant on the registers referred to
         in Subsection  y3.1y(a) hereof,  or on any branch registers  maintained
         pursuant  to  Subsection   y3.1(g)  hereof,   if  such  transfer  would
         constitute a violation of the securities  laws of any  jurisdiction  or
         the rules,  regulations or policies of any regulatory  authority having
         jurisdiction.

         (e) NO NOTICE  OF  TRUSTS.  Subject  to  applicable  law,  neither  the
         Corporation  nor the  Warrant  Agent will be bound to take notice of or
         see  to the  execution  of  any  trust,  whether  express,  implied  or
         constructive,  in respect of any Warrant,  and may transfer any Warrant
         on the  direction  of the  person  registered  as the  holder  thereof,
         whether named as trustee or  otherwise,  as though that person were the
         beneficial owner thereof.

         (f) INSPECTION. The registers referred to in Subsection y3.1(a) hereof,
         and any branch  registers  maintained  pursuant to  Subsection  y3.1(g)
         hereof,  will at all  reasonable  times be open for  inspection  by the
         Corporation and any Warrantholder.  The Warrant Agent will from time to

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         time when  requested  to do so in  writing  by the  Corporation  or any
         Warrantholder (upon payment of the Warrant Agent's reasonable charges),
         furnish the Corporation or such Warrantholder, as the case may be, with
         a list of the names and  addresses  of holders of  Warrants  entered on
         such  registers  and showing  the number of Warrants  held by each such
         holder.

         (g) LOCATION OF  REGISTERS.  The  Corporation  may at any time and from
         time to time  change the place at which the  registers  referred  to in
         Subsection  y3.1(a) hereof are kept,  cause branch registers of holders
         or transfers to be kept at other places and close such branch registers
         or change the place at which such branch  registers  are kept,  in each
         case subject to the approval of the Warrant  Agent.  Notice of all such
         changes or closures  shall be given by the  Corporation  to the Warrant
         Agent and to holders of  Warrants  in  accordance  with  Section  y10.2
         hereof.

3.2      EXCHANGE OF WARRANT CERTIFICATES.

         (a) EXCHANGE.  One or more Warrant Certificates may, on compliance with
         the reasonable  requirements of the Warrant Agent, be exchanged for one
         or more Warrant Certificates of different  denominations  evidencing in
         the aggregate the same number of Warrants as the Warrant Certificate or
         Warrant Certificates being exchanged.

         (b) PLACE OF EXCHANGE.  Warrant  Certificates  may be exchanged only at
         the office in  Toronto,  Ontario of the  Warrant  Agent or at any other
         place  designated by the  Corporation  with the approval of the Warrant
         Agent.

         (c)  CANCELLATION.   Any  Warrant  Certificate  tendered  for  exchange
         pursuant to this Section shall be  surrendered to the Warrant Agent and
         cancelled.

         (d)  EXECUTION.  The  Corporation  will sign all  Warrant  Certificates
         necessary to carry out exchanges pursuant to this Section y3.2 and such
         Warrant Certificates will be certified by the Warrant Agent.

3.3      NO CHARGES FOR TRANSFER OR EXCHANGE.

No charge will be levied on a  presenter  of a Warrant  Certificate  pursuant to
this  Warrant  Indenture  for the transfer of any Warrant or the exchange of any
Warrant Certificate.

3.4      OWNERSHIP OF WARRANTS.

         (a) OWNER. The Corporation and the Warrant Agent may deem and treat the
         person in whose name any Warrant is registered as the absolute owner of
         such Warrant for all purposes, and such person will for all purposes of
         this Indenture be and be deemed to be the absolute  owner thereof,  and
         the  Corporation  and the  Warrant  Agent will not be  affected  by any
         notice or knowledge to the contrary except as required by statute or by
         order of a court of competent jurisdiction.

         (b) RIGHTS OF REGISTERED  HOLDER.  The registered holder of any Warrant
         will be entitled to the rights evidenced thereby free from all equities
         and rights of set-off or  counterclaim  between the Corporation and the

                                       11
<PAGE>

         original  or any  intermediate  holder  thereof and all persons may act
         accordingly,  and the issue and delivery to any such registered  holder
         of  the  Warrant  Shares  issuable  pursuant  thereto  will  be a  good
         discharge to the Corporation and the Warrant Agent therefor and neither
         the Corporation nor the Warrant Agent will be bound to inquire into the
         title of any such registered holder.

ARTICLE 4           EXERCISE OF WARRANTS

4.1      EXERCISE.

         (a)  EXERCISE.  Subject  to the  limitations  set  forth in  Subsection
         y4.1(b),  and Section y4.7 hereof, the holder of any Warrant may at any
         time  commencing on the Closing Date and terminating at the Expiry Time
         exercise the right thereby  conferred,  to be issued  Warrant Shares by
         surrendering  to the  Warrant  Agent at the office in ? of the  Warrant
         Agent,  or to any other person or at any other place  designated by the
         Corporation  with the  approval of the  Warrant  Agent,  during  normal
         business  hours on a Business Day, the Warrant  Certificate  evidencing
         such Warrant,  with a duly  completed  and executed  notice of exercise
         substantially  in  the  form  set  out  in  such  Warrant   Certificate
         specifying the number of Warrant Shares  subscribed for together with a
         certified  cheque,  bank  draft or money  order in lawful  money of the
         United  States,  payable  to or to the order of the  Corporation  in an
         amount equal to the Exercise Price  multiplied by the number of Warrant
         Shares  subscribed for. The  Corporation  shall pay all taxes and other
         expenses  and  charges  payable  in  connection  with the  preparation,
         execution and delivery of certificates  representing the Warrant Shares
         subscribed  for pursuant to this  subsection  y4.1(a),  except that, if
         such  certificates are to be registered in the name or names other than
         the holder of the Warrants  being so  exercised  or its nominee,  funds
         sufficient  to pay all stock  transfer  taxes which shall be payable in
         connection with the execution and delivery of such  certificates  shall
         be paid by the holder of the Warrants to the Corporation at the time of
         delivery of such certificates as set out above.

         (b)  RESTRICTIONS.  The exercise of the Warrants pursuant to Subsection
         y4.1(b) shall be subject to compliance  with, and may be restricted by,
         applicable securities  legislation and the resale of the Warrant Shares
         may be restricted by such securities legislation.

         (c) SURRENDER OF WARRANT  CERTIFICATES.  Any Warrant Certificate with a
         duly  completed  and  executed  notice  of  exercise   referred  to  in
         Subsection  y4.1(a)  hereof will be deemed to have been  surrendered to
         the Warrant Agent only on actual  receipt  thereof by the Warrant Agent
         or one of the other  persons at the  office or one of the other  places
         specified in Subsection y4.1(a) hereof.

         (d)  NOTICE  OF  EXERCISE.  Any  notice  of  exercise  referred  to  in
         Subsection y4.1(a) hereof must be signed by the  Warrantholder,  or his
         executors,  administrators  or other  legal  representatives  or his or
         their  attorney duly  appointed by an instrument in writing in form and
         executed  in  a  manner  satisfactory  to  the  Warrant  Agent,  acting

                                       12
<PAGE>

         reasonably,  and,  if any Warrant  Shares  thereby  issuable  are to be
         issued  to a person  or  persons  other  than the  Warrantholder,  must
         specify  the name or names and the  address or  addresses  of each such
         person or persons and the number of Warrant Shares to be issued to each
         such person if more than one is so specified.

         (e)  EXERCISE OF LESS THAN ALL.  The holder of any Warrant  Certificate
         who  wishes  to  exercise  the  Warrants   evidenced  by  such  Warrant
         Certificate may exercise less than all of such Warrants and in the case
         of any such  partial  exercise  shall be  entitled to receive a Warrant
         Certificate,  in form,  signed and  certified  in  accordance  with the
         provisions of yArticle 2 hereof, evidencing the number of Warrants held
         by the Warrantholder which remain unexercised.

4.2      EFFECT OF EXERCISE.

         (a) EFFECT OF EXERCISE. Upon the exercise of any Warrants in accordance
         with Section y4.1 hereof,  the Warrant Shares thereby issuable shall be
         deemed to have been  issued,  and the  person or  persons  to whom such
         Warrant  Shares  are to be issued  shall be deemed to have  become  the
         holder or holders of record thereof,  on the Exercise Date,  unless the
         transfer  registers for the Warrant  Shares are closed on that date, in
         which case such Warrant  Shares shall be deemed to have been issued and
         such  person or  persons  shall be deemed to have  become the holder or
         holders of record thereof on the date on which such transfer  registers
         are reopened,  but such Warrant  Shares shall be issued on the basis of
         the number of  Warrant  Shares to which  such  person or  persons  were
         entitled on the Exercise Date.

         (b) MAILING OF  CERTIFICATES.  Within five (5) Business Days  following
         the  surrender  to the  Warrant  Agent of the Warrant  Certificates  in
         accordance with Subsection y4.1(c),  the Corporation shall,  subject to
         the provisions of Section y4.6,  cause the Warrant Agent to mail by way
         of first class mail to the person or persons in whose name or names the
         Warrant  Shares  thereby  issued  have  been  issued,  at his or  their
         respective  addresses  set forth on the notice of  exercise,  or, if so
         specified, cause to be delivered to such person or persons at the place
         where  the  Warrant   Certificates   evidencing   such   Warrants  were
         surrendered, certificates representing the Warrant Shares so issued.

         (c) ISSUE TO OTHER THAN HOLDER. If any Warrant Shares issuable pursuant
         to any Warrants are to be issued to a person or persons  other than the
         Warrantholder,  (i)  the  signature  of the  holder  on the  Notice  of
         Exercise  in  connection  with the  exercise of such  Warrants  must be
         guaranteed by a member of a recognized  Medallion  Signature  Guarantee
         program  or  a  Canadian  Schedule  I  Chartered  Bank;  and  (ii)  the
         Warrantholder  must pay to the  Corporation  or to the Warrant Agent on
         its  behalf an amount  equal to all  eligible  transfer  taxes or other
         government  charges,  and neither the Corporation nor the Warrant Agent
         will be required to issue or deliver any certificates  representing any
         such Warrant Shares unless or until such amount has been so paid or the
         Warrantholder  has  established to the  satisfaction of the Corporation
         that such  taxes and  charges  have been paid or that no such  taxes or
         charges are owing.

                                       13
<PAGE>

4.3      NO FRACTIONAL WARRANT SHARES.

The  Corporation  shall not be required to issue  fractional  Warrant  Shares in
satisfaction  of its  obligations  hereunder.  To the  extent  that a holder  of
Warrants  would  otherwise  have been entitled to receive on the exercise of the
Warrants a fraction of a Warrant Share,  the number of Warrant  Shares  received
shall be rounded down to the next whole Warrant Share and the  Corporation  will
not, in lieu of delivering the fractional Warrant Share, make any payment to the
holder or satisfy the right to receive  such  fractional  interest by payment to
the Warrantholder of an amount in cash.

4.4      WARRANTS VOID AFTER EXPIRY TIME.

After the Expiry Time, no holder of a Warrant Certificate representing a Warrant
which has not been validly  exercised as set forth herein has any rights  either
under this Warrant  Indenture or the Warrant  Certificate,  and the Warrants are
void and of no value or effect.  All  provisions  of this Warrant  Indenture are
subject to this Section.

4.5      RECORDING.

The Warrant  Agent shall  record  particulars  of each Warrant  exercised  which
particulars  shall  include the name and address of each person to whom  Warrant
Shares  are  thereby  issued,  the  number of  Warrant  Shares so issued and the
Exercise  Date in respect  thereof.  Within three (3)  Business  Days after each
Exercise  Date,  the Warrant Agent shall provide such  particulars in writing to
the Corporation.

4.6      POSTPONEMENT OF DELIVERY OF CERTIFICATES.

The Corporation shall not be required to deliver certificates for Warrant Shares
during the period when the transfer books of the  Corporation  are closed by law
and, in the event that the Exercise Date occurs during such period, the delivery
of certificates  may be postponed for a period not exceeding five (5) days after
the date of the re-opening of the transfer books.

4.7      SECURITIES RESTRICTIONS.

         (a) LEGENDED  CERTIFICATES  FOR THE WARRANT  SHARES.  No Warrant Shares
         will be issued  pursuant to the exercise of any Warrant if the issue of
         such Warrant Shares would constitute a violation of the securities laws
         of any applicable jurisdiction, and, without limiting the generality of
         the foregoing, if the Warrants are exercised prior to the expiration of
         the applicable hold period in respect of the Warrants, the certificates
         representing  the Warrant  Shares thereby issued will bear such legends
         as may, in the opinion of counsel to the  Corporation,  be necessary or
         advisable in order to avoid a violation of any  securities  laws of any
         applicable jurisdiction or to comply with the requirements of any stock
         exchange on which the Warrant  Shares are listed,  provided that if, at
         any time,  in the opinion of counsel to the  Corporation,  such legends
         are no longer  necessary  or advisable in order to avoid a violation of
         any such  laws or  requirements,  or the  holder  of any such  legended
         certificate provides the Corporation with evidence satisfactory in form
         and  substance  to the  Corporation  to the effect  that such holder is
         entitled  to  sell or  otherwise  transfer  such  Warrant  Shares  in a
         transaction  in which such  legends  are not  required,  such  legended

                                       14
<PAGE>

         certificate  may  thereafter  be  surrendered  to  the  Corporation  in
         exchange  without  charge  for a  certificate  which does not bear such
         legend.

         (b) RESALE RESTRICTIONS.  Upon the issuance of the Warrant Shares prior
         to the  expiration  of the  applicable  hold  period in  respect of the
         Warrants, the certificates  representing such Warrant Shares shall bear
         the following  legends,  or such other legends as may be required under
         applicable securities laws, until the expiration of the applicable hold
         period in respect of the  Warrants,  in addition  to any other  legends
         required by any stock exchange on which the Warrant Shares are listed:

                  "The  securities  represented  hereby have not been registered
                  under the United  States  Securities  Act of 1933,  as amended
                  (the "US Securities  Act"),  or any state  securities  laws in
                  reliance on  Regulation S and may be offered,  sold,  pledged,
                  transferred  or  otherwise  disposed of only (A) pursuant to a
                  registration  statement with respect to such securities  which
                  has been declared  effective  under the US Securities Act; (B)
                  in an offshore  transaction  meeting the  requirements of Rule
                  904 of  Regulation  S  under  the  US  Securities  Act  and in
                  compliance  with any  applicable  securities  laws; (C) for so
                  long  as  the  securities  represented  hereby  or  underlying
                  securities  are eligible  for resale  pursuant to Rule 144; or
                  (D)  pursuant  to  any  other  available  exemption  from  the
                  registration requirements under the US Securities Act."

4.8      ADJUSTMENTS.

         (a) DEFINITIONS.  For the purposes of this Section y4.8 unless there is
         something in the subject matter or context inconsistent therewith,  the
         words  and terms  defined  below  shall  have the  respective  meanings
         specified therefor in this Section:

                  (i) "Current  Market  Price" of the Common  Shares at any date
                  means the price per share equal to the weighted  average price
                  at which the Common Shares have traded on the OTCBB or, if the
                  Common Shares are not then listed on the OTCBB,  on such other
                  Canadian or United  States stock  exchange or market as may be
                  selected by the directors of the  Corporation for such purpose
                  during  the  period of any  twenty  consecutive  trading  days
                  ending  not more than five  business  days  before  such date;
                  provided that the weighted average price will be determined by
                  dividing the aggregate sale price of all Common Shares sold on
                  the said  exchange or market,  as the case may be,  during the
                  said twenty  consecutive  trading  days by the total number of
                  Common Shares so sold; and provided further that if the Common
                  Shares are not then listed on any Canadian  stock  exchange or
                  traded in the over-the counter market, then the Current Market
                  Price will be determined by such firm of independent chartered
                  accountants as may be selected by the directors; and

                                       15
<PAGE>

                  (ii)  "trading  day"  with  respect  to a  stock  exchange  or
                  over-the-counter  market  means  a day  on  which  such  stock
                  exchange or market is open for business.

         (b) COMMON SHARE REORGANIZATION.  If and whenever at any time after the
         date  hereof and prior to the  Expiry  Time the  Corporation  shall (i)
         subdivide, redivide or change its then outstanding Common Shares into a
         greater  number of Common Shares,  (ii) reduce,  combine or consolidate
         its then  outstanding  Common  Shares  into a lesser  number  of Common
         Shares or (iii) issue Common Shares (or securities  exchangeable for or
         convertible  into Common Shares) to the holders of all or substantially
         all of its then outstanding Common Shares by way of a stock dividend or
         other  distribution  (any of such events  herein called a "Common Share
         Reorganization"),  then the Exercise Price shall be adjusted  effective
         immediately  after the record date  established in connection  with any
         such  event  or,  in the  event  that  no such  record  date  has  been
         established, immediately after the effective date of any such event, as
         the case may be, by multiplying the then  applicable  Exercise Price in
         effect on such  effective date or record date, as the case may be, by a
         fraction,  the  numerator of which shall be the number of Common Shares
         outstanding  on such effective date or record date, as the case may be,
         before  giving  effect  to such  Common  Share  Reorganization  and the
         denominator  of which shall be the number of Common Shares  outstanding
         immediately  after giving  effect to such Common  Share  Reorganization
         including, in the case where securities exchangeable for or convertible
         into Common Shares are  distributed,  the number of  additional  Common
         Shares that would be outstanding if such  securities were exchanged for
         or converted  into Common  Shares  after  giving  effect to such Common
         Share Reorganization. To the extent that any adjustment in the Exercise
         Price  occurs  pursuant to this  Subsection  y4.7(b) as a result of the
         fixing by the  Corporation  of a record  date for the  distribution  of
         securities  exchangeable  for or convertible  into Common  Shares,  the
         Exercise Price will be readjusted  immediately  after the expiry of any
         relevant  exchange or conversion right to the Exercise Price that would
         then be in effect  based  upon the  number of  Common  Shares  actually
         issued and  remaining  issuable  after such  expiry and will be further
         readjusted in such manner upon the expiry of any further such rights.

         (c) RIGHTS OFFERING.  If and whenever at any time after the date hereof
         and prior to the Expiry Time, the  Corporation  fixes a record date for
         the issue or distribution to the holders of all or substantially all of
         the outstanding  Common Shares of rights,  options or warrants pursuant
         to which such holders are entitled,  during a period  expiring not more
         than 45 days after the record  date for such issue (such  period  being
         the "Rights  Period"),  to subscribe  for or purchase  Common Shares or
         securities  exchangeable  for or  convertible  into Common  Shares at a
         price per Common Share (or in the case of securities  exchangeable  for
         or  convertible  into Common Shares at an exchange or conversion  price
         per Common Share at the date of issue of such securities) which is less
         than 95% of the  Current  Market  Price of the  Common  Shares  on such
         record date for such issue (any of such events  being  herein  called a
         "Rights  Offering"),  the  Exercise  Price will be  adjusted  effective
         immediately  after the Rights  Period for the  Rights  Offering  to the
         amount  determined by  multiplying  the  applicable  Exercise  Price in
         effect at the end of the Rights Period by a fraction:

                                       16
<PAGE>

                  (i) the numerator of which will be the sum of:

                           (1) the number of Common  Shares  outstanding  on the
                           record date for the Rights Offering; and

                           (2) the number determined by dividing:

                                    (A) either (a) the  product of the number of
                                    Common  Shares  offered for issue during the
                                    Rights  Period  pursuant to the  exercise of
                                    the rights,  warrants  or options  under the
                                    Rights  Offering and the price at which such
                                    Common  Shares  are  offered;  or,  (b)  the
                                    product of the exchange or conversion  price
                                    of the  securities so offered and the number
                                    of  Common  Shares  for or  into  which  the
                                    securities  offered  pursuant  to the Rights
                                    Offering may be exchanged or  converted,  as
                                    the case may be; by

                                    (B) the Current  Market  Price of the Common
                                    Shares as of the record  date for the Rights
                                    Offering; and

                  (ii) the  denominator  of which will be the  aggregate  of the
                  number of Common  Shares  outstanding  on such record date and
                  the number of Common Shares  actually issued or subscribed for
                  during the Rights Period upon exercise of the rights, warrants
                  or options  pursuant to the Rights Offering  (including in the
                  case of the issue or distribution  of securities  exchangeable
                  for or  convertible  into  Common  Shares the number of Common
                  Shares for or into which such  securities  may be exchanged or
                  converted).

         If by the terms of the rights, options, or warrants referred to in this
         Subsection  y4.8(c),  there is more than one  purchase,  conversion  or
         exchange  price per  Common  Share,  the  aggregate  price of the total
         number  of  additional   Common  Shares  offered  for  subscription  or
         purchase,  or  the  aggregate  conversion  or  exchange  price  of  the
         convertible or exchangeable  securities so offered,  will be calculated
         for  purposes of the  adjustment  on the basis of the lowest  purchase,
         conversion or exchange price per Common Share,  as the case may be. Any
         Common Shares owned by or held for the account of the Corporation  will
         be  deemed  not  to  be  outstanding   for  the  purpose  of  any  such
         calculation.  To the extent that any  adjustment in the Exercise  Price
         occurs pursuant to this Subsection y4.8(c) as a result of the fixing by
         the  Corporation  of a record  date for the  issue or  distribution  of
         rights, options or warrants referred to in this Subsection y4.8(c), the
         Exercise Price will be readjusted  immediately  after the expiry of any
         relevant  exchange,  conversion or exercise right to the Exercise Price
         that  would then be in effect  based  upon the number of Common  Shares
         actually  issued and remaining  issuable  after such expiry and will be
         further  readjusted  in such manner upon the expiry of any further such
         rights.

                  (d) SPECIAL  DISTRIBUTION.  If and  whenever at any time after
                  the date hereof and prior to the Expiry Time, the  Corporation
                  fixes a record date for the payment,  issue or distribution to
                  the holders of all or  substantially  all of the Common Shares
                  of:

                           (i)  Common   Shares  or  other   securities  of  the
                           Corporation;

                                       17
<PAGE>

                           (ii)  rights,  options or warrants to acquire  Common
                           Shares or securities  exchangeable for or convertible
                           into Common  Shares  (other than  rights,  options or
                           warrants  pursuant to which  holders of Common Shares
                           are entitled,  during a period expiring not more than
                           45 days  after the  record  date for such  issue,  to
                           subscribe  for or purchase  Common  Shares at a price
                           per share (or in the case of securities  exchangeable
                           for or convertible  into Common Shares at an exchange
                           or conversion price per share at the date of issue of
                           such  securities)  of at  least  95% of  the  Current
                           Market  Price of the  Common  Shares  on such  record
                           date);

                           (iii) evidences of  indebtedness of the  Corporation;
                           or

                           (iv) any property or assets  (including  evidences of
                           the Corporation's indebtedness) of the Corporation;

         and if such issue or  distribution  does not  constitute a Common Share
         Reorganization  or a Rights Offering (any of such  non-excluded  events
         being herein called a "Special Distribution"),  the Exercise Price will
         be adjusted effective immediately after the record date for the Special
         Distribution to the amount determined by multiplying the Exercise Price
         in  effect  on the  record  date  for  the  Special  Distribution  by a
         fraction:

                           (v) the  numerator  of which  will be the  difference
                           between:

                                    (1) the  product  of the  number  of  Common
                                    Shares  outstanding  on such record date and
                                    the  Current  Market  Price  of  the  Common
                                    Shares on such record date, and

                                    (2) the fair value,  as  determined  in good
                                    faith by the  directors of the  Corporation,
                                    to the holders of the Common Shares, of such
                                    dividend, cash, securities, rights, options,
                                    warrants,   evidences  of   indebtedness  or
                                    property   or   assets   to  be   issued  or
                                    distributed in the Special Distribution, and

                                    (3) the  denominator  of  which  will be the
                                    product  obtained by multiplying  the number
                                    of Common Shares  outstanding on such record
                                    date  by the  Current  Market  Price  of the
                                    Common Shares on such record date.

         Any Common  Shares owned by or held for the account of the  Corporation
         will  be  deemed  not  to  be  outstanding  for  the  purpose  of  such
         calculation.  To the extent that any  adjustment in the Exercise  Price
         occurs pursuant to this Subsection y4.8(d) as a result of the fixing by
         the  Corporation  of a record  date for the  issue or  distribution  of
         rights,  options or warrants  to acquire  Common  Shares or  securities
         exchangeable  for or convertible into Common Shares referred to in this
         Subsection y4.8(d),  the Exercise Price will be readjusted  immediately
         after the expiry of any relevant exercise, exchange or conversion right
         to the amount that would then be in effect if the fair market value had
         been  determined on the basis of the number of Common Shares issued and
         remaining  issuable  immediately after such expiry, and will be further
         readjusted in such manner upon the expiry of any further such rights.

                                       18
<PAGE>

         (e) CAPITAL REORGANIZATION.  If and whenever at any time after the date
         hereof and prior to the Expiry  Time there is a capital  reorganization
         of the Corporation or a reclassification, redesignation or other change
         in  the  Common  Shares  or  securities  (other  than  a  Common  Share
         Reorganization)   or  a   consolidation,   arrangement   or  merger  or
         amalgamation of the Corporation  with or into any other  corporation or
         other  entity  (other  than a  consolidation,  arrangement,  merger  or
         amalgamation  which  does not  result  in any  reclassification  of the
         outstanding  Common  Shares or a change of the Common Shares into other
         securities),  or a transfer, sale or conveyance of all or substantially
         all of the Corporation's  undertaking or assets to another  corporation
         or other  entity in which the holders of Common  Shares are entitled to
         receive shares,  other securities or other property (any of such events
         being called a "Capital Reorganization"), the holder of Warrants issued
         hereunder,   where  such  holder  has  not   exercised   the  right  of
         subscription and purchase under this Warrant  certificate  prior to the
         effective  date of such  Capital  Reorganization,  shall be entitled to
         receive and shall accept, upon the exercise of such right, on such date
         or any time thereafter, for the same aggregate consideration in lieu of
         the  number  of Common  Shares to which  such  holder  was  theretofore
         entitled  to  subscribe  for and  purchase  upon  the  exercise  of the
         Warrants,  the  kind  and  aggregate  number  of  shares  and/or  other
         securities or property resulting from the Capital  Reorganization which
         such  holder  would have been  entitled  to receive as a result of such
         Capital  Reorganization if, on the effective date thereof,  such holder
         had been the registered  holder of the number of Common Shares to which
         such holder was theretofore entitled to subscribe for and purchase.  If
         necessary,  as a  result  of any  Capital  Reorganization,  appropriate
         adjustments  will be made in the  application of the provisions of this
         Warrant  certificate with respect to the rights and interest thereafter
         of  such  holder  to the  end  that  the  provisions  of  this  Warrant
         certificate  will  thereafter  correspondingly  be made  applicable  as
         nearly as may reasonably be possible in relation to any shares or other
         securities and/or property thereafter  deliverable upon the exercise of
         the Warrants.

         (f) ADJUSTMENT TO NUMBER OF WARRANT SHARES. If and whenever at any time
         after the date hereof and prior to the Expiry  Time,  any of the events
         set out in  Subsections  4.8(b),  (c),  (d) or (e) shall  occur and the
         occurrence of such event results in an adjustment of the Exercise Price
         pursuant to the  provisions  of this Section  y4.8,  then the number of
         Warrant  Shares  purchasable  pursuant to this  Warrant  upon  exercise
         thereof shall be adjusted  contemporaneously with the adjustment of the
         Exercise  Price by  multiplying  the  number  of  Warrant  Shares  then
         otherwise  purchasable  on the  exercise  thereof  by a  fraction,  the
         numerator  of  which  shall be the then  applicable  Exercise  Price in
         effect immediately prior to the adjustment and the denominator of which
         shall be the Exercise Price resulting from such adjustment.

         (g) DEFERRAL OF  ADJUSTMENT.  In any case in which this  Section  shall
         require that an adjustment shall become effective  immediately  after a
         record date for or an  effective  date of an event  referred to herein,
         the  Corporation  may defer,  until the occurrence and  consummation of
         such event,  issuing to the holder of any Warrant  exercised after such
         record  date  or  effective   date  and  before  the   occurrence   and
         consummation  of such  event  the  additional  Warrant  Shares or other
         shares, securities or property issuable upon such exercise by reason of
         the  adjustment  required by such event,  provided,  however,  that the

                                       19
<PAGE>

         Corporation  will  deliver  to such  holder an  appropriate  instrument
         evidencing  such  holder's  right to receive  such  additional  Warrant
         Shares or other shares,  securities or property upon the occurrence and
         consummation  of such event and the right to receive  any  dividend  or
         other  distribution  in respect of such  additional  Warrant  Shares or
         other shares,  securities or property declared in favour of the holders
         of record  of Common  Shares or of such  other  shares,  securities  or
         property  on or after  the  Exercise  Date or such  later  date as such
         holder would,  but for the provisions of this  Subsection,  have become
         the holder of record of such additional Warrant Shares or of such other
         shares, securities or property pursuant hereto.

         (h)  ADJUSTMENTS  CUMULATIVE.  The  adjustments  provided  for in  this
         Section are cumulative and shall,  in the case of any adjustment to the
         Exercise  Price,  be computed to the  nearest  one  one-hundredth  of a
         Warrant  Share  and will  apply  (without  duplication)  to  successive
         subdivisions, consolidations,  distributions, issuances or other events
         resulting  in any  adjustment  under the  provisions  of this  Section,
         provided that,  notwithstanding any other provision of this Section, no
         adjustment of the Exercise  Price will be made which would result in an
         increase in the Exercise Price (except in connection  with an event set
         forth in subsection  4.8(b)(ii) hereof or subsection 4.8(e) hereof) and
         no  adjustment  of the Exercise  Price will be required (i) unless such
         adjustment  would  require a  decrease  of at least 1% in the  Exercise
         Price then in effect (provided,  however,  that any adjustment which by
         reason of this  Subsection  is not  required to be made will be carried
         forward and taken into account in any subsequent adjustment),  (ii) if,
         in respect  of any event  described  in this  Section  (other  than the
         events referred to in Subsection y4.8(b) and Subsection  y4.8(c)),  the
         holders of Warrants are entitled to participate  in such event,  or are
         entitled to participate  within 45 days in a comparable  event,  on the
         same terms,  mutatis  mutandis as if the  Warrants  had been  exercised
         prior to or on the  effective  date of or record  date for such  event,
         (iii) in respect of any Common  Shares  issuable or issued  pursuant to
         any stock option or stock  purchase plan in force from time to time for
         directors,  officers or employees of the Corporation or of a Subsidiary
         of the  Corporation or pursuant to the Warrants,  or (iv) in respect of
         any Common  Shares  issued on the  exercise of any other stock  options
         issued by the Corporation and outstanding on the date hereof, or (v) in
         respect of the issuance of any Common Shares issued as consideration of
         the  acquisition of mining  rights,  property or shares in the ordinary
         course of business.

         (i) No adjustment to the number of Warrant Shares  purchasable upon the
         exercise  of the  Warrants  shall  be  made  in  respect  of any  event
         described in Subsections  y4.8y(b),  y(c),  y(d) or y(e) other than the
         events  referred  to in  paragraphs  (i)  and  (ii) of  subsection  (b)
         thereof, if Warrantholders are entitled to participate in such event on
         the same terms,  mutatis mutandis,  as if Warrantholders  had exercised
         their Warrants prior to or on the effective date or record date of such
         event, such participation being subject to the prior written consent of
         theNASDAQ Bulletin Board.

         (j) No adjustment to the number of Warrant Shares  purchasable upon the
         exercise  of  the  Warrants  shall  be  made  pursuant  to  Subsections
         y4.8y(b),  y(c), y(d) or y(e) in respect of the issue from time to time

                                       20
<PAGE>

         of Common Shares  purchasable on exercise of the Warrants or in respect
         of the  issue  from  time to time of a  dividend  paid in the  ordinary
         course of Common  Shares to holders of Common  Shares who  exercise  an
         option or election to receive  substantially  equivalent  dividends  in
         Common Shares in lieu of receiving a cash dividend,  and any such issue
         shall be deemed not to be a Common Share Reorganization.

         (k) RESOLUTION OF QUESTIONS.  In the event of any question arising with
         respect to the adjustments provided for in this Section, such questions
         shall be conclusively  determined by the Corporation's  Auditors or, if
         they  are  unable  or  unwilling  to  act,  by such  firm of  chartered
         accountants  as is appointed by the  Corporation  and acceptable to the
         Warrant  Agent.  Such  accountants  shall have access to all  necessary
         records of the Corporation and such determination shall be binding upon
         the Corporation, the Warrant Agent and the Warrantholders.  If any such
         determination  is made,  the  Corporation  shall  forthwith  deliver  a
         certificate to the Warrant Agent describing such determination and give
         notice to the Warrantholders of such determination.

         (l) OTHER ACTIONS.  If and whenever at any time the  Corporation  shall
         take any action affecting or relating to the Common Shares,  other than
         any  action  described  in this  Section,  which in the  opinion of the
         directors  would  prejudicially  affect  the  rights of any  holders of
         Warrants,  the Exercise Price will be adjusted by the directors in such
         manner,  if any, and at such time,  as the  directors may in their sole
         discretion  determine to be equitable in the circumstances,  subject to
         the prior consent of the NASDAQ Bulletin Board or any other exchange on
         which the Corporation's securities are then listed to such holders.

         (m)  RECORD  DATE.  In the  absence  of a  resolution  of the  board of
         directors of the  Corporation  fixing a record date for any dividend or
         distribution  referred to in Subsection  y4.8(b) above, the Corporation
         shall be deemed to have fixed as the record date  therefor  the date on
         which such dividend or  distribution  is effected.  If the  Corporation
         sets a record  date to take any  action and  thereafter  and before the
         taking of such action  abandons its plan to take such  action,  then no
         adjustment  to the  Exercise  Price will be  required  by reason of the
         setting of such record date.

         (n) ADDITIONAL  ACTIONS.  As a condition precedent to the taking of any
         action which would require an adjustment in any of the rights under the
         Warrants,  the  Corporation  will take any  action  which  may,  in the
         opinion of counsel to the  Corporation  be  necessary in order that the
         Corporation,  or any successor to the  Corporation  or successor to the
         undertaking or assets of the Corporation,  will be obligated to and may
         validly and legally  issue all of the Warrant  Shares or other  shares,
         securities or property  which the holders of Warrants would be entitled
         to receive  thereafter on the exercise  thereof in accordance  with the
         provisions hereof.

         (o) NOTICE TO WARRANT AGENT. At least 10 days before the earlier of the
         effective  date of or  record  date for any event  referred  to in this
         Section  that  requires or might  require an  adjustment  in any of the
         rights under the Warrants, the Corporation will:

                                       21
<PAGE>

                  (i)  file  with  the  Warrant  Agent,  a  Certificate  of  the
                  Corporation  specifying the  particulars of such event and, to
                  the  extent  determinable,  any  adjustment  required  and the
                  computation of such adjustment; and

                  (ii) deliver a certificate  to the  Warrantholders  specifying
                  the particulars of such event and, to the extent determinable,
                  any adjustment required.

         Such  notice  need  only  set  forth  such  particulars  as  have  been
         determined  at the date such  notice is given.  If any  adjustment  for
         which such  notice is given is not then  determinable,  promptly  after
         such adjustment is determinable the Corporation will:

                  (i)  file  with  the  Warrant  Agent  a  Certificate   of  the
                  Corporation showing the computation of such adjustment; and

                  (ii)  deliver  a  certificate  to the  Warrantholders  of such
                  adjustment.

         The  Warrant  Agent  may  act and  rely,  for all  purposes,  upon  the
         certificate and any other  documents filed by the Corporation  pursuant
         to this Section.

         (p) CLOSING  TRANSFER BOOKS,  ETC. The  Corporation  will not close its
         transfer books or take any other  corporate  action which might deprive
         the holder of a Warrant of the  opportunity  of exercising its right of
         acquisition  pursuant  thereto  during the period of ten Business  Days
         after the giving of any notice required by Subsection y4.8(o).

         (q) DUTY OF WARRANT AGENT. The Warrant Agent:

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

                  (ii) shall not be accountable  with respect to the validity or
                  value (or the kind or amount) of any Warrant  Shares or of any
                  other shares,  securities or property which may at any time be
                  issued or delivered upon the exercise of any Warrant; and

                  (iii)  shall  not  be  responsible  for  any  failure  of  the
                  Corporation to make any cash payment or to issue,  transfer or
                  deliver Warrant Shares or share or warrant  certificates  upon
                  the  surrender of any Warrant for the purpose of exercise,  or
                  to comply with any of the covenants contained in this Section.

         (r) POST-ADJUSTMENT. After any adjustment pursuant to this Section, the
         term "Warrant Shares" where used in this Indenture shall be interpreted
         to mean  securities of any class or classes which,  as a result of such
         adjustment  and all prior  adjustments  pursuant to this  Section,  the
         Warrantholder is entitled to receive upon the exercise of its Warrants,
         and the  number  of  Warrant  Shares  indicated  in any  exercise  made

                                       22
<PAGE>

         pursuant  to a  Warrant  shall be  interpreted  to mean the  number  of
         securities  and other  property and assets  which,  as a result of such
         adjustment and all prior  adjustments  pursuant to this Section y4.8, a
         Warrantholder is entitled to receive upon the exercise of a Warrant.

ARTICLE 5   COVENANTS OF THE CORPORATION

5.1      COVENANTS OF THE CORPORATION.

The Corporation covenants with the Warrant Agent, for the benefit of the Warrant
Agent and the Warrantholders, that until the Expiry Time:

         (a)  MAINTENANCE.  The  Corporation  will  at all  times  maintain  its
         corporate existence, carry on and conduct its business, and that of its
         material Subsidiaries,  in a proper, efficient and business-like manner
         and keep or cause to be kept proper books of account in accordance with
         generally accepted accounting practice.

         (b) RESERVATION OF WARRANT SHARES. The Corporation will reserve for the
         purpose and keep available  sufficient unissued Common Shares to enable
         it to satisfy its obligations on the exercise of the Warrants.

         (c) WARRANTS AND ISSUE OF WARRANT  SHARES.  The  Warrants  shall,  when
         countersigned   and  registered  as  herein  provided,   be  valid  and
         enforceable  against the Corporation  and, subject to the provisions of
         this Indenture, the Corporation will cause the Warrant Shares from time
         to time  issued  pursuant  to the  exercise  of the  Warrants,  and the
         certificates  representing  such  Warrant  Shares,  to  be  issued  and
         delivered in accordance  with the Warrants and the terms hereof and all
         Warrant  Shares  that are issued on exercise  of the  Warrants  will be
         fully paid and non-assessable shares.

         (d) OPEN  REGISTERS.  The  Corporation  will cause the Warrant Agent to
         keep open the registers of holders and registers of transfers  referred
         to in Section y3.1 hereof as required by such Section and will not take
         any  action or omit to take any action  which  would have the effect of
         preventing the  Warrantholders  from  exercising any of the Warrants or
         receiving any of the Warrant Shares upon such exercise.

         (e)  CARRYING  ON OF  BUSINESS.  At all times  while the  Warrants  are
         outstanding,  the Corporation will maintain its corporate existence and
         carry on and conduct its business in a proper and business-like  manner
         and cause to be kept the proper  books of account  in  accordance  with
         generally accepted accounting practices.

         (f) FURTHER ASSURANCES.  The Corporation will do, execute,  acknowledge
         and deliver or cause to be done, executed,  acknowledged and delivered,
         all  other  acts,  deeds  and  assurances  as  the  Warrant  Agent  may
         reasonably   require  for  better   accomplishing   and  affecting  the
         provisions of this Indenture.

         (g) WARRANT AGENT'S REMUNERATION.  The Corporation shall pay (and shall
         be responsible for the payment thereof) to the Warrant Agent reasonable
         remuneration  agreed to in writing for its services  hereunder and will

                                       23
<PAGE>

         repay to the Warrant Agent the amount of all  reasonable  out-of-pocket
         expenditures  that the Warrant Agent reasonably incurs in the execution
         of  its  duties   hereunder  with  respect  to  the  Warrants   without
         duplication  of any  amounts  otherwise  claimed or paid to the Warrant
         Agent,  including reasonable fees and disbursement  reasonably incurred
         by counsel and all other  advisors  reasonably  retained by the Warrant
         Agent in connection herewith.

         (h) FILINGS.  The Corporation will make all requisite  filings required
         of  it,  including  filings  with  appropriate   Securities  Regulatory
         Authorities,  in  connection  with the exercise of the Warrants and the
         issue of the Warrant Shares.

         (i) ORDERS,  RULINGS ETC.  The  Corporation  covenants  that if, in the
         reasonable opinion of outside counsel,  supported by legal analysis, if
         requested,  any  instrument  is  required  to be  filed  with,  or  any
         permission,  order  or  ruling  is  required  to be  obtained  from any
         securities  administrator,  regulatory agency or governmental authority
         in the United States or Canada or any other step is required  under any
         applicable  law before the Warrant Shares may be issued or delivered to
         the   Warrantholders,   the  Corporation   will  use  its  commercially
         reasonable  efforts to file such  instrument,  obtain such  permission,
         order or ruling or take all such other actions,  at its expense, as are
         required.

         (j) GENERAL PERFORMANCE. Generally, the Corporation will well and truly
         perform  and carry out all acts and things to be done by it as provided
         in this Indenture.

5.2      PERFORMANCE OF COVENANTS BY WARRANT AGENT.

If the Corporation fails to perform any of its obligations under this Indenture,
the Warrant  Agent may notify the  Warrantholders  of such failure or may itself
perform any of such  obligations  capable of being performed by it, but will not
be bound to do so or to  notify  the  Warrantholders  that it is so  doing.  All
reasonable  sums expended or advanced by the Warrant Agent in performance of the
Corporation's  obligations  as  provided  for in  this  Section  y5.2  shall  be
repayable by the Corporation. No such performance, expenditure or advance by the
Warrant  Agent  shall be  deemed  to  relieve  the  Corporation  of any  default
hereunder  or  of  its  continuing   obligations   under  this  Indenture.   5.3
CERTIFICATES OF NO DEFAULT.

If at any time requested by the Warrant Agent, the Corporation  shall deliver to
the Warrant  Agent an officer's  certificate  stating that the  Corporation  has
complied with all covenants,  conditions or other requirements contained in this
indenture  or if such is not the case,  specifying  the  covenant,  condition or
other  requirement  which has not been complied with and giving  particulars  of
such non-compliance.

ARTICLE 6   ENFORCEMENT

6.1      SUITS BY WARRANTHOLDERS.

All or any of the rights  conferred on the holder of any Warrant by the terms of
the Warrant  Certificate  evidencing  such Warrant or of this  Indenture  may be
enforced by such holder by appropriate  legal  proceedings but without prejudice

                                       24
<PAGE>

to the right which is hereby  conferred  on the Warrant  Agent to proceed in its
own name or on behalf of the  holders  of  Warrants  to  enforce  each and every
provision herein contained for the benefit of the Warrantholders.

ARTICLE 7   MEETINGS OF WARRANTHOLDERS

7.1      RIGHT TO CONVENE MEETINGS.

         (a)  CONVENING OF MEETING.  The Warrant  Agent may at any time and from
         time to time convene a meeting of the Warrantholders, and will do so on
         receipt of a Written  Request of the  Corporation or a  Warrantholders'
         Request  and  on  being  funded  and   indemnified  to  its  reasonable
         satisfaction by the Corporation or by one or more of the Warrantholders
         signing  such  Warrantholders'  Request  against the costs which it may
         incur in connection with calling and holding such meeting.

         (b) FAILURE TO CONVENE. If the Warrant Agent fails, within fifteen (15)
         Business Days after receipt of such Written  Request of the Corporation
         or Warrantholders' Request, funding and indemnification, to give notice
         convening a meeting, the Corporation or any of such Warrantholders,  as
         the case may be, may convene such meeting.

         (c) PLACE OF MEETING.  Every such meeting  shall be held in the City of
         Toronto,  Ontario or such other  place in  Ontario  as is  approved  or
         determined by the Warrant Agent and the Corporation.

7.2      NOTICE.

         (a) NOTICE. At least ten (10) Business Days' notice of any meeting must
         be  given to the  Warrantholders,  to the  Warrant  Agent  (unless  the
         meeting  has been  called  by it) and to the  Corporation  (unless  the
         meeting has been called by it).

         (b)  CONTENTS.  The notice of the meeting  must state the time when and
         the place  where the  meeting is to be held and must state  briefly the
         general nature of the business to be transacted  thereat,  but it shall
         not be necessary for the notice to set out the terms of any  resolution
         to be proposed or any of the provisions of this Article.

7.3      CHAIRMAN.

Some  person  (who need not be a  Warrantholder)  designated  in  writing by the
Warrant Agent shall be chairman of the meeting or, if no person is so designated
or the person so  designated  is not  present  within 30 minutes  after the time
fixed for the holding of the meeting, the Warrantholders present in person or by
proxy may choose some person present to be chairman.

7.4      QUORUM.

         (a) QUORUM.  Subject to the provisions of Section y7.12 hereof,  at any
         meeting  of  Warrantholders  a  quorum  shall  consist  of two or  more
         Warrantholders present either in person or by proxy at the commencement
         of the meeting  holding in the aggregate not less than 20% of the total
         number of Warrants then outstanding.

                                       25
<PAGE>

         (b) NO QUORUM.  If a quorum of  Warrantholders is not present within 30
         minutes  after the time fixed for holding a meeting,  the  meeting,  if
         summoned by Warrantholders or on a  Warrantholders'  Request,  shall be
         dissolved,  but,  subject to Section  y7.12  hereof,  in any other case
         shall be adjourned to the fifth following Business Day at the same time
         and place and no notice of the adjournment need be given.

         (c)  ADJOURNED  MEETING.  At the adjourned  meeting two  Warrantholders
         present in person or by proxy shall form a quorum and may  transact any
         business for which the meeting was originally convened  notwithstanding
         the number of Warrants that they hold.

7.5      POWER TO ADJOURN.

The  chairman  of a meeting at which a quorum of the  Warrantholders  is present
may, with the consent of the meeting, adjourn the meeting, and no notice of such
adjournment need be given except as the meeting prescribes.

7.6      SHOW OF HANDS.

Every question submitted to a meeting,  other than an Extraordinary  Resolution,
shall be decided in the first  place by a majority  of the votes given on a show
of hands and, unless a poll is duly demanded as herein  provided,  a declaration
by the chairman that a resolution has been carried or carried  unanimously or by
a particular  majority or lost or not carried by a particular  majority shall be
conclusive  evidence of the fact.  In the case of an equality of votes on a show
of hands, the chairman shall not have a casting vote.

7.7      POLL.

         (a) EXTRAORDINARY RESOLUTION. On every Extraordinary Resolution, and on
         every other question submitted to a meeting on which a poll is directed
         by the chairman or requested  by one or more  Warrantholders  acting in
         person  or by  proxy,  a poll  shall  be taken  in such  manner  as the
         chairman directs.

         (b) OTHER.  Questions  other than those  required to be  determined  by
         Extraordinary  Resolution  shall be decided by a majority  of the votes
         cast on the poll.

7.8      VOTING.

On a show of hands  each  person  present  and  entitled  to vote,  whether as a
Warrantholder or as proxy for one or more absent Warrantholders,  or both, shall
have one vote, and on a poll each Warrantholder present in person or represented
by a proxy duly appointed by instrument in writing shall be entitled to one vote
in  respect  of each  Warrant  held  by  such  holder.  A  proxy  need  not be a
Warrantholder.  The chairman of any meeting shall be entitled to vote in respect
of any Warrants and proxies held by him.

                                       26
<PAGE>

7.9      REGULATIONS.

         (a) ABILITY TO MAKE. The Warrant  Agent,  or the  Corporation  with the
         approval of the Warrant Agent,  may from time to time make or vary such
         regulations  not contrary to the  provisions of this  Indenture,  as it
         thinks fit:

                  (i) for the form of instrument  appointing a proxy, the manner
                  in which it must be executed and verification of the authority
                  of a person who executes it on behalf of a Warrantholder;

                  (ii)  governing  the  places  at which  and the times by which
                  voting certificates or instruments  appointing proxies must be
                  deposited;

                  (iii) generally for the calling of meetings of  Warrantholders
                  and the conduct of business thereat; and

                  (iv) for the deposit of instruments appointing proxies at some
                  approved  place or  places  other  than the place at which the
                  meeting  is  to be  held  and  enabling  particulars  of  such
                  instruments  appointing proxies to be sent by mail, telecopier
                  or  other   means  of   prepaid,   transmitted   or   recorded
                  communication  before the meeting to the Corporation or to the
                  Warrant Agent at the place where the meeting is to be held and
                  for  voting  pursuant  to  instruments  appointing  proxies so
                  deposited as though the  instruments  themselves were produced
                  at the meeting.

         Any  regulations  so made shall be binding and  effective and the votes
         given in accordance therewith shall be valid and shall be counted.

         (b) RECOGNITION.  Except as such regulations  provide, the only persons
         who shall be recognized at a meeting as the holders of any Warrants, or
         as entitled to vote or, subject to Section y7.10 hereof,  to be present
         at the meeting in respect thereof,  shall be the registered  holders of
         Warrants or persons holding proxies on their behalf.

7.10     THE CORPORATION AND WARRANT AGENT MAY BE REPRESENTED.

The Corporation and the Warrant Agent by their respective employees, officers or
directors,  and the counsel of the Corporation and the Warrant Agent, may attend
any meeting of Warrantholders, but shall have no vote as such.

7.11     POWERS EXERCISABLE BY EXTRAORDINARY RESOLUTION.

In addition to all other  powers  conferred on them by the other  provisions  of
this Warrant Indenture or by law, the Warrantholders at a meeting shall have the
power, exercisable from time to time by Extraordinary Resolution:

         (a) to assent to or sanction any amendment,  modification,  abrogation,
         alteration,   compromise   or   arrangement   of  any   right   of  the
         Warrantholders or, with the reasonable consent of the Warrant Agent, of
         the Warrant  Agent in its  capacity as Warrant  Agent  hereunder  or on
         behalf of the  Warrantholders  against the  Corporation,  whether  such

                                       27
<PAGE>

         right arises under this Warrant Indenture or otherwise,  which shall be
         agreed to by the  Corporation,  and to authorize  the Warrant  Agent to
         concur in and execute any indenture  supplemental  hereto in connection
         therewith;

         (b) to amend, alter or repeal any Extraordinary  Resolution  previously
         passed;

         (c) subject to arrangements as to financing and indemnity  satisfactory
         to the Warrant  Agent,  to direct or  authorize  the  Warrant  Agent to
         enforce any obligation of the Corporation  under this Warrant Indenture
         or to enforce any right of the  Warrantholders  in any manner specified
         in the Extraordinary Resolution;

         (d) to direct or authorize the Warrant Agent to refrain from  enforcing
         any obligation or right referred to in Subsection y7.11(c);

         (e) to waive and direct the  Warrant  Agent to waive any default by the
         Corporation in complying with any provision of this Warrant  Indenture,
         either   unconditionally   or  on  any   condition   specified  in  the
         Extraordinary Resolution;

         (f) to appoint a committee with power and authority to exercise, and to
         direct the Warrant Agent to exercise,  on behalf of the Warrantholders,
         such  of  the  powers  of the  Warrantholders  as  are  exercisable  by
         Extraordinary Resolution;

         (g) to restrain any Warrantholder  from taking or instituting any suit,
         action or proceeding against the Corporation for the enforcement of any
         obligation  of the  Corporation  under  this  Warrant  Indenture  or to
         enforce any right of the Warrantholders;

         (h) to direct any  Warrantholder  who,  as such,  has brought any suit,
         action  or  proceeding,  to  stay  or  discontinue  or  otherwise  deal
         therewith on payment of the costs,  charges and expenses reasonably and
         properly incurred by him in connection therewith;

         (i)  to  assent  to any  change  in or  omission  from  the  provisions
         contained in the Warrant Certificates and this Warrant Indenture or any
         ancillary  or  supplemental  instrument  which  may be agreed to by the
         Corporation,  and to  authorize  the  Warrantholders  to  concur in and
         execute any ancillary or supplemental indenture embodying the change or
         omission;

         (j) to assent to any compromise or arrangement  made by the Corporation
         with all or substantially  all of its creditors or any class or classes
         of  creditors,   whether   secured  or  otherwise,   and  with  all  or
         substantially  all of the holders of any shares or other  securities of
         the Corporation; and

         (k) from time to time and at any time to remove the  Warrant  Agent and
         appoint a successor Warrant Agent.

                                       28
<PAGE>

7.12     MEANING OF "EXTRAORDINARY RESOLUTION".

         (a) MEANING.  The expression  "Extraordinary  Resolution"  when used in
         this Warrant Indenture means, subject to the provisions of this Section
         and of Sections 7.15 and 7.16 hereof, a motion proposed at a meeting of
         Warrantholders  duly  convened for that purpose and held in  accordance
         with the  provisions  of this  Article  at which  there are  present in
         person or by proxy  Warrantholders  holding in the aggregate  more than
         50% of the total number of Warrants then  outstanding and passed by the
         affirmative votes of Warrantholders  who hold in the aggregate not less
         than 66 2/3% of the total number of Warrants represented at the meeting
         and voted on the motion.

         (b)  QUORUM.  If, at a meeting  called  for the  purpose  of passing an
         Extraordinary  Resolution,  the quorum required by Subsection  y7.12(b)
         hereof is not present  within 30 minutes  after the time  appointed for
         the  meeting,  the  meeting,  if  convened  by  Warrantholders  or on a
         Warrantholders'  Request,  shall be  dissolved,  but in any other  case
         shall stand  adjourned to such day,  being not less than five  Business
         Days or more than ten Business Days later,  and to such place and time,
         as is appointed by the chairman.

         (c) NOTICE.  Not less than three Business Days' notice must be given to
         the Warrantholders of the time and place of such adjourned meeting.

         (d) FORM OF NOTICE. The notice must state that at the adjourned meeting
         two  Warrantholders  present in person or by proxy  shall form a quorum
         but it shall not be  necessary  to set forth the purposes for which the
         meeting was originally called or any other particulars.

         (e)  QUORUM  AT  ADJOURNED  MEETING.   At  the  adjourned  meeting  two
         Warrantholders  present  in person or by proxy  shall form a quorum and
         may  transact  any  business  for  which  the  meeting  was  originally
         convened, and a motion proposed at such adjourned meeting and passed by
         the requisite vote as provided in Subsection y7.12(b)hereof shall be an
         Extraordinary Resolution within the meaning of this Indenture.

         (f) POLL. Votes on an Extraordinary  Resolution must always be given on
         a poll and no demand for a poll on an Extraordinary Resolution shall be
         necessary.

7.13     POWERS CUMULATIVE.

Any one or more  of the  powers,  and any  combination  of the  powers,  in this
Indenture  stated  to be  exercisable  by the  Warrantholders  by  Extraordinary
Resolution or otherwise, may be exercised from time to time, and the exercise of
any one or more of such  powers or any  combination  of such powers from time to
time shall not prevent the  Warrantholders  from exercising such power or powers
or combination of powers thereafter from time to time.

                                       29
<PAGE>

7.14     MINUTES.

Minutes of all resolutions  passed and proceedings taken at every meeting of the
Warrantholders  shall be made  and  duly  entered  in  books  from  time to time
provided  for  such  purpose  by  the  Warrant  Agent  at  the  expense  of  the
Corporation,  and any such minutes,  if signed by the chairman of the meeting at
which such  resolutions  were passed or such  proceedings  were taken,  shall be
prima facie evidence of the matters therein  stated,  and, until the contrary is
proved,  every such meeting in respect of the  proceedings of which minutes have
been so made,  entered and signed shall be deemed to have been duly convened and
held, and all resolutions passed and proceedings taken thereat to have been duly
passed and taken.

7.15     INSTRUMENTS IN WRITING.

Any  action  that  may  be  taken  and  any  power  that  may  be  exercised  by
Warrantholders  at a meeting  held as provided in this Article may also be taken
and exercised by  Warrantholders  who hold in the aggregate not less than 50% of
the  total  number  of  Warrants  at the time  outstanding  or in the case of an
Extraordinary Resolution, Warrantholders who hold in the aggregate not less than
66 2/3% of the  total  number  of  Warrants  at the time  outstanding,  by their
signing,  each in person or by attorney duly appointed in writing, an instrument
in  writing  in one or  more  counterparts,  and the  expression  "Extraordinary
Resolution" when used in this Warrant Indenture  includes a resolution  embodied
in an instrument so signed.

7.16     BINDING EFFECT OF RESOLUTIONS.

Every resolution and every  Extraordinary  Resolution  passed in accordance with
the provisions of this Article at a meeting of  Warrantholders  shall be binding
on all Warrantholders, whether present at or absent from the meeting and whether
voting for or against the  resolution  or  abstaining,  and every  instrument in
writing signed by  Warrantholders  in accordance with Section y7.15 hereof shall
be binding on all Warrantholders,  whether signatories thereto or not, and every
Warrantholder and the Warrant Agent (subject to the provisions for its indemnity
herein  contained)  shall be  bound to give  effect  accordingly  to every  such
resolution and instrument in writing.

7.17     HOLDINGS BY THE CORPORATION AND SUBSIDIARIES DISREGARDED.

In  determining  whether  Warrantholders  holding the  required  total number of
Warrants  are  present in person or by proxy for the purpose of  constituting  a
quorum,  or have voted or consented to a resolution,  Extraordinary  Resolution,
consent,  waiver,  Warrantholders'  Request or other  action  under this Warrant
Indenture,  a  Warrant  held  by  the  Corporation  or by a  Subsidiary  of  the
Corporation shall be deemed to be not outstanding. The Corporation shall provide
the Warrant Agent with a Certificate of the Corporation providing details of any
Warrants held by the Corporation or by a Subsidiary of the Corporation  upon the
written request of the Warrant Agent.

ARTICLE 8   SUPPLEMENTAL INDENTURES AND SUCCESSOR CORPORATIONS

8.1      PROVISION FOR SUPPLEMENTAL INDENTURES FOR CERTAIN PURPOSES.

From time to time the  Corporation  (when  authorized by the  directors) and the
Warrant Agent may, subject to the provisions  hereof, and shall when so directed
hereby,  execute and deliver by their proper officers  indentures or instruments

                                       30
<PAGE>

supplemental  hereto, which thereafter shall form part hereof, for any or all of
the following purposes:

         (a) adding to the  provisions  hereof  such  additional  covenants  and
         enforcement  provisions as, in the opinion of counsel acceptable to the
         Warrant  Agent,  are necessary or advisable in the  premises,  provided
         that the same are not, in the reasonable  opinion of the Warrant Agent,
         prejudicial to the interests of the Warrantholders;

         (b) giving effect to any Extraordinary Resolution;

         (c) making such provisions not inconsistent  with this Indenture as may
         be necessary or desirable in the opinion of counsel  acceptable  to the
         Warrant Agent with respect to matters or questions  arising  hereunder,
         provided that such provisions are not, in the reasonable opinion of the
         Warrant Agent, prejudicial to the interests of the Warrantholders;

         (d)  adding to or  altering  the  provisions  hereof in  respect of the
         transfer of Warrants, making provision for the exchange of Warrants and
         making  any  modification  in the form of the  Warrants  that  does not
         affect the substance thereof;

         (e)  evidencing  any  succession,  or  successive  successions,  to the
         Corporation and the assumption by any successor of the covenants of the
         Corporation, herein and in the Warrants contained as provided hereafter
         in this Article; and

         (f) for any  other  purpose  not  inconsistent  with the  terms of this
         Indenture,   including   the   correction  or   rectification   of  any
         ambiguities,  defective  provisions,  errors  or  omissions  herein  in
         accordance  with advice of counsel  acceptable  to the  Warrant  Agent,
         provided  that,  in the  reasonable  opinion of counsel to the  Warrant
         Agent,  the rights of the Warrant Agent and of the  Warrantholders  are
         not prejudiced thereby.

8.2      SUCCESSOR CORPORATIONS.

In the case of the consolidation,  amalgamation, arrangement, merger or transfer
of the undertaking or assets of the Corporation as an entirety, or substantially
as an entirety, to another corporation, the successor corporation resulting from
such consolidation,  amalgamation,  arrangement,  merger or transfer (if not the
Corporation)  shall  be  bound  by the  provisions  hereof  and  for the due and
punctual  performance  and  observance of each and every covenant and obligation
contained in this Warrant  Indenture to be performed by the Corporation and will
execute and deliver to the Warrant Agent a supplemental indenture and such other
instruments as are  satisfactory in form to the Warrant Agent and in the opinion
of counsel are necessary or advisable to evidence the express  assumption by the
successor corporation of such obligations.

8.3      HOLDINGS BY CORPORATIONS AND SUBSIDIARIES DISREGARDED.

For the purposes of Section y8.1,  the term,  "Warrantholders"  does not include
the  Corporation  or any  Subsidiary of the  Corporation to the extent that they
hold any Warrants.

                                       31
<PAGE>

ARTICLE 9           CONCERNING THE WARRANT AGENT

9.1      TRUST INDENTURE LEGISLATION.

If and to the  extent  that any  provision  of this  Warrant  Indenture  limits,
qualifies or conflicts with a mandatory  requirement of Applicable  Legislation,
the mandatory  requirement shall prevail.  The Corporation and the Warrant Agent
each shall at all times in relation to this Warrant  Indenture and any action to
be taken  hereunder  observe and comply with and be entitled to the  benefits of
Applicable Legislation.

9.2      RIGHTS AND DUTIES OF WARRANT AGENT.

         (a) WARRANT AGENT NOT A TRUSTEE.  The Warrant Agent accepts the powers,
         rights,  duties and  responsibilities  conferred  on it by the terms of
         this  Indenture.  No trust is intended to be, or is or will be, created
         hereby  and the  Warrant  Agent  shall  owe no  duties  hereunder  as a
         trustee.

         (b) DUTY OF WARRANT  AGENT.  In the  exercise  of the  powers,  rights,
         duties  and  responsibilities  conferred  on it by the  terms  of  this
         Warrant  Indenture,  the Warrant  Agent shall act  honestly and in good
         faith  with a view to the best  interests  of the  Warrantholders,  and
         shall  exercise  that  degree  of  care,  diligence  and  skill  that a
         reasonably   prudent   warrant  agent  would   exercise  in  comparable
         circumstances.  The Warrant Agent shall not be bound to give any notice
         or do or take any act,  action or  proceeding  by virtue of the powers,
         rights,  duties and responsibilities  conferred on it hereby unless and
         until it shall have been required so to do under the terms hereof;  nor
         shall the  Warrant  Agent be  required  to take  notice of any  default
         hereunder,  unless and until notified in writing of such default, which
         notice shall  distinctly  specify the default  desired to be brought to
         the  attention  of the  Warrant  Agent and in the  absence  of any such
         notice the Warrant Agent may for all purposes of this Warrant Indenture
         conclusively  assume that no default has been made in the observance or
         performance  of  any  of the  representations,  warranties,  covenants,
         agreements or conditions  contained herein. Any such notice shall in no
         way limit any discretion herein given to the Warrant Agent to determine
         whether or not the Warrant  Agent shall take action with respect to any
         default.

         (c) NO RELIEF FROM  LIABILITY.  No provision of this Warrant  Indenture
         shall be construed to relieve the Warrant Agent from  liability for its
         own negligent act,  negligent failure to act, willful misconduct or bad
         faith.

         (d)  ACTIONS.  The  obligation  of the  Warrant  Agent to  commence  or
         continue  any  act,  action  or  proceeding  in  connection   herewith,
         including without limitation, for the purpose of enforcing any right of
         the Warrant Agent or the Warrantholders  hereunder is on the conditions
         that the Warrant  Agent shall have received a  Warrantholders'  Request
         specifying  the act,  action or  proceeding  which the Warrant Agent is
         requested to take and, when required by notice to the Warrantholders by
         the  Warrant  Agent,  the  Warrant  Agent is  furnished  by one or more
         Warrantholders  with sufficient funds to commence or continue such act,
         action or proceeding and an indemnity  reasonably  satisfactory  to the

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<PAGE>

         Warrant  Agent to  protect  and hold it  harmless  against  the  costs,
         charges,  expenses and liabilities to be incurred  thereby and any loss
         and damage it may suffer by reason thereof.

         (e) FUNDING.  No provision of this Warrant  Indenture shall require the
         Warrant  Agent to  expend  or risk its own  funds  or  otherwise  incur
         financial  liability in the  performance of any of its duties or in the
         exercise of any of its rights or powers unless it is so indemnified.

         (f) DEPOSIT OF WARRANTS. The Warrant Agent may, before commencing or at
         any time  during  the  continuance  of any act,  action or  proceeding,
         require the  Warrantholders  at whose  instance it is acting to deposit
         with the Warrant Agent the Warrant Certificates held by them, for which
         certificates the Warrant Agent shall issue receipts.

         (g)  RESTRICTION.  Every  provision  of  this  Warrant  Indenture  that
         relieves  the Warrant  Agent of liability or entitles it to rely on any
         evidence  submitted to it is subject to the  provisions  of  Applicable
         Legislation, this Section and Section y9.3 hereof.

         (h) RIGHT OF  OFFSET.  The  Warrant  Agent has the right to offset  any
         unpaid amounts due to it pursuant to its duties and  obligations  under
         this Indenture  against amounts  received by the Warrant Agent upon the
         exercise of Warrant Certificates.

9.3      EVIDENCE, EXPERTS AND ADVISERS.

         (a) EVIDENCE.  In addition to the reports,  certificates,  opinions and
         other  evidence  required  by this  Indenture,  the  Corporation  shall
         furnish to the Warrant  Agent such  additional  evidence of  compliance
         with any  provision  hereof,  and in such  form,  as is  prescribed  by
         Applicable  Legislation or as the Warrant Agent reasonably  requires by
         written notice to the Corporation.

         (b)  RELIANCE BY WARRANT  AGENT.  In the  exercise of any right or duty
         hereunder the Warrant Agent, if it is acting in good faith, may act and
         rely,  as to the truth of any  statement or the accuracy of any opinion
         expressed  therein,  on any  statutory  declaration,  opinion,  report,
         certificate or other  evidence  furnished to the Warrant Agent pursuant
         to a provision  hereof or of  Applicable  Legislation  or pursuant to a
         request of the Warrant Agent, if such evidence complies with Applicable
         Legislation and the Warrant Agent examines such evidence and determines
         that it  complies  with the  applicable  requirements  of this  Warrant
         Indenture.

         (c) STATUTORY  DECLARATION.  Whenever Applicable  Legislation  requires
         that evidence  referred to in Subsection  y9.3(a) hereof be in the form
         of a statutory declaration, the Warrant Agent may accept such statutory
         declaration in lieu of a Certificate of the Corporation required by any
         provision hereof. Any such statutory declaration may be made by any one
         or  more  of  the  Chairman,  President,  Vice-President,   Finance  or
         Secretary of the Corporation or by any other  officer(s) or director(s)
         of the Corporation to whom such authority is delegated by the directors

                                       33
<PAGE>

         from time to time. In addition,  the Warrant Agent may act and rely and
         shall  be  protected  in  acting  and  relying  upon  any   resolution,
         certificate,  direction,  instruction,  statement, instrument, opinion,
         report,   notice,   request,   consent,   order,   letter,   telecopier
         transmission  or other paper or  document  believed by it to be genuine
         and to have  been  signed,  sent or  presented  by or on  behalf of the
         proper party or parties.

         (d) PROOF OF  EXECUTION.  Proof of the  execution  of any  document  or
         instrument  in  writing,  including  a  Warrantholders'  Request,  by a
         Warrantholder  may be made by the  certificate of a notary  public,  or
         other  officer  with  similar  powers,  that the  person  signing  such
         instrument  acknowledged  to  him  the  execution  thereof,  or  by  an
         affidavit of a witness to such  execution,  or in any other manner that
         the Warrant Agent considers adequate.

         (e)  EXPERTS.  The  Warrant  Agent may employ or retain  such  counsel,
         accountants,  engineers, appraisers, or other experts or advisers as it
         reasonably  requires for the purpose of determining and discharging its
         rights and duties hereunder and may pay the reasonable remuneration and
         disbursements  for all services so  performed  by any of them,  without
         taxation of costs of any counsel,  and shall not be responsible for any
         misconduct  or  negligence  on the  part  of any of them  who has  been
         selected with due care by the Warrant Agent.  Any  remuneration so paid
         by the  Warrant  Agent  shall be  repaid  to the  Warrant  Agent by the
         Corporation in accordance with Subsection  y5.1(g) hereof.  The Warrant
         Agent may act and rely and shall be  protected in acting and relying in
         good faith on the opinion or advice of or information obtained from any
         counsel, accountant,  engineers, appraisers or other expert or advisor,
         whether  retained  or  employed  by the  Corporation  or by the Warrant
         Agent, in relation to any matter arising in the  administration  of the
         trusts hereof.

9.4      DOCUMENTS, MONEY ETC. HELD BY WARRANT AGENT.

Any securities,  documents of title or other instruments that may at any time be
held by the Warrant Agent  hereunder may be placed in the deposit  vaults of the
Warrant  Agent or of any  Schedule  I Canadian  chartered  bank.  Unless  herein
otherwise  expressly  provided,  any moneys held by the Warrant Agent hereunder,
pending the  application  or  withdrawal  thereof  under any  provisions of this
Indenture,  shall be  deposited  in a trust  account in the name of the  Warrant
Agent  (which may be held with the Warrant  Agent or an Affiliate of the Warrant
Agent), which account shall be non-interest  bearing. Upon the written direction
of the  Corporation,  the Warrant  Agent shall invest in its name such moneys in
Authorized  Investments in accordance with such direction.  Any direction by the
Corporation  to the Warrant Agent as to the investment of the moneys shall be in
writing and shall be  provided  to the Warrant  Agent no later than 9:00 a.m. on
the day on which the investment is to be made.  Any such  direction  received by
the  Warrant  Agent  after  9:00  a.m.  on  a  Business  Day  or  received  on a
non-Business Day, shall be deemed to have been given prior to 9:00 a.m. the next
Business Day. Except as otherwise  provided in this  Indenture,  all interest or
other  income  received by the  Warrant  Agent in respect of such  deposits  and
investments shall belong to the Corporation and shall be paid to the Corporation
forthwith upon receipt thereof by the Warrant Agent.

                                       34
<PAGE>

9.5      ACTION BY WARRANT AGENT TO PROTECT INTERESTS.

The Warrant Agent shall have power to institute and to maintain such actions and
proceedings  as it  considers  necessary  or expedient to protect or enforce its
interests and the interests of the Warrantholders.

9.6      WARRANT AGENT NOT REQUIRED TO GIVE SECURITY.

The Warrant  Agent shall not be required to give any bond or security in respect
of the execution of the trusts and powers of this Warrant Indenture.

9.7      WARRANT AGENT NOT APPOINTED RECEIVER

The Warrant  Agent will not be appointed a receiver and manager or liquidator of
all or any part of the assets or undertaking of the Corporation.

9.8      PROTECTION OF WARRANT AGENT.

         (a)  PROTECTION.  By way of supplement to the provisions of any law for
         the time being relating to Warrant Agents, it is expressly declared and
         agreed that:

                  (i) the Warrant Agent shall not be liable for or by reason of,
                  or  required  to   substantiate,   any   statement   of  fact,
                  representation  or recital in this Warrant Indenture or in the
                  Warrant Certificates  (except the representation  contained in
                  Section  y9.10 or in the  certificate  of the Warrant Agent on
                  the Warrant Certificates), but all such statements or recitals
                  are and shall be deemed to be made by the Corporation;

                  (ii)  nothing  herein  contained  shall  impose on the Warrant
                  Agent any obligation to see to, or to require evidence of, the
                  registration or filing (or renewal  thereof) of this Indenture
                  or any instrument ancillary or supplemental hereto;

                  (iii) the  Warrant  Agent shall not be bound to give notice to
                  any person of the execution hereof;

                  (iv) the  Warrant  Agent  shall  not incur  any  liability  or
                  responsibility  whatever or be in any way  responsible for the
                  consequence of any breach by the Corporation of any obligation
                  or warranty  herein  contained or of any act of any  director,
                  officer, employee or Warrant Agent of the Corporation;

                  (v) the Warrant Agent,  in its personal or any other capacity,
                  may buy, lend upon and deal in  securities of the  Corporation
                  and in the Warrants and  generally may contract and enter into
                  financial  transactions  with the  Corporation  or any related
                  corporation  without  being  liable to account  for any profit
                  made thereby; and

                                       35
<PAGE>

                  (vi) the Warrant  Agent shall incur no liability  with respect
                  to  the  delivery  or   non-delivery  of  any  certificate  or
                  certificates whether delivered by mail, or any other means.

         (b)  INDEMNITY.  In addition to and without  limiting any protection of
         the Warrant Agent hereunder or otherwise by law, the Corporation hereby
         indemnifies the Warrant Agent and saves it and its officers, directors,
         employees and agents  harmless from all  liabilities,  suits,  damages,
         costs, expenses and actions which may be brought against or suffered by
         it arising out of or connected with the performance by it of its duties
         hereunder except to the extent that such liabilities,  suits,  damages,
         costs and actions are attributable to the negligence,  fraud or willful
         misconduct of the Warrant Agent.  Notwithstanding  any other  provision
         hereof,  this indemnity shall survive any removal or resignation of the
         Warrant  Agent,  discharge of this  Indenture  and  termination  of any
         trusts hereunder.

9.9      REPLACEMENT OF WARRANT AGENT.

         (a)   RESIGNATION.   The  Warrant  Agent  may  resign  its  duties  and
         obligations  and be discharged  from all further duties and liabilities
         hereunder,  except  as  provided  in this  Section,  by  giving  to the
         Corporation  and the  Warrantholders  not less  than 30 days  notice in
         writing or, if a new Warrant  Agent has been  appointed,  such  shorter
         notice as the Corporation accepts as sufficient.

         (b) REMOVAL. The Warrantholders by Extraordinary  Resolution may at any
         time remove the Warrant Agent and appoint a new Warrant Agent.

         (c)  APPOINTMENT OF NEW WARRANT AGENT.  If the Warrant Agent so resigns
         or  is  so  removed  or  is  dissolved,  becomes  bankrupt,  goes  into
         liquidation or otherwise  becomes  incapable of acting  hereunder,  the
         Corporation  shall  forthwith  appoint a new Warrant Agent unless a new
         Warrant Agent has already been appointed by the Warrantholders.

         (d) FAILURE TO APPOINT.  Failing such  appointment by the  Corporation,
         the  retiring  Warrant  Agent  or any  Warrantholder  may  apply at the
         expense of the Corporation to the Ontario Superior Court of Justice, on
         such notice as the Court directs,  for the appointment of a new Warrant
         Agent.

         (e) NEW WARRANT  AGENT.  Any new  Warrant  Agent  appointed  under this
         Section must be a corporation  authorized to carry on the business of a
         transfer  agent or trust  company in Ontario  and,  if  required by the
         Applicable  Legislation of any other province,  in such other province.
         On any such  appointment the new Warrant Agent shall be vested with the
         same  powers,  rights,  duties and  responsibilities  as if it had been
         originally named herein as Warrant Agent without any further assurance,
         conveyance,  act or deed, but there shall be immediately  executed,  at
         the  expense  of  the  Corporation,   all  such  conveyances  or  other
         instruments  as, in the opinion of counsel,  are necessary or advisable
         for the purpose of assuring the transfer of such powers, rights, duties

                                       36
<PAGE>

         and responsibilities to the new Warrant Agent. Any new Warrant Agent so
         appointed  by the  Corporation  or by the  Court  shall be  subject  to
         removal as aforesaid by the Warrantholders and by the Corporation.

         (f) NOTICE OF NEW WARRANT  AGENT.  On the  appointment of a new Warrant
         Agent,  the  Corporation  shall  promptly  give  notice  thereof to the
         Warrantholders in accordance with Subsection y10.2(a) hereof.

         (g)  SUCCESSOR  WARRANT  AGENT.  A  corporation  into or with which the
         Warrant  Agent  is  merged  or  consolidated   or  amalgamated,   or  a
         corporation  succeeding  to the trust  business of the  Warrant  Agent,
         shall be the  successor  to the  Warrant  Agent  hereunder  without any
         further  act on its part or on the  part of any  party  hereto  if such
         corporation  would be eligible for  appointment  as a new Warrant Agent
         under Subsection y9.9(e) hereof.

         (h) CERTIFICATES.  A Warrant Certificate certified but not delivered by
         a  predecessor  Warrant  Agent may be delivered by the new or successor
         Warrant Agent in the name of the predecessor Warrant Agent or successor
         Warrant Agent.

9.10     CONFLICT OF INTEREST.

The  Warrant  Agent  represents  to the  Corporation  that  at the  time  of the
execution and delivery  hereof no material  conflict of interest  exists between
its role as a fiduciary  hereunder  and its role in any other  capacity and if a
material  conflict of interest arises hereafter it shall,  within ten days after
ascertaining  that it has such material  conflict of interest,  either eliminate
the  conflict of interest or resign its trust  hereunder.  If any such  material
conflict  of  interest  exists  or  hereafter  shall  exist,  the  validity  and
enforceability  of this  Indenture and the Warrants shall not be affected in any
manner whatsoever by reason thereof.

9.11     WARRANT AGENT'S AUTHORITY TO CARRY ON BUSINESS.

The Warrant Agent  represents to the  Corporation  that at the date hereof it is
authorized to carry on business in Ontario.  If,  notwithstanding the provisions
of this Section  y9.11,  the Warrant  Agent ceases to be  authorized to carry on
such  business,  the  validity  and  enforceability  of this  Indenture  and the
interest of the Warrantholders in the Warrants registered hereunder shall not be
affected in any manner whatsoever by reason only of such event provided that the
Warrant  Agent,  within  30 days  after  ceasing  to be  authorized  to carry on
business,  either  becomes so  authorized  or resigns in the manner and with the
effects specified in Section y9.9.

9.12     ACCEPTANCE OF RIGHTS, DUTIES AND OBLIGATIONS.

The Warrant Agent hereby accepts the powers, rights, duties and responsibilities
in this Warrant  Indenture  declared and provided for and agrees to perform them
on the terms and conditions herein set forth.

                                       37
<PAGE>

ARTICLE 10   GENERAL

10.1     NOTICE TO THE CORPORATION AND WARRANT AGENT.

         (a) Subject to the terms and provisions of this Indenture,  any notice,
         direction  or other  communication  hereunder  shall be in writing  and
         shall be given by delivery or by facsimile  transmission (if receipt of
         such transmission is confirmed):

                  (i)      if to the Corporation at:

                           Adsero Corp.
                           2085 Hurontario Street, Suite 300
                           Mississauga, ON
                           L4A 4G1

                           Attention:  President
                           Facsimile:  (905) 629-7025

                  (ii)     if to the Warrant Agent at:

                           Beard Winter LLP
                           Barristers and Solicitors
                           130 Adelaide St. W., Suite 701
                           Toronto, ON
                           M5H 2K4

                           Attention:  Julian L. Doyle
                           Facsimile:  (416) 593-7760

         Any such  notice  shall be deemed to have been  given if  delivered  by
         courier  during  normal  business  hours of the recipient on a Business
         Day, on the day following the date of delivery and if sent by facsimile
         transmission,  on the Business Day so sent  provided  that any delivery
         made or sent by facsimile after 4:00 p.m.  (Toronto time) on a Business
         Day, shall be deemed to be received on the next following Business Day.

         (b) CHANGE OF ADDRESS.  The  Corporation or the Warrant  Agent,  as the
         case may be,  may from  time to time  notify  the  other in the  manner
         provided in Subsection  y10.1(a)  hereof of a change of address  which,
         from the  effective  date of such  notice  and  until  changed  by like
         notice,  shall be the address of the  Corporation or the Warrant Agent,
         as the case may be, for all purposes of this Warrant Indenture.

10.2     NOTICE TO WARRANTHOLDERS.

         (a) NOTICE.  Unless otherwise expressly provided herein, a notice to be
         given hereunder to Warrantholders will be deemed to be validly given if
         the notice is sent by ordinary  surface or air mail,  postage  prepaid,
         addressed to the  Warrantholders  or delivered (or so mailed to certain
         Warrantholders  and so delivered to the other  Warrantholders) at their
         respective  addresses  appearing  on any of the  registers  of  holders

                                       38
<PAGE>

         described in Section y3.1 hereof, provided, however, that if, by reason
         of a strike,  lockout or other  work  stoppage,  actual or  threatened,
         involving postal  employees,  the notice could reasonably be considered
         unlikely to reach or likely to be delayed in reaching its  destination,
         the notice will be valid and effective only if it is so delivered or is
         given by publication twice in the a national  newspaper or in any other
         paper of national circulation in Canada.

         (b) DATE OF NOTICE.  A notice so given by mail or so delivered  will be
         deemed to have been given on the first  Business  Day after it has been
         mailed  or on the day on which it has been  delivered,  as the case may
         be,  and a notice so given by  publication  will be deemed to have been
         given  on the day on  which  it has  been  published  as  required.  In
         determining  under  any  provision  hereof  the date  when  notice of a
         meeting or other event must be given, the date of giving notice will be
         included  and the date of the meeting or other event will be  excluded.
         Accidental error or omission in giving notice or accidental  failure to
         mail  notice to any  Warrantholder  will not  invalidate  any action or
         proceeding founded thereon.

10.3     SATISFACTION AND DISCHARGE OF WARRANT INDENTURE.

On the earlier of:

         (a) the date by which there has been delivered to the Warrant Agent for
         exercise,   exchange  or  surrender   for   cancellation   all  Warrant
         Certificates theretofore certified hereunder; or

         (b) the Expiry Date;

and if all  certificates  representing  Warrant Shares  required to be issued in
compliance with the provisions  hereof have been issued and delivered  hereunder
in  accordance  with such  provisions,  if all  payments  required to be made in
compliance  with the  provisions  of this  Warrant  Indenture  have been made in
accordance with such provisions and payment to the Warrant Agent of the fees and
other  remuneration  payable to the Warrant Agent,  this Warrant Indenture shall
cease to be of further  effect  and, on demand of and at the cost and expense of
the  Corporation  and on delivery to the Warrant Agent of a  Certificate  of the
Corporation  stating  that all  conditions  precedent  to the  satisfaction  and
discharge of this Warrant  Indenture  have been  complied with and on payment to
the  Warrant  Agent of the fees and other  remuneration  payable to the  Warrant
Agent,  the  Warrant  Agent  shall  execute  proper  instruments   acknowledging
satisfaction of and discharging this Warrant Indenture.

10.4     SOLE BENEFIT OF PARTIES AND WARRANTHOLDERS.

Nothing in this  Warrant  Indenture  or the Warrant  Certificates,  expressed or
implied, shall give or be construed to give to any person other than the parties
hereto and the Warrantholders, as the case may be, any legal or equitable right,
remedy or claim under this Indenture or the Warrant  Certificates,  or under any
covenant  or  provision  herein or therein  contained,  all such  covenants  and
provisions   being  for  the  sole  benefit  of  the  parties   hereto  and  the
Warrantholders.

                                       39
<PAGE>

10.5     DISCRETION OF DIRECTORS.

Any matter provided herein to be determined by the directors shall be determined
by the directors in their sole discretion,  and a determination so made shall be
conclusive.

10.6     COUNTERPARTS.

This  Warrant  Indenture  may be  executed  by  facsimile  and in any  number of
counterparts, which taken together shall form one and the same instrument.

IN WITNESS WHEREOF the parties hereto have executed this Warrant Indenture as of
the day and year first above written.

                                            ADSERO CORP.

                                            By: /s/ William Smith
                                                --------------------------------
                                                 William Smith, CFO

                                            BEARD WINTER LLP, as Warrant Agent

                                            By: /s/ Julian Doyle
                                                --------------------------------
                                                Julian L. Doyle, Partner

                                       40EXHIBIT 10.2

                             SUBSCRIPTION AGREEMENT

SKRP 1, Inc.
1900 Avenue of the Stars, Suite 310
Los Angeles, CA 90067

Attn: Glenn Krinsky, Chief Financial Officer

      Re: Prospectus, dated October __, 2004

Dear Mr. Krinsky:

The undersigned investor ("Investor") in this Subscription Agreement
("Agreement") hereby acknowledges receipt of the prospectus ("Prospectus"),
dated October __, 2004 of SRKP 1, Inc., a Delaware corporation ("SRKP"), and
subscribes for the following number of shares upon the terms and conditions set
forth in the Prospectus. The Investor agrees that this Agreement is subject to
availability and acceptance by SRKP.

The Investor hereby subscribes for ________________ shares of SRKP's common
stock ("Common Stock") at $0.17 per share, for an aggregate purchase price of
$____________. Enclosed is the Investor's check made payable to "City National
Bank/SRKP 1, Inc.'s Escrow Account" and has been forwarded to the escrow account
in the self-addressed stamped envelope that has been provided for convenience.
The Investor may also elect to submit his subscription funds to the escrow
account via wire transfer as provided in this Agreement.

The Investor hereby acknowledges that City National Bank is acting solely as
escrow holder in connection with the offering of Common Stock and makes no
recommendation with respect thereto. City National Bank has made no
investigation regarding the offering or any person or entity involved in the
offering.

              [Remainder of this page is left blank intentionally.]

<PAGE>

WIRING INSTRUCTIONS:                           ACCEPTED AND AGREED:

ABA # ______________________                   ---------------------------------
City National Bank                             Signature of Investor
A/C ________________________
f/f/c Trust account #  ___________             ---------------------------------
Account Name:  SRKP 1, Inc.                    Print Full Name
Attn:   ______________________
                                               ---------------------------------
                                               Street Address

                                               ---------------------------------
                                               City, State, Zip

                                               ---------------------------------
                                               Area Code and Telephone Number

                                               ---------------------------------
                                               Social Security Number

                                               ACCEPTED AND AGREED:

                                               SRKP 1, Inc.

                                             By:
                                                --------------------------------
                                                Glenn Krinsky

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