
                                  BY-LAW NO. 1


                       A by-law relating generally to the
                   transaction of the business and affairs of
                          COTTON VALLEY ENERGY LIMITED
                        (herein called the "Corporation")


                             CONTENTS

   One              Interpretation
   Two              Directors
   Three            Committees
   Four             Officers
   Five             Protection of Directors, Officers and Others
   Six              Meetings of Shareholders
   Seven            Securities
   Eight            Dividends and Rights
   Nine             Notices
   Ten              Borrowing Powers of the Directors
   Eleven           Business of the Corporation


                  BE IT ENACTED as a by-law of the Corporation as follows:


                                    SECTION I

                                 INTERPRETATION

1.1 Definitions. In this by-law, unless the context otherwise requires:

     (a)  "Act"  means  the   Business   Corporations   Act,  and  includes  the
          regulations  made  pursuant  thereto,  and every  other act or statute
          incorporated  therewith  or amending  the same,  or any act or statute
          substituted  therefor,  and in  the  case  of  such  substitution  the
          reference in the by-laws of the  Corporation to  non-existing  acts or
          statutes shall be read as referring to the  substituted  provisions in
          the new act or statute;

     (b)  "board" means the board of directors of the Corporation;

     (c)  words and  expressions  defined in the Act shall  have the  applicable
          definitions when used herein; and



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     (d)  in all  by-laws of the  Corporation  where the  context so requires or
          permits,  the singular  shall  include the plural and the plural shall
          include  the  singular.  The word  "person"  shall  include  firms and
          corporations,  and the masculine gender shall include the feminine and
          neuter genders.


                                   SECTION II

                                    DIRECTORS

2.1 Powers.  Subject to any  unanimous  shareholder  agreement,  the board shall
manage  or  supervise  the  management  of  the  affairs  and  business  of  the
Corporation.  So long as a quorum of  directors  remains in office no vacancy or
vacancies  in the board shall  affect the power of the  continuing  directors to
act.

2.2 Number and Quorum.  The board of directors  shall  consist of such number of
persons  as are from time to time  determined  by the  directors  subject to the
limitations  established by the Articles. The board of directors shall determine
the  quorum,  provided in no event shall a quorum be less than 2/5 of the number
of directors or minimum number of directors,  as the case may be, subject to the
limitations  contained  in  the  Act  including  the  limitation  that,  if  the
Corporation has fewer than three (3) directors,  the quorum shall consist of all
directors.  However,  for a meeting of  directors to be validly  constituted,  a
majority of directors  present must be resident  Canadians as defined by the Act
(unless  the  Corporation  has only one or two  directors,  in which  case  that
director or only one of the two directors need be resident Canadians);  provided
if a resident  Canadian  director  who is unable to be  present  at the  meeting
approves the business  transacted  thereat and such director together with those
resident  Canadian  directors  present at the meeting would have constituted the
required number of resident Canadian directors to be present, such meeting shall
be validly constituted.

2.3  Qualification.  No person shall be qualified  for election as a director if
he: (i) is less than eighteen years of age; (ii) is of unsound mind and has been
so found by a court in Canada or elsewhere;  (iii) is not an individual; or (iv)
has the status of a bankrupt.  A director need not be a shareholder.  A majority
of the  directors  shall be resident  Canadians  provided  that if the number of
directors  is only one or two,  that  director or only one of the two  directors
need be a resident Canadian.

2.4 Election  and Term of Office.  Unless the Articles  otherwise  provide,  the
directors shall be elected yearly at the annual meeting of the  shareholders and
shall hold office until the annual meeting next following. The whole board shall
be elected at each annual  meeting and all the  directors  then in office  shall
retire, but, if qualified,  shall be eligible for re-election.  The election may
be by a show of hands or by  resolution of the  shareholders  unless a ballot be
demanded  by any  shareholder.  If  after  nomination  there is no  contest  for
election, the persons nominated may be elected by declaration of the chairman to
that effect. If an election of directors is not held at the


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proper time,  the directors  then in office shall continue in office until their
successors are elected or appointed.

2.5  Vacancies.  Subject to the Act, a quorum of the board may fill a vacancy in
the  board,  except a  vacancy  resulting  from an  increase  in the  number  of
directors  or in the  maximum  number  of  directors  or from a  failure  of the
shareholders  to elect the  number of  directors  required  to be elected at any
meeting of  shareholders.  In the  absence  of a quorum of the board,  or if the
vacancy has arisen from the failure of the  shareholders  to elect the number of
directors  required by the  Articles,  or if the vacancy  has  resulted  from an
increase in the number of directors or in the maximum  number of directors,  the
board  shall  forthwith  call a  special  meeting  of  shareholders  to fill the
vacancy.  If the  board  fails to call  such a  meeting  or if there are no such
directors,  then in office,  any shareholder  may call such meeting.  A director
appointed or elected to fill a vacancy  holds office for the  unexpired  term of
his predecessor.

2.6 Vacation of Office. A director ceases to hold office when: (i) he dies; (ii)
he is removed from office by the  shareholders;  (iii) he ceases to be qualified
for election as a director;  or (iv) his written  resignation is received by the
Corporation  provided  if a  time  subsequent  to its  date  of  receipt  by the
Corporation  is specified  in such written  resignation  the  resignation  shall
become  effective at the time so  specified.  No director  named in the Articles
shall be permitted to resign his office unless at the time the resignation is to
become effective a successor is elected or appointed.

2.7 Removal of Directors. Subject to the provisions of the Act, the shareholders
may by  resolution  passed at an annual or special  meeting  remove any director
before  the  expiration  of his term of office and the  vacancy  created by such
removal may be filled at the same meeting  failing which it may be filled by the
directors pursuant to Section 2.5 of this By-law.

2.8 Canadian Majority. The board shall not transact business at a meeting unless
a  majority  of the  directors  are  resident  Canadians  as defined by the Act,
(unless  the  Corporation  has only one or two  directors,  in which  case  that
director or only one of the two directors  need be resident  Canadians),  except
where:

     (a)  a resident  Canadian  director who is unable to be present approves in
          writing  or  by  telephone  or  other  communications  facilities  the
          business to be transacted at the meeting; and

     (b)  a majority  of  resident  Canadians  would have been  present had that
          director been present at the meeting.

2.9 Place of Meetings.  Meetings of the board may be held at any place within or
outside Ontario. The board need not hold any meetings within Canada.

2.10 Calling of Meetings.  Meetings of the board may be held at any time without
formal notice being given if all the  directors  are present,  or if a quorum is
present and those  directors who are absent signify their consent to the holding
of the meeting in their absence. Any resolution passed,


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or  proceeding  had,  or  action  taken at such  meeting  shall be as valid  and
effectual as if it had been passed at or had been taken at a meeting duly called
and constituted.

Subject to the Act,  no notice of a meeting of the board shall be  necessary  if
the  meeting  is the first  meeting of the board held  immediately  following  a
meeting of shareholders at which such board was elected or if the meeting of the
board is a meeting which follows  immediately  upon a meeting of shareholders at
which a director was  appointed to fill a vacancy on the board,  provided at any
such meeting of the board a quorum of directors is present.

2.11 Notice of Meeting. The Chairman, the President or a Vice-President who is a
director  or any two  directors  may at any time by notice call a meeting of the
board.  Such notice shall be given in the manner provided in Section 9.1 to each
director not less than  forty-eight  (48) hours before the time when the meeting
is to be held. A notice of a meeting of  directors  need not specify the purpose
of or the business to be transacted at the meeting except where the Act requires
such  purpose or business to be  specified.  A director may in any manner and at
any time  waive  notice  of or  otherwise  consent  to a meeting  of the  board.
Attendance  of a  director  at such a meeting  is a waiver of notice of  meeting
except  where the  attendance  is for the express  purpose of  objecting  to the
transaction  of any  business  on the ground  that the  meeting is not  lawfully
called.

2.12  Adjourned  Meeting.  Notice of an  adjourned  meeting  of the board is not
required  if the time and place of the  adjourned  meeting is  announced  at the
original  meeting or the adjourned  meeting  preceding the applicable  adjourned
meeting, if the original meeting is adjourned on more than one occasion.

2.13  Regular  Meetings.  The  board  may  appoint a day or days in any month or
months for regular meetings of the board at a place and hour to be named. A copy
of any  resolution  of the  board  fixing  the  place  and time of such  regular
meetings  shall be sent to each director  forthwith  after being passed,  but no
other notice shall be required for any such regular meeting except where the Act
requires  the purpose  thereof or the  business to be  transacted  thereat to be
specified.

2.14  Absent  Directors.  Any  director  of the  Corporation  may file  with the
Secretary of the  Corporation a written  waiver of notice of any meetings of the
directors  and may at any time  withdraw  such waiver,  and until such waiver is
withdrawn, no notice of meetings of directors need be sent to such director, and
any and all  meetings of the  directors  of the  Corporation  shall  (provided a
quorum is present) be validly constituted  notwithstanding that notice shall not
have been given to such director.

2.15 Chairman. Subject to Section 4.8 hereof, the chairman of any meeting of the
board  shall  be  the  President  and,  in  his  absence,  a  director  who is a
Vice-President  present  at the  meeting.  If no such  officer is  present,  the
directors present shall choose one of their number to be chairman.

2.16 Voting at Meetings.  Questions arising at any meeting of directors shall be
decided  by a  majority  of votes.  In the case of an  equality  of  votes,  the
chairman of the meeting,  in addition to his original vote,  shall have a second
or casting vote.


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2.17 Resolution in Writing. A resolution in writing, signed by all the directors
entitled to vote on that  resolution at a meeting of directors or a committee of
directors,  is as valid as if it had been passed at a meeting of  directors or a
committee of directors.

2.18 Meetings by Telephone.  If all the directors present at or participating in
a meeting consent,  a meeting of the board or of a committee of the board may be
held by means of such telephone, electronic or other communication facilities as
permit all persons  participating  in the meeting to communicate with each other
simultaneously  and  instantaneously,  and a  director  participating  in such a
meeting by such means is deemed to be present at the  meeting.  Any such consent
shall be effective whether given before or after the meeting to which it relates
and may be given with respect to all meetings of the board and of  committees of
the board held while a director holds office.

2.19 Interest of Directors and Officers in  Contracts.  Provided the  applicable
director or officer shall have complied with the applicable  requirements of the
Act in respect of disclosure of interest and  otherwise,  no director or officer
shall be  disqualified by his office from  contracting  with the Corporation nor
shall  any  contract  or  arrangement  entered  into  by or  on  behalf  of  the
Corporation  with any director or officer or in which any director or officer is
in any way  interested  be liable to be voided nor shall any director or officer
so  contracting  or being so interested be liable to account to the  Corporation
for any profit  realized by any such contract or  arrangement  by reason of such
director's  or officer's  holding that office or of the  fiduciary  relationship
thereby established.

                                   SECTION III

                                   COMMITTEES

3.1  Managing  Director  and  Committee  of  Directors.  The  board  may  in its
discretion  appoint a managing  director and such  committees of the board as it
deems appropriate,  and delegate to such managing director and committees any of
the powers of the board  except those which the board is  prohibited  by the Act
from  delegating.  A majority  of the  members of each such  committee  shall be
resident Canadians. The managing director shall be a resident Canadian.

3.2  Transaction  of Business.  The powers of a committee  of  directors  may be
exercised by a meeting at which a quorum is present or by  resolution in writing
signed by all the members of such committee who would have been entitled to vote
on that resolution at a meeting of the committee. Meetings of such committee may
be held at any place within or outside Ontario.

3.3 Procedure.  Unless otherwise  determined by the board,  each committee shall
have the power to fix its quorum at not less than a majority of its members,  to
elect its chairman and to regulate its procedure.



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                                   SECTION IV

                                    OFFICERS

4.1  Appointment.  Subject  to the Act,  this  by-law  and any other  applicable
by-laws of the Corporation and any unanimous shareholder agreement:

     (a)  the directors may  designate the offices of the  Corporation,  appoint
          officers,  specify  their duties and delegate to them powers to manage
          the business and affairs of the Corporation;

     (b)  a director may be appointed to any office of the Corporation; and

     (c)  two or more offices of the Corporation may be held by the same person.

4.2 The President.  The President  shall be the chief  executive  officer of the
Corporation  and,  subject to the authority of the board,  shall be charged with
the general supervision of the business and affairs of the Corporation. He shall
be ex officio a member of all  standing  committees  and,  if no chairman of the
board has been  appointed,  or if  appointed  is not  present,  chairman  of all
meetings of shareholders and of all meetings of directors of the Corporation, if
a director.  Except when the board of directors has appointed a General Manager,
the President  shall also have the powers and be charged with the duties of that
office.  He shall perform all duties  incident to his office and shall have such
other powers and duties as may from time to time be assigned to him by the board
of directors.

4.3 Vice-President. During the absence or disability of the President his duties
may be performed  and his powers may be exercised by the  Vice-President,  or if
there  are more than  one,  by the  Vice-Presidents  in order of  seniority  (as
determined by the board), save that no Vice-President shall preside at a meeting
of the board or at a meeting of shareholders  who is not qualified to attend the
meeting as a director or  shareholder,  as the case may be. If a  Vice-President
exercises  any such duty or power,  the absence or  disability  of the President
shall be presumed with reference  thereto.  A Vice-President  shall also perform
such  duties and  exercise  such powers as the  President  may from time to time
delegate to him or the board may prescribe.

4.4  Secretary.  The  Secretary  shall give,  or cause to be given,  all notices
required  to be  given to  shareholders,  directors,  auditors  and  members  of
committees  provided  that the  validity of any notice  shall not be affected by
reason only of the fact that it is sent by some person other than the Secretary.
He shall attend all meetings of the directors and of the  shareholders and shall
enter or cause to be  entered  in books  kept for that  purpose  minutes  of all
proceedings at such meetings.  He shall,  subject to any specific appointment to
the contrary,  be the custodian of the stamp or mechanical device generally used
for affixing the corporate  seal of the  Corporation,  if any, and of all books,
papers,  records,  documents and other instruments belonging to the Corporation,
and he shall perform such other duties as may from time to time be prescribed by
the board.



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4.5  Treasurer.  The  Treasurer  shall keep or cause to be kept proper  books of
account  and  accounting  records  with  respect  to  all  financial  and  other
transactions  of the  Corporation  and, under the direction of the board,  shall
control the deposit of money, the safekeeping of securities and the disbursement
of the funds of the  Corporation.  He shall  render to the board at the meetings
thereof,  or whenever  required of him,  an account of all his  transactions  as
Treasurer and of the financial  position of the Corporation and he shall perform
such other duties as may from time to time be prescribed by the board.

4.6 Assistant-Secretary and Assistant-Treasurer. The Assistant-Secretary and the
Assistant-Treasurer  or,  if more than one,  the  Assistant-Secretaries  and the
Assistant-Treasurers, shall respectively perform all the duties of the Secretary
and Treasurer in the absence or disability of the Secretary or Treasurer, as the
case may be. The Assistant-Secretary and the Assistant-Treasurer shall also have
such  powers  and  duties  as may from time to time be  assigned  to them by the
board.

4.7 General Manager.  The General Manager, if one be appointed,  shall have full
authority,  subject  to  the  authority  of  the  board  of  directors  and  the
supervision of the  President,  to manage and direct the business and affairs of
the Corporation and to appoint and remove all officers,  employees and agents of
the  Corporation not elected or appointed  directly by the board,  and to settle
the terms of their  employment and  remuneration.  If and so long as the General
Manager is a director, he may, but need not, be known as the Managing Director.

4.8  Chairman  of the  Board.  The  directors  may from  time to time  appoint a
Chairman  of the Board  who shall be a  director.  If  appointed,  the board may
assign to him any of the powers and duties  that are by any  provisions  of this
by-law assigned to the President, and he shall, subject to the provisions of the
Act, have such other powers and duties as the board may specify. The Chairman of
the Board shall act as chairman of all  directors and  shareholders  meetings at
which he is present.  During the absence or  disability  of the  Chairman of the
Board,  his duties shall be performed  and his powers  exercised by the managing
director, if any, or by the president.

4.9 Power and  Duties of Other  Officers.  The  powers  and  duties of all other
officers shall be such as the terms of their engagement call for or as the board
may specify. Any of the powers and duties of an officer to whom an assistant has
been  appointed  may be exercised and  performed by such  assistant,  unless the
board otherwise directs.

4.10 Duties may be Delegated.  In case of the absence or inability to act of the
President,  a Vice-President  or any other officer of the Corporation or for any
other reason that the board may deem  sufficient,  the board may delegate all or
any of the powers of such  officer to any other  officer or to any  director for
the time being.

4.11  Remuneration  and Removal.  The board may determine the remuneration to be
paid to the directors,  officers,  agents and employees of the Corporation.  Any
officer,  agent or employee of the Corporation may receive such  remuneration as
may be determined  notwithstanding the fact that he is a director or shareholder
of the Corporation.  The board may by resolution  award special  remuneration to
any officer of the Corporation undertaking any special work or service for, or


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undertaking any special mission on behalf of the Corporation  other than routine
work  ordinarily  required  of such  office.  If any  director or officer of the
Corporation  shall be employed by or shall perform  services for the Corporation
otherwise  than as a  director  or  officer  or shall be a member of a firm or a
shareholder,  director  or  officer of a  corporation  which is  employed  by or
performs  services  for the  Corporation,  the fact of his being a  director  or
officer of the Corporation shall not disentitle such director or officer or such
firm or corporation,  as the case may be, from receiving proper remuneration for
such  services.  All  officers,  in the  absence  of  written  agreement  to the
contrary,  shall be subject to  removal by  resolution  of the board at any time
with or without  cause.  Until such removal each officer shall hold office until
his successor is elected or appointed or until his earlier resignation.

4.12  Agents  and  Attorneys.  The board  shall  have power from time to time to
appoint  agents or attorneys for the  Corporation  in or out of Canada with such
powers of management or otherwise  (including the power to  sub-delegate) as may
be thought fit.

4.13 Fidelity Bonds.  The board may require such officers,  employees and agents
of the  Corporation  as the  board  deems  advisable  to  furnish  bonds for the
faithful  discharge  of their  duties,  in such form and with such surety as the
board may from  time to time  prescribe,  but no  director  shall be liable  for
failure to require any bond or for the insufficiency of any bond or for any loss
by reason of the failure of the  Corporation  to receive any  indemnity  thereby
provided.

                                    SECTION V

                  PROTECTION OF DIRECTORS, OFFICERS AND OTHERS

5.1  Protection  of Directors  and  Officers.  Except as otherwise  specifically
provided in the Act, no director or officer of the  Corporation  shall be liable
for the acts, receipts, neglects or defaults of any other director or officer or
employee, or for joining in any receipt or other act for conformity,  or for any
loss, damage or expense  happening to the Corporation  through the insufficiency
or  deficiency  of  title to any  property  acquired  by  order of the  board of
directors  for or on  behalf  of the  Corporation  or for the  insufficiency  or
deficiency of any security in or upon which any of the monies of the Corporation
shall  be  invested  or for any loss or  damage  arising  from  the  bankruptcy,
insolvency  or tortious  act of any person,  firm or  corporation  with whom any
monies,  securities or effects of the Corporation shall be deposited, or for any
loss, conversion, misapplication or misappropriation of or damage resulting from
any  dealings  with any monies,  securities  or other  assets  belonging  to the
Corporation or for any loss  occasioned by any error of judgment or oversight on
his part or for any other loss,  damage or misfortune  whatever which may happen
in the execution of the duties of his office or in relation  thereto  unless the
same shall happen by failure to exercise the powers and to discharge  the duties
of his office  honestly,  and in good faith with a view to the best interests of
the  Corporation  and in  connection  therewith to exercise that degree of care,
diligence  and  skill  that  a  reasonably  prudent  person  would  exercise  in
comparable circumstances.



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                  Subject  to the  foregoing,  the  directors  may rely upon the
accuracy of any statement or report  prepared by the  Corporation's  auditors or
accountants  and shall not be  responsible or held liable for any loss or damage
resulting  from the  payment of any  dividends  or  otherwise  acting  upon such
statement or report.

                  The directors of the  Corporation  are hereby  authorized from
time to time to cause the  Corporation  to give  indemnities  to any director or
other person who has undertaken or is about to undertake any liability on behalf
of the  Corporation  and to secure such director or other person against loss by
mortgage and charge upon the whole or any part of the real and personal property
of the Corporation by way of security. Any action from time to time taken by the
directors under this paragraph shall not require approval or confirmation by the
shareholders.

5.2 Indemnity.  Subject to the limitations contained in the Act, the Corporation
hereby  indemnifies all past,  present and future  directors and officers of the
Corporation,  and all persons who are now or may  hereafter  be,  acting or have
heretofore  acted, at the Corporation's  request,  as a director or officer of a
body corporate of which the Corporation is or was a shareholder or creditor, and
his heirs and legal  representatives,  against all costs,  charges and expenses,
including any amount paid to settle an action or satisfy a judgment,  reasonably
incurred by him in respect of any civil,  criminal or  administrative  action or
proceeding  to which  he is made a party by  reason  of being or  having  been a
director or officer of the Corporation or body corporate, if:

     (a)  he acted  honestly and in good faith with a view to the best interests
          of the Corporation; and

     (b)  in the case of a criminal or administrative  action or proceeding that
          is  enforced  by a monetary  penalty,  he had  reasonable  grounds for
          believing that his conduct was lawful.

5.3 Insurance.  Subject to the limitations contained in the Act, the Corporation
may purchase and maintain  such  insurance  for the benefit of its directors and
officers  against any liability  incurred by them in their capacity as directors
or officers of the Corporation, or in their capacity as directors or officers of
another  body  corporate  where they act or have acted in that  capacity  at the
Corporation's request, as the board may from time to time determine.



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                                   SECTION VI

                            MEETINGS OF SHAREHOLDERS

6.1  Annual  Meeting.  Subject to the  Articles  and any  unanimous  shareholder
agreement,  the annual  meeting of the  shareholders  shall be held at any place
within or outside  Ontario  on such day and at such time as the board,  may from
time to time determine, for the purpose of hearing and receiving the reports and
statements  required by the Act to be read to and laid before shareholders at an
annual  meeting,  electing  directors,  appointing  the  auditor  and  fixing or
authorizing the board to fix his  remuneration,  and for the transaction of such
other business as may properly be brought before the meeting.

6.2 Special  Meetings.  Subject to the  Articles and any  unanimous  shareholder
agreement,  the board shall have the power at any time to call a special meeting
of  shareholders  to be held at such time on such day and at any place within or
outside Ontario as may be determined by the board.  The phrase "special  meeting
of the  shareholders"  wherever it occurs in this by-law shall include a meeting
of  any  class  or  classes  of   shareholders,   and  the  phrase  "meeting  of
shareholders" wherever it occurs in this by-law shall mean and include an annual
meeting of shareholders and a special meeting of shareholders.

6.3  Notice  of  Meetings.  Notice  of the time and  place  of each  meeting  of
shareholders shall be given in the manner provided in Section 9.1, and

     (a)  if the  Corporation is at the time of such notice  offering any of its
          securities to the public, not less than twenty-one (21) days, and

     (b)  if the  Corporation  is at the time of such notice not offering any of
          its securities to the public, not less than ten (10) days,

and in any event,  not more than  fifty  (50) days  before the date on which the
meeting is to be held,  to the auditor of the  Corporation,  to the directors of
the  Corporation  and to each  shareholder of record at the close of business on
the day on which the notice is given who is entered on the  securities  register
of the  Corporation  as the holder of one or more shares  carrying  the right to
vote at the meeting.  Notice of a meeting of shareholders called for any purpose
other than  consideration  of the financial  statements  and  auditor's  report,
election of directors and reappointment of the incumbent auditor shall state the
nature of such business in sufficient detail to permit the shareholder to form a
reasoned judgment thereon and shall state the text of any special  resolution to
be submitted to the meeting.

6.4 List of Shareholders  Entitled to Notice. For every meeting of shareholders,
the Corporation shall prepare a list of shareholders  entitled to receive notice
of the meeting,  arranged in alphabetical order and showing the number of shares
held by each shareholder.  If a record date for the meeting is fixed pursuant to
Section 6.5, the  shareholders  listed shall be those registered at the close of
business  on a day not later than ten (10) days after such  record  date.  If no
record date


<PAGE>


                                                     - 11 -

is fixed,  the  shareholders  listed shall be those  registered  at the close of
business on the day immediately preceding the day on which notice of the meeting
is given,  or where no such  notice is given,  the day on which the  meeting  is
held.  The list shall be available for  examination  by any  shareholder  during
usual business hours at the registered office of the Corporation or at the place
where the  securities  register  is kept and at the place  where the  meeting is
held.

6.5  Record  Date for  Notice.  The  board  may fix in  advance  a record  date,
preceding  the date of any meeting of  shareholders  by not more than fifty (50)
days and not less  than  twenty-one  (21)  days,  for the  determination  of the
shareholders entitled to notice of the meeting, provided that notice of any such
record date is given not less than seven (7) days before  such record  date,  by
newspaper  advertisement in the manner provided in the Act. If no record date is
so fixed, the record date for the determination of the shareholders  entitled to
notice of the  meeting  shall be the close of  business  on the day  immediately
preceding the day on which the notice is given.

6.6  Meetings  Without  Notice.  A meeting of  shareholders  may be held without
notice at any time and place as permitted by the Act:

     (a)  if all the shareholders entitled to vote thereat are present in person
          or  represented  by proxy or if those not  present or  represented  by
          proxy waive notice of or otherwise consent to such meeting being held;
          and

     (b)  if the  auditors and the  directors  are present or waive notice of or
          otherwise consent to such meeting being held.

                  At such a meeting any  business  may be  transacted  which the
Corporation at a meeting of shareholders may transact.

6.7 Persons Entitled to be Present. The only persons entitled to be present at a
meeting  of the  shareholders  shall  be those  entitled  to vote  thereat,  the
directors and auditors of the Corporation and others who,  although not entitled
to vote, are entitled or required under any provision of the Act or the Articles
or by-laws to be present at the meeting.  Any other person may be admitted  only
on the  invitation  of the  chairman  of the  meeting or with the consent of the
meeting.

6.8 Quorum. Two persons entitled to vote at a meeting of shareholders present in
person constitute a quorum.

6.9 Right to Vote. Subject to the Act, the articles and Section 6.5 hereof, each
person registered as a shareholder of the Corporation at the date of any meeting
of shareholders shall be entitled to one vote for each share held.

6.10  Representatives.  An  executor,  administrator,  committee  of a  mentally
incompetent  person,  guardian  or trustee  and where a body  corporate  is such
executor,  administrator,  committee,  guardian  or  trustee,  any  person  duly
appointed by proxy for such body  corporate,  upon filing with the  secretary of
the meeting  sufficient proof of his appointment,  shall represent the shares of
the


<PAGE>


                                                     - 12 -

testator,  intestate,  mentally  incompetent person, ward or cestui que trust in
his or its stead at all meetings of the  shareholders of the Corporation and may
vote  accordingly  as a shareholder in the same manner and to the same extent as
the  shareholder of record.  If there be more than one executor,  administrator,
committee, guardian or trustee, the provisions of clause 6.12 shall apply.

6.11  Proxies.  Every  shareholder,  including  a  shareholder  that  is a  body
corporate, entitled to vote at a meeting of shareholders may by means of a proxy
appoint a person,  who need not be a  shareholder,  as his nominee to attend and
act at the meeting in the manner,  to the extent and with the power conferred by
the proxy.

                  Subject  to  the  Act,  a  proxy  shall  be  executed  by  the
shareholder  or his attorney  authorized in writing or, if the  shareholder is a
body  corporate,  under its corporate seal, if any, or by an officer or attorney
thereof duly authorized.

                  A proxy may be in any form which may be  prescribed  from time
to time by the board of  directors  or which the  chairman  of the  meeting  may
accept as  sufficient,  provided that such form complies with the  provisions of
the Act.

                  Proxies  shall be deposited  with the secretary of the meeting
before any vote is cast under the authority  thereof or at such earlier time and
in such manner as the board may prescribe in accordance  with the  provisions of
the  Act.  A  proxy  in the  form of a  facsimile  transmission  may  also be so
deposited.

6.12 Joint Shareholders. Where two or more persons hold the same share or shares
jointly,  any one of such persons present at a meeting of  shareholders  has the
right in the  absence of the other or others to vote in respect of such share or
shares,  but, if more than one of such  persons are  present or  represented  by
proxy and vote,  they shall vote together as one on the share or shares  jointly
held by them.

6.13 Scrutineer.  At each meeting of shareholders one or more scrutineers may be
appointed by a resolution  of the meeting or by the chairman with the consent of
the meeting to serve at the meeting.  Such  scrutineers need not be shareholders
of the Corporation.

6.14 Votes to Govern.  Unless  otherwise  required by the provisions of the Act,
the  Articles or by-laws of the  Corporation,  at all  meetings of  shareholders
every  question  shall be decided by the  majority of the votes duly cast on the
question.

6.15 Show of Hands.  At all meetings of  shareholders  every  question  shall be
decided by a show of hands  unless a poll thereon is required by the chairman or
be  demanded  by a  shareholder  present in person or  represented  by proxy and
entitled to vote or unless a poll is required  under the  provisions of the Act.
Upon a show of hands every shareholder present in person or represented by proxy
and  entitled to vote shall have one vote.  After a show of hands has been taken
upon any question the chairman may require or any shareholder  present in person
or represented by proxy and entitled to vote may demand a poll thereon. Whenever
a vote by show of hands has been taken upon


<PAGE>


                                                     - 13 -

a question,  unless a poll thereon is demanded, a declaration by the chairman of
the meeting  that the vote upon the  question  has been  carried or carried by a
particular majority or not carried and an entry to that effect in the minutes of
the proceedings at the meeting shall be prima facie evidence of the fact without
proof of the number or proportion of the votes  recorded in favour of or against
any resolution or other  proceedings  in respect of the said  question,  and the
result of the vote so taken shall be the decision of the  Corporation  in annual
or general meeting,  as the case may be, upon the question.  A demand for a poll
may be withdrawn at any time prior to the taking of the poll.

6.16 Polls.  If a poll is  required by the  chairman of the meeting or under the
provisions  of the Act or is  demanded by any  shareholder  present in person or
represented  by proxy and  entitled to vote and the demand be not  withdrawn,  a
poll upon the  question  shall be taken in such  manner as the  chairman  of the
meeting  directs.  Upon a poll  each  shareholder  who is  present  in person or
represented by proxy shall,  unless the Articles otherwise provide,  be entitled
to one vote for each  share in respect  of which he is  entitled  to vote at the
meeting and the result of the poll shall be the decision of the  Corporation  in
annual or general meeting, as the case may be, upon the question.

6.17  Casting  Vote.  In  case  of an  equality  of  votes  at  any  meeting  of
shareholders  either  upon a show of hands or upon a poll  the  chairman  of the
meeting shall be entitled to a second or casting vote.

6.18 Chairman.  Subject to Section 4.8 hereof, the President or, in his absence,
a  Vice-President  who is a director  shall  preside as Chairman at a meeting of
shareholders.  If there is no  President  or such a  Vice-President,  or if at a
meeting, none of them is present within fifteen minutes after the time appointed
for holding of the meeting,  the shareholders present shall choose a person from
their number to be the Chairman.

6.19 Adjournment of Meetings.  The Chairman of any meeting of shareholders  may,
with the consent of the meeting  and subject to such  conditions  as the meeting
may decide,  adjourn the same from time to time and from place to place,  and no
notice of such adjournment need be given to the shareholders  except as required
by the Act.  Any  business  may be brought  before or dealt with at an adjourned
meeting  which  might have been  brought  before or dealt  with at the  original
meeting in accordance with the notice calling such original meeting.

6.20  Resolution  in  Writing.  A  resolution  in  writing  signed by all of the
shareholders entitled to vote on that resolution at a meeting of shareholders is
as valid as if it had been  passed at a  meeting  of the  shareholders  unless a
written  statement  with  respect to the  subject  matter of the  resolution  is
submitted by a director or the auditors in accordance with the Act.

6.21 Only One  Shareholder.  Where the  Corporation  has only one shareholder or
only one holder of any class or series of  shares,  the  shareholder  present in
person or by proxy constitutes a meeting.



<PAGE>


                                                     - 14 -

6.22 Procedure.  At all meetings of shareholders questions of procedure shall be
settled by  reference  to such  publication  relating  to the conduct of company
meetings as shall be acceptable to the chairman of the meeting.


                                   SECTION VII

                                   SECURITIES

7.1 Registers.  The Corporation shall keep or cause to be kept such registers of
security holders and of transfers as required by the Act.

7.2 Allotment. Subject to the provisions, if any, of the Articles, the board may
from time to time allot or grant  options to  purchase  the whole or any part of
the  authorized  and unissued  shares in the capital of the  Corporation to such
person or  persons or class of persons  as the board  determines  by  resolution
provided  that no share shall be issued until it is fully paid as  prescribed by
the Act.

7.3  Commissions.  The board may from time to time authorize the  Corporation to
pay a reasonable  commission to any person in consideration of his purchasing or
agreeing to purchase shares of the Corporation,  whether from the corporation or
from any other person,  or procuring or agreeing to procure  purchasers  for any
such shares.

7.4 Share  Certificates.  Every holder of one or more shares of the  Corporation
shall  be  entitled,   at  his  option,  to  a  share   certificate,   or  to  a
non-transferable  written  acknowledgement  of  his  right  to  obtain  a  share
certificate,  stating  the number  and class or series of shares  held by him as
shown on the securities  register.  Share certificates and acknowledgements of a
shareholder's right to a share certificate,  respectively, shall be in such form
as the board shall from time to time  approve.  Any share  certificate  shall be
signed in accordance with Section 11.4 hereof,  provided that,  unless the board
otherwise  determines,  certificates  representing  shares in respect of which a
transfer  agent  or  registrar  has been  appointed  shall  not be valid  unless
countersigned  by or on  behalf of such  transfer  agent or  registrar.  A share
certificate  shall be signed manually by at least one director or officer of the
Corporation  or by or on behalf of the  transfer  agent or registrar if there is
one. Any additional signatures required may be printed or otherwise mechanically
reproduced.   A  share   certificate   executed  as  aforesaid  shall  be  valid
notwithstanding  that one of the directors or officers whose facsimile signature
appears thereon no longer holds office at the date of issue of the certificate.

7.5 Replacement of Security Certificates.  The board or any person designated by
the board shall  direct the issue of a new security  certificate  in lieu of and
upon  cancellation  of a  security  certificate  that has been  mutilated  or in
substitution for a security  certificate  claimed to have been lost,  apparently
destroyed  or  wrongfully  taken on  payment of such fee and on such terms as to
indemnity,  reimbursement  of expenses  and evidence of loss and of title as the
board may from time to time  prescribe,  whether  generally or in any particular
case.


<PAGE>


                                                     - 15 -


7.6  Transfer  Agent  and  Registrar.  The  directors  may from  time to time by
resolution appoint or remove a transfer agent and a registrar (who may, but need
not be the same  individual or body  corporate) and one or more branch  transfer
agents and  registrars  (who may,  but need not be the same  individual  or body
corporate)  for  the  securities  of the  Corporation  and may  provide  for the
transfer of  securities  in one or more places and may provide  that  securities
will be interchangeably transferable or otherwise.

7.7 Transfer of Securities.  Securities in the capital of the Corporation  shall
be  transferable  only on the  register  of  transfers  or on one of the  branch
registers  of  transfers  (if any)  kept by or for the  Corporation  in  respect
thereof by the  registered  holder of such  securities  in person or by attorney
duly  authorized in writing upon surrender for  cancellation  of the certificate
representing  such  securities  properly  endorsed or  accompanied by a properly
executed  transfer,  subject  to the  provisions  of the Act and  subject to the
restrictions on transfer (if any) set forth in the Articles.

7.8  Corporation's  Lien on  Shares.  The  Corporation  shall  have a first  and
paramount lien upon all the shares  registered in the names of each  shareholder
whether solely or jointly with others for his debts, liabilities and engagements
solely or jointly with any other person, to or with the Corporation, whether the
periods for payment,  fulfilment or discharge  thereof have actually  arrived or
not. Any such lien shall extend to all  dividends  from time to time declared in
respect of such shares.  Unless  otherwise agreed the registration of a transfer
of shares shall operate as a waiver of the  Corporation's  lien, if any, on such
shares.  However,  the  Corporation  shall not be entitled to enforce  such lien
against a transferee of the share who has no actual knowledge of it, unless such
lien is noted conspicuously on such share certificate.

                  For the purpose of enforcing such lien, the board may sell the
shares  subject  thereto in such manner as it thinks  fit;  but no sale shall be
made until  notice in writing of the  intention  to sell has been served on such
shareholder,  his executors or administrators,  and default has been made by him
or them,  in payment,  fulfilment  or  discharge of such debts,  liabilities  or
engagements for ten days after the date of mailing of such notice.

                  The net  proceeds  of any such  sale  shall be  applied  in or
towards satisfaction of the debts, liabilities or engagements,  and the residue,
if any, paid to such shareholder, his executors or administrators or assigns.

                  Upon  any  such  sale  in  purported  exercise  of the  powers
hereinbefore  given,  the directors may cause the purchaser's name to be entered
in the  register  in respect of the shares sold and the  purchaser  shall not be
bound to see to the regularity of the  proceedings or to the  application of the
purchase  money,  and after his name has been entered in the register in respect
of such  shares,  the  validity of the sale shall not be impeached by any person
and the remedy of any person  aggrieved by the sale shall be in damages only and
against the Corporation exclusively.

7.9 Refusal to Register Transfer. Except in the case of shares listed on a stock
exchange recognized by the Ontario Securities  Commission,  the board may refuse
to permit the registration


<PAGE>


                                                     - 16 -

of a transfer  of shares in the  capital of the  Corporation  against  which the
Corporation  has a lien until all of the debt  represented by that lien has been
paid to the Corporation.

7.10 Joint Shareholders.  If two or more persons are registered as joint holders
of any  share,  any one of such  persons  may give  effectual  receipts  for the
certificate issued in respect thereof,  and for any dividend,  bonus,  return of
capital or other money payable or warrant issuable in respect of such share, but
all the joint  holders of a share shall be severally  as well as jointly  liable
for the payment of all demands payable in respect thereof.

                                  SECTION VIII

                              DIVIDENDS AND RIGHTS

8.1 Dividends.  Subject to the provisions of the Act, the board may from time to
time declare dividends payable to the shareholders according to their respective
rights  and  interests  in the  Corporation.  Dividends  may be paid in money or
property or by issuing fully paid shares of the Corporation.

8.2 Dividend  Cheques.  A dividend payable in cash shall be paid by cheque drawn
on the  Corporation's  bankers  or one of them to the  order of each  registered
holder of shares of the class or series in respect of which it has been declared
and  mailed  by  prepaid  ordinary  mail to such  registered  holder at his last
recorded  address,  unless such holder otherwise  directs.  In the case of joint
holders the cheque shall,  unless such joint holders  otherwise  direct, be made
payable  to the order of all of such joint  holders  and mailed to them at their
recorded  address  and if more  than one  address  appears  on the  books of the
Corporation  in respect of such joint holding the cheque shall be mailed to such
of those addresses as is selected by the person mailing such cheque. The mailing
of such cheque as  aforesaid,  unless the same is not paid on due  presentation,
shall  satisfy and discharge all liability for the dividend to the extent of the
sum  represented  thereby  plus the amount of any tax which the  Corporation  is
required to and does withhold.

8.3  Non-receipt of Cheques.  In the event of non-receipt of any dividend cheque
by the person to whom it is sent as aforesaid,  the Corporation on proof of such
non-receipt  and upon  satisfactory  indemnity being given to it, shall issue to
such person a replacement cheque for a like amount.

8.4 Record Date.  The board may fix in advance a date preceding by not more than
fifty days the date for the payment of any dividend or the date for the issue of
any warrant or other evidence of right to subscribe for shares in the capital or
securities  of the  Corporation  as a record date for the  determination  of the
persons entitled to receive payment of such dividend or to exercise the right to
subscribe for such  securities,  as the case may be, and in every such case only
such persons as shall be security  holders of record at the close of business on
the date so fixed shall be entitled  to receive  payment of such  dividend or to
exercise the right to  subscribe  for  securities  and to receive the warrant or
other evidence in respect of such right, as the case may be, notwithstanding the
transfer of any securities after any such record date fixed as aforesaid.  Where
no record date is


<PAGE>


                                                     - 17 -

fixed in advance as  aforesaid,  the record  date for the  determination  of the
persons entitled to receive payment of such dividend or to exercise the right to
subscribe  for such  securities  of the  Corporation  shall  be at the  close of
business on the day on which the  resolution  relating to such dividend or right
to subscribe is passed by the board.

8.5 Unclaimed Dividends.  Any dividend unclaimed after a period of six (6) years
from the date on which the same was  declared to be payable  shall be  forfeited
and shall revert to the Corporation.

                                   SECTION IX

                                     NOTICES

9.1 Method of Giving. Any notice, communication or other document to be given by
the  Corporation  to  a  shareholder,   director,  officer  or  auditor  of  the
Corporation shall be sufficiently given if:

     (a)  delivered  personally  to the  person to whom it is to be given to the
          latest  address  of  such  person  as  shown  in  the  records  of the
          Corporation or its transfer agent; or

     (b)  if sent by prepaid mail addressed to such address; or

     (c)  if sent to such  address  by any  means  of  transmitted  or  recorded
          communication; or

     (d)  if sent by telecopier,  to the latest  telecopier number of the person
          to whom it is to be given, as shown in the records of the Corporation.

The  Secretary  or any  person  authorized  by him may  change  the  address  or
telecopier  number  on the  books  of the  Corporation  of  any  shareholder  in
accordance  with any  information  believed  by him to be  reliable.  A  notice,
communication  or document so delivered shall be deemed to have been received by
the addressee when it is delivered  personally to the address  aforesaid;  and a
notice,  communication  or  document  so  mailed  shall be  deemed  to have been
received by the addressee on the fifth day after  mailing;  and a notice sent by
any means of transmitted or recorded  communication shall be deemed to have been
received  by the  addressee  when  delivered  to the  appropriate  communication
company  or agency or its  representative  for  dispatch;  and a notice  sent by
telecopier  shall be deemed to have been  received at the time of  transmission;
provided however that, notwithstanding the foregoing, in the case of any meeting
of directors, verbal notice thereof shall be sufficient notice.

9.2  Computation  of Time. In computing the date when notice must be given under
any provision of the Articles or by-laws  requiring a specified  number of days'
notice of any  meeting  or other  event,  the  period of days shall be deemed to
commence the day following the date the notice


<PAGE>


                                                     - 18 -

was given and shall be deemed to  terminate  at  midnight of the last day of the
period,  except that if the last day of the period  falls on a Sunday or holiday
the period shall  terminate at midnight of the day next  following that is not a
Sunday or holiday.

9.3  Omissions  and Errors.  The  accidental  omission to give any notice to any
shareholder,  director,  officer or auditor or the  non-receipt of any notice by
any  shareholder,  director,  officer  or auditor or any error in any notice not
affecting the substance  thereof  shall not  invalidate  any action taken at any
meeting held pursuant to such notice or otherwise founded thereon.

9.4  Notice to Joint  Shareholders.  All  notices  with  respect  to any  shares
registered  in more than one name may, if more than one  address  appears on the
books of the  Corporation  in respect of such  joint  holding,  be given to such
joint  shareholders  at such  address so  appearing as is selected by the person
giving such notice,  and notice so given shall be  sufficient  notice to all the
holders of such shares.

9.5 Persons Becoming  Entitled by Death or Operation of Law. Every person who by
operation  of law,  transfer,  death of a security  holder or by any other means
whatsoever,  becomes entitled to any security, shall be bound by every notice in
respect of such  security  which prior to his name and address  being entered on
the books of the  Corporation  was duly given to the person from whom he derives
his title to such security.

                  On the death of any security  holder (not being one of several
joint holders of a security) the  executors or  administrators  of such deceased
security  holder  shall be the only persons  recognized  by the  Corporation  as
having any title to such security.

                  Any person  becoming  entitled to a security in consequence of
the death,  bankruptcy or insolvency of any shareholder (herein referred to as a
person entitled by transmission)  shall produce to the Corporation such evidence
as may be  reasonably  required  by the board to prove his title and  declare in
writing his election  either to be himself  registered  as a security  holder in
respect of the security,  or instead of being registered  himself,  to make such
transfer as the deceased or bankrupt person could have made.

                  Until  any  person  becoming   entitled  to  any  security  by
transmission has complied with the terms  aforesaid,  the Corporation may retain
any dividend or other payment declared or payable upon such security,  and shall
not  be  bound  to  recognize  the  title  of the  person  claiming  under  such
transmission.

9.6 Proof of Service.  A certificate  of the Secretary or other duly  authorized
officer  of  the  Corporation  in  office  at the  time  of  the  making  of the
certificate,  or of any agent of the  Corporation as to facts in relation to the
mailing or  delivery  or sending  of any  notice to any  shareholder,  director,
officer or auditor shall be conclusive  evidence thereof and shall be binding on
every shareholder,  director, officer or auditor of the Corporation, as the case
may be.



<PAGE>


                                                     - 19 -

9.7 Waiver of Notice.  Any shareholder (or his duly appointed  proxy)  director,
officer or auditor may waive any notice required to be given under any provision
of the  articles or by-laws of the  Corporation  or of the Act, and such waiver,
whether  given  before or after the  meeting or other  event of which  notice is
required  to be given,  shall  cure any  default  in  giving  such  notice.  Any
shareholder  (or his duly  appointed  proxy) may waive any  irregularity  in any
meeting of shareholders.

                                    SECTION X

                        BORROWING POWERS OF THE DIRECTORS

10.1 Borrowing  Power.  Without limiting the borrowing powers of the Corporation
as set forth in the Act, but subject to the provisions of the Act, the board may
from time to time, without authorization of the shareholders:


     (a)  borrow money on the credit of the Corporation;

     (b)  issue, reissue, sell or pledge debt obligations of the Corporation;

     (c)  give guarantees on behalf of the Corporation to secure  performance of
          an obligation of any person; and

     (d)  mortgage,  hypothecate, pledge or otherwise create a security interest
          in all or  any  property  of the  Corporation  owned  or  subsequently
          acquired, to secure any obligation of the Corporation.

10.2 The  directors  may from time to time  authorize any director or directors,
officer or  officers,  employee of the  Corporation  or other person or persons,
whether  connected  with  the  Corporation  or not,  to make  arrangements  with
reference to the monies  borrowed or to be borrowed as  aforesaid  and as to the
terms and  conditions  of the loan thereof and as to the  securities to be given
therefor,  with power to vary or modify such arrangements,  terms and conditions
and to give  such  additional  debt  obligations  for  any  monies  borrowed  or
remaining  due by  the  Corporation  as the  directors  of the  Corporation  may
authorize and generally to manage, transact and settle the borrowing of money by
the Corporation.

10.3 The  directors  may from time to time  authorize any director or directors,
officer or  officers,  employee of the  Corporation  or other person or persons,
whether  connected  with the  Corporation  or not, to sign,  execute and give on
behalf of the  Corporation all documents,  agreements and promises  necessary or
desirable for the purposes aforesaid and to draw, make, accept, endorse, execute
and issue  cheques,  promissory  notes,  bills of exchange,  bills of lading and
other  negotiable  or  transferable  instruments  and the same and all  renewals
thereof  or  substitutions   therefor  so  signed  shall  be  binding  upon  the
Corporation.



<PAGE>


                                                     - 20 -

10.4  The  words  "debt  obligations"  as used in this  Section  10 mean  bonds,
debentures,  notes  or  other  similar  obligations  or  guarantees  of  such an
obligation, whether secured or unsecured.

                                   SECTION XI

                           BUSINESS OF THE CORPORATION

11.1 Registered Office. The registered office of the Corporation shall be in the
municipality or geographic  township  within Ontario  specified in its Articles,
and at such place therein as the directors of the  Corporation  may from time to
time by resolution determine.

11.2 Corporate  Seal. The corporate  seal of the  Corporation,  if any, shall be
such  seal  as the  directors  of the  Corporation  may  from  time  to  time by
resolution adopt.

11.3 Banking  Arrangements.  The banking business of the Corporation or any part
thereof shall be transacted with such chartered banks,  trust companies or other
financial  institutions  as the  board  may by  resolution  from  time  to  time
determine.

                  Cheques on the bank accounts,  drafts drawn or accepted by the
Corporation,  promissory  notes  given by it,  acceptances,  bills of  exchange,
orders for the  payment of money and other  instruments  of a like nature may be
made, signed,  drawn,  accepted or endorsed, as the case may be, by such officer
or officers,  person or persons as the board of directors may by resolution from
time to time name for that purpose.

                  Cheques,  promissory notes, bills of exchange,  orders for the
payment of money and other  negotiable  paper may be endorsed for deposit to the
credit of the Corporation's bank account by such officer or officers,  person or
persons,  as the board of directors may by resolution from time to time name for
that  purpose,  or they may be  endorsed  for such  deposit  by means of a stamp
bearing the Corporation's name.

11.4 Execution of  Instruments.  Any instruments in writing may be signed in the
name of and on behalf of the  Corporation by two persons,  one of whom holds the
office of Chairman of the Board,  President,  Vice-President or director and the
other of whom  holds  one of the said  offices  or the  office of  Secretary  or
Treasurer  and any  instrument  in writing so signed  shall be binding  upon the
Corporation  without any further  authorization or formality.  In the event that
the  Corporation  has only one officer and director,  that person alone may sign
any instruments in writing in the name of and on behalf of the Corporation.  The
board of directors  shall have power from time to time by  resolution to appoint
any  other  officer  or  officers  or any  person  or  persons  on behalf of the
Corporation  either to sign instruments in writing generally or to sign specific
instruments  in  writing.  The  corporate  seal,  if any,  may be affixed to any
instruments  in writing on the  authority  of any of the  persons  named in this
section.

                  The  term  "instruments  in  writing"  as used  herein  shall,
without limiting the generality thereof,  include contracts,  documents,  deeds,
mortgages, hypothecs, charges, security


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                                                     - 21 -

interests, conveyances, transfers and assignments of property (real or personal,
immovable or movable),  agreements,  tenders,  releases,  proxies,  receipts and
discharges for the payment of money or other obligations, conveyances, transfers
and assignments of shares, stocks, bonds, debentures or other securities and all
paper writings.

11.5  Investments.  In  particular,  without  limiting  the  generality  of  the
foregoing,  execution  as provided in Section  11.4 hereof  shall be adequate to
sell, assign, transfer,  exchange, convert or convey any securities,  rights and
warrants.

11.6 Voting Securities in Other Companies. All securities carrying voting rights
in any other body  corporate  held from time to time by the  Corporation  may be
voted at all meetings of holders of such  securities  in such manner and by such
person or persons as the board of the Corporation  from time to time determines.
In the  absence  of action by the  board,  the proper  signing  officers  of the
Corporation  may also from time to time execute and deliver for and on behalf of
the  Corporation  instruments  of proxy and arrange  for the  issuance of voting
certificates  and  other  evidence  of right  to vote in such  names as they may
determine.

11.7  Solicitors.  Either the President or the  Secretary  shall have power from
time to time to instruct  solicitors  to  institute  or defend  actions or other
legal  proceedings  for the  Corporation  without  any  specific  resolution  or
retainer or instructions  from the board provided,  however,  that the board may
give instructions superseding or varying such instructions.

11.8 Custody of  Securities.  The  directors may from time to time by resolution
provide for the deposit and custody of securities of the Corporation.

                  All share  certificates,  bonds,  debentures,  debenture stock
certificates,  notes  or  other  obligations  or  securities  belonging  to  the
Corporation,  may be issued or held in the name of a nominee or  nominees of the
Corporation (and if issued or held in the name of more than one nominee shall be
held in the names of the nominees jointly with right of survivorship) and may be
endorsed in blank with endorsement guaranteed in order to enable transfers to be
completed and registration to be effected.

11.9  Charging  Assets.  The board may from  time to time  charge,  hypothecate,
mortgage or pledge any or all of the assets of the Corporation not only by means
of bonds and  debentures by way of fixed charge or charges or by way of floating
charge or  charges,  but also by any other  instrument  or  instruments  for the
purposes of securing any past or existing or new or future  liability  direct or
indirect of the Corporation or for the purpose of securing any bonds, debentures
or other  securities  or  liabilities  of the  Corporation  or of any other body
corporate.

11.10   Invalidity  of  Any  Provisions  of  this  By-Law.   The  invalidity  or
unenforceability  of any  provision of this by-law shall not affect the validity
or enforceability of the remaining provisions of this by-law.



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                                                     - 22 -

11.11 Fiscal Year. The fiscal year of the  Corporation  shall  terminate on such
day in each year as is from time to time established by the board of directors.


                  The  undersigned,  being the sole director of the Corporation,
by his  signature  below  resolves  pursuant to Section  129(1) of the  Business
Corporations  Act that the  foregoing  by-law  shall be and it is hereby  made a
by-law of the Corporation.

     DATED the 15th day of February, 1995.

                                --------------------------------------
                                Richard J. Lachcik


                                 ---------------------


                  The undersigned, being the sole shareholder of the Corporation
entitled to vote in respect of the  foregoing  by-law,  by his  signature  below
resolves pursuant to Section 104(1) (a) and (b) of the Business Corporations Act
that the foregoing by-law shall be and it is hereby confirmed as a by-law of the
Corporation.

                  DATED the 15th day of February, 1995.




                                      --------------------------------------
                                      Eugene A. Soltero

0161508.01


<PAGE>



