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ATTACHMENT - ITEM 19(b)3(a) - AMALGAMATION AGREEMENT
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06/05/97-2
THIS AMALGAMATION AGREEMENT made as of the 5th day of May,
1997.
B E T W E E N:
INTERNATIONAL URANIUM CORPORATION, a corporation
incorporated under the laws of the Province
of Ontario,
(hereinafter called "INTERNATIONAL URANIUM")
OF THE FIRST PART;
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THORNBURY CAPITAL CORPORATION, a
corporation incorporated under the laws of
the Province of Ontario,
(hereinafter called "THORNBURY CAPITAL")
OF THE SECOND PART.
WHEREAS International Uranium was incorporated under the laws
of the Province of Ontario pursuant to the Business Corporations Act (Ontario)
(the "ACT") by Certificate dated October 3, 1996 and is governed by the Act;
AND WHEREAS Thornbury Capital was incorporated under the laws
of the Province of Ontario pursuant to the Act by Letters Patent dated September
29, 1950 and is governed by the Act;
AND WHEREAS the parties have each made full and complete
disclosure to one another of all their respective known assets and liabilities;
AND WHEREAS the authorized capital of International Uranium
consists of an unlimited number of common shares of which 26,500,000 common
shares are issued and outstanding as fully paid and non-assessable and
37,800,000 common shares have been reserved for issuance pursuant to the
exercise of certain special warrants issued by International Uranium,
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and approximately 2,540,000 common shares have been reserved for issuance
pursuant to options to be granted prior to the amalgamation (subject to
additional increase to reflect options granted to officers, directors, eligible
employees of, or consultants to, International Uranium);
AND WHEREAS the authorized capital of Thornbury Capital
consists of an unlimited number of common shares of which 7,215,334 common
shares are issued and outstanding as fully paid and non-assessable;
AND WHEREAS under the authority conferred by the Act, each of
International Uranium and Thornbury Capital desire and have agreed to amalgamate
as one corporation upon the terms and conditions hereinafter set out;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration
of the mutual covenants herein contained, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto covenant and agree as follows:
ARTICLE 1 - DEFINITIONS
1.1 In this Agreement:
(a) "ACT" means the Business Corporations Act (Ontario);
(b) "AMALGAMATED CORPORATION" means the corporation continuing
from the amalgamation of the Amalgamating Corporations;
(c) "AMALGAMATING CORPORATIONS" means International Uranium and
Thornbury Capital;
(d) "AMALGAMATION" means the amalgamation of the Amalgamating
Corporations as herein provided;
(e) "CERTIFICATE" means the Certificate of Amalgamation issued by
the Director under the Act;
(f) "EFFECTIVE DATE" means the date shown on the Certificate of
Amalgamation issued by the Director under the Act giving
effect to the Amalgamation;
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(g) "LETTER AGREEMENT" means the letter agreement dated February
13, 1997 between International Uranium and Thornbury Capital,
as amended by agreements dated March 31, 1997 and April 30,
1997;
(h) "OFFERING MEMORANDUM" means the Confidential Offering
Memorandum of International Uranium dated March 19, 1997
respecting the offering of up to 40,000,000 Special Warrants;
(i) "SPECIAL WARRANT" means a special warrant issued by
International Uranium pursuant to a special warrant indenture
dated as of March 26, 1997 between International Uranium and
Montreal Trust Company of Canada, which special warrant is
exercisable into one Common Share of International Uranium.
ARTICLE 2 - RECITALS
2.1 The parties hereto confirm the truth and accuracy of the
foregoing recitals and agree that such recitals are incorporated into this
Agreement.
ARTICLE 3 - AMALGAMATION
3.1 Each of the Amalgamating Corporations hereby agrees to
amalgamate, under the provisions of section 174 of the Act and to continue as
one corporation under the terms and conditions hereinafter set out.
3.2 Upon the issue of a Certificate giving effect to the
Amalgamation:
(a) the Amalgamating Corporations shall be amalgamated and shall
continue as one corporation effective on the date of the
Certificate under the terms and conditions prescribed in this
Agreement;
(b) the Amalgamated Corporation shall possess all the property,
rights, privileges and franchises and be subject to all the
liabilities, including civil, criminal and quasi-criminal, and
all the contracts, disabilities and debts of each of the
Amalgamating Corporations;
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(c) a conviction against, or ruling, order or judgment in favour
of or against an Amalgamating Corporation may be enforced by
or against the Amalgamated Corporation;
(d) the Articles of Amalgamation of the Amalgamated Corporation
shall be deemed to be the articles of incorporation of the
Amalgamated Corporation and the Certificate, except for
purposes of subsection 117(1) of the Act, shall be deemed to
be the certificate of incorporation of the Amalgamated
Corporation;
(e) the Amalgamated Corporation shall be deemed to be the party
plaintiff or the party defendant, as the case may be, in any
civil action commenced by or against an Amalgamating
Corporation before the Amalgamation has become effective.
3.3 All rights of creditors against the property, rights and
assets of the Amalgamating Corporations and all liens upon their property,
rights and assets shall be unimpaired by such amalgamation and all debts,
contracts, liabilities and duties of the Amalgamating Corporations shall attach
to the Amalgamated Corporation and may be enforced against it.
3.4 No action or proceeding by or against any of the Amalgamating
Corporations shall ▇▇▇▇▇ or be affected by the Amalgamation.
ARTICLE 4 - NAME
4.1 The name of the Amalgamated Corporation shall be
"International Uranium Corporation".
ARTICLE 5 - REGISTERED OFFICE
5.1 The registered office of the Amalgamated Corporation shall be
in the City of Toronto, in the Municipality of Metropolitan Toronto, in the
Province of Ontario.
5.2 The address of the first registered office of the Amalgamated
Corporation shall be:
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ARTICLE 6 - RESTRICTIONS ON BUSINESS
6.1 There shall be no restrictions on the business the
Amalgamated Corporation may carry on or on the powers the Amalgamated
Corporation may exercise.
ARTICLE 7 - BY-LAWS AND STOCK OPTION PLAN
7.1 The by-laws of the Amalgamated Corporation shall be the
by-laws of International Uranium.
7.2 The stock option plan of the Amalgamated Corporation shall be
the stock option plan of International Uranium in effect as at the Effective
Date.
7.3 Copies of the proposed by-laws and the proposed stock option
plan of the Amalgamated Corporation may be examined at the following address:
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ARTICLE 8 - DIRECTORS
8.1 The board of directors of the Amalgamated Corporation shall
consist of a minimum of three directors and a maximum of 10 directors, until
changed in accordance with the Act. Until changed by special resolution of the
shareholders of the Amalgamated Corporation, or if the directors of the
Amalgamated Corporation are so authorized by special resolution of the
shareholders of the Amalgamated Corporation, by resolution of the said
directors, the board of directors of the Amalgamated Corporation shall consist
of seven directors, and the first directors of the Amalgamated Corporation shall
be the following:
Resident
Name Address aaaaa Canadian
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8.2 The said first directors shall hold office until the first
annual meeting of the shareholders of the Amalgamated Corporation, or until
their successors are elected or appointed in accordance with the by-laws of the
Amalgamated Corporation and the Act. The subsequent directors shall be elected
each year thereafter by ordinary resolution at either an annual meeting of the
shareholders or a special meeting of the shareholders by a majority of the votes
cast at such meeting. The directors shall manage or supervise the management of
the business and affairs of the Amalgamated Corporation, subject to the
provisions of the Act.
ARTICLE 9 - AUTHORIZED CAPITAL
9.1 The Amalgamated Corporation is authorized to issue an
unlimited number of Common Shares.
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ARTICLE 10 - ISSUANCE OF SHARES UPON AMALGAMATION
10.1 The authorized but unissued shares and the issued and
outstanding shares in the capital of the Amalgamating Corporations shall be
respectively cancelled and/or converted into issued shares in the capital of the
Amalgamated Corporation as follows:
(a) International Uranium:
each issued and outstanding Common Share of International
Uranium shall become one Common Share of the Amalgamated
Corporation and the remaining authorized but unissued Common
Shares of International Uranium shall be cancelled; and
(b) Thornbury Capital:
each five issued and outstanding Common Shares of Thornbury
Capital shall become one Common Share of the Amalgamated
Corporation and the remaining authorized but unissued Common
Shares of Thornbury Capital shall be cancelled.
For greater certainty, the parties agree that each Special
Warrant of International Uranium that is exercised immediately prior to the
Amalgamation and each option of International Uranium shall entitle the holder
thereof to receive one Common Share of the Amalgamated Corporation upon the
completion of the Amalgamation.
10.2 After the filing of Articles of Amalgamation in respect of
this Agreement and the issue of a Certificate, the shareholders of the
Amalgamating Corporations shall, when requested by the Amalgamated Corporation,
surrender the certificates representing or entitling them to shares in the
Amalgamating Corporations and, subject to the provisions of the Act, in return
shall be entitled to receive certificates for shares of the Amalgamated
Corporation as set forth in section 10.1 herein on the basis aforesaid.
10.3 Holders of shares of either of the Amalgamating Corporations
shall not be entitled to receive any consideration in respect of fractional
shares of the Amalgamated Corporation resulting from the conversion described
above or to be registered on the books of the Amalgamated Corporation with
respect to fractional shares, and any such shares shall be deemed to be
cancelled.
ARTICLE 11 - TRANSFER OF SHARES
11.1 The right to transfer shares in the capital of the Amalgamated
Corporation shall not be restricted.
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ARTICLE 12 - SPECIAL PROVISIONS
12.1 Subject to the provisions of the Act, the following provisions
shall apply to the Amalgamated Corporation:
Without in any way restricting the powers conferred upon the
Amalgamated Corporation or its board of directors by the Act, as now enacted or
as the same may from time to time be amended, re-enacted or replaced, the board
of directors may from time to time, without authorization of the shareholders,
in such amounts and on such terms as it deems expedient:
(a) borrow money upon the credit of the Amalgamated Corporation;
(b) issue, re-issue, sell or pledge debt obligations of the
Amalgamated Corporation;
(c) subject to the provisions of the Act, as now enacted or as the
same may from time to time be amended, re-enacted or replaced,
give a guarantee on behalf of the Amalgamated 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 Amalgamated Corporation
owned or subsequently acquired, to secure any obligation of
the Amalgamated Corporation.
The board of directors may from time to time delegate to a
director, a committee of directors or an officer of the Amalgamated Corporation
any or all of the powers conferred on the board as set out above, to such extent
and in such manner as the board shall determine at the time of such delegation.
ARTICLE 13 - COVENANTS, REPRESENTATIONS AND WARRANTIES
13.1 Thornbury Capital covenants, represents and warrants to International
Uranium as follows and acknowledges that International Uranium is relying on
such covenants, representations and warranties in entering into this Agreement
and that the same will be true and correct on and up to the Effective Date as if
made on and as of the Effective Date (with such modifications as may be
acceptable to International Uranium in its sole discretion):
(a) INCORPORATION AND ORGANIZATION OF THORNBURY CAPITAL. Thornbury
Capital is duly incorporated under the laws of Ontario and is
duly organized and validly
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existing under such laws with the corporate power and
authority to own or lease and operate its properties and
assets and to carry on business.
(b) AUTHORIZED CAPITAL AND SHARES RESERVED FOR ISSUE. The
authorized capital of Thornbury Capital consists of an
unlimited number of Common Shares of which 7,215,334 Common
Shares have been duly issued as fully paid and non-assessable
shares.
(c) QUALIFICATION. Thornbury Capital has the requisite corporate
power and capacity to enter into this Agreement and to perform
its obligations hereunder.
(d) DUE AUTHORIZATION. All requisite corporate acts and
proceedings have been done and taken by Thornbury Capital to
authorize the execution and delivery of this Agreement and the
performance of Thornbury Capital's obligations hereunder.
(e) VALIDITY OF AGREEMENT. The execution and delivery of this
Agreement and the performance of Thornbury Capital's
obligations hereunder do not and will not (i) violate any
provision of law or administrative regulation or any judicial
or administrative order, award, judgment or decree applicable
to Thornbury Capital; (ii) conflict with, result in a breach
of, or cause a default under any indenture, mortgage, deed of
trust, loan agreement or any other agreement or instrument to
which Thornbury Capital is a party or by which Thornbury
Capital or any of its property or assets is bound or to which
its property is subject, or result in the cancellation,
suspension or material alteration in the terms of any licence,
permit or authority held by Thornbury Capital or result in the
creation of any lien, charge, security interest or encumbrance
upon any of the assets of Thornbury Capital or give to others
any material interest or rights, including rights of purchase,
termination, cancellation or acceleration, under any such
agreement or instrument; or (iii) conflict with or result in
any violation of the provisions of Thornbury Capital's
articles, by-laws or other constating documents or any
resolution of Thornbury Capital's shareholders or directors or
any laws of Thornbury Capital's jurisdiction of incorporation
or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over Thornbury Capital or
any of its property or assets.
(f) ENFORCEABILITY OF AGREEMENT. This Agreement and each other
agreement or instrument executed by Thornbury Capital and
delivered on or before the Effective Date constitutes and will
constitute a legal, valid and binding obligation of Thornbury
Capital enforceable against Thornbury Capital in accordance
with their respective terms.
(g) BUSINESS. Thornbury Capital is conducting its business in
compliance in all material respects with all applicable laws,
rules and regulations and is not in
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breach of any such laws, rules or regulations. Thornbury
Capital holds all material licenses, certificates,
registrations, permits, consents or qualifications required by
the appropriate state, provincial, municipal or federal
regulatory agencies or bodies necessary in order to enable its
business to be carried on as now conducted or as proposed to
be conducted and all such licences, certificates,
registrations, permits, consents and qualifications are valid
and subsisting and in good standing and do not contain any
unusual or burdensome provision, condition or limitation which
has or may have a material adverse effect on the operation of
the business of Thornbury Capital as now conducted or as
presently proposed to be conducted and Thornbury Capital has
not received any notice of proceedings relating to the
revocation or modification of any such licenses, certificates,
registrations, permits, consents or qualifications which, if
the subject of an unfavourable decision, ruling or finding,
would materially and adversely affect the conduct of the
business, operations, financial condition, income or future
prospects of Thornbury Capital.
(h) OTHER RIGHTS. No person, firm or corporation has any
agreement, option, warrant, right or privilege (whether
pre-emptive or contractual, written or oral) capable of
becoming an agreement, option or warrant for the purchase of
Common Shares from Thornbury Capital or any agreement, option,
warrant, right or privilege (whether pre-emptive or
contractual, written or oral) capable of becoming an
agreement, option or warrant for the purchase, subscription or
issuance of any unissued shares or other securities in the
capital of Thornbury Capital.
(i) NO CONSENTS OR CONTRAVENTIONS. The execution and delivery by
Thornbury Capital of this Agreement and the performance of its
obligations hereunder does not require any consent, approval,
authorization or order of any court or governmental agency or
body, and will not contravene any statute or regulation
binding on Thornbury Capital.
(j) DISSOLUTION. No proceedings are now pending for and Thornbury
Capital is unaware of any proceedings leading to the
dissolution or winding-up of Thornbury Capital or the placing
of Thornbury Capital in bankruptcy nor is Thornbury Capital
subject to any other laws governing the affairs of insolvent
persons.
(k) CLAIMS. Thornbury Capital owns the eight mining claims
situated in the Mayo Mining District of the Yukon Territory
(the "Claims") free and clear of any and all mortgages,
pledges, liens, charges, security interests, adverse claims,
demands and encumbrances of whatsoever nature and howsoever
incurred. All assessment work and/or other requirements have
been done or met to keep the Claims in good standing and all
governmental rules and regulations made or relating to or
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governing the Claims or the work carried out therefrom have
been complied with. All work, exploration, development and
mining carried out on the Claims has been carried out in
accordance with recognized good and miner-like exploration and
engineering practices and in conformity in all respects with
all applicable governmental, mining, pollution and
environmental laws and regulations. There is not any adverse
claim or challenge against or to the ownership of or title to
the Claims nor is there any basis therefor and there are no
outstanding agreements or options to acquire or purchase the
Claims or any portion thereof.
(l) DIVIDENDS, ETC. Thornbury Capital has not, directly or
indirectly, declared, paid or authorized any dividends or
other distributions on or payments in respect of its shares or
securities. There is not, in the constating documents or
by-laws of Thornbury Capital or in any agreement, mortgage,
note, debenture, indenture or other instrument or document to
which Thornbury Capital is a party, any restriction upon or
impediment to the declaration or payment of dividends by the
directors of Thornbury Capital or the payment of dividends by
Thornbury Capital to the holders of its shares.
(m) FINANCIAL STATEMENTS. The financial statements of Thornbury
Capital for the year ended December 31, 1996 (the "Audited
Financial Statements") present fairly, in all material
respects, the financial position of Thornbury Capital as at
the date thereof and the results of its operations and the
changes in its financial position for the period then ended in
accordance with generally accepted accounting principles
applied on a consistent basis and do not and shall not omit to
state any material facts that are required by generally
accepted accounting principles or by applicable law to be
stated or reflected therein or which is necessary to make the
statements contained therein not misleading.
(n) TAX RETURNS. Thornbury Capital has filed all necessary tax
returns and notices and has paid all applicable taxes of
whatever nature for all tax years to the date hereof to the
extent such taxes have become due or have been alleged to be
due and Thornbury Capital is not aware of any tax deficiencies
or interest or penalties accrued or accruing or alleged to be
accrued or accruing with respect to Thornbury Capital.
(o) CONTRACTS. The only material contracts (the "Material
Contracts") to which Thornbury Capital is a party have been
disclosed in writing to International Uranium. Thornbury
Capital is not in default under or in breach of any term of
any such Material Contracts and there exists no state of facts
which, after notice or lapse of time or both or otherwise,
would constitute a default under or breach of a term of any of
such Material Contracts. All such Material Contracts are in
good standing and in full force and effect, unamended.
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(p) LIABILITIES. Thornbury Capital is not subject to any
liabilities or obligations, direct or indirect, absolute or
accrued, contingent or otherwise, other than the liabilities
or obligations disclosed in the Audited Financial Statements
or incurred in the ordinary course of business. Without
limiting the generality of any covenant, representation or
warranty given in this Agreement, there are not any facts or
circumstances which might reasonably serve as the basis for or
give rise to any liabilities or obligations, contingent or
otherwise, on the part of Thornbury Capital.
(q) GUARANTEES. Thornbury Capital is not a party to or bound by
any agreement of guarantee, indemnification, assumption or
endorsement or any like commitment of the obligations,
liabilities (contingent or otherwise) or indebtedness of any
other person, firm or corporation.
(r) BOOKS AND RECORDS. All accounts, books, ledgers and official
and other records of whatsoever kind have been fully, properly
and accurately kept and completed for and by Thornbury Capital
and there are no material inaccuracies or discrepancies of any
kind contained or reflected therein.
(s) ABSENCE OF UNUSUAL TRANSACTIONS. Since the last audited
financial year-end of Thornbury Capital, other than as
disclosed in this Agreement or as disclosed in writing to
International Uranium, Thornbury Capital has not:
(i) transferred, assigned, sold or otherwise disposed of
any significant assets other than marketable
securities (for which Thornbury Capital received cash
proceeds);
(ii) incurred, assumed or paid any obligation or liability
(fixed or contingent) other than obligations or
liabilities incurred in the ordinary course of
business;
(iii) mortgaged, pledged, subjected to lien, granted a
security interest in or otherwise encumbered any of
its assets or property;
(iv) suffered any damage, destruction or loss or waived
any rights or entered into any commitment or
transaction where such loss, rights, commitment or
transaction is or would be material except
commitments or transactions in the ordinary course of
business; or
(v) authorized or agreed or otherwise become committed to
any of the foregoing.
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(t) CONTINUING COMMITMENTS. Thornbury Capital is carrying on its
business in the ordinary course and continues to pay, satisfy
and discharge its obligations and liabilities in the ordinary
course of its business.
(u) CONDITION OF ASSETS. All material tangible assets owned or
used by Thornbury Capital are in good condition, repair and
proper working order, subject to normal wear and tear, and are
fit and appropriate for use for the purpose for which they
were intended, and Thornbury Capital owns all of the assets
listed in the Audited Financial Statements free and clear of
any liability or obligation whether accrued, absolute,
contingent or otherwise other than those arising in the
ordinary course of business.
(v) CAPITAL EXPENDITURES. Since the date of the last audited
financial year-end of Thornbury Capital, Thornbury Capital has
not made any capital expenditures except in the ordinary
course of business.
(w) CORPORATE ACTION. All necessary corporate action has been
taken in connection with the performance of Thornbury
Capital's obligations pursuant to this Agreement.
(x) ENVIRONMENTAL MATTERS. No notice, citation, summons or order
has been issued, no complaint has been filed, no penalty has
been assessed and no investigation or review is pending or
threatened by any authority with respect to any alleged
violation of any applicable environmental law or regulation by
Thornbury Capital and there are no environmental charges,
privileges or encumbrances ("Environmental Liens") relating to
the Claims and no actions have been taken or are in process or
pending which could subject the Claims to such Environmental
Liens. Thornbury Capital knows of no facts or circumstances
with respect to environmental matters relating to the Claims
that could lead to any further environmental claims,
liabilities or responsibilities.
(y) MINUTE BOOKS. The minute books of Thornbury Capital contain
accurate and complete copies of its charter documents (and any
and all amendments thereto) and by-laws. There are not
outstanding any applications or filings which would alter in
any way the charter documents or corporate status of Thornbury
Capital. No resolutions or by-laws have been passed, enacted,
consented to or adopted by the directors or shareholders of
Thornbury Capital except those contained in the said minute
books. The corporate records of Thornbury Capital have been
maintained in accordance with all applicable statutory
requirements and are complete and accurate.
(z) LITIGATION. There are no judgments, decrees, injunctions,
rules, executions or order of any court, governmental
department, commission, agency,
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instrumentality, tribunal or arbitration outstanding against
Thornbury Capital and there are no suits, actions or legal,
administrative, arbitration or other proceedings or
governmental or regulatory investigations or any adverse
change affecting the business, operations, prospects, property
or affairs of Thornbury Capital pending, in progress or
threatened by or against Thornbury Capital, its property or
the conduct of its business.
(aa) BROKER'S FEES. Other than as disclosed in the Audited
Financial Statements, there is no person, firm or corporation
acting or purporting to act at the request of Thornbury
Capital, who is entitled to any brokerage or finder's fee from
Thornbury Capital in connection with the transactions
contemplated herein, and in the event that any person, firm or
corporation acting or purporting to act for Thornbury Capital
establishes a claim for any fee from International Uranium,
Thornbury Capital covenants to indemnify and hold harmless
International Uranium with respect thereto and with respect to
all costs reasonably incurred in the defence thereof.
(ab) NO MATERIAL ADVERSE CHANGE. Since December 31, 1994, there has
been no material adverse change in the business, operations,
properties, assets, liabilities or conditions, financial or
otherwise, of Thornbury Capital.
(ac) DISCLOSURE. In connection with the disclosure of information
relating to Thornbury Capital, neither this Agreement, nor the
Letter Agreement, the Offering Memorandum or any other
document or certificate furnished pursuant to this Agreement
contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the
statements contained herein or therein, in light of the
circumstances under which they were made, not misleading.
Thornbury Capital is current in the filing of all public
disclosure documents required to be filed by Thornbury Capital
under applicable securities and other laws and all of such
filings are complete and correct and do not contain any
misrepresentations, as such term is defined in the Securities
Act (Ontario).
(ad) APPLICABLE SECURITIES LAWS. No securities commission or
similar regulatory authority has issued any cease trade or
other order which is currently outstanding preventing or
suspending trading in any securities of Thornbury Capital,
Thornbury Capital is not in default of any requirement of any
applicable securities laws and no investigation or other
proceedings concerning Thornbury Capital are currently in
progress or pending before any securities regulatory
authority.
(ae) REPORTING ISSUER. Thornbury Capital is a "reporting issuer" in
the Province of Ontario, has been a reporting issuer for at
least 12 months immediately prior to the date of this
Agreement, and its Common Shares are quoted for trading on the
Canadian Dealing Network Inc.
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(af) ADDITIONAL COVENANTS TO THE EFFECTIVE DATE. Up to and
including the Effective Date, Thornbury Capital shall:
(i) not declare or pay any dividend or make any
distribution of its properties or assets to its
shareholders, or purchase or retire any of its Common
Shares other than the cancellation of 57,639 Common
Shares held by it;
(ii) not allot or issue, or enter into any agreement for
the allotment or issuance of, or grant of any other
rights to acquire, shares of its capital stock or
securities convertible into, exchangeable for, or
which carry the right to acquire, directly or
indirectly, any shares of its capital stock;
(iii) not sell all or any part of its assets to any other
person or agree to do so or perform any act or enter
into any transaction or negotiation which could
reasonably be expected to interfere or be
inconsistent with the consummation of the transaction
contemplated by this Agreement or which would render
inaccurate any of the representations and warranties
set forth above if such representations and
warranties were made at a date subsequent to such
act, negotiation or transaction and all references to
the date of this Agreement were deemed to be such
later date;
(iv) not merge, amalgamate or consolidate into or with any
person or enter into any other corporate
reorganization or sell all or any substantial part of
its assets to any person or perform any act or enter
into any transaction or negotiation which can
reasonably be expected to interfere or be
inconsistent with the consummation of the
transactions contemplated by this Agreement or which
would render inaccurate any of the representations or
warranties set forth in this section 13.1 if such
representations and warranties were made at a date
subsequent to such act, negotiations, or transaction
and all references to the date of this Agreement were
deemed to be such later date;
(v) not alter or amend any of its articles or by-laws, as
the same exist on the date of this Agreement;
(vi) use all reasonable efforts to obtain all consents,
approvals and waivers, including the approval of the
directors and shareholders, that may be necessary or
desirable in connection with the Amalgamation and the
other transactions contemplated in the Letter
Agreement and take such other measures as may be
appropriate to fulfill its obligations hereunder and
to carry out the transactions contemplated in this
Agreement or the Letter Agreement;
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(vii) afford to International Uranium and its financial and
other advisers, reasonable access during normal
business hours during the period prior to the
Effective Date to the management, properties, books,
contracts, commitments and records of Thornbury
Capital and to allow International Uranium and such
advisers to perform an examination of the financial
condition, business, affairs property and assets of
Thornbury Capital and during such period, furnish
promptly to International Uranium a copy of each
material change report or similar document filed by
it during such period pursuant to the requirements of
any securities laws, and all other information
concerning its business, properties and personnel as
International Uranium may reasonably request;
(viii) use its best efforts to cause each of the conditions
precedent set forth in this Agreement to be complied
with on or before the Effective Date and take such
measures as may be necessary or desirable to fulfill
its obligations hereunder and thereunder so as to
implement the Amalgamation;
(ix) not carry on its business other than in the ordinary
course of business consistent with recent past
practice, unless otherwise approved in writing by
International Uranium; and
(x) have a minimum of 300 shareholders each holding a
minimum of 500 Common Shares of Thornbury Capital.
(ag) COVENANTS ON THE EFFECTIVE DATE. On the Effective Date,
Thornbury Capital shall:
(i) have assets net of liabilities of not less than
$300,000 (after payment of all success fees and
finder's fees by Thornbury Capital) which assets
shall consist of cash and/or marketable securities;
and
(ii) provide International Uranium with valid and legally
binding waivers, releases and resignations from each
director and officer of Thornbury Capital, which
waivers and releases shall provide that each such
director and officer waives any and all rights or
claims whatsoever to any compensation, shares,
options, rights or warrants of any kind whatsoever in
or from International Uranium, Thornbury Capital or
the Amalgamated Corporation.
(ah) FURTHER ASSURANCES. Thornbury Capital will do all such other
acts and things as may be necessary or desirable in order to
give effect to the Amalgamation and,
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without limiting the generality of the foregoing, will use its
best efforts to apply for and obtain, and will cooperate in
applying for and obtaining, among other things (i) at the
option of International Uranium, the quotation of the Common
Shares of the Amalgamated Corporation on the Canadian Dealing
Network Inc.; and (ii) such other consents, orders or
approvals as International Uranium's counsel may advise are
necessary or desirable for the implementation of the
Amalgamation.
13.2 Thornbury Capital acknowledges and agrees that the covenants,
representations and warranties contained in this Agreement have been given by
Thornbury Capital for the benefit of International Uranium and its directors and
officers, Salman Partners Inc., CIBC Wood Gundy Securities Inc., ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ & Partners, Newcrest Capital Inc. and First Marathon Securities Limited
(collectively, the "Agents") and their respective directors and officers and the
purchasers of the Special Warrants. Thornbury Capital further acknowledges and
agrees that International Uranium holds the covenants, representations and
warranties contained in this Agreement for itself and its directors and
officers, and for the benefit of the Agents and their respective directors and
officers and the purchasers of the Special Warrants in connection with the
consummation of the transactions contemplated in this Agreement.
13.3 International Uranium covenants, represents and warrants to
Thornbury Capital as follows and acknowledges that Thornbury Capital is relying
on such covenants, representations and warranties in entering into this
Agreement and that the same will be true and correct on and up to the Effective
Date as if made on and as of the Effective Date (with such modifications as may
be acceptable to Thornbury Capital in its sole discretion):
(a) INCORPORATION AND ORGANIZATION OF INTERNATIONAL URANIUM.
International Uranium is duly incorporated and subsisting
under the laws of the Province of Ontario and has the
corporate power and authority to own or lease its property and
assets and to carry on its business as now conducted by it.
(b) OFFERING MEMORANDUM. With respect to International Uranium,
the Offering Memorandum does not contain any untrue statement
of a material fact and does not omit to state a material fact
that is required to be stated or omit to state a material fact
that is necessary to be stated in order for the statement not
to be misleading.
(c) COSTS. International Uranium will pay all reasonable legal
costs of legal counsel of each of the Amalgamating
Corporations in respect of the Amalgamation, including in
respect of the implementation of the Amalgamation.
(d) COVENANTS ON THE EFFECTIVE DATE. On the Effective Date,
International Uranium's only material non-cash asset will
consist of substantially all of the uranium producing assets
and business (the "Energy Fuels Assets") of Energy
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Fuels, Ltd., Energy Fuels Exploration Co. and Energy Fuels
Nuclear, Inc. and International Uranium will have 26,500,000
Common Shares issued and outstanding (each of which will have
been issued for a cash consideration of $0.25 per share) a
portion of the proceeds of which will be used to pay the costs
associated with the acquisition of the Energy Fuels Assets,
and save and except for the Special Warrant financing and
options to purchase Common Shares of International Uranium
pursuant to a share option plan, no warrants or other
securities of International Uranium will be issued or
outstanding and International Uranium is not a party to any
agreement, written or oral, to issue any Common Shares or
other securities save as aforesaid.
13.4 International Uranium acknowledges and agrees that the
covenants, representations and warranties contained in this Agreement have been
given by International Uranium for the benefit of Thornbury Capital and its
directors and officers, and further acknowledges and agrees that Thornbury
Capital holds the covenants, representations and warranties contained in this
Agreement for itself and its directors and officers, in connection with the
consummation of the transactions contemplated in this Agreement.
13.5 The representations and warranties of each of Thornbury
Capital and International Uranium shall survive the execution and delivery of
this Agreement with full force and effect until May 5, 1998 in the event that
the Amalgamation is consummated, failing which they shall survive and continue
in full force and effect until August 31, 1997.
ARTICLE 14 - CONDITIONS
14.1 The obligation of the parties to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment of the
following conditions by the respective parties prior to the time of the
endorsement of the Certificate:
(a) the Amalgamation shall have been adopted and approved without
amendment by a special resolution passed by the shareholders
of each of the Amalgamating Corporations in accordance with
the provisions of the Act;
(b) the respective boards of directors of each of the Amalgamating
Corporations shall have approved of the Amalgamation;
(c) the Amalgamating Corporations shall have completed their due
diligence inquiries and investigations in connection with the
Amalgamation to their satisfaction;
(d) all approvals shall have been obtained from applicable
regulatory authorities and stock exchanges relating to the
Amalgamation, including, without limitation, The Toronto Stock
Exchange;
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(e) the representations, warranties and covenants set out herein
shall not have been breached and any conditions set out herein
or in the Letter Agreement in respect of the completion of the
Amalgamation shall have been fulfilled;
(f) all conditions precedent to the closing of the acquisition of
the Energy Fuels Assets shall have been satisfied other than
the payment of the purchase price by International Uranium
which will be satisfied immediately following completion of
the Amalgamation;
(g) International Uranium shall have received an opinion of
counsel for Thornbury Capital, addressed to International
Uranium and the Agents, as to the due incorporation, valid
existence and corporate capacity, power and authority of
Thornbury Capital, the due authorization and execution of the
Letter Agreement and this Agreement by Thornbury Capital and
the enforceability of such documents, and such other matters
as counsel to International Uranium may reasonably require;
(h) the business affairs and activities of the parties shall have
been conducted in the ordinary course of business and there
shall have been no material adverse change in the affairs of
such companies except for the transactions contemplated in the
Letter Agreement;
(i) there shall be immediately prior to the completion of the
Amalgamation 64,300,000 International Uranium Common Shares
issued and outstanding, assuming the exercise of the
37,800,000 Special Warrants, and 7,215,334 Thornbury Capital
Common Shares issued and outstanding;
(j) the number of Common Shares of the Amalgamated Corporation
reserved for issue or to be reserved for issue pursuant to
options and warrants shall not exceed 2,540,000 Common Shares
of the Amalgamated Corporation (subject to additional increase
to reflect any options granted to officers, directors,
eligible employees of, or consultants to, International
Uranium);
(k) Thornbury Capital and International Uranium agreeing to comply
with the conditions imposed by The Toronto Stock Exchange
relating to its approval of the listing of the Common Shares
of the Amalgamated Corporation; and
(l) there shall not be in force any order or decree restraining or
enjoining the consummation of the transactions contemplated by
the Letter Agreement or this Agreement.
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14.2 If any conditions as set out in this Article 14 are not
fulfilled or performed on or before the time of the endorsement of the
Certificate, the Amalgamating Corporation entitled to the benefit thereof, may
terminate this Agreement or waive the conditions, in whole or in part.
14.3 The directors of each Amalgamating Corporation may terminate
the Agreement at any time before or after the obtaining of the approval of the
shareholders of the Amalgamating Corporation, but no later than the time of the
endorsement of the Certificate, without any further action on the part of the
shareholders of such Amalgamating Corporation if: (i) in the case of Thornbury
Capital, the results of their due diligence of International Uranium reveal that
the Amalgamation is not in the best interests of the shareholders of Thornbury
Capital; and (ii) in the case of International Uranium, they determine, in their
sole and unfettered discretion, that it is not advisable to proceed with the
Amalgamation.
ARTICLE 15 - FILING OF ARTICLES OF AMALGAMATION
15.1 Upon the approval of this Agreement by the shareholders of
each of the Amalgamating Corporations in accordance with the requirements of the
Act, the parties hereto shall jointly complete and file articles of
amalgamation, in duplicate, in prescribed form with the Director appointed under
the Act, providing for the amalgamation of International Uranium and Thornbury
Capital upon and subject to the terms of this Agreement.
IN WITNESS WHEREOF this Agreement has been duly executed by
the parties hereto under their respective corporate seals as witnessed by the
signatures of their proper officers in that behalf.
INTERNATIONAL URANIUM
CORPORATION
Per:
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THORNBURY CAPITAL CORPORATION
Per:
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