LAW OFFICE OF
WILLIAM D. BAGLEY
TELEPHONE 1107 WEST SIXTH AVENUE FACSIMILE
(307) 634-0446 CHEYENNE, WYOMING 82001 (307) 637-7445
November 4, 1997
Canmax Inc.
150 West Carpenter Freeway
Irving, Texas 75039
Re: Offering of 863,364 Shares of Common Stock of Canmax Inc. by
Founder Equity Group, Inc., owner of 13.7% of Canmax Inc.
Ladies and Gentlemen:
I am advised that on or about November 4, 1997, Canmax Inc., a Wyoming
corporation (the "Company"), expects to file with the Securities and Exchange
Commission (the "Commission") Amendment No. 1 to that Registration Statement
on Form S-3 previously filed by the Company with the Commission on August 13,
1997 (as so amended, the "Registration Statement") under the Securities Act
of 1933, as amended (the "Act"). Such Registration Statement relates to the
offering (the "Offering") of up to 863,364 shares of common stock, no par
value per share (the "Common Stock"), by Founders Equity Group Inc., one
stockholder of the Company (the "Selling Stockholder"). You have requested my
opinion with respect to certain legal aspects of the Offering.
In rendering our opinion, I have examined and relied upon the original or
copies of (1) the Articles of Incorporation of the Company dated July 9,
1986; and the (2) Certificate of Incorporation issued July 10, 1986 by the
Province of British Columbia; (3) the April 30, 1987 Resolution authorizing
issuance of 44,169,100 common shares without par value; (4) The State of
Wyoming Application for Certificate of Registration and Articles of
Continuance, filed August 7, 1992, and related documents; (5) The Bylaws of
the Company adopted June 23, 1993; (6) a copy of the February 28, 1997
Resolutions of the Board of Directors of the Company authorizing "in
principle" the issuance of the shares to EDS, which sold its interest to the
Selling Stockholder; (7) the draft Registration Statement and the exhibits
thereto; and (8) such other documents and instruments from the office of the
Wyoming Secretary of State as I have deemed necessary. In any examinations, I
have assumed the genuineness of all signatures and the authenticity of all
documents submitted to us as originals, and the conformity to original
documents of all documents submitted to me as certified or reproduction
copies. As to various questions of fact material to this opinion, I have
relied, to the extent I deem reasonably appropriate, upon representations or
certificates of officers or directors of the Company and upon documents,
records and instruments furnished to us by the Company, without independent
check or verification of their accuracy.
Canmax Inc.
November 4, 1997
Page 2
Based upon the foregoing examination and subject to the comments and
assumptions noted below, I am of the opinion that the shares of Common Stock
to be sold by the Selling Stockholder in the Offering were validly issued and
fully paid and are nonassessable.
This opinion is limited in all respects to the General Corporation Law of
the State of Wyoming as in effect on the date thereof.
I bring to your attention the fact that this legal opinion is an
expression of professional judgment and not a guaranty of result. This
opinion is given as of the date hereof, and I assume no obligation to update
or supplement such opinion to reflect any facts or circumstances that may
hereafter come to our attention or any changes in laws or judicial decisions
that may hereafter occur.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of my name under the caption "Legal
Matters" in the Prospectus forming a part of the Registration Statement. In
giving such consent, I do not admit that I have come within the category of
persons whose consent is required by Section 7 of the Act or the rules and
regulations of the Securities and Exchange Commission thereunder.
Respectfully submitted,
/s/ William D. Bagley
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William D. Bagley