EXHIBIT 2.2
SUBSCRIPTION AGREEMENT FOR COMMON SHARES
TO: Acadian Mining Corporation (the "Corporation")
The undersigned (the "Subscriber") hereby irrevocably subscribes for and agrees
to purchase the number of common shares (the "Shares") of the Corporation for
the aggregate subscription price set forth below, representing a subscription
price of $0.03 per Share, upon and subject to the terms and conditions set forth
in "Terms and Conditions of Subscription for Common Shares of Acadian Mining
Corporation" attached hereto (the "Terms and Conditions"), including without
limitation, the representations, warranties and covenants of the Subscriber set
forth in the Terms and Conditions.
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Number of Shares @ $0.03 per Share:
Golden River Resources Corporation
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(Name of Subscriber - please print) 300,000,000
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By: /s/Peter Lee
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Authorized Signature Aggregate Subscription Price:
Director, Chief Financial officer & Secretary
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(Official Capacity or Title - please print) $9,000,000.00
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Peter James Lee
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(Please print name of individual whose signature appears
above if different than the name of the subscriber printed
above.)
PO Box 6315 St Kilda Road Melbourne Vic 8008 Australia
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(Subscriber's Address, including postal code)
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+61 3 8532 2860
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(Telephone Number)
peterl@axisc.com.au
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(E-mail Address)
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Register the Shares as set forth below: Deliver the Shares as set forth below:
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(Name) (Name)
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(Account Reference, if applicable) (Account Reference, if applicable)
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(Address, including postal code) (Contact Name)
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(Telephone Number)
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(Address, including postal code)
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ACCEPTANCE: The Corporation hereby accepts the subscription as set forth above
on the Terms and Conditions and confirms that the representations and warranties
made by the Corporation in the Terms and Conditions are true and correct in all
material respects as of the Initial Closing Date and that the Subscriber is
entitled to rely thereon.
ACADIAN MINING CORPORATION
Per: /s/ G William Felderhof
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Name: G William Felderhof
Title: President & CEO
Date: July 9, 2009
TERMS AND CONDITIONS OF SUBSCRIPTION FOR
COMMON SHARES OF ACADIAN MINING CORPORATION
Definitions
(a) "CCAA" means the Companies Creditors' Arrangement Act;
(b) "Closing Time" means the time of closing on a particular closing date;
(c) "Corporation" means Acadian Mining Corporation;
(d) "Final Closing" means the final closing of the purchase of Shares at
which the Subscriber will have purchased all remaining Shares;
(e) "Final Closing Date" has the meaning ascribed to it in Section 1 of
this Agreement;
(f) "Information" has the meaning ascribed to it in Section 4(y) of this
Agreement;
(g) "Initial Closing" means the initial closing of the purchase of the
Shares by the Subscriber, such closing to take place as soon as
practicable after the Tranche 2 Conditions Precedent have been met;
(h) "Initial Closing Date" has the meaning ascribed to it in Section 1 of
this Agreement;
(i) "Mineral Rights" has the meaning ascribed to it in Section 4(y) of this
Agreement;
(j) "PCMLTFA" means the Proceeds of Crime (Money Laundering) and Terrorist
Financing Act (Canada);
(k) "Reporting Provinces" means British Columbia, Alberta, Manitoba,
Ontario, New Brunswick, Nova Scotia and Newfoundland;
(l) "Shares" means 300,000,000 common shares in the capital of the
Corporation;
(m) "Subscriber" means Golden River Resources Corporation;
(n) "Subscription Price" means $0.03 per Share;
(o) "Subsequent Closing" means each closing after the Initial Closing
pursuant to which the Subscriber purchases a portion of the Shares;
(p) "Subsidiaries" means ScoZinc Limited, 6927692 Canadian Corp., Annapolis
Properties Corp., Goldenville Mining Corporation and 6179053 Canada
Inc.;
(q) "Terms and Conditions" means the terms and conditions of the
subscription for common shares of the Corporation;
(r) "Tranche 2 Conditions Precedent" has the meaning ascribed to it in
Section 2 of this Agreement;
(s) "TSX" means the Toronto Stock Exchange; and
(t) "U.S. Securities Act" means the United States Securities Act of 1933,
as amended.
Subscription for Shares
1. Upon satisfaction of the Tranche 2 Closing Conditions Precedent and
subject to other terms and conditions set out herein, the Subscriber
hereby irrevocably subscribes for and offers to purchase 300,000,000
Shares of the Corporation at a price of $0.03 per Share (the
"Subscription Price") on or before the Final Closing Date, in such
tranches as set out below.
Initial Closing. Upon satisfaction of the Tranche 2 Closing Conditions
Precedent, the Subscriber agrees to subscribe for and purchase from the
Corporation, and the Corporation agrees to allot and issue to the
Subscriber, that number of shares to be agreed upon by the parties (the
"Initial Closing Date").
Subsequent Closings: The subscriber agrees to subscribe for and
purchase from the Corporation, and the Corporation agrees to allot and
issue to the Subscriber, from time to time between the Initial Closing
Date and the Final Closing Date, that number of Shares of the
Corporation required to satisfy the cash requirements of the
Corporation in accordance with the budget approved by the Subscriber.
Final Closing. On the earlier of i) March 16, 2010 and ii) the date of
the Corporation's annual general meeting in 2010 (the "Final Closing
Date"), the Subscriber agrees to subscribe for and purchase from the
Corporation, and the Corporation agrees to allot and issue to the
Subscriber, any remaining portion of the Shares of the Corporation that
have not already been subscribed for and issued.
For greater certainty, the Subscriber will not be bound to subscribe
for and purchase any Shares until the Tranche 2 Conditions Precedent
have been satisfied but once they have been met and the Initial Closing
is held, the Subscriber is irrevocably committed to purchase all the
Shares on or before the Final Closing Date.
Tranche 2 Closing Conditions Precedent
2. The obligations of the Subscriber to complete the transactions
contemplated hereby are subject to the fulfillment of the
following conditions (the "Tranche 2 Conditions Precedent"):
(a) resolution to the satisfaction of the Subscriber of the
proceedings of ScoZinc Limited under CCAA;
(b) acquisition by the Corporation of the remaining 50% interest in
the Fifteen Mile Stream Deposit on terms no less favourable to
the Corporation than the following: a 1% NSR payable to the
vendor(s) and a $1,070,000 payment to the vendor(s), with $70,000
payable on closing of the acquisition and the remaining
$1,000,000 balance to be paid by the Corporation issuing a
non-interest bearing note for such amount payable one-year after
closing (provided that such repayment period in the note may be
extended for up to an additional 12 months at the option of the
Corporation so long as at the time of such extension the
Corporation pays to the vendor(s) of the Fifteen Mile Stream
Deposit $100,000 on such note, so that the remaining balance is
$900,000. In addition, the Subscriber and Corporation agree that
in the event the Corporation completes a financing of at least
$20,000,000 while the note is outstanding, such note will be paid
our from the proceeds of such financing. For greater certainty,
this acquisition may close concurrently with the Initial Closing;
(c) the acquisition by the Corporation from Votix Corporation Limited
of land owned by Votix Corporation Limited required for the
mining of the Forest Hill Deposit for $8,000. For greater
certainty, this acquisition may close concurrently with the
Initial Closing; and
(d) all covenants, agreements and conditions contained in this
Subscription Agreement to be performed by the Corporation on or
prior to the Initial Closing Date shall have been performed or
complied with in all material respects.
Representations, Warranties and Covenants by Subscriber
3. By executing this Subscription Agreement, the Subscriber (on
its own behalf and, if applicable, on behalf of the others for
whom it is contracting hereunder) represents and warrants to
and covenants with the Corporation (and acknowledges that the
Corporation and its counsel are relying thereon) that:
(a) No Prospectus. It understands and acknowledges that the Shares
are being issued pursuant to exemptions from the prospectus
requirements under applicable securities legislation on the basis
of representations made by the Subscriber hereunder and that no
prospectus has been filed by the Corporation with any securities
commission or similar regulatory authority in any jurisdiction,
and as a result:
(i) it is restricted from using certain of the protections,
rights, remedies otherwise available under applicable
securities laws, including statutory rights of rescission or
damages;
(ii) it may not receive information that might otherwise be
required to be provided to the Subscriber under the
applicable securities laws if the exemptions were not being
used;
(iii) the Corporation is relieved from certain obligations that
would otherwise apply under the applicable securities laws
if the exemptions were not being used; and
(iv) the Subscriber hereby expressly waives any and all rights of
withdrawal or rescission to which the Subscriber might
otherwise be entitled under applicable securities
legislation;
(b) No Offering Material. It has not received, nor has it requested,
nor does it have any need to receive, any prospectus, sales or
advertising literature, offering memorandum or any other document
describing the business and affairs of the Corporation which has
been prepared for delivery to, and review by, prospective
purchasers in order to assist them in making an investment
decision in respect of the purchase of the Shares and it has not
become aware of any advertisement in printed public media, radio,
television or telecommunications, including electronic display
such as the internet with respect to the distribution of the
Shares;
(c) Residence. It is resident in the jurisdiction set forth in the
"Subscriber's Address" on page 1 of this Subscription Agreement;
(d) Purchasing as Principal. It is purchasing the Shares as principal
for its own account, not for the benefit of any other person, for
investment only, and not with a view to the resale or
distribution of all or any of the Shares and, unless paragraph
(e) or subparagraph (g)(iv) applies, or unless the transaction
contemplated by this Subscription Agreement is exempted by an
order of the securities commission or similar regulatory
authority of the province in which it resides:
(i) the Subscriber is an "accredited investor" (as that term is
as defined in National Instrument 45-106 - Prospectus and
Registration Exemptions), has not been created or used
solely to purchase or hold the Shares as an accredited
investor, and has completed and executed the Certification
of Accredited Investor attached hereto as Schedule "B" and
hereby confirms the truth and accuracy of all statements
made therein by the Subscriber; or
(ii) the Shares have an acquisition cost to the Subscriber of not
less than $150,000 which will be paid in cash on Closing;
(e) Offshore Subscribers. If it is not a Canadian resident, nor
resident in or otherwise subject to the securities laws of the
United States , the Subscriber, and any beneficial owner on whose
behalf it is acting, is subject to the securities legislation of
a jurisdiction other than Canada or the United States and:
(i) the Subscriber is, and (if applicable) any beneficial
purchaser for whom it is acting is:
(A) a purchaser that is recognized as an exempt purchaser
by the securities regulatory authority in the
jurisdiction in which it is and (if applicable) any
other such purchaser for whom it is acting hereunder is
resident or otherwise subject and is purchasing the
Shares as principal for its or (if applicable) each
other such purchaser's own account, and not for the
benefit of any other person, for investment only and
not with a view to resale or distribution; or
(B) a purchaser which is purchasing Shares pursuant to an
exemption from any prospectus or securities
registration requirements available to the Corporation,
the Subscriber and any other such purchaser under
applicable securities laws of their jurisdiction of
residence or to which the Subscriber and any other such
purchaser are otherwise subject, and the Subscriber and
any other such purchaser shall deliver to the
Corporation such further particulars of the exemption
and their qualification thereunder as the Corporation
may reasonably request;
(ii) the purchase of Shares by the Subscriber, and (if
applicable) any other beneficial purchaser for whom it is
acting hereunder, does not contravene any of the applicable
securities laws in such jurisdiction and does not trigger:
(i) any obligation to prepare and file a prospectus, an
offering memorandum or similar document, or any other
ongoing reporting requirements with respect to such purchase
or otherwise; or (ii) any registration or other obligation
on the part of the Corporation; and
(iii) the Subscriber, and (if applicable) any other beneficial
purchaser for whom it is acting hereunder, will not sell or
otherwise dispose of any of the Shares except in accordance
with applicable securities laws, and if the Subscriber or
(if applicable) such beneficial purchaser sells or otherwise
disposes of any the Shares to a person other than a resident
of Canada, the Subscriber and (if applicable) such
beneficial purchaser will obtain from such purchaser
representations, warranties and covenants in the same form
as provided in this Subscription Agreement and shall comply
with such other requirements as the Corporation may
reasonably require;
(f) Shares Not Registered Under U.S. Securities Act. It is aware and
accepts that the Shares have not been and will not be registered
under the United States Securities Act of 1933, as amended (the
"U.S. Securities Act"), or the securities laws of any state of
the United States and, subject to certain exceptions, may not be
offered or sold in the United States or to, or for the benefit or
account of, any person in the United States or any U.S. Person.
"U.S. Person" has the meaning set forth in Rule 902 of Regulation
S promulgated under the U.S. Securities Act;
(g) U.S. Registration Exemption. The Subscriber represents and
warrants that the Subscriber either:
(i) is not, and is not purchasing the Shares for the account or
benefit of, a U.S. Person;
(ii) was not offered the Shares in the United States; and
(iii) did not execute or deliver this Subscription Agreement in
the United States; OR
(iv) has completed and executed the Certification of U.S.
Purchaser attached hereto as Schedule "C" and hereby
confirms the truth and accuracy of all statements made
therein by the Subscriber.
(h) Resale Restrictions. The Shares will be subject to statutory
resale restrictions under applicable Canadian securities law and
the Subscriber covenants that it will not resell the Shares
except in compliance with such laws and the Subscriber
acknowledges that it is solely responsible (and the Corporation
is in no way responsible) for such compliance. The Subscriber
also acknowledges that the certificates representing the Shares
will bear a legend substantially in the following form and with
the necessary information inserted:
"UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF
THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE [INSERT DATE
THAT IS FOUR (4) MONTHS AND ONE (1) DAY AFTER THE CLOSING
DATE]"
In addition, Subscribers resident in or otherwise subject to
the securities laws of the United States acknowledge that the
certificates representing the Subscriber's Shares will be
endorsed with the legend contemplated by the Certification of
U.S. Purchaser attached hereto as Schedule "C";
(i) Authorization and Effectiveness. It has the legal capacity and
competence to enter into and be bound by this Subscription
Agreement and further certifies that all necessary approvals of
directors, shareholders or otherwise have been given and
obtained;
(j) No Violation. The entering into of this Subscription Agreement
and the transactions contemplated hereby will not result in a
violation of any of the terms and provisions of any law
applicable to it, or any of its constating documents, or of any
agreement to which the Subscriber is a party or by which it is
bound;
(k) Investment Suitability. It has such knowledge in financial and
business affairs as to be capable of evaluating the merits and
risks of its investment or as a result of advice received from a
registered person other than the Corporation or any affiliates
thereof or, where it is not purchasing as principal, each
beneficial purchaser, is able to bear the economic risk of loss
of its investment;
(l) Additional Financings. The Subscriber acknowledges that the
Corporation may complete additional financings in the future in
order to develop the business of the Corporation and to fund its
ongoing development; that there is no assurance that such
financings will be available and, if available, on reasonable
terms; any such future financings may have a dilutive effect on
current securityholders, including the Subscriber; that if such
future financings are not available, the Corporation may be
unable to fund its ongoing development and the lack of capital
resources may result in the failure of its business venture;
(m) Filings. If required by applicable securities legislation,
regulations, rules, instruments, policies or orders or by any
securities commission, or other regulatory authority, the
Subscriber will execute, deliver, file and otherwise assist the
Corporation in filing, such reports, undertakings and other
documents with respect to the issue of the Shares as may be
required;
(n) No Illegal Activities Proceeds. None of the funds representing
the aggregate Subscription Price which will be advanced by or on
behalf of the Subscriber to the Corporation hereunder are, to the
knowledge of the Subscriber, proceeds obtained or derived,
directly or indirectly, as a result of illegal activities. The
funds being used to purchase the Shares which will be advanced by
or on behalf of the Subscriber hereunder will not represent
proceeds of crime for the purposes of the Proceeds of Crime
(Money Laundering) and Terrorist Financing Act (Canada)
("PCMLTFA") and the Subscriber acknowledges that the Corporation
may in the future be required by law to disclose the Subscriber's
name and other information relating to this Subscription
Agreement and the Subscriber's subscription hereunder, on a
confidential basis, pursuant to the PCMLTFA. To the best of the
Subscriber's knowledge, none of the funds to be provided by the
Subscriber are being tendered on behalf of the person who has not
been identified to the Subscriber. The Subscriber covenants that
it shall promptly notify the Corporation if the Subscriber
discovers that any of such representations cease to be true and
to provide the Corporation with appropriate information in
connection therewith; and
The Subscriber agrees (on its own behalf and, if applicable, on behalf
of each person on whose behalf the Subscriber is acting) that the above
representations, warranties and covenants will be true and correct both
as of the execution of this Subscription Agreement and as of the
Closing Time (as defined in Section 8 below) and will survive the
completion of the issuance of the Shares.
Representations and Warranties of the Corporation
4. The Corporation represents and warrants to the Subscriber, and
acknowledges that it is relying upon such representations and
warranties in entering into this Subscription Agreement or
purchasing the Shares, as the case may be, that:
(a) Incorporation and Organization. Each of the Corporation and the
Subsidiaries is a valid and subsisting corporation under the laws
of its jurisdiction of incorporation and has all requisite
corporate power and authority to carry on its businesses as now
conducted or proposed to be conducted and to own or lease and
operate the properties and assets thereof;
(b) Extra-provincial Registration. Each of the Corporation and the
Subsidiaries is licensed, registered or qualified as an
extra-provincial or foreign corporation in all jurisdictions
where the character of the property or assets thereof owned or
leased or the nature of the activities conducted by it make
licensing, registration or qualification necessary and is
carrying on the business thereof in compliance with all
applicable laws, rules and regulations of each such jurisdiction;
(c) Authorized Capital. The Corporation is authorized to issue, an
unlimited number of common shares and an unlimited number of
preference shares, of which, as of June 8, 2009, 191,607,241
common shares were issued and outstanding as fully paid and
non-assessable shares, excluding any securities issued on
Closing;
(d) Issue of Shares. All necessary corporate action has been taken to
authorize the issue and sale of, and the delivery of certificates
representing, the Shares and, (subject to the provisions of
Section 2 hereof) upon payment of the Subscription Price, the
Shares will be issued as fully paid and non-assessable common
shares of the Corporation;
(e) No Conflicts. None of the offering and sale of the Shares, the
execution and delivery of this Subscription Agreement, compliance
by the Corporation with the provisions of this Subscription
Agreement or the consummation of the transactions contemplated
herein and therein and the issue of the Shares to the Subscriber
for the consideration and upon the terms and conditions as set
forth herein do or will: (i) conflict with or result in any
breach or violation of any of the provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, lease or
other agreement or instrument to which the Corporation is a party
or by which it or any of the properties or assets thereof is
bound; or (ii) conflict with or result in any breach or violation
of any provisions or, constitute a default under the articles or
by-laws of the Corporation or any resolution passed by the
directors (or any committee thereof) or shareholders of the
Corporation, or (subject to compliance with TSX policies) any
statute or any judgment, decree, order, rule, policy or
regulation of any court, governmental authority, any arbitrator,
or securities regulatory authority applicable to the Corporation
or any of the properties or assets thereof;
(f) Authority and Authorization. The Corporation has full corporate
power and authority to enter into this Subscription Agreement and
to do all acts and things and execute and deliver all documents
as are required hereunder to be done, observed, performed or
executed and delivered by it in accordance with the terms hereof
and the Corporation has taken all necessary corporate action to
authorize the creation, execution, delivery and performance of
this Subscription Agreement, and to observe and perform the
provisions of this Subscription Agreement, in accordance with the
provisions hereof;
(g) Validity and Enforceability. This Subscription Agreement has been
authorized, executed and delivered by the Corporation and
constitutes a valid and legally binding obligation of the
Corporation enforceable against the Corporation in accordance
with its terms;
(h) Issuance of Common Shares. Save and except as disclosed in the
Corporation's public disclosure, common shares to be issued to
the Subscriber or its nominee pursuant to the agreement entered
into between the Subscriber and the Corporation dated March 16,
2009, and common shares issued under the Corporation's incentive
stock option plan or pursuant to the exercise of share purchase
warrants, the Corporation has not issued, or agreed to issue, any
shares or any securities exchangeable or exercisable for, or
convertible into, common shares of the Corporation at an
effective price per share which is less than the Subscription
Price during the 60 day period immediately preceding the date
hereof. Schedule "D" sets out a complete list of all of the
options, warrants and other securities convertible or
exchangeable into common shares of the Corporation;
(i) Certain Securities Law Matters. The common shares of the
Corporation are listed only on the TSX and the Frankfurt
Exchange, the Corporation is a reporting issuer or the equivalent
only in the Provinces of British Columbia, Alberta, Manitoba,
Ontario, New Brunswick, Nova Scotia and Newfoundland and Labrador
("Reporting Provinces") and is not in default of any requirement
of the securities laws of any of such provinces;
(j) Rights to Acquire Securities. Other than as set out in Schedule
"D", no person has any agreement, option, right or privilege
(whether pre-emptive, contractual or otherwise) capable of
becoming an agreement for the purchase, acquisition, subscription
for or issue of any of the unissued shares or other securities of
the Corporation or the Subsidiaries;
(k) No Pre-emptive Rights. Other than as disclosed in the
Corporation's public record, the issue of the Shares will not be
subject to any pre-emptive right or other contractual right to
purchase securities granted by the Corporation or to which the
Corporation is subject;
(l) Purchased Securities. Provided that the Subscriber's
representations and warranties herein are accurate, the execution
of this Subscription Agreement and the issue by the Corporation
to the Subscriber of the Shares will be exempt from the
registration and prospectus requirements of applicable securities
laws;
(m) Capital of Subsidiaries. All of the outstanding shares of the
Subsidiaries are issued and outstanding as fully paid and
non-assessable shares and such shares are beneficially owned by
the Corporation and no person has any agreement, option, right or
privilege (whether pre-emptive, contractual or otherwise) capable
of becoming an agreement for the purchase, acquisition,
subscription for or issue of any of the unissued shares or other
securities of any of the subsidiaries or for the purchase or
acquisition of any of the outstanding shares or other securities
of any of the subsidiaries. The Corporation owns 100% of the
outstanding shares of each of ScoZinc Limited, 6927692 Canada
Corp., Annapolis Properties Corp. and Goldenville Mining
Corporation and Annapolis Properties Corp. owns 50% of the issued
and outstanding shares of 6179053 Canada Inc. (collectively,
"Subsidiaries") and, in addition, the Corporation owns 29% of the
outstanding shares of Royal Roads Corp.;
(n) Public Disclosure. Each of the documents which contains any of
the Corporation's public record is, as of the date thereof, in
compliance in all material respects with the securities laws of
the Reporting Provinces and did not contain any untrue statement
of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading and such documents collectively constitute full, true
and plain disclosure of all material facts relating to the
Corporation and do not contain any untrue statement of a material
fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, as
of the date hereof. There is no fact known to the Corporation
which the Corporation has not publicly disclosed which materially
adversely affects, or so far as the Corporation can reasonably
foresee, will materially adversely affect, the assets,
liabilities (contingent or otherwise), capital, affairs,
business, prospects, operations or condition (financial or
otherwise) of the Corporation or the ability of the Corporation
to perform its obligations under this Subscription Agreement or
which would otherwise be material to any person intending to make
an equity investment in the Corporation, it being acknowledged
that the Corporation's wholly-owned subsidiary, ScoZinc Limited,
was granted an order by the Nova Scotia Supreme Court under CCAA
and that documents filed in connection with such proceeding form
part of the Corporation's public record;
(o) Timely Disclosure. The Corporation is in compliance with all
timely disclosure obligations under the securities laws of the
Reporting Provinces and, without limiting the generality of the
foregoing, there has not occurred any material adverse change in
the assets, liabilities (contingent or otherwise), capital,
affairs, business, prospects, operations or condition (financial
or otherwise) of the Corporation or any Subsidiary which has not
been publicly disclosed and none of the documents filed by or on
behalf of the Corporation pursuant to the securities laws of the
Reporting Provinces contain a misrepresentation (as such term is
defined in the Securities Act (Nova Scotia)) at the date of the
filing thereof;
(p) Accounting Controls. The Corporation now maintains a system of
internal accounting controls sufficient to provide reasonable
assurance that in all material respects: (i) transactions are
completed in accordance with the general or a specific
authorization of management of the Corporation; (ii) transactions
are recorded as necessary to permit the preparation of
consolidated financial statements for the Corporation in
conformity with Canadian generally accepted accounting principles
and to maintain asset accountability; (iii) access to assets of
the Corporation and the subsidiaries is permitted only in
accordance with the general or a specific authorization of
management of the Corporation; and (iv) the recorded
accountability for assets of the Corporation and the Subsidiaries
is compared with the existing assets of the Corporation and the
Subsidiaries at reasonable intervals and appropriate action is
taken with respect to any differences therein;
(q) No Cease Trade Order. No order preventing, ceasing or suspending
trading in any securities of the Corporation or prohibiting the
issue and sale of securities by the Corporation has been issued
and no proceedings for either of such purposes have been
instituted or, to the best of the knowledge of the Corporation,
are pending, contemplated or threatened;
(r) Financial Statements. The audited consolidated financial
statements of the Corporation for the year ended December 31,
2008, together with the auditors' report thereon and the notes
thereto, and the unaudited interim consolidated financial
statements of the Corporation for the period ended March 31, 2009
and the notes thereto, have been prepared in accordance with
Canadian generally accepted accounting principles applied on a
basis consistent with prior periods (except as disclosed in such
consolidated financial statements), are substantially correct in
every particular and present fairly the financial condition and
position of the Corporation on a consolidated basis as at the
dates thereof and such consolidated financial statements contain
no direct or implied statement of a material fact which is untrue
on the date of such consolidated financial statements and do not
omit to state any material fact which is required by Canadian
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;
(s) No Contemplated Changes. Except as disclosed in the Corporation's
public documents or pursuant to the transaction contemplated
hereby, none of the Corporation or any Subsidiary has approved,
is contemplating, has entered into any agreement in respect of,
or has any knowledge of:
(i) the purchase of any property or assets or any interest
therein or the sale, transfer or other disposition of any
material property or material assets or any material
interest therein currently owned, directly or indirectly, by
the Corporation or any Subsidiary whether by asset sale,
transfer of shares or otherwise;
(ii) the change of control (by sale or transfer of shares or sale
of all or substantially all of the property and assets of
the Corporation or any Subsidiary or otherwise) of the
Corporation or any Subsidiary; or
(iii) a proposed or planned disposition of shares by any
shareholder who owns, directly or indirectly, 10% or more of
the outstanding shares of the Corporation or any Subsidiary;
(t) Insurance. The assets of the Corporation and of each Subsidiary
and the business and operations thereof are insured against loss
or damage with responsible insurers on a basis consistent with
insurance obtained by reasonably prudent participants in a
comparable business in comparable circumstances, such coverage is
in full force and effect and the Corporation and each Subsidiary
has not failed to promptly give any notice or present any
material claim thereunder;
(u) Taxes and Tax Returns. Other than as set out in Schedule "E", the
Corporation and each Subsidiary has filed in a timely manner all
necessary tax returns and notices and has paid all applicable
taxes of whatsoever nature for all tax years prior to the date
hereof to the extent that such taxes have become due or have been
alleged to be due (unless being contested in good faith) and none
of the Corporation or any Subsidiary is aware of any tax
deficiencies or interest or penalties accrued or accruing, or
alleged to be accrued or accruing, thereon where, in any of the
above cases, it might reasonably be expected to result in any
material adverse change in the condition (financial or otherwise)
or in the earnings, business, affairs or prospects of the
Corporation or any Subsidiary, and there are no agreements,
waivers or other arrangements providing for an extension of time
with respect to the filing of any tax return by any of them or
the payment of any material tax, governmental charge, penalty,
interest or fine against any of them. To the knowledge of
management of the Corporation, there are no material actions,
suits, proceedings, investigations or claims now threatened or
pending against the Corporation or any Subsidiary which could
result in a material liability in respect of taxes, charges or
levies of any governmental authority, penalties, interest, fines,
assessments or reassessments or any matters under discussion with
any governmental authority relating to taxes, governmental
charges, penalties, interest, fines, assessments or reassessments
asserted by any such authority and the Corporation and each
Subsidiary has withheld (where applicable) from each payment to
each of the present and former officers, directors, employees and
consultants thereof the amount of all taxes and other amounts,
including, but not limited to, income tax and other deductions,
required to be withheld therefrom, and has paid the same or will
pay the same when due to the proper tax or other receiving
authority within the time required under applicable tax
legislation;
(v) Compliance with Laws, Licenses and Permits. The Corporation and
each Subsidiary has conducted and is conducting the business
thereof in compliance in all material respects with all
applicable laws, rules, regulations, tariffs, orders and
directives of each jurisdiction in which it carries on business
and possesses all material approvals, consents, certificates,
registrations, authorizations, permits and licenses issued by the
appropriate provincial, state, municipal, federal or other
regulatory agency or body necessary to carry on the business
currently carried on, or contemplated to be carried on, by it, is
in compliance in all material respects with the terms and
conditions of all such approvals, consents, certificates,
authorizations, permits and licenses and with all laws,
regulations, tariffs, rules, orders and directives material to
the operations thereof, and none of the Corporation or any
Subsidiary has received any notice of the modification,
revocation or cancellation of, or any intention to modify, revoke
or cancel or any proceeding relating to the modification,
revocation or cancellation of any such approval, consent,
certificate, authorization, permit or license which, singly or in
the aggregate, if the subject of an unfavourable decision, order,
ruling or finding, would materially adversely affect the conduct
of the business or operations of, or the assets, liabilities
(contingent or otherwise), condition (financial or otherwise) or
prospects of, the Corporation or any Subsidiary;
(w) Agreements and Actions. Neither the Corporation nor any
Subsidiary is in violation of any term of the articles or by-laws
or any constating document thereof. Neither the Corporation nor
any Subsidiary is in violation of any term or provision of any
agreement, indenture or other instrument applicable to it which
would, or could, result in any material adverse effect on the
business, condition (financial or otherwise), capital, affairs or
operations of the Corporation or any Subsidiary, neither the
Corporation nor any Subsidiary is in default in the payment of
any obligation owed which is now due and there is no action,
suit, proceeding or investigation commenced, pending or, to the
knowledge of the Corporation, threatened which, either in any
case or in the aggregate, might result in any material adverse
effect on the business, condition (financial or otherwise),
capital, affairs, prospects or operations of the Corporation on a
consolidated basis or in any of the material properties or assets
thereof or in any material liability on the part of the
Corporation or any Subsidiary or which places, or could place, in
question the validity or enforceability of this Subscription
Agreement, or any document or instrument delivered, or to be
delivered, by the Corporation pursuant hereto or thereto;
(x) Owner of Property. The Corporation and the Subsidiaries are the
absolute legal and beneficial owner of, and have good and
marketable title to, all of the interest in and to the material
property or assets thereof as described in the Corporation's
pubic disclosure, free of all mortgages, liens, charges, pledges,
security interests, encumbrances, claims or demands whatsoever,
other than those described in the Corporation's pubic disclosure,
and no other property rights are necessary for the conduct of the
business of the Corporation or any Subsidiary as currently
conducted or contemplated to be conducted, none of the
Corporation or any Subsidiary knows of any claim or the basis for
any claim that might or could adversely affect the right thereof
to use, transfer or otherwise exploit such property rights and,
except as disclosed in the Corporation's pubic disclosure, none
of the Corporation or any Subsidiary has any responsibility or
obligation to pay any commission, royalty, licence fee or similar
payment to any Person with respect to the property rights
thereof;
(y) Mineral Rights. The Corporation and the Subsidiaries hold either
freehold title, exploration licences, mining leases, mining
claims or participating interests or other conventional property,
proprietary or contractual interests or rights, or has applied
for such, recognized in the jurisdiction in which a particular
property is located, in respect of the ore bodies and minerals
located in properties in which the Corporation and the
Subsidiaries have an interest as described in the Corporation's
pubic disclosure ("Mineral Rights") under valid, subsisting and
enforceable title documents or other recognized and enforceable
agreements or instruments, or has applied for such, sufficient to
permit the Corporation or applicable Subsidiary to explore the
minerals relating thereto, all such property, leases, licences or
claims, and all property, mining leases or mining claims in which
the Corporation or any Subsidiary has an interest or right have
been validly located and recorded or are in the process of being
recorded, in accordance with all applicable laws and are valid
and subsisting, the Corporation and the Subsidiaries have all
necessary surface rights, access rights and other necessary
rights and interests in the properties in which the Corporation
and the Subsidiaries have an interest as described in the
Company's continuous disclosure record (the "Information") as are
necessary to permit the Corporation or Subsidiary to explore for
minerals, ore and metals for development purposes as are
appropriate in view of the rights and interest therein of the
Corporation or applicable Subsidiary and the state of development
of the property, with only such exceptions as do not materially
interfere with the use made by the Corporation or applicable
Subsidiary of the rights or interests so held and each of the
proprietary interests or rights and each of the documents,
agreements and instruments and obligations relating thereto
referred to above is currently in good standing in the name of
the Corporation or a Subsidiary. Other than as disclosed in the
Information: (i) the Mineral Rights, and the Corporation's
interest in the Mineral Rights, are free and clear of all
encumbrances; (ii) there are no outstanding agreements or options
to acquire or purchase the Mineral Rights or any interest in the
Mineral Rights; (iii) no person has any royalty or other interest
whatsoever in production or profits from the Mineral Rights; and
(iv) all work or expenditure obligations applicable to the
Mineral Rights, all reports of the work or expenditures and other
requirements to be satisfied or filed to keep the Mineral Rights
in good standing have been satisfied or filed, and have satisfied
the applicable governmental authority. Schedule "F" contains a
list of all material mineral licences, leases and other interests
held by the Corporation directly or indirectly through
subsidiaries or otherwise;
(z) No Defaults. Except as disclosed in the Corporation's pubic
disclosure record, none of the Corporation or any Subsidiary is
in default of any material term, covenant or condition under or
in respect of any judgment, order, agreement or instrument to
which it is a party or to which it or any of the property or
assets thereof are or may be subject, and no event has occurred
and is continuing, and no circumstance exists which has not been
waived, which constitutes a default in respect of any commitment,
agreement, document or other instrument to which the Corporation
or any Subsidiary is a party or by which it is otherwise bound
entitling any other party thereto to accelerate the maturity of
any amount owing thereunder or which could have a material
adverse effect upon the condition (financial or otherwise),
capital, property, assets, operations or business of the
Corporation or any Subsidiary;
(aa) Compliance with Employment Laws. Except as disclosed in the
Corporation's pubic disclosure record, the Corporation and each
Subsidiary is to its knowledge in compliance with all laws and
regulations respecting employment and employment practices, terms
and conditions of employment, pay equity and wages, except where
such non-compliance would not constitute an adverse material fact
concerning the Corporation on a consolidated basis or result in
an adverse material change to the Corporation on a consolidated
basis, and has not and is not engaged in any unfair labour
practice, there is no labour strike, dispute, slowdown, stoppage,
complaint or grievance pending or, to the knowledge of the
Corporation, threatened against the Corporation or any
Subsidiary, no union representation question exists respecting
the employees of the Corporation or any Subsidiary and no
collective bargaining agreement is in place or currently being
negotiated by the Corporation or any Subsidiary, neither the
Corporation nor any Subsidiary has received any notice of any
unresolved matter and there are no outstanding orders under any
employment or human rights legislation in any jurisdiction in
which the Corporation or any Subsidiary carries on business or
has employees, and, except as disclosed in the Information, no
employee has any agreement as to the length of notice required to
terminate his or her employment with the Corporation or any
Subsidiary in excess of twelve months or equivalent compensation
and all benefit and pension plans of the Corporation or any
Subsidiary are funded in accordance with applicable laws and no
past service funding liability exist thereunder;
(bb) Employee Plans. To its knowledge, each material plan for
retirement, bonus, stock purchase, profit sharing, stock option,
deferred compensation, severance or termination pay, insurance,
medical, hospital, dental, vision care, drug, sick leave,
disability, salary continuation, legal benefits, unemployment
benefits, vacation, pension, incentive or otherwise contributed
to, or required to be contributed to, by the Corporation or any
Subsidiary for the benefit of any current or former officer,
director, employee or consultant of the Corporation or any
Subsidiary has been maintained in material compliance with the
terms thereof and with the requirements prescribed by any and all
statutes, orders, rules, policies and regulations that are
applicable to any such plan. Schedule "G" contains a list of all
such plans of the Corporation and each Subsidiary;
(cc) Accruals. All material accruals for unpaid vacation pay, premiums
for unemployment insurance, health premiums, federal or
provincial pension plan premiums, accrued wages, salaries and
commissions and payments for any plan for any officer, director,
employee or consultant of the Corporation or any Subsidiary have
been accurately reflected in the books and records of the
Corporation;
(dd) Work Stoppage. There has not been, and there is not currently,
any labour trouble which is adversely effecting or could
adversely effect, in a material manner, the conduct of the
business of the Corporation or any Subsidiary;
(ee) Environmental Compliance. Except as set out in Schedule "H", the
Corporation and the Subsidiaries:
(i) and the property, assets and operations thereof comply, to
their knowledge, in all material respects with all
applicable Environmental Laws (which term means and
includes, without limitation, any and all applicable
international, federal, provincial, state, municipal or
local laws, statutes, regulations, treaties, orders,
judgments, decrees, ordinances, official directives and all
authorizations relating to the environment, occupational
health and safety, or any Environmental Activity (which term
means and includes, without limitation, any past, present or
future activity, event or circumstance in respect of a
Contaminant (which term means and includes, without
limitation, any pollutants, dangerous substances, liquid
wastes, hazardous wastes, hazardous materials, hazardous
substances or contaminants or any other matter including any
of the foregoing, as defined or described as such pursuant
to any Environmental Law), including, without limitation,
the storage, use, holding, collection, purchase,
accumulation, assessment, generation, manufacture,
construction, processing, treatment, stabilization,
disposition, handling or transportation thereof, or the
release, escape, leaching, dispersal or migration thereof
into the natural environment, including the movement through
or in the air, soil, surface water or groundwater));
(ii) do not have any knowledge of, and have not received any
notice of, any material claim, judicial or administrative
proceeding, pending or threatened against, or which may
affect, either the Corporation or any Subsidiary or any of
the property, assets or operations thereof, relating to, or
alleging any violation of any Environmental Laws, the
Corporation is not aware of any facts which could give rise
to any such claim or judicial or administrative proceeding
and neither the Corporation nor any Subsidiary nor any of
the property, assets or operations thereof is the subject of
any investigation, evaluation, audit or review by any
Governmental Authority (which term means and includes,
without limitation, any national, federal government,
province, state, municipality or other political subdivision
of any of the foregoing, any entity exercising executive,
legislative, judicial, regulatory or administrative
functions of or pertaining to government and any corporation
or other entity owned or controlled (through stock or
capital ownership or otherwise) by any of the foregoing) to
determine whether any violation of any Environmental Laws
has occurred or is occurring or whether any remedial action
is needed in connection with a release of any Contaminant
into the environment, except for compliance investigations
conducted in the normal course by any Governmental
Authority;
(iii) have not given or filed any notice under any federal,
state, provincial or local law with respect to any
Environmental Activity, the Corporation and the Subsidiaries
do not have any liability (whether contingent or otherwise)
in connection with any Environmental Activity and the
Corporation is not aware of any notice being given under any
federal, state, provincial or local law or of any liability
(whether contingent or otherwise) with respect to any
Environmental Activity relating to or affecting the
Corporation or any Subsidiary or the property, assets,
business or operations thereof;
(iv) do not store any hazardous or toxic waste or substance on
the property thereof and have not disposed of any hazardous
or toxic waste, in each case in a manner contrary to any
applicable Environmental Laws or permits, and there are no
Contaminants on any of the premises at which the Corporation
or any Subsidiary carries on business, in each case other
than in compliance with applicable Environmental Laws and
permits; and
(v) are not, except as disclosed in the Information, subject to
any material contingent or other material liability relating
to the restoration or rehabilitation of land, water or any
other part of the environment or non-compliance with
Environmental Law;
(ff) No Litigation. Except as disclosed in the Corporation's pubic
disclosure, there are no actions, suits, proceedings, inquiries
or investigations existing, pending or, to the knowledge of the
Corporation, threatened against or which adversely affect the
Corporation or any Subsidiary or to which any of the property or
assets thereof is subject, at law or equity, or before or by any
court, federal, provincial, state, municipal or other
governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which may in any way
materially adversely affect the condition (financial or
otherwise), capital, property, assets, operations or business of
the Corporation or any Subsidiary or the ability of any of them
to perform the obligations thereof and none of the Corporation or
any Subsidiary is subject to any judgment, order, writ,
injunction, decree, award, rule, policy or regulation of any
Governmental Authority, which, either separately or in the
aggregate, may result in a material adverse effect on the
condition (financial or otherwise), capital, property, assets,
operations or business of the Corporation on a consolidated basis
or the ability of the Corporation to perform its obligations
under this Subscription Agreement; and
(gg) Non-Arm's-Length Transactions. Except as disclosed in the
Corporation's pubic disclosure and except with respect to Will
Felderhof's interest in 6179053 Canada Inc., neither the
Corporation nor any Subsidiary owes any amount to, nor has the
Corporation or any Subsidiary any present loans to, or borrowed
any amount from or is otherwise indebted to, any officer,
director, employee or securityholder of any of them or any Person
not dealing at "arm's length" (as such term is defined in the
Income Tax Act (Canada)) with any of them except for usual
employee reimbursements and compensation paid in the ordinary and
normal course of the business of the Corporation or Subsidiary.
Except usual employee or consulting arrangements made in the
ordinary and normal course of business or as disclosed in the
Corporation's pubic disclosure, neither the Corporation nor any
Subsidiary is a party to any contract, agreement or understanding
with any officer, director, employee or securityholder of any of
them or any other Person not dealing at arm's length with the
Corporation and the Subsidiaries. No officer, director or
employee of the Corporation or any Subsidiary and no Person which
is an affiliate or associate of any of the foregoing Persons,
owns, directly or indirectly, any interest (except for shares
representing less than 5% of the outstanding shares of any class
or series of any publicly traded company) in, or is an officer,
director, employee or consultant of, any Person which is, or is
engaged in, a business competitive with the business of the
Corporation or any Subsidiary which could materially adversely
impact on the ability to properly perform the services to be
performed by such Person for the Corporation or any Subsidiary.
No officer, director, employee or securityholder of the
Corporation or any Subsidiary has any cause of action or other
claim whatsoever against, or owes any amount to, the Corporation
or any Subsidiary except for claims in the ordinary and normal
course of the business of the Corporation or any Subsidiary such
as for accrued vacation pay or other amounts or matters which
would not be material to the Corporation.
5. The Corporation hereby covenants and agrees with the
Subscriber as follows:
(a) Reporting Issuer. The Corporation shall maintain its
status as a "reporting issuer" in, and will not be in
default of any requirement of the securities laws of,
the Reporting Provinces for a period of at least 12
months after the Initial Closing Date unless the
Corporation ceases to be a reporting issuer as a result
of a merger with, or take over bid by, another
corporation;
(b) Corporate Status. For a period of at least 12 months
after the Initial Closing Date, the Corporation shall
remain a corporation validly subsisting under the laws
of its jurisdiction of continuance, licensed,
registered or qualified as an extra-provincial or
foreign corporation in all jurisdictions where the
character of its properties owned or leased or the
nature of the activities conducted by it make such
licensing, registration or qualification necessary and
shall carry on its business in the ordinary course and
in compliance in all material respects with all
applicable laws, rules and regulations of each such
jurisdiction unless the Corporation ceases to exist as
a result of a merger with, or take-over bid by, another
corporation;
(c) Listing on Stock Exchanges. The Corporation shall
maintain the listing on the TSX of its common of shares
for a period of at least 12 months after the Initial
Closing Date unless such listing is terminated as a
result of a merger with, or take over bid by, another
corporation;
(d) Securities Filings. Forthwith after each Closing the
Corporation shall file such forms and documents as may
be required under applicable securities laws relating
to the offering of the Shares which, without limiting
the generality of the foregoing, shall include a Form
45-106F1 as prescribed by the Canadian Securities
Administrators;
(e) Performance of Acts. The Corporation shall perform and
carry out all of the acts and things to be completed by
it as provided in this Subscription Agreement; and
(f) Use of Proceeds. The Corporation shall use the proceeds
in respect of the ScoZinc CCAA proceedings, operational
overhead and the advancement of the Corporation's gold
projects and other such activities as agreed in writing
between the Corporation and the Subscriber, in
accordance with a plan and agreed budget between the
Corporation and the Subscriber. All payment requests
are subject to the approval of the Subscriber. The
Corporation agrees to provide the Subscriber with a
weekly payment schedule and bank reconciliation from
the date of this Agreement to the Final Closing Date.
Such information shall be provided by the Subscriber
within two business days of the end of each business
week.
COLLECTION OF PERSONAL INFORMATION
6. The Subscriber (on its own behalf and, if applicable, on
behalf of each beneficial purchaser for whose benefit the
Subscriber is acting):
(a) acknowledges, consents and authorizes the Corporation
to collect the Subscriber's (and any beneficial
purchaser's) personal information for the purpose of
completing the Subscriber's subscription;
(b) acknowledges and consents to the Corporation retaining
the personal information for as long as permitted or
required by applicable law or business practices;
(c) acknowledges, consents and authorizes the Corporation
to deliver to the Ontario Securities Commission
personal information (such as full name, residential
address and telephone number) pertaining to the
Subscriber (and any beneficial purchaser) if the
Subscriber is resident in Ontario or otherwise subject
to the securities legislation of Ontario;
(d) acknowledges and consents to the fact that the
Corporation may be required by applicable securities
laws, or regulatory authorities to provide regulatory
authorities any personal information provided by the
Subscriber respecting itself (and any beneficial
purchaser);
(e) acknowledges that this information is being collected
indirectly by the Ontario Securities Commission (as
applicable), and may be collected by other securities
regulators (as applicable), under the authority granted
to it in applicable securities laws;
(f) if resident in Ontario or otherwise subject to the
securities legislation of Ontario acknowledges that
this information is being collected for the purposes of
the administration and enforcement of the securities
legislation of Ontario;
(g) acknowledges that the public official in Ontario who
can answer questions about the Ontario Securities
Commission's indirect collection of such information is
the Administrative Assistant to the Director of
Corporate Finance, Suite 1903, Box 55, 20 Queen Street
West, Toronto, Ontario M5H 3S8, who may be contacted at
(416) 593-8086; and
(h) represents and warrants that it has the authority to
provide the consents, acknowledgements and
authorizations set out in this paragraph on behalf of
all beneficial purchasers.
Deliveries on Initial Closing
7. (a) The Subscriber agrees to deliver to McInnes Cooper, counsel for the
Corporation, on the Initial Closing Date the following:
(i) this duly completed and executed Subscription Agreement; and
(ii) a certified cheque or bank draft payable to "McInnes Cooper in
Trust" or wire transfer (in accordance with Schedule "A" attached
hereto) for the Subscription Price or payment of the same amount
so payable on the Initial Closing Date in such other manner as is
acceptable to the Corporation.
(b) The Corporation agrees to deliver to the Subscriber on the Initial
Closing Date the following documents in form satisfactory to the
Subscriber:
(i) this Subscription Agreement duly executed by the Corporation;
(ii) a certified copy of the resolutions of the directors of the
Corporation approving this Subscription Agreement and the
transactions contemplated hereby, including the allotment and
issuance of the Shares;
(iii) a share certificate representing the Shares so purchased;
(iv) a favourable legal opinion of counsel of the Corporation, in form
and content acceptable to the Subscriber and its legal counsel,
acting reasonably, relating to the title and right of the ScoZinc
Project, Beaver Dam Property, Forest Hill Property, the Tangier
Project, the Goldenville Project, the Fifteen Mile Stream
Property and the Getty Property.
Deliveries on Subsequent Closings
8. (a) On the closing date of all Subsequent Closings the Subscriber agrees to
deliver to McInnes Cooper, counsel for the Corporation, a certified cheque
or bank draft payable to "McInnes Cooper in Trust" or wire transfer (in
accordance with Schedule "A" attached hereto) for the Subscription Price or
payment of the same amount so payable on the such Subsequent Closing date
in such other manner as is acceptable to the Corporation. On the closing
that is the Final Closing, the Subscriber will deliver to the Corporation
the consent to act as a director of the Corporation for each of the
Subscriber's nominees to the Board of Directors of the Corporation in such
form required under the governing statute of the Corporation.
(b) The Corporation agrees to deliver to the Subscriber on all Subsequent
Closing dates a share certificate representing the Shares so
purchased. On the closing that is the Final Closing, the Corporation will
deliver to the Subscriber the resignations of the board members of the
Corporation that will resign on such date in order to comply with the
provisions of Section 17 hereof.
Facsimile Subscriptions, Counterparts
9. The Corporation shall be entitled to rely on delivery of an executed copy
of this Subscription Agreement sent by facsimile or other electronic means,
and acceptance by the Corporation of such agreement shall be legally
effective to create a valid and binding agreement between the Subscriber
and the Corporation in accordance with the terms hereof. In addition, this
Subscription Agreement may be executed in counterparts, each of which shall
be deemed an original and all of which shall constitute one and the same
document.
Indemnity
10. The Subscriber acknowledges that the representations, warranties and
covenants contained herein including, without limitation, those set forth
in Section 3 are made with the intent that they may be relied upon by the
Corporation and its counsel in determining the Subscriber's eligibility to
purchase the Shares under the relevant securities legislation including,
without limitation, the availability of exemptions from the registration
and prospectus requirements of applicable securities legislation in
connection with the issuance of the Shares to the Subscriber hereunder. The
Subscriber further covenants that by the acceptance of the Shares, he or
she shall be representing and warranting that such representations and
warranties are true as at the Closing Time as if made at that time. The
Subscriber hereby agrees to indemnify the Corporation and its directors,
officers, employees, advisers, affiliates, shareholders and agents
(including its legal counsel) against all losses, claims, costs, expenses
and damages or liabilities which any of them may suffer or incur caused or
arising from reliance thereon. The Subscriber undertakes to immediately
notify the Corporation in writing of any change in any statement or other
information relating to the Subscriber set forth herein which takes place
prior to the Closing Time on a closing date.
Governing Law
11. This Subscription Agreement shall be governed by and construed in
accordance with the laws of the Province of Nova Scotia and the laws of
Canada applicable therein and the Subscriber on its own behalf and, if
applicable, of others whom it is contracting hereunder, and the Corporation
each irrevocably attorns to the exclusive jurisdiction of the courts of the
Province of Nova Scotia with respect to any matters arising out of this
Subscription Agreement.
Time of Essence
12. Time shall be of the essence hereof.
Entire Agreement and Headings
13. This Subscription Agreement represents the entire agreement of the parties
hereto relating to the subject matter hereof and there are no
representations, covenants or other agreements relating to the subject
matter hereof except as stated or referred to herein. The headings
contained are for convenience only and shall not affect the meanings or
interpretation hereof.
Subscriber's Expenses
14. The Subscriber acknowledges and agrees that all costs incurred by the
Subscriber (including any fees and disbursements of any counsel retained by
the Subscriber) relating to the purchase of the Shares by the Subscriber
shall be borne by the Subscriber.
Assignment
15. The terms and provisions of this Subscription Agreement shall be binding
upon and enure to the benefit of the Subscriber and the Corporation and
their respective heirs, executors, administrators, successors and assigns;
provided that this Subscription Agreement shall not be assignable by either
party without the prior written consent of the other.
Acceptance of Subscription
16. The Subscriber acknowledges and agrees that the acceptance of this
Subscription Agreement will be conditional among other things upon the sale
of the Shares to the Subscriber being exempt from any prospectus and
offering memorandum requirements of applicable securities laws. The
Corporation will be deemed to have accepted this Subscription Agreement
upon the delivery at closing of the certificates representing the Shares to
or upon the direction of the Subscriber in accordance with the provisions
hereof.
Board Representation
17. The Corporation agrees that, upon the Final Closing and upon the approval
of the TSX to such appointment, the Corporation shall take all such action
necessary or advisable to facilitate (i) the appointment to the Board of
Directors of the Corporation two nominees of the Subscriber as Directors of
the Corporation, (ii) the appointment of a nominee of the Subscriber to the
position of Executive Chairman of the Board, (iii) the resolution of the
Board of Directors to restructure the Board so as to comprise of six
members, and (iv) the Chairman of the Board having a casting vote. The
Subscriber acknowledges and agrees that the Corporation shall have no
obligation to facilitate the appointment to the Board of Directors of any
person who does not provide a personal information form satisfactory to the
TSX, or who is otherwise not approved by the TSX, or who is otherwise
ineligible to serve as a Director under applicable law. The Corporation may
by mutual agreement with the Subscriber amend the date of the restructure
of the Board of Directors set out in this clause.
Modification
18. Neither this Subscription Agreement nor any provision hereof shall be
modified, changed, discharged or terminated except by an instrument in
writing signed by the party against whom any waiver, change, discharge or
termination is sought.
Miscellaneous
19. All covenants, representations, warranties and agreements contained herein
shall survive the closing of the transactions contemplated hereby.
Currency
20. All references herein to "$" means, unless otherwise specified, Canadian
dollars.
Legal and Tax Advice
21. The Subscriber acknowledges and agrees that it is solely responsible for
obtaining such legal advice and tax advice as it considers appropriate in
connection with the execution, delivery and performance by it of this
Subscription Agreement and the completion of the transaction contemplated
hereby.
* * * * * * * * * *
SCHEDULE "A" TO THE SUBSCRIPTION AGREEMENT
WIRE TRANSFER INSTRUCTIONS
If paying by wire transfer, wire funds as follows:
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Intermediary Bank: Bank of Montreal, 5151 George Street, Halifax,
N.S., B3J 1M5, Canada
- -----------------------------------------------------------------------------------------------------
Swift Code of Bank of Montreal: BOFMCAM2
- -----------------------------------------------------------------------------------------------------
For Credit of: McInnes Cooper, In Trust
- -----------------------------------------------------------------------------------------------------
Bank No.: 001
- -----------------------------------------------------------------------------------------------------
Transit No.: 00093
- -----------------------------------------------------------------------------------------------------
Canadian Dollar Account Name: McInnes Cooper - Trust Account
- -----------------------------------------------------------------------------------------------------
Canadian Dollar Account No.: 1008-576
- -----------------------------------------------------------------------------------------------------
Reference: Acadian Mining Corporation Private Placement
- -----------------------------------------------------------------------------------------------------
SCHEDULE "B" TO THE SUBSCRIPTION AGREEMENT
CERTIFICATE OF ACCREDITED INVESTOR
TO: ACADIAN MINING CORPORATION (the "Corporation")
RE: SUBSCRIPTION FOR SECURITIES OF THE CORPORATION
The undersigned Subscriber/duly authorized representative of the Subscriber (or
in the case of a trust, the trustee or an officer of the trustee of the trust)
hereby certifies that:
1. he/she has read the Subscription Agreement to which this Schedule "B"
is attached and understands that the offering of the Securities is
being made on a prospectus exempt basis; and
2. the Subscriber and, if applicable, the disclosed principal on whose
behalf the Subscriber is purchasing the Securities, is an "accredited
investor" as defined in National Instrument 45-106, by virtue of being:
[please check one]
a. _____ a Canadian financial institution, or a Schedule III bank,
b. _____ the Business Development Bank of Canada incorporated under the
Business Development Bank of Canada Act (Canada),
c. _____ a subsidiary of any person referred to in paragraphs (a) or (b), if
the person owns all of the voting securities of the subsidiary, except the
voting securities required by law to be owned by directors of that
subsidiary,
d. _____ a person registered under the securities legislation of a
jurisdiction of Canada as an adviser or dealer, other than a person
registered solely as a limited market dealer under one or both of the
Securities Act (Ontario) or the Securities Act (Newfoundland and Labrador),
e. _____ an individual registered or formerly registered under the securities
legislation of a jurisdiction of Canada as a representative of a person
referred to in paragraph (d),
f. _____ the Government of Canada or a jurisdiction of Canada, or any crown
corporation, agency or wholly owned entity of the Government of Canada or a
jurisdiction of Canada,
g. _____ a municipality, public board or commission in Canada and a
metropolitan community, school board, the Comite de gestion de la taxe
scolaire de l'ile de Montreal or an intermunicipal management board in
Quebec,
h. _____ any national, federal, state, provincial, territorial or municipal
government of or in any foreign jurisdiction, or any agency of that
government,
i. _____ a pension fund that is regulated by either the Office of the
Superintendent of Financial Institutions (Canada) or a pension commission
or similar regulatory authority of a jurisdiction of Canada,
j. _____ an individual who, either alone or with a spouse, beneficially owns,
directly or indirectly, financial assets(1) having an aggregate realizable
value that before taxes, but net of any related liabilities(2), exceeds
Cdn$1,000,000,
k. _____ an individual whose net income before taxes exceeded Cdn$200,000 in
each of the two most recent calendar years or whose net income before taxes
combined with that of a spouse exceeded Cdn$300,000 in each of the two most
recent calendar years and who, in either case, reasonably expects to exceed
that net income level in the current calendar year,
l. _____ an individual who, either alone or with a spouse, has net assets of
at least Cdn$5,000,000,
m. _____ a person (including a corporate entity), other than an individual or
investment fund, that has net assets of at least Cdn$5,000,000 as shown on
its most recently prepared financial statements,
n. _____ an investment fund that distributes or has distributed its securities
only to:
(i) a person that is or was an accredited investor at the
time of the distribution,
(ii) a person that acquires or acquired securities in the
circumstances referred to in sections 2.10 [Minimum
amount investment], and 2.19 [Additional investment
in investment funds] of National Instrument 45-106,
or
(iii) a person described in paragraph (i) or (ii) that
acquires or acquired securities under section 2.18
[Investment fund reinvestment] of National Instrument
45-106,
o. _____ an investment fund that distributes or has distributed securities
under a prospectus in a jurisdiction of Canada for which the regulator or,
in Quebec, the securities regulatory authority, has issued a receipt,
p. _____ a trust company or trust corporation registered or authorized to
carry on business under the Trust and Loan Companies Act (Canada) or under
comparable legislation in a jurisdiction of Canada or a foreign
jurisdiction, acting on behalf of a fully managed account managed by the
trust company or trust corporation, as the case may be,
q. _____ a person (including a corporate entity) acting on behalf of a fully
managed account managed by that person, if that person is registered or
authorized to carry on business as an adviser or the equivalent under the
securities legislation of a jurisdiction of Canada or a foreign
jurisdiction and in Ontario, is purchasing a security that is not a
security of an investment fund,
r. _____ a registered charity under the Income Tax Act (Canada) that, in
regard to the trade, has obtained advice from an eligibility adviser or an
adviser registered under the securities legislation of the jurisdiction of
the registered charity to give advice on the securities being traded,
s. _____ an entity organized in a foreign jurisdiction that is analogous to
any of the entities referred to in paragraphs (a) to (d) or paragraph (i)
in form and function, or
t. _____ a person (including a corporate entity) in respect of which all of
the owners of interests, direct, indirect or beneficial, except the voting
securities required by law to be owned by directors, are persons that are
accredited investors,
u. _____ an investment fund that is advised by a person registered as an
adviser or a person that is exempt from registration as an adviser, or
v. _____ a person (including a corporate entity) that is recognized or
designated by the securities regulatory authority or, except in Ontario and
Quebec, the regulator as:
(i) an accredited investor, or
(ii) an exempt purchaser in Alberta or British Columbia
after National Instrument 45-106 came into force.
(1) For the purposes of National Instrument 45-106 and this Certificate the
term "financial assets" means (a) cash; (b) securities or (c) a contract of
insurance, a deposit or an evidence of a deposit that is not a security for
the purposes of securities legislation.
(2) For the purposes of National Instrument 45-106 and this Certificate the
term "related liabilities" means (a) liabilities incurred or assumed for
the purpose of financing the acquisition or ownership of financial assets,
or (b) liabilities that are secured by financial assets.
The statements made in this Schedule are true and will be true on the Closing
Date.
DATED ___________________________, 2009.
- ----------------------------------------
Signature of Subscriber
- ----------------------------------------
Name of Subscriber
- ----------------------------------------
- ----------------------------------------
Address Of The Subscriber
SCHEDULE "C" TO THE SUBSCRIPTION AGREEMENT
CERTIFICATION OF U.S. PURCHASER
TO: ACADIAN MINING CORPORATION (the "Corporation")
RE: SUBSCRIPTION FOR SECURITIES OF THE CORPORATION
Capitalized terms not specifically defined in this certification have the
meaning ascribed to them in the Subscription Agreement to which this Schedule
"C" is attached. In the event of a conflict between the terms of this
certification and such Subscription Agreement, the terms of this certification
shall prevail.
In addition to the covenants, representations and warranties contained in the
Subscription Agreement to which this Schedule "C" is attached, the undersigned
Subscriber covenants, represents and warrants to the Corporation that:
(a) It is (i) a U.S. Person or a person in the United States and (ii)
authorized to consummate the purchase of the Shares.
(b) It has such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment in the
Shares and it is able to bear the economic risk of loss of its entire
investment.
(c) The Corporation has provided to it the opportunity to ask questions and
receive answers concerning the terms and conditions of the Offering and it
has had access to such information concerning the Corporation as it has
considered necessary or appropriate in connection with its investment
decision to acquire the Shares, including access to the Corporation's
public filings available on the Internet at www.sedar.com, and that any
answers to questions and any request for information have been complied
with to the Subscriber's satisfaction.
(d) It is acquiring the Shares for its own account, for investment purposes
only and not with a view to any resale, distribution or other disposition
of the Shares in violation of the United States securities laws.
(e) The address of the Subscriber set out on the front page of the Subscription
Agreement is the true and correct principal address of the Subscriber and
can be relied on by the Corporation for the purposes of state blue-sky laws
and the Subscriber has not been formed for the specific purpose of
purchasing the Shares.
(f) It understands (i) the Shares have not been and will not be registered
under the United States Securities Act of 1933, as amended (the "U.S.
Securities Act") or the securities laws of any state of the United States
and will be "restricted securities", as defined in Rule 144 under the U.S.
Securities Act; (ii) the sale contemplated hereby is being made in reliance
on an exemption from such registration requirements; (iii) subject to
certain exceptions provided under the U.S. Securities Act, the Shares may
not be offered, sold or otherwise transferred in the United States or to,
by or on behalf of a U.S. Person unless such Shares are registered under
the U.S. Securities Act and applicable state securities laws, or unless an
exemption from such registration requirements is available; and (iv) as a
consequence, the Subscriber may be required to bear the economic risks of
the investment in the Shares for an indefinite period of time.
(g) The Subscriber is an "accredited investor" as defined in Rule 501(a) of
Regulation D of the U.S. Securities Act by virtue of meeting one of the
following criteria (please hand-write your initials on the appropriate
lines):
1. A bank, as defined in Section 3(a)(2) of the U.S. Securities Act, whether acting
Initials _______ in its individual or fiduciary capacity; or
2. A savings and loan association or other institution as defined in Section
Initials _______ 3(a)(5)(A) of the U.S. Securities Act, whether acting in its individual or
fiduciary capacity; or
3. A broker or dealer registered pursuant to Section 15 of the United States
Initials _______ Securities Exchange Act of 1934; or
4. An insurance company as defined in Section 2(a)(13) of the U.S. Securities Act; or
Initials _______
5. An investment company registered under the United States Investment Company Act
Initials _______ of 1940; or
6. A business development company as defined in Section 2(a)(48) of the United
Initials _______ States Investment Company Act of 1940; or
7. A small business investment company licensed by the U.S. Small Business
Initials _______ Administration under Section 301 (c) or (d) of the United States Small Business
Investment Act of 1958; or
8. A plan established and maintained by a state, its political subdivisions or any
Initials _______ agency or instrumentality of a state or its political subdivisions, for the
benefit of its employees, with total assets in excess of US$5,000,000; or
9. An employee benefit plan within the meaning of the United States Employee
Initials _______ Retirement Income Security Act of 1974 in which the investment decision is made
by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank,
savings and loan association, insurance company or registered investment adviser, or
an employee benefit plan with total assets in excess of US$5,000,000 or, if a
self-directed plan, with investment decisions made solely by persons who are
Accredited Investors; or
10. A private business development company as defined in Section 202(a)(22) of the
Initials _______ United States Investment Advisers Act of 1940; or
11. An organization described in Section 501(c)(3) of the United States Internal
Initials _______ Revenue Code, a corporation, a Massachusetts or similar business trust, or a
partnership, not formed for the specific purpose of acquiring the Shares offered,
with total assets in excess of US$5,000,000; or
12. Any director or executive officer of the Corporation; or
Initials _______
13. A natural person whose individual net worth, or joint net worth with that
Initials _______ person's spouse, at the date hereof exceeds US$1,000,000; or
14. A natural person who had an individual income in excess of US$200,000 in each of
Initials _______ the two most recent years or joint income with that person's spouse in excess of
US$300,000 in each of those years and has a reasonable expectation of reaching the
same income level in the current year; or
15. A trust, with total assets in excess of US$5,000,000, not formed for the purpose of
specific Initials _______ acquiring the Shares offered, whose purchase is directed by a sophisticated person
as described in Rule 506(b)(2)(ii) under the U.S. Securities Act; or
16. Any entity in which all of the equity owners meet the requirements of at least
Initials _______ one of the above categories.
(h) The Subscriber has not purchased the Shares as a result of any form of
general solicitation or general advertising (as those terms are used in
Regulation D under the U.S. Securities Act), including advertisements,
articles, notices or other communications published in any newspaper,
magazine or similar media or broadcast over radio or television, or other
form of telecommunications, including electronic display, or any seminar or
meeting whose attendees have been invited by general solicitation or
general advertising.
(i) If the Subscriber decides to offer, sell or otherwise transfer any of the
Shares it will not offer, sell or otherwise transfer any of such Shares
directly or indirectly, unless:
(i) the sale is to the Corporation;
(ii) the sale is made outside the United States in a transaction meeting
the requirements of Rule 904 of Regulation S under the U.S. Securities
Act and in compliance with applicable local laws and regulations;
(iii) the sale is made pursuant to the exemption from the registration
requirements under the U.S. Securities Act provided by Rule 144
thereunder, if available, and in accordance with any applicable state
securities or "blue sky" laws; or
(iv) the securities are sold in a transaction that does not require
registration under the U.S. Securities Act or any applicable state
laws and regulations governing the offer and sale of securities,
and, in the case of each of (iii) and (iv) it has prior to such sale
furnished to the Corporation an opinion of counsel reasonably
satisfactory to the Corporation stating that such transaction is exempt
from registration under applicable securities laws and that the legends
referred to in paragraph (1) below may be removed.
(j) It understands and agrees that the Shares may not be acquired in the United
States by or on behalf of a U.S. Person or a person in the United States
unless registered under the U.S. Securities Act and any applicable state
securities laws or unless an exemption from such registration requirements
is available.
(k) It acknowledges that it has not purchased the Shares as a result of, and
will not itself engage in, any "directed selling efforts" (as defined in
Regulation S under the U.S. Securities Act) in the United States in respect
of the Shares which would include any activities undertaken for the purpose
of, or that could reasonably be expected to have the effect of,
conditioning the market in the United States for the resale of the Shares.
(l) The certificates representing the Shares, as well as all certificates
issued in exchange for or in substitution of the foregoing, until such time
as is no longer required under the applicable requirements of the U.S.
Securities Act or applicable state securities laws, will bear, on the face
of such certificate, the following legends:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED
(THE "U.S. SECURITIES ACT") OR THE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING
SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT
SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED
ONLY (A) TO THE COMPANY; (B) OUTSIDE THE UNITED STATES IN
ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S.
SECURITIES ACT; (C) IN ACCORDANCE WITH THE EXEMPTION FROM
REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY RULE
144 THEREUNDER, IF AVAILABLE, AND IN COMPLIANCE WITH ANY
APPLICABLE STATE SECURITIES LAWS; OR (D) IN A TRANSACTION THAT
DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT
AND ANY APPLICABLE STATE SECURITIES LAWS, AND, IN THE CASE OF
PARAGRAPH (C) OR (D), THE SELLER FURNISHES TO THE COMPANY AN
OPINION OF COUNSEL OF RECOGNIZED STANDING IN FORM AND
SUBSTANCE SATISFACTORY TO THE COMPANY TO SUCH EFFECT."
"THE PRESENCE OF THIS LEGEND MAY IMPAIR THE ABILITY OF THE
HOLDER HEREOF TO EFFECT "GOOD DELIVERY" OF THE SECURITIES
REPRESENTED HEREBY ON A CANADIAN STOCK EXCHANGE. A CERTIFICATE
WITHOUT A LEGEND MAY BE OBTAINED FROM THE REGISTRAR AND
TRANSFER AGENT OF THE CORPORATION IN CONNECTION WITH A SALE OF
THE SECURITIES REPRESENTED HEREBY AT A TIME WHEN THE
CORPORATION IS A "FOREIGN ISSUER" AS DEFINED IN REGULATION S
UNDER THE U.S. SECURITIES ACT, UPON DELIVERY OF THIS
CERTIFICATE, AN EXECUTED DECLARATION AND, IF REQUESTED BY THE
CORPORATION OR THE TRANSFER AGENT, AN OPINION OF COUNSEL OF
RECOGNIZED STANDING, EACH IN FORM SATISFACTORY TO THE TRANSFER
AGENT OF THE CORPORATION AND THE CORPORATION, TO THE EFFECT
THAT SUCH SALE OF THE SECURITIES REPRESENTED HEREBY IS BEING
MADE IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE
U.S. SECURITIES ACT.";
provided, that if the Shares are being sold outside the United States
in compliance with the requirements of Rule 904 of Regulation S at a
time when:
(i) the Corporation is a "foreign issuer" as defined in Regulation
S at the time of sale, and
(ii) the seller of the Shares is not an "affiliate" of the
Corporation, as that term is defined in Rule 405 under the
U.S. Securities Act (other than an officer or director who is
an affiliate of the Corporation solely by virtue of holding
such position),
the legends set forth above may be removed by providing an executed
declaration to the registrar and transfer agent of the Corporation, in
substantially the form set forth as Appendix A attached hereto (or in
such other forms as the Corporation may prescribe from time to time)
and, if requested by the Corporation or the transfer agent, an opinion
of counsel of recognized standing in form and substance satisfactory to
the Corporation and the transfer agent to the effect that such sale is
being made in compliance with Rule 904 of Regulation S; and provided,
further, that, if any Shares are being sold otherwise than in
accordance with Regulation S and other than to the Corporation, the
legends may be removed by delivery to the registrar and transfer agent
and the Corporation of an opinion of counsel, of recognized standing
reasonably satisfactory to the Corporation, that such legends are no
longer required under applicable requirements of the U.S. Securities
Act or state securities laws.
(m) It understands and acknowledges that the Corporation is not obligated to
remain a "foreign issuer".
(n) It understands and acknowledges that, for the purposes of the U.S.
Securities Act, any person will be presumed to be an "affiliate" of the
Corporation if such person beneficially owns or directly or indirectly
controls more than 10% of the Corporation's outstanding voting securities.
(o) It understands and agrees that there may be material tax consequences to
the Subscriber of an acquisition or disposition of the Shares. The
Corporation gives no opinion and makes no representation with respect to
the tax consequences to the Subscriber under United States, state, local or
foreign tax law of the undersigned's acquisition or disposition of such
Shares.
(p) It understands and agrees that the financial statements of the Corporation
have been prepared in accordance with Canadian generally accepted
accounting principles and therefore may be materially different from
financial statements prepared under U.S. generally accepted accounting
principles and therefore may not be comparable to financial statements of
United States companies.
(q) It consents to the Corporation making a notation on its records or giving
instructions to any transfer agent of the Corporation in order to implement
the restrictions on transfer set forth and described in this certification
and the Subscription Agreement.
ONLY U.S. PURCHASERS NEED COMPLETE AND SIGN
Dated _______________ 2009.
X_______________________________________________________
Signature of individual (if Subscriber is an individual)
X_______________________________________________________
Authorized signatory (if Subscriber is not an
individual)
________________________________________________________
Name of Subscriber (please print)
________________________________________________________
Name of authorized signatory (please print)
________________________________________________________
Official capacity of authorized signatory (please print)
Appendix "A" to
CERTIFICATE OF U.S. PERSON
Form of Declaration for Removal of Legend
TO: Acadian Mining Corporation (the "Corporation")
AND TO: Registrar and transfer agent for the Common Shares of the Corporation
The undersigned (A) acknowledges that the sale of the securities of the
Corporation to which this declaration relates is being made in reliance on Rule
904 of Regulation S under the United States Securities Act of 1933, as amended
(the "U.S. Securities Act"), and (B) certifies that (1) the undersigned is not
(a) an "affiliate" of the Corporation (as that term is defined in Rule 405 under
the U.S. Securities Act), except any officer or director who is an affiliate of
the Corporation solely by virtue of holding such position (b) a "distributor" as
defined in Regulation S or (c) an affiliate of a distributor; (2) the offer of
such securities was not made to a person in the United States and either (a) at
the time the buy order was originated, the buyer was outside the United States,
or the seller and any person acting on its behalf reasonably believed that the
buyer was outside the United States, or (b) the transaction was executed on or
through the facilities of the Toronto Stock Exchange (or another designated
offshore securities market) and neither the seller nor any person acting on its
behalf knows that the transaction has been prearranged with a buyer in the
United States; (3) neither the seller nor any affiliate of the seller nor any
person acting on their behalf has engaged or will engage in any directed selling
efforts in the United States in connection with the offer and sale of such
securities; (4) the sale is bona fide and not for the purpose of "washing off"
the resale restrictions imposed because the securities are "restricted
securities" (as that term is defined in Rule 144(a)(3) under the U. S.
Securities Act); (5) the seller does not intend to replace such securities with
fungible unrestricted securities; and (6) the contemplated sale is not a
transaction, or part of a series of transactions, which, although in technical
compliance with Regulation S, is part of a plan or scheme to evade the
registration provisions of the U. S. Securities Act. Terms used herein have the
meanings given to them by Regulation S under the U.S. Securities Act.
Dated _______________ 200_.
X______________________________________________________
Signature of individual (if Purchaser is an individual)
X______________________________________________________
Authorized signatory (if Purchaser is not an individual)
_______________________________________________________
Name of Purchaser (please print)
_______________________________________________________
Name of authorized signatory (please print)
_______________________________________________________
Official capacity of authorized signatory (please print)
Affirmation by Seller's Broker-Dealer
We have read the foregoing representations of our customer,
_________________________ (the "Seller") dated _______________________, with
regard to the sale, for such Seller's account, of the _________________
represented by certificate number ______________ of the Corporation described
therein, and we hereby affirm that, to the best of our knowledge and belief, the
facts set forth therein are full, true and correct.
________________________________________
Name of Firm
By:
________________________________________
Authorized Officer
Dated: _____________________________ 200_.
SCHEDULE "D" TO THE SUBSCRIPTION AGREEMENT
OUTSTANDING OPTIONS, WARRANTS, CONVERTIBLE SECURITIES
AND OTHER RIGHTS TO ACQUIRE
COMMON SHARES OF THE CORPORATION
- --------------------------------------------------------------------------------------------------------
1. Outstanding Incentive Stock Options 6,405,000
- --------------------------------------------------------------------------------------------------------
2. Outstanding Warrants
- Issued to Desjardin Securities Inc. exercisable at $0.30 until August 180,000
20, 2009
- Issued to Desjardin Securities Inc. exercisable at $0.30 until 40,000
September 2, 2009
- --------------------------------------------------------------------------------------------------------
3. Options held by Dale Dunlop in connection with Smithfield claims 100,000
(exercisable at $0.824 until December 11, 2009)
- --------------------------------------------------------------------------------------------------------
4. Issuable to Dale Dunlop within 5 business days of acquiring the required 25,000
surface rights to develop the Smithfield property
- --------------------------------------------------------------------------------------------------------
SCHEDULE "E" TO THE SUBSCRIPTION AGREEMENT
TAXES AND TAX RETURNS
Acadian Mining Corporation: outstanding filing 2008 Corporate income tax return;
drafted, due to be filed June 30, 2009; estimated capital tax $25,000 provided
for in the 2008 financials; employee withholdings and HST are filed and paid to
date.
ScoZinc Limited: outstanding filing 2008 Corporate income tax return; drafted,
due to be filed June 30, 2009; no balance owing; employee withholdings are in
arrears for payment in the amount of $299,157.54 for months of March and April,
current returns and payments are up to date, amounts due are disclosed to Golden
River management and a plan of repayment has been put to Canada Revenue Agency,
HST returns are filed to date and settled. Province of Nova Scotia royalty
reports are due before end of June, they are not finalized as the Mine Assessor
is on vacation, the payment of the estimated royalty owing of $805,000 has been
deferred by the Province until the mine at Gays River goes back into production.
6927692 Canada Corp: outstanding filing 2008 Corporate income tax return; due to
be filed June 30; Company has no transactions; HST returns filed as required.
Annapolis Properties Corp: outstanding filing 2008 Corporate income tax return;
due to be filed June 30; Company has no transactions; HST returns filed as
required.
Goldenville Mining Corporation: no assets or activities; this Company was
probably struck off the Canada Revenue Agency lists four years ago.
6179053 Canada Inc: outstanding filing 2008 Corporate income tax return; due to
be filed June 30; Company has no transactions; HST returns filed as required.
SCHEDULE "F" TO THE SUBSCRIPTION AGREEMENT
MINERAL CLAIMS, LICENSES, LEASES AND SURFACE RIGHTS
ScoZinc Zinc-Lead Mine
Getty Zinc-Lead Property
Beaver Dam Gold Property
Forest Hill Gold Property
Tangier Gold Property
Goldenville Gold Property
Fifteen Mile Stream Gold Property
Lake Catch Gold Property
Oldham Gold Property
Smithfield Zinc-Lead Property
Lake Ainslie Barite Property
Real Property Interests
SCOZINC LIMITED
Claims Comprising Mineral Lease 90-1
Right Holder: ScoZinc Limited
- ---------------------------------------------------------------------------------------------------
NTS
Sheet Tract Claims No. of Claims
- ---------------------------------------------------------------------------------------------------
11E3B 5 NOP 3
19 JKPQ 4
20 BCDE FGK LMNO PQ 13
28 DEKL MNOP 8
29 ABCD FGH JKQ 10
- ---------------------------------------------------------------------------------------------------
Exploration Licences on the ScoZinc Project
Right Holder: ScoZinc Limited
- -------------------------------------------------------------------------------------------------
Licence NTS No. of
No. Sheet Tract Claims Claims Renewal Date
- -------------------------------------------------------------------------------------------------
06268 11E3B 19 ABCD EFGH LMN 28 May 2, 2010
11E3B 18 ABC EFGH
11E3B 7 DE JKLM NOPQ
- -------------------------------------------------------------------------------------------------
06304 11E3B 29 E 1 October 13,
2009
- -------------------------------------------------------------------------------------------------
06303 11E3B 29 LMNOP 5 October 25,
2009
- -------------------------------------------------------------------------------------------------
05851 11E3B 45 FGH JKL O 15 November 5,
11E3B 46 EFG 2009
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
GETTY ZINC-LEAD PROPERTY
Exploration Licences at Getty
Right Holder: Acadian Mining Corporation
- ------------------------------------------------------------------------------------------------------
Licence NTS Tract Claims No. of Renewal
No. Sheet claims Date
- ------------------------------------------------------------------------------------------------------
11 E 3 B 17 Q
6959 11 E 3 B 30 ABCDEFGHJKLMNOPQ 80 October 20,
11 E 3 B 31 ABCDEFGHJKLMNOPQ 2009
11 E 3 B 32 ABGHJKPQ
11 E 3 B 42 ABCGHJK
11 E 3 B 43 ABCDEFGHJKLMNOPQ
11 E 3 B 44 ABCDEFGHJKLMNOPQ
- ------------------------------------------------------------------------------------------------------
BEAVER DAM GOLD PROPERTY
Exploration Licences at Beaver Dam
Right Holder: Acadian Mining Corporation
- ------------------------------------------------------------------------------------------------
Licence NTS Tract Claims No. of Renewal Date
No. Sheet Claims
- ------------------------------------------------------------------------------------------------
05920 11 E 2 A 59 JKLM NOPQ 8 March 22, 2010
11 E 2 A 60 EFGHJKLMNOPQ 12
11 E 2 A 61 ABCDEFGH 8
11 E 2 A 62 ABCDEFGH 8
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
FOREST HILL GOLD PROPERTY
Exploration Licences at Forest Hill
- ---------------------------------------------------------------------------------------------------------
Licence NTS Tract Claims No. of Renewal Date
No. Sheet Claims
- ---------------------------------------------------------------------------------------------------------
06029(1) 11 F 5 B 47 LMNO 4 March 7, 2010
- ---------------------------------------------------------------------------------------------------------
SL 1/99(2) 11 F 5 B 49 BG 2 March 31, 2010
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
05985(1) 11 F 5 A 37 JKLM NOPQ 80 September 20, 2009
11 F 5 A 60 All Claims
11 F 5 B 47 JKPQ
11 F 5 B 48 JKLM NOPQ
11 F 5 B 49 ACDE FHJK LMNO
11 F 5 B 50 PQ
11 F 5 A 38 All Claims
11 F 5 A 59 MN
DEFG JKLM NOPQ
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------
Notes:
- -----
(1) Right holder of Licence 06029 is Acadian Mining Corporation
(2) Right holder of SL 1/99 and Licence 05985 is Annapolis Properties Corp.
TANGIER GOLD PROPERTY
Exploration Licences at Tangier
- ------------------------------------------------------------------------------------------------------
Licence NTS Sheet Tract Claims No. of Renewal Date
No. Claims
- ------------------------------------------------------------------------------------------------------
06018(1) 11 D 15 A 64 ABCD EFGH 8 January 21, 2010
- ------------------------------------------------------------------------------------------------------
06019(1) 11 D 15 A 65 JKPQ 4 January 21, 2010
- ------------------------------------------------------------------------------------------------------
06020(2) 11 D 15 A 66 BC 6 January 21, 2010
55 LMNO
- ------------------------------------------------------------------------------------------------------
06021(1) 11 D 15 A 56 ABCD EFGH 8 January 21, 2010
- ------------------------------------------------------------------------------------------------------
06140(1) 11 D 15 A 39 OPQ 77 June 19, 2009
40 OPQ
56 JKLM NOPQ
57 ABCD EFGH JKLM
58 NOPQ
59 ABCD EFGH JKLM
65 NOPQ
66 ABGH JK
79 ABCD EFGH
D EFGH JKLM
NOPQ
ABCD
- ------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------
06261(1) 11 D 15 A 65 LMNO 4 September 14,
2009
- ------------------------------------------------------------------------------------------------------
08216(2) 11 D 15 A 40 J 3 April 21, 2010
41 MN
- ------------------------------------------------------------------------------------------------------
08217(2) 11 D 15 A 55 E 1 April 21, 2010
- ------------------------------------------------------------------------------------------------------
08218(2) 11 D 15 A 64 JKL 3 April 21, 2010
- ------------------------------------------------------------------------------------------------------
08331(1) 11 D 15 A 35 PQ 36 September 8,
37 ABCGHJ 2009
38 ABCDEFGHJKLMO
39 PQ
40 JKLMN
59 EFGKLMN
C
- -------------------------------------------------------------------------------------------------------
Notes:
- ------
(1) Right holder of Licences 06018, 06019, 06021, 06140, 06261 and 08331 is
Acadian Mining Corporation.
(2) Right holder of Licences 06020, 08216, 08217 and 08218 is Annapolis
Properties Corp.
GOLDENVILLE GOLD PROPERTY
Exploration Licences at Goldenville
- ---------------------------------------------------------------------------------------------------
Licence NTS Tract Claims No. of Renewal Date
No. Sheet Claims
- ---------------------------------------------------------------------------------------------------
05817(1) 11 F 04 B 108 LMNO 40 December 9, 2009
11 F 04 C 12 CDEF
11 E 01 A 97 JKLM NOPQ
11 E 01 A 98 JKLM NOPQ
11 E 01 D 1 ABCD EFGH
11 E 01 D 2 ABCD EFGH
- -------------------------------------------------------------------------------------------------
08324(2) 11 E 01 A 97 EFGH 76 April 9, 2010
11 E 01 A 98 EFGH
11 E 01 A 99 JKLMNOPQ
11 E 01 A 100 JKLMNOPQ
11 E 01 A 101 JKPQ
11 E 01 D 1 JKLM
11 E 01 D 2 JKLM
11 E 01 D 3 ABCDEFGHJKLM
11 E 01 D 4 ABCDEFGHJKLM
11 E 01 D 5 ABGHJK
11 F 04 B 108 EFGKP
11 F 04 C 12 BGKLM
- -------------------------------------------------------------------------------------------------
Notes:
- ------
(1) Right holder of Licence 05817 is Annapolis Properties Corp.
(2) Right holder of Licence 08324 is Acadian Mining Corporation.
FIFTEEN MILE STREAM GOLD PROPERTY
Exploration Licences at Fifteen Mile Stream
- -------------------------------------------------------------------------------------------------------------------
License No. NTS Sheet Tract Claims No. of Claims Renewal Date
- -------------------------------------------------------------------------------------------------------------------
06134*(1) 11 E 02 D 1 JKLMNOPQ 29 May 20, 2010
11 E 02 C 23 J
11 E 02 C 24 ABCDEFGHJKLM
11 E 02 C 12 LMNO
11 E 02 C 13 CDEF
- -------------------------------------------------------------------------------------------------------------------
06135*(1) 11 E 02 D 2 PQ 2 July 25, 2009
- -------------------------------------------------------------------------------------------------------------------
SL11/90*(1) 11 E 02 D 23 ABCDEFGH 8 December 11, 2009
- -------------------------------------------------------------------------------------------------------------------
05929 11 E 01 C 13 OP 2 April 8, 2010
- -------------------------------------------------------------------------------------------------------------------
08365(2) 11 E 02 D 24 O 1 August 18, 2009
- -------------------------------------------------------------------------------------------------------------------
08371(2) 11 E 02 D 2 GH 2 August 21, 2009
- -------------------------------------------------------------------------------------------------------------------
08443 11 E 02 D 23 KLOPQ 6 June 20, 2010
11 E 02 D 24 N
- -------------------------------------------------------------------------------------------------------------------
08444 11 E 02 D 1 DE 71 October 1, 2009
11 E 02 D 2 ABCDEFM
11 E 02 D 3 ABCDEFGHJKLMN
11 E 02 D 4 OP
11 E 02 D 5 ABCDEFGHJKLMN
11 E 02 D 21 OPQ
11 E 02 D 22 AB
11 E 02 A 100 ABCDEFGHJKLMQ
11 E 02 A 101 ABEFKLMNOPNOP
NO
JKPQ
- -------------------------------------------------------------------------------------------------------------------
08445 11 E 01 C 13 ABGHJKLMNQ 45 April 18, 2010
11 E 02 C 14 EFGHJKLMNOPQ
11 E 02 C 15 N
11 E 02 C 35 ABCDEFGH
11 E 02 C 36 ABCDEFGH
11 E 02 D 24 PQ
11 E 02 D 25 ABGH
- -------------------------------------------------------------------------------------------------------------------
05930 11 E 01 C 14 CD 2 April 8, 2010
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Notes:
- ------
(1) * Licences held by 6179053 Canada Inc., in which Acadian Mining Corporation
holds a 50% interest.
(2) Licences held by Annapolis Properties Corp. All other licences are held by
Acadian Mining Corporation.
LAKE CATCHA GOLD PROPERTY
Exploration Licences at Lake Catcha
- -------------------------------------------------------------------------------------------------------------
Licence NTS Sheet Tract Claims No. of Renewal Date
No. claims
- -------------------------------------------------------------------------------------------------------------
05849(1) 11 D 11 D 87 AEFGHJKQ 11 February 23, 2010
11 D 11 D 88 N
11 D 11 D 105 DE
- -------------------------------------------------------------------------------------------------------------
05894(1) 11 D 11 D 86 JQ 14 February 16, 2010
11 D 11 D 87 LMNOP
11 D 11 D 106 ABCDEGH
- -------------------------------------------------------------------------------------------------------------
06392(2) 11 D 11 D 105 CFLM 20 November 04, 2009
106 FJKLM
107 ABHJ
86 ABGHKP
87 D
- -------------------------------------------------------------------------------------------------------------
Notes:
- ------
(1) Right holder of Licences 05849 and 05894 is Acadian Mining Corporation.
(2) Right holder of Licence 06392 is Annapolis Properties Corp.
OLDHAM GOLD PROPERTY
Exploration Licences at Oldham
Licence NTS Sheet Tract Claims No.of Claims Renewal Date
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06016(1) 11 D 14 C 37 BGK 3 January 9, 2010
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06183(1) 11 D 14 C 35 N 6 March 20, 2010
11 D 14 C 36 OPQ
11 D 14 C 38 DE
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06185(1) 11 D 14 C 37 CD 2 May 6, 2010
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06187(1) 11 D 14 C 37 EF 2 May 2, 2010
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06136 11 D 14 C 37 J 1 July 3, 2009
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06177 11 D 14 C 37 AH 2 July 9, 2009
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06572 11 D 13 D 25 JKLOPQ 10 September 2, 2009
11 D 13 D 48 AB
11 D 14 C 36 MN
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06292 11 D 14 C 38 MN 7 September 21, 2009
11 D 14 C 37 LMOPQ
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06462 11 D 13 D 25 EFGMN 6 December 20, 2009
11 D 13 D 26 H
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06462A 11 D 13 D 48 C 1 December 20, 2009
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
06462B 11 D 13 D 48 GH 2 December 20, 2009
- ------------------- ----------------------- ---------- -------------------- ------------------ ------------------------------
Notes:
(1) Right holder of Licences 06016, 06183, 06185 and 06187 is Acadian Mining
Corporation. All other Licences listed above are held by Annapolis
Properties Corp.
SMITHFIELD ZINC-LEAD PROPERTY
Exploration Licences at Smithfield
Right Holder: Acadian Mining Corporation
- ------------------- ---------------- ---------------- ----------------------------- ------------ ---------------------
Licence NTS Sheet Tract Claims No. of Renewal Date
No. claims
- ------------------- ---------------- ---------------- ----------------------------- ------------ ---------------------
06120 11 E 06 A 21 BCDEFGKLM 9 May 27, 2010
- ------------------- ---------------- ---------------- ----------------------------- ------------ ---------------------
LAKE AINSLIE BARITE PROPERTY
Exploration Licences at Lake Ainslie
Right Holder: Acadian Mining Corporation
- --------------- ----------------------- ------------ ------------------------------ ------------ ----------------------------
Licence NTS Sheet Tract Claims No.of Renewal Date
No. Claims
- --------------- ----------------------- ------------ ------------------------------ ------------ ----------------------------
07099 11 K 03 A 90 ABGHJKPQ 52 February 28, 2010
11 K 03 A 91 DEMN
11 K 03 A 102 DEMN
11 K 03 A 103 ABCFGHJKLOPQ
11 K 03 D 6 DEM
11 K 03 D 7 ABCFGHJKLOPQ
11 K 03 D 18 ABCFGHJKL
- --------------- ----------------------- ------------ ------------------------------ ------------ ----------------------------
ACADIAN MINING CORPORATION
Real Property Interests
- --------- ------------------------------------------------------ -----------------------------------------------------
1 18 Goldmine Rd, Tangier, NS Land and Building
- --------- ------------------------------------------------------ -----------------------------------------------------
2 East Lake Ainslie, Inverness, NS Land and Building
- --------- ------------------------------------------------------ -----------------------------------------------------
3 17404 Highway #7 Tangier, NS Land and Building
- --------- ------------------------------------------------------ -----------------------------------------------------
4 17735 Highway #7 Tangier, NS Land and Building
- --------- ------------------------------------------------------ -----------------------------------------------------
5 Marine Terminal, Sheet Harbour, NS Ore Concentration Storage Building; land is leased
- --------- ------------------------------------------------------ -----------------------------------------------------
6 15601 Hwy 224, Gays River, NS Land and Building
- --------- ------------------------------------------------------ -----------------------------------------------------
SCHEDULE "G" TO THE SUBSCRIPTION AGREEMENT
EMPLOYEE PLANS
- - Incentive Stock Option Plan
- - Great West Life health, drug, dental, long-term disability and life
insurance plan
- - Group RRSP administered by Great West Life - currently no active
participants
- - Vacation plan in force for all staff
SCHEDULE "H" TO THE SUBSCRIPTION AGREEMENT
ENVIRONMENTAL COMPLIANCE EXCEPTIONS
The following items have been identified for Scozinc facilities in relationship
to real or potential environmental issues.
Sheet Harbour:
o There is currently a drainage issue adjacent to Scozinc storage and
unloading facility. Conestoga - Rivers & Associates Limited has an
engineered design for dealing with the situation which will cost an
estimated $20,000.
Scozinc Mine/Mill:
o Hull Property:
o There is a small area (~1 acre) of contaminated soil located on
the former Hull Brothers property that resulted from spillage
through the culvert at SW6. This area has been identified by Nova
Scotia Department of Environment ("DOE"). A design plan has been
formulated by Scozinc engineers to clean up the site and move the
associated metal bearing material into the tailings facility. The
estimated price is $25,000. Part of this work will also require
the removal of the culvert so that all potential contamination in
this area will subsequently flow back into the pit.
o Mill Reagents:
o There are a number of reagents currently stored on site. These
materials are to be removed from site prior to their expiry date
as indicated. As of April 1st, 2009, these include the following:
- 10 barrels of MIBC (205 litres) - Aug.2010-July 2012
expiry,
- 23 barrels of denatured alcohol (205 litres) - no
expiry date,
- 11 pallets of zinc sulphate (25 kg bags) - Nov. 2009
expiry,
- 7 pallets of copper sulphate (25 kg bags) - Nov. 2010
expiry,
- 12 boses of S.I.X. (750 kg), 1 part box (~150 kg) -
Oct. 2010 expiry,
- 324 drums of Cyanide (100 kg) - Nov. 2010 expiry,
- 2 boxes of Cyanide (1000 kg), 1 part box (~250 kg) -
Sept. 2010 expiry, and
- 8 bags of lime, no expiry.
o Saddle Dam:
o DOE has identified that the five pipes in the saddle dam are to be
removed to prevent potential leakage. An engineering plan has been
established for the project at an associated cost of $20,000.
o Bone Yard:
o There are two environmental issues at this location that have been
identified by DOE and a directive issued. They are:
|X| Removal of contaminated soil (less than one
truckload), and
|X| Removal of barrels containing hazardous waste
materials.
o The associated cost for this has been quoted at ~$20,000.
o Empty Barrels:
o There are a number of empty barrels in front of the mill building
that contained either steel balls or identified chemicals. All of
these barrels can be crushed and placed in a dumpster with other
metal scrap for subsequent removal. This was identified as an area
where the barrels were primarily regarded as unsightly.
o Concentrate on ground at Mill Doors:
o No directive from DOE has been issued for this situation. However,
there is a minor amount of both lead and zinc concentrate on the
ground in the loading area that should be cleaned up and placed
back in the pit area.
o Diesel Gas and Propane Tanks:
o All fuel tanks are in good shape and there are no associated
environmental issues pertaining to spillage or leakage. All tanks
(except the administrative building tank) are double walled.
o Gallant Crushed Stone:
o There is ~500 tonnes of crushed stone north of the administrative
building, which stone was the property of Gallant Aggregate. It
contains a small quantity of lead (~0.05%). This has not been
identified by DOE as an issue at this time. All drainage from this
area is back into the pit as required.
o Tarp Building:
o Lead concentrate was stored temporarily in the core storage tarp
building and there will be minor residual concentrate remaining on
the floor of the facility. This has not been identified as an
issue by DOE and all drainage is back into the pit.
o Main Transformer:
o There was a small oil leak at the main transformer which has been
repaired. Although DOE has not identified an issue in this regard,
it is recommended that new seals be installed in the transformer
as soon as possible at an estimated cost of ~$1,000.
o Timbers by Bridge:
o There are a few creosote timbers located near the bridge over the
Gays River at the entrance to the mine site. These have not been
identified by DOE but it is recommended that they be removed
during the general cleanup.
o Asbestos:
o There is no known asbestos anywhere on site.
o Septic Tank:
o The top ring of the septic tank was cracked during winter snow
plowing. This has not been identified as an issue by DOE but it is
recommended that a new ring cover be installed. The cost is ~$200.
o Fire Suppression System:
o There is currently no chemical in the fire retardant system in the
Master Control Centre (electrical room). It is recommended that
this be filled as soon as possible. Cost for filling is ~$20,000.
o Paints, flammables, etc.:
o All paints and other flammable materials are properly stored in
locked containers. There has been no concern expressed by DOE in
this regard.
o MMER:
o There was one non-compliance Metal Mining Effluent Regulations
report resulting from failure to submit a hard copy of the
quarterly report. The issue was subsequently rectified.