EXHIBIT 4
COMPANY'S MATERIAL CONTRACTS
FORTRESS IT CORP.
Suite 3123, 000 Xxxxxxx Xxxxxx
P.O. Box 49139
Vancouver, B.C. V7X 1J1
International Uranium Corporation March 1, 2004
Suite 2101
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, X.X. V6C 3E8
ATTENTION: XX. XXX XXXXXXXXX, PRESIDENT
International Uranium (Bermuda I) Ltd.
Canon's Court, 00 Xxxxxxxx Xxxxxx
P.O. Box HM 1179 Xxxxxxxx XX EX Bermuda
Dear Sirs:
RE: ACQUISITION OF INTERNATIONAL URANIUM (BERMUDA II) LTD. ("BERMUDA II")
We understand that International Uranium Corporation ("IUC"), through its
wholly-owned Bermuda subsidiary, International Uranium (Bermuda I) Ltd.
("Bermuda I"), owns all of the outstanding share capital of Bermuda II which, in
turn, will at Closing own all of the outstanding share capital of Shiveen Gol
XXK ("Shiveen Gol") and Mongol Resources Exploration XXK ("Mongol Resources").
We also understand that Xxxxxxx Xxx and Mongol Resources are the registered
owners of certain copper-gold mining exploration properties located in Mongolia,
all as more particularly described in Schedule A hereto (the "Properties").
We are writing to confirm our interest in acquiring from Bermuda I all of the
outstanding shares of Bermuda II owned by Bermuda I on and subject to the
following terms and conditions:
Acquiring Entity: Fortress IT Corp. ("Fortress"), a company continued
under the laws of Canada, a reporting issuer in the
Provinces of British Columbia and Alberta, whose common
shares are listed and posted for trading on the NEX
Board of the TSX Venture Exchange, or its subsidiary to
be incorporated for the purpose;
Acquired Entity: Bermuda II, a company incorporated under the laws of
Bermuda, which owns 100% of the outstanding shares of
Shiveen Gol and Mongol Resources;
Transaction Structure: The transaction will be effected by way of an
acquisition by Fortress of all of the outstanding shares
of Bermuda II (the "Transaction"). For greater
certainty, any and all data and other information in
respect of the Properties held by IUC or any of its
subsidiaries shall be deemed to be the property of
Bermuda II prior to closing and delivered to Fortress at
closing;
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Consideration: In consideration for the acquisition of all of the
outstanding shares of Bermuda II and the assignment to
Fortress or its nominee of all outstanding debts as of
the date of this letter of intent owed by Bermuda II to
Bermuda I or to any other affiliate of IUC, Fortress
shall issue to Bermuda I (or as Bermuda I may direct) a
total of 28,000,000 common shares in its capital stock
at a deemed price of C$0.1125 per share (the "Purchase
Price"). The number of shares has been determined based
on IUC and it subsidiaries having incurred approximately
US$2.4 million in deferred exploration expenditures on
the Properties within the last three years as evidenced
by draft financial statements attached hereto as
Schedule B. In addition, Fortress shall assume all
working capital levels required for the normal, daily
ongoing conduct of Bermuda II from March 1, 2004. Until
Closing, Bermuda I shall advance to Bermuda II, on an
interest-free basis, funds necessary for the normal
daily ongoing conduct of Bermuda II. On Closing,
Fortress shall repay Bermuda I all of such funds. It is
anticipated that within ten days of the execution of
this agreement, Bermuda I and Fortress shall agree upon
a budget, setting forth expenditures required in
relation to Bermuda II (the "Budget"). Until Closing or
termination of this letter of agreement, any and all
expenditures on the part of Bermuda II that do not form
a part of the Budget shall require the prior written
approval of Fortress. If the Transaction does not close
for any reason, Fortress shall, nonetheless be
responsible for the cost of the Report referred to
below;
Terms and Conditions: On or before closing, each of Fortress and Bermuda II
will sign a mutually acceptable certificate (the
"Representations and Warranties Certificate") that
provides the mutual representations, warranties,
covenants and closing deliveries, including, without
limitation, appropriate corporate and securities
opinions from counsel for each party, in a form that is
reasonable and customary for a transaction such as is
contemplated herein;
Due Diligence Period: Each of Bermuda I and Fortress will have an unfettered
right to conduct and complete legal, audit and tax due
diligence investigations regarding the other company
within 45 days of the acceptance of this letter. On or
before such date, either Bermuda I or Fortress may elect
not to close if the results of its due diligence
investigation of the other company are not satisfactory
to it, acting reasonably. Notwithstanding the foregoing,
Bermuda I or Fortress may elect not to complete the
Transaction if the results of their continuing due
diligence investigations of the other company are not
satisfactory to it, acting reasonably.
Financing: Fortress will undertake a private placement (the
"Private Placement") of 10,000,000 common shares at a
price of not less than C$0.12 per share. The number of
common shares to be issued pursuant to the Private
Placement shall be increased only if agreed upon by both
IUC and Fortress;
Conditions to
Closing of Transaction: (i) Fortress shall have completed the Private
Placement;
(ii) An employment contract will have been entered into
with Xxxxx Xxxxxxx which will include, among other
things, the grant of an option on 1,000,000 shares
at $0.15 per share; and Xxxxx X(phi)hn will have
been appointed Geologist and Corporate Development
and will have been granted 50,000 options at $0.15
per share.
(iii) The Board of directors of Fortress shall be made
up of one IUC nominee; namely, Xx. Xxx Xxxxxxxxx,
plus Xx. Xxxxxxx Xxxxxxxx,
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Xx. Xxxxx Xxxxxxx and Xx. Xxxx Xxxxxx. Each
non-management director being granted options of
100,000 shares at $0.15 per share;
(iv) An advisory agreement will have been entered into
with Endeavour Financial to provide corporate
administration, regulatory assistance and
financial advice to Fortress;
(v) No material adverse change shall have occurred in
the business, operations, capital, financial
condition or prospects of either Bermuda II and
its subsidiaries or Fortress;
(vi) Such other conditions to closing as shall be
ordinary for a transaction of this nature,
including the signed Representations and
Warranties Certificate together with requisite
shareholder and regulatory approvals;
(vii) Closing of the Transaction and Private Placement
by May 31, 2004 or earlier.
Expenses: Each party will be responsible for the payment of its
own expenses in connection with the Transaction
(including, but not limited to legal and accounting
fees, any fees payable to brokers or agents, or any
finder's or other advisory fees). In addition, Fortress
shall be responsible for any and all costs incurred by
IUC for the commissioning of a qualified technical
report on the Properties (the "Report");
Timing: The parties hereto agree that they are prepared to make
every reasonable effort to complete the Transaction and
Private Placement as planned. The parties will work in
good faith seeking all necessary shareholder and
regulatory approvals that may be required to complete
the Transaction;
General: This letter of agreement will be governed by the laws of
British Columbia and the federal laws of Canada
applicable therein;
This letter shall be binding upon the parties.
This letter and the information contained in this letter shall be confidential
and shall not be disclosed by either IUC or Fortress to third parties without
the written consent of the other party. The parties will co-operate in the
making and dissemination of any public announcements relating to the subject
matter of this letter, including a press release to be issued following
execution hereof specifying the identities of the parties and the principal
terms of the Transaction.
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If the foregoing is acceptable to you, please sign and return this letter to us.
Facsimile transmissions of our respective signatures of this letter shall
evidence our acceptance of its terms.
Yours truly,
FORTRESS IT CORP.
Per: __________________________________________
Xxxxx Xxxxxxx, President
Accepted and agreed to as of the 1st day of March, 2004.
INTERNATIONAL URANIUM CORPORATION
Per:__________________________________________
INTERNATIONAL URANIUM (BERMUDA I) LTD.
Per:__________________________________________
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SCHEDULE A
MONGOLIA EXPLORATION LICENSES
HELD BY
MONGOL RESOURCES EXPLORATION XXK
&
SHIVEEN GOL XXK
A. LICENSES HELD BY MONGOL RESOURCES EXPLORATION XXK
LICENSE LICENSE AREA
PROPERTY LICENSE NAME NUMBER DATE (HECTARES)
----------------- ----------------- ------- ---------- ---------
Ulziit Ulziit A 4750X 8/13/2002 16,973
Ulziit B 4752X 8/13/2002 8,277
Ulziit C 4751X 8/13/2002 4,322
---------
Total 29,572
Gants Modot Gants Modot A 4823X 9/2/2002 49,996
Gants Modot B 4824X 9/2/2002 16,720
Gants Modot C 4825X 9/2/2002 66,042
---------
Total 132,758
Davaa Davaa 6514X 11/1/2002 100,962
Burkheer Khar Burkheer Khar 1 6515X 11/1/2002 49,383
Erdenet Tomortolgoi N1 4947X 10/3/2002 100,224
Tomortolgoi N2 4948X 10/3/2002 49,524
Tomortolgoi N3 4949X 10/3/2002 24,630
Tomortolgoi S-1 4950X 10/3/2002 19,668
Tomortolgoi S-2 4951X 10/3/2002 14,464
Tomortolgoi S-3 4952X 10/3/2002 48,664
Erdenet SE-2 4943X 10/3/2002 19,275
Erdenet SE-3 6475X 10/21/2002 82,772
Erdenet NE-1 6474X 10/3/2002 108,784
Erdenet NE4 5981X 6/27/2003 9,812
Erdenet NE5 5982X 6/27/2003 35,541
Erdenet SE4 5983X 6/27/2003 22,611
Tomortolgoi Add. 5606X 4/6/2003 5,983
Usan Seer 6447X 10/20/2003 8,384
---------
Total 550,336
Xxxxxxx Xxxxxxx 6 6545X 11/19/2002 15,947
West Huvsgol 1 6548X 12/23/2002 105,287
West Huvsgol 2 5233X 12/23/2002 127,056
West Huvsgol 3 5234X 12/23/2002 26,491
---------
Total 274,781
Xxxxxxx Xxxxxx / Tsagaan Tolgoi NA 4826X 9/2/2002 84,846
Shiveen Gol Tsagaan Tolgoi NB 4827X 9/2/2002 73,088
Tsagaan Tolgoi NC 4828X 9/2/2002 29,615
Tsagaan Tolgoi S 4829X 9/2/2002 149,924
Namariin A 5603X 4/6/2003 4,151
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LICENSE LICENSE AREA
PROPERTY LICENSE NAME NUMBER DATE (HECTARES)
----------------- -------------- ------- ---------- ---------
Namariin B 5604X 4/6/2003 935
Namariin C 5605X 4/6/2003 224
Har Uul 5685X 4/28/2003 71,165
Tsunheg Uul 6430X 10/14/2003 4,626
Shiveen Gol 2 5228X 12/23/2002 130
Shiveen Gol 3 5229X 12/23/2002 6,173
Xxxxxxx Xxx 4 5230X 12/23/2002 1,197
Shiveen Gol 5 5231X 12/23/2002 4,767
Shiveen Gol 1A 5396X 2/5/2003 4,302
Shiveen Gol 1B 5395X 2/5/2003 43
Shiveen Gol 1C 5394X 2/5/2003 65
---------
Total 435,251
Tsagaan Gozgor Orhontuul 1 6767X 1/16/2004 17,043
Orhontuul 2 6768X 1/16/2004 7,690
Orhontuul 3 6769X 1/16/2004 18,608
Orhontuul 4 6770X 1/16/2004 26,033
Orhontuul 5 6766X 1/16/2004 3,284
Orhontuul 6 6765X 1/16/2004 9,684
Orhontuul 7 6764X 1/16/2004 23,025
Orhontuul 8 6771X 1/16/2004 9,873
---------
Total 115,240
MRE TOTAL 50 1,688,283
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B. LICENSES HELD BY SHIVEENGOL XXK
LICENSE LICENSE AREA
PROPERTY LICENSE NAME NUMBER DATE (HECTARES)
------------------- -------------------- ------- ---------- ----------
Datsan Trade Option Shar Bulag 2476X 7/31/2000 4,485
Salhim Uul 2555X 8/28/2000 2,431
Orlogiin Gol 2637X 10/2/2000 1,178
Hoh Tolgoi 2860X 1/8/2001 897
Tsonhogiin Gol 3101X 3/23/2001 4,151
Seruunii Tal 3102X 3/23/2001 673
Tsagaan Chuluut Uul 3322X 5/23/2001 10,114
Chuulgany Tsahir Uul 3597X 8/10/2001 3,366
Urtuudiin Tsahir Uul 3598X 8/10/2001 2,092
Shiveen Gol 4030X 1/11/2002 897
Shariljit Uul 4389X 5/9/2002 1,944
Jargaltain Tolgod 4390X 5/9/2002 953
Gashuunii Sair 4391X 5/9/2002 561
Gashuunii Har Tolgoi 4392X 5/9/2002 635
Huren Tolgoi 4393X 5/9/2002 436
Shiveet 4592X 7/1/2002 152
Hoh Tolgoi 4594X 7/1/2002 673
Shiveet 5070X 10/31/2002 1,271
Shiveen Goliin Aarag 5379X 2/4/2003 2,768
Shar Zuuh 2 5629X 4/15/2003 3,595
Shar Zuuh 5630X 4/15/2003 1,123
Namariin Gol 5631X 4/15/2003 674
--------
SHIVEEN GOL TOTAL 22 45,069
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SCHEDULE B
FINANCIAL STATEMENTS
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