As filed with the Securities and Exchange Commission on May 5, 2000
Registration No. 333-_______
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-3
REGISTRATION STATEMENT
Under the
Securities Act of 1933
----------------------
Altair International Inc.
(Exact name of registrant as specified in its charter)
Province of Ontario, Canada None
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
William P. Long Copies to:
President
Altair International Inc. Brian G. Lloyd, Esq.
1725 Sheridan Avenue, Suite 140 Bryan T. Allen, Esq.
Cody, Wyoming 82414 PARR WADDOUPS BROWN GEE & LOVELESS
(307) 587-8245 185 South State Street, Suite 1300
(Name, address, including zip code, Salt Lake City, Utah 84111
and telephone number,including area code, (801) 532-7840
of agent for service)
<PAGE>
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement as
determined by market conditions.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box:[ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering:[ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box:[ ]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
====================================================================================================================
Proposed
Proposed maximum maximum Amount of
Title of each class Amount to be offering price aggregate registration
of securities to be registered registered per share(1) offering fee(1)
price(1)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common shares, no par value 3,177,945(2) $4.20 $13,347,369 $3,523
Warrants(3) 75,078 -- --
====================================================================================================================
</TABLE>
(1) Estimated pursuant to Rule 457 solely for the purpose of calculating the
registration fee, based upon the average of the high and low sales prices for
the common shares as reported on the Nasdaq National Market on May 1, 2000.
(2) In addition, pursuant to Rule 416 of the Securities Act of 1933, this
Registration Statement covers a presently indeterminate number of shares of
Common Stock issuable upon the occurrence of a stock split, stock dividend, or
other similar transaction.
(3) Warrants to purchase up 75,078 of the Shares subject to this Registration
Statement.
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the SEC, acting pursuant to said Section 8(a), may
determine.
<PAGE>
[GRAPHIC OMITTED]
ALTAIR INTERNATIONAL INC.
3,177,945 Common Shares
75,078 Warrants
------------------
Altair International Inc. (" We," "Altair" or the "Company") is a
development-stage Ontario company in the business of developing mineral
processing equipment and mineral properties. Altair recently acquired the rights
to a hydrometallurgical process designed primarily for the production of
titanium dioxide products from titanium bearing ores or concentrates (the
"Processing Technology"). Altair intends to initially use the Processing
Technology to produce small "nanoparticles" of titanium dioxide that are used in
paints, cosmetics and other products. In addition, Altair owns and is developing
a mineral processing machine it calls the "Altair Centrifugal Jig" or simply the
"Jig." The Jig uses a rotating circular screen and pulsating water to separate
valueless mineral particles from more valuable mineral particles based on their
specific gravity. Altair also leases and is exploring an approximately 14,000
acre parcel of land near Camden, Tennessee to determine whether it would be
amenable to large-scale mining of titanium and zircon using the Jig or other
equipment. Altair has not completed testing of the Processing Technology, the
Jig, or the Tennessee mineral property.
This Prospectus relates to 3,177,945 common shares of Altair, without
par value (the "Shares") and 75,078 warrants to purchase common shares of Altair
without par value (the "Offered Warrants"; collectively with the Shares, the
"Offered Securities"). All of the Offered Securities are to be sold by persons
who are existing security holders of the Company and identified in the section
of this Prospectus entitled "Selling Shareholders" (the "Selling Shareholders").
Of the Shares offered hereby, 1,442,970 are currently owned by the Selling
Shareholders, and 483,672 are issuable upon the exercise of warrants to purchase
common shares of Altair, including the Offered Warrants (the "Warrants"). The
remaining 1,251,303 Shares are being registered pursuant to a contractual
obligation with one of the Selling Shareholders and represent common shares of
Altair, without par value ("Common Stock") that the Company may be required to
issue to such Selling Shareholder pursuant to repricing provisions contained in
the stock purchase agreement between such Selling Shareholder and the Company.
The number of Shares actually issued pursuant to such repricing provisions may
be greater or fewer than 1,251,303 Shares. See "Selling Shareholders--Repricing
Provisions and Additional Shares." In addition, pursuant to Rule 416 of the
Securities Act of 1933, as amended (the "Securities Act"), this Prospectus and
the registration statement of which it is a part cover a presently indeterminate
number of shares of Common Stock issuable upon the occurrence of a stock split,
stock dividend, or other similar transaction.
The Company will not receive any of the proceeds from the sale of the
Offered Securities. In the United States, the shares of Common Stock are listed
for trading under the symbol ALTIF on the Nasdaq National Market. On May 1,
2000, the closing sale price of the Common Stock, as reported by the Nasdaq
National Market, was $4.3125 per share. See "Price Range of Common Stock."
Unless otherwise expressly indicated, all monetary amounts set forth in this
Prospectus are expressed in United States Dollars.
- --------------------------------------------------------------------------------
Consider carefully the risk factors beginning on page 7 in this Prospectus
before investing in the shares beihng sold with this Prospectus
- --------------------------------------------------------------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed on the
adequacy or accuracy of this Prospectus. Any representation to the contrary is a
criminal offense.
Dated May 4, 2000
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
ABOUT THIS PROSPECTUS.............................................................................................4
- ---------------------
PROSPECTUS SUMMARY................................................................................................4
- ------------------
ALTAIR INTERNATIONAL INC.......................................................................................4
-------------------------
THE OFFERING...................................................................................................5
------------
FORWARD-LOOKING STATEMENTS........................................................................................7
- --------------------------
RISK FACTORS......................................................................................................7
- ------------
RISK FACTORS RELATED TO THE COMPANY GENERALLY..................................................................7
---------------------------------------------
We Have Not Generated Any Operating Revenues or Profits.....................................................7
--------------------------------------------------------
We May Continue to Operate at a Net Loss....................................................................8
-----------------------------------------
We May Not Be Able to Raise Sufficient Capital to Meet Present and Future Obligations.......................8
--------------------------------------------------------------------------------------
Our Operations Are and Will Be Subject to Extensive Government Regulation...................................9
--------------------------------------------------------------------------
Certain of Our Experts and Directors Reside in Canada and May Be Able to Avoid Civil Liability..............9
-----------------------------------------------------------------------------------------------
We Are Dependent on Key Personnel..........................................................................10
----------------------------------
We May Fail to Identify or Be Unable to Consummate Important Strategic Transactions........................10
------------------------------------------------------------------------------------
We May Issue Substantial Amounts of Additional Shares Without Stockholder Approval.........................10
-----------------------------------------------------------------------------------
The Market Price of Our Common Stock Is Extremely Volatile.................................................11
-----------------------------------------------------------
Future Sales of Currently Restricted Securities May Affect the Market Price of Our Common Stock............11
------------------------------------------------------------------------------------------------
We Have Never Declared a Dividend and May Not for the Foreseeable Future...................................12
-------------------------------------------------------------------------
RISK FACTORS RELATED TO DEVELOPMENT OF THE JIG................................................................12
----------------------------------------------
Our Series 12 Jig Is Too Small for Most Commercial Uses....................................................12
--------------------------------------------------------
Testing Is Incomplete on Our Series 30 Jig.................................................................12
-------------------------------------------
Performance Of the Jig in a Commercial Setting May Not Match Test Results..................................12
--------------------------------------------------------------------------
The Jig Faces Competition from Alternative Technologies....................................................13
--------------------------------------------------------
The Jig Faces Competition from Other Jig-like Products.....................................................13
-------------------------------------------------------
The Market for Commodities Produced Using the Jig May Collapse.............................................14
---------------------------------------------------------------
We Are Dependent upon Others to Manufacture the Jig........................................................14
----------------------------------------------------
Certain Patents for the Centrifugal Jig Have Expired or Will Expire in the Near Future.....................14
---------------------------------------------------------------------------------------
RISK FACTORS RELATED TO DEVELOPMENT OF THE TENNESSEE MINERAL PROPERTY.........................................15
---------------------------------------------------------------------
We Have Not Completed Testing the Feasibility of Mining the Tennessee Mineral Property.....................15
---------------------------------------------------------------------------------------
We May Be Unable to Obtain Necessary Environmental Permits for the Tennessee Mineral Property..............15
----------------------------------------------------------------------------------------------
Any Operations on the Tennessee Mineral Property May Lead to Environmental Liability.......................16
-------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
RISK FACTORS RELATED TO DEVELOPMENT OF THE PROCESSING.........................................................16
-----------------------------------------------------
TECHNOLOGY AND PROCESSING ASSETS..............................................................................16
--------------------------------
We Have Not Yet Confirmed the Viability and Effectiveness of the Processing Technology and Processing Assets.16
-------------------------------------------------------------------------------------------------------------
Nanoparticles Produced Using the Processing Technology May Be, or Be Perceived as, Substandard.............16
-----------------------------------------------------------------------------------------------
The Current Market for TiO2 Nanoparticles Is Limited.......................................................17
-----------------------------------------------------
Our Cost of Production May Exceed Estimates................................................................17
--------------------------------------------
Pending Patent Applications May Be Denied or Provide Inadequate Protection.................................17
---------------------------------------------------------------------------
Use of the Processing Technology May Lead to Substantial Environmental Liability...........................18
---------------------------------------------------------------------------------
THE COMPANY'S COMMON STOCK.......................................................................................19
- --------------------------
PRICE RANGE OF COMMON STOCK...................................................................................19
---------------------------
OUTSTANDING SHARES AND NUMBER OF SHAREHOLDERS.................................................................19
---------------------------------------------
DIVIDENDS.....................................................................................................20
---------
TRANSFER AGENT AND REGISTRAR..................................................................................20
----------------------------
CANADIAN TAXATION CONSIDERATIONS..............................................................................20
--------------------------------
USE OF PROCEEDS..................................................................................................21
- ---------------
DILUTION.........................................................................................................21
- --------
SELLING SHAREHOLDERS.............................................................................................21
- --------------------
BENEFICIAL OWNERSHIP OF SELLING SHAREHOLDERS..................................................................21
--------------------------------------------
PRIVATE PLACEMENT OF SHARES AND WARRANTS......................................................................23
----------------------------------------
De Jong and Associates.....................................................................................23
----------------------
Toyota on Western, Inc.....................................................................................23
-----------------------
Ladenburg Thalmann & Co., Inc..............................................................................24
------------------------------
Anderson LLC...............................................................................................24
------------
REPRICING PROVISIONS AND ADDITIONAL SHARES....................................................................25
------------------------------------------
PLAN OF DISTRIBUTION.............................................................................................26
- --------------------
DESCRIPTION OF SHARES............................................................................................27
- ---------------------
LEGAL MATTERS....................................................................................................28
- -------------
EXPERTS..........................................................................................................28
- -------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE..................................................................29
- -----------------------------------------------
WHERE YOU CAN FIND MORE INFORMATION..............................................................................30
- -----------------------------------
</TABLE>
3
<PAGE>
ABOUT THIS PROSPECTUS
This Prospectus provides you with a general description of Altair,
certain risk factors associated with investment in the Offered Securities, and a
description of the contemplated offering. In addition, you should read the
additional information described under the heading "Incorporation of Certain
Documents by Reference" on page 30 of this Prospectus.
PROSPECTUS SUMMARY
This summary highlights some information from this Prospectus. Because
it is a summary, it necessarily does not contain all of the information
necessary to your investment decision. To understand this offering fully, you
should read carefully the entire Prospectus.
Altair International Inc.
Altair International Inc. is a development-stage Ontario company whose
primary business is acquiring and developing mineral processing equipment for
use in the recovery of fine mineral particles, including gold, titanium, and
zircon, and environmental contaminants. Altair also seeks to acquire or lease
mineral deposits suitable for the use of its mineral processing equipment.
Unless the context requires otherwise, all references to "Altair," "Altair
International Inc.," "we" or the "Company" in this Prospectus refer to Altair
International Inc. and each of its subsidiaries.
In November, 1999, Altair acquired the rights to a Processing
Technology developed by BHP Minerals International Inc. ("BHP") primarily for
the production of titanium dioxide products from titanium bearing ores or
concentrates. Altair also acquired all testing equipment related to the
Processing Technology owned by BHP, the right to use (for no fee) the services
of certain BHP employees for a year, and the right to lease (for $15,000 per
month) a 20,000 square foot portion of BHP's testing facility in Reno, Nevada.
The Processing Technology is capable of producing conventional titanium dioxide
pigments as well as specialized titanium dioxide nanoparticles. Altair has
determined that it will initially use the Processing Technology and related
equipment (the "Processing Assets") to produce titanium dioxide nanoparticles.
These are high value products used in specialty paints, cosmetics and other high
technology applications due to their unique optical and photo-catalytic
properties.
Altair is also developing the Jig. The Jig is a machine that uses a
rotating circular screen and pulsating water to separate valueless mineral
particles from more valuable mineral particles based on the differences in their
specific gravity. In tests, the Jig has proven capable of segregating and
recovering extremely fine mineral particles, sized from 100 to 400 mesh, which
are not presently recoverable using conventional techniques. ("Mesh" refers to
the openings or spaces in a screen, and the value (size) of mesh is given as the
number of openings per linear inch.) Altair is presently testing and customizing
the Jig for use in the recovery of heavy minerals such as titanium and zircon
and for use in the washing of coal. Management believes that the Jig could also
be used to recover other minerals such as gold and for environmental
remediation.
4
<PAGE>
Altair has also leased, and is exploring, an approximately 14,000 acre
parcel of land near Camden, Tennessee (the "Tennessee Mineral Property") to
determine whether it would be amenable to large-scale mining for titanium and
zircon using the Jig or other equipment. Preliminary reports suggest that the
Tennessee Mineral Property contains significant amounts of valuable heavy
minerals, including titanium and zircon, and is suitable for a large-scale sand
mining operation with a multi-decade life. Altair has commissioned a final
feasibility study to further study the mineralogical characteristics of the
resource, analyze possible mining techniques, evaluate product markets and
assess financing options. Altair expects to receive results from such study in
late 2000.
Altair's principal office is located at 1725 Sheridan Avenue, Suite
140, Cody, Wyoming 82414 U.S.A., and its telephone number is (307) 587-8245.
The Offering
Securities offered by the Selling Shareholders 3,177,945
Warrants 75,078
- --------------------------------------------------------------------------------
Shares of Common Stock outstanding prior to this 17,114,185(1)
offering
- --------------------------------------------------------------------------------
Shares of Common Stock outstanding following this 17,597,857(1) (2)
offering, if all Shares are sold
- --------------------------------------------------------------------------------
Use of Proceeds All proceeds of the
offering will be received
by the Selling
Shareholders.
- --------------------------------------------------------------------------------
Risk Factors You should read the "Risk
Factors," beginning on
page 7, as well as other
cautionary statements
throughout this
Prospectus, before
investing in the Offered
Securities.
- --------------------------------------------------------------------------------
(1) Excludes 2,988,700 shares of Common Stock authorized for issuance upon
exercise of outstanding options granted pursuant to Altair's stock option plans,
358,000 shares of Common Stock reserved for the future grant of stock options
under such plans, and 696,172 shares of Common Stock subject to outstanding
warrants to purchase Common Stock.
(2) Assumes (a) exercise of all of the Warrants in exchange for 483,672 Shares
and immediate re-sale of all such Shares, and (b) that no shares of Common Stock
are issued pursuant to the repricing provisions. The actual number of shares of
Common Stock outstanding following the offering will vary, and may vary
materially, depending upon how many Shares are issued pursuant to the repricing
provisions described in "Selling Shareholders--Repricing Provisions and
Additional Shares."
5
<PAGE>
Selling Shareholders
All of the Offered Securities are to be sold by persons who are
existing security holders of the Company. The Selling Shareholders acquired
their Shares and Offered Warrants in private placements of (i) 25,000 Shares and
75,000 Warrants that the Company completed on February 15, 2000, (ii) 166,667
Shares and 83,333 Warrants that the Company completed on March 3, 2000 and (iii)
1,251,303 Shares and 325,339 Warrants (75,078 of which were issued to a
placement agent) that the Company completed on April 7, 2000.
The Offered Warrants are currently owned by one of the Selling
Shareholders. Of the Shares offered hereby, 1,442,970 are currently owned by the
Selling Shareholders and 483,672 are issuable upon the exercise of the Warrants.
The remaining 1,251,303 Shares are being registered pursuant to a contractual
obligation with one of the Selling Shareholders and represent shares of Common
Stock that the Company may be required to issue to such Selling Shareholder
pursuant to repricing provisions contained in the stock purchase agreement
between such Selling Shareholder and the Company. The number of Shares actually
issued pursuant to such repricing provisions may be greater or fewer than
1,251,303 Shares. See "Selling Shareholders--Repricing Provisions and Additional
Shares." In addition, pursuant to Rule 416 of the Securities Act, this
Prospectus and the registration statement of which it is a part cover a
presently indeterminate number of shares of Common Stock issuable upon the
occurrence of a stock split, stock dividend, or other similar transaction. See
"Selling Shareholders."
For purposes of this Prospectus, the Company has assumed that the
number of Shares issuable upon exercise of each of the Warrants is the number
stated on the face thereof. Nonetheless, the number of Shares issuable upon
exercise of the Warrants, and available for resale hereunder, is subject to
adjustment and could materially differ from the estimated amount depending on
the occurrence of a stock split, stock dividend, or similar transaction
resulting in an adjustment in the number of Shares subject to the terms of the
Warrants.
6
<PAGE>
FORWARD-LOOKING STATEMENTS
This Prospectus contains various forward-looking statements. Such
statements can be identified by the use of the forward-looking words
"anticipate," "estimate," "project," "likely," "believe," "intend," "expect," or
similar words. These statements discuss future expectations, contain projections
regarding future developments, operations, or financial conditions, or state
other forward-looking information. When considering such forward-looking
statements, you should keep in mind the risk factors noted in this section and
other cautionary statements throughout this Prospectus and the Company's
periodic filings with the SEC that are incorporated herein by reference. You
should also keep in mind that all forward-looking statements are based on
management's existing beliefs about present and future events outside of
management's control and on assumptions that may prove to be incorrect. If one
or more risks identified in this Prospectus or any applicable filings
materializes, or any other underlying assumptions prove incorrect, the Company's
actual results may vary materially from those anticipated, estimated, projected,
or intended.
Among the key factors that may have a direct bearing on the Company's
operating results are risks and uncertainties described under "Risk Factors,"
including those attributable to the absence of operating revenues or profits,
uncertainties regarding the development and commercialization of the Processing
Technology and the Jig, development risks associated with the Tennessee Mineral
Properties and uncertainties regarding the Company's ability to obtain capital
sufficient to continue its operations and pursue its proposed business strategy.
RISK FACTORS
Before you invest in the Offered Securities described in this
Prospectus, you should be aware that such investment involves the assumption of
various risks, including those described below. You should consider carefully
these risk factors together with all of the other information included in this
Prospectus before you decide to purchase the Offered Securities.
Risk Factors Related to the Company Generally
We Have Not Generated Any Operating Revenues or Profits.
- --------------------------------------------------------
Altair is a development stage company. To date, Altair has not
generated revenues from operations or realized a profit. Altair is presently
investing substantial resources in the testing and development of the Jig, the
exploration of the Tennessee Mineral Property, and the acquisition, development
and commercialization of the Processing Technology and Processing Assets. There
can be no assurance that the Jig, the Tennessee Mineral Property, the Processing
Technology and Processing Assets or any other project undertaken by Altair will
ever enable Altair to generate revenues or that Altair will at any time realize
a profit from operations.
7
<PAGE>
We May Continue to Operate at a Net Loss.
- -----------------------------------------
Altair has experienced a loss from operations in every fiscal year
since its inception. Altair's losses from operations in 1998 were $1,762,088 and
its losses from operations in 1999 were $2,291,850. Although Altair expects to
begin product sales of titanium dioxide ("TiO2") nanoparticles in 2000, total
sales will probably not be at a level sufficient to produce a positive net
income for the year. Altair will continue to experience a net operating loss
until, and if, the Processing Technology and Processing Assets, the Jig and/or
the Tennessee Mineral Property begin generating revenues for Altair. Even if the
Processing Technology and Processing Assets, the Jig or the Tennessee Mineral
Property begin generating revenues, such revenues may not exceed the costs of
production. Accordingly, Altair may not ever realize a profit from operations.
We May Not Be Able to Raise Sufficient Capital to Meet Present and Future
- --------------------------------------------------------------------------------
Obligations.
- ------------
In order to complete our purchase of the Processing Technology and the
Processing Assets, we are required to make an AUD$7,475,000 installment payment
(plus interest) on May 15, 2000 and a AUD$3,750,000 installment payment on
August 15, 2000. If we fail to timely make such payments to BHP, we will forfeit
to BHP, without any right to reimbursement for the amount of the purchase price
paid to date, all right, title and interest in and to the Processing Technology
and Procssing Assets. Although we presently have capital sufficient to pay the
May 15, 2000 installment and commitments to provide capital sufficient to fund
the August 15, 2000 installment, unanticipated events may prohibit our timely
making such installment payments.
In addition, we may not be able to complete the development work
necessary to complete the testing and make the modifications necessary to place
the Processing Technology and Processing Assets into continuous operation in a
commercial setting. We may also be unable to obtain the capital necessary to
complete testing and development of the Jig or exploration of the Tennessee
Mineral Property. If we determine to construct and operate a mine on the
Tennessee Mineral Property, we will need to obtain a significant amount of
additional capital to complete construction of the mine and commencement of
operations.
In addition, we may need additional capital for necessary or
discretionary acquisitions of equipment, properties, intellectual property
rights or companies. General and industry market factors or other unforeseen
events may also affect Altair's use of and need for capital.
If Altair needs additional capital, it may not to be able obtain the
amount of additional capital needed or may be forced to pay an extremely high
price for capital. Factors affecting the availability and price of capital may
include, without limitation, the following:
|X| market factors affecting the availability and cost of capital
generally;
|X| the performance of Altair;
|X| the size of Altair's capital needs;
|X| the market's perception of mining, technology and/or minerals stocks;
|X| the economics of projects being pursued; and
|X| industry perception of Altair's ability to recover minerals with the
Jig or Processing Technology.
8
<PAGE>
If Altair is unable to obtain sufficient capital or is forced to pay a high
price for capital, Altair may be unable to make all installment payments on the
Processing Technology and Processing Assets, be unable to place the Processing
Technology and Processing Assets into continuous operation, complete testing and
production of the Jig, complete exploration and development of the Tennessee
Mineral Property, or otherwise pursue and fully exploit existing or future
development opportunities. In addition, because of their size, resources,
history and other factors, certain competitors of Altair may have better access
to capital than Altair and, as a result, may be able to exploit opportunities
more rapidly, easily or thoroughly than Altair.
Our Operations Are and Will Be Subject to Extensive Government Regulation.
- --------------------------------------------------------------------------
Altair's exploration of the Tennessee Mineral Property, testing of the
Jig, and operation of the titanium pigment processing facility are, and any
future testing, operation, construction or mining activities of Altair will be,
subject to a number of federal, state, and local laws and regulations concerning
mine and machine safety and environmental protection. Such laws include, without
limitation, the Clean Air Act, the Clean Water Act, the Resource Conservation
and Recovery Act, and the Comprehensive Environmental Response Compensation
Liability Act. Such laws require that Altair take steps to, among other things,
maintain air and water quality standards, protect threatened, endangered and
other species of wildlife and vegetation, preserve certain cultural resources,
and reclaim exploration, mining and processing sites. These laws are continually
changing and, as a general matter, are becoming more restrictive.
Compliance with federal, state, or local laws or regulations represents
a small part of Altair's present budget; nevertheless, continued compliance may
be extremely costly, especially if Altair actually commences mining operations
on the Tennessee Mineral Property. If Altair fails to comply with any such laws
or regulations, a government entity may levy a fine on Altair or require Altair
to take costly measures to ensure compliance. Any such fine or expenditure may
adversely affect Altair's development.
Certain of Our Experts and Directors Reside in Canada and May Be Able to Avoid
- --------------------------------------------------------------------------------
Civil Liability.
- ----------------
Altair is an Ontario corporation, and a majority of its directors are
residents of Canada. In addition, certain of Altair's experts (including its
principal accountants and Canadian legal counsel) are located in Canada. As a
result, investors may be unable to effect service of process upon such persons
within the United States and may be unable to enforce court judgments against
such persons predicated upon civil liability provisions of the United States
securities laws. It is uncertain whether Canadian courts would (i) enforce
judgments of United States courts obtained against Altair or such directors,
officers or experts predicated upon the civil liability provisions of United
States securities laws or (ii) impose liability in original actions against
Altair or its directors, officers or experts predicated upon United States
securities laws.
9
<PAGE>
We Are Dependent on Key Personnel.
- ----------------------------------
The continued success of Altair will depend to a significant extent on
the services of Dr. William P. Long, President and Chief Executive Officer of
Altair, and Mr. C. Patrick Costin, Vice President of Altair and President of
Fine Gold and MRS. The loss or unavailability of Mr. Long or Mr. Costin could
have a material adverse effect on Altair. Altair does not carry key man
insurance on the lives of such key officers.
In addition to the individuals identified above, Altair employs a Chief
Financial Officer, senior process engineer, metallurgist, geologist, controller
and administrative assistant. Altair has no other employees. Aside from Dr.
Long, Mr. Costin and the Chief Financial Officer, Altair has no employment
agreements with any of its personnel. Competition for such personnel is intense,
and Altair can provide no assurance that it will be able to attract and maintain
all personnel necessary for the development and operation of its business.
We May Fail to Identify or Be Unable to Consummate Important Strategic
- --------------------------------------------------------------------------------
Transactions.
- -------------
Altair is currently evaluating, and plans to continue to evaluate,
licensing or acquiring additional mining products or properties. Altair also
plans to remain open to acquiring, or developing strategic relations with other
companies that have products, manufacturing capabilities, or other qualities
that are compatible with Altair's business objectives. Altair must compete for
attractive acquisition or strategic alliance candidates with numerous other
companies, many of whom have significantly greater financial and technological
resources than Altair. In addition, to the extent Altair is in a competitive
position, it may fail to identify or consummate acquisition or strategic
alliance opportunities.
Even if Altair identifies and completes such alliances, consummation
thereof may require Altair to incur additional debt, amortize expenses related
to goodwill and intangible assets, or issue dilutive equity securities, all of
which could adversely affect Altair's operating results or financial condition.
In addition, a failure by Altair to integrate its operations with that of an
ally or acquisition target may adversely affect operating results. Disruptions
in operations are likely to be especially severe during the fiscal quarters
immediately following any acquisition or alliance transaction, while the
operations of the acquired or combined business are being integrated into
Altair's operations.
We May Issue Substantial Amounts of Additional Shares Without Stockholder
- --------------------------------------------------------------------------------
Approval.
- ---------
Altair's Articles of Incorporation authorize the issuance of an
unlimited number of shares of Common Stock. All such shares may be issued
without any action or approval by Altair's stockholders. In addition, Altair has
two stock option plans which have potential for diluting of the ownership
interests of Altair's stockholders. The issuance of any additional shares of
Common Stock would further dilute the percentage ownership of Altair held by
existing stockholders.
10
<PAGE>
The Market Price of Our Common Stock Is Extremely Volatile.
- -----------------------------------------------------------
The Common Stock was listed on the Alberta Stock Exchange through April
23, 1998 and has been listed on the Nasdaq National Market since January 26,
1998. Between March 24, 1997 and January 23, 1998, our Common Stock was listed
on the Nasdaq SmallCap Market. Trading in the Common Stock has been
characterized by a high degree of volatility. See "Price Range of Common Stock."
Trading in the Common Stock may continue to be characterized by extreme
volatility for numerous reasons, including the following:
|X| Uncertainty regarding the viability of the Processing Technology;
|X| The continued absence of any revenues from the Jig;
|X| Uncertainty regarding the viability of mining the Tennessee Mineral
Property;
|X| Continued dominance of trading in the Common Stock by a small number of
firms;
|X| Positive or negative announcements by Altair or its competitors;
|X| Industry trends, general economic conditions in the United States or
elsewhere, or the general markets for equity securities, minerals, and
commodities;
|X| The announcement of financial or research and development results that
differ from analyst and investor expectations, regardless of the health
of Altair;
|X| Significant changes in future prospects of Altair; and
|X| Speculation by short sellers of Common Stock or other persons who stand
to profit from a rapid increase or decrease in the price of the Common
Stock.
Future Sales of Currently Restricted Securities May Affect the Market Price of
- --------------------------------------------------------------------------------
Our Common Stock.
- -----------------
The resale of "restricted securities" as well as securities held by
"affiliates" of Altair, is generally subject to the provisions of Rule 144
("Rule 144") promulgated under the Securities Act of 1993, as amended (the
"Securities Act"). In general, under Rule 144 as currently in effect, a person
who has beneficially owned restricted securities for at least one year
(including the holding period of any prior owner except an affiliate) would be
entitled to sell within any three-month period a number of shares that does not
exceed the greater of 1% of the number of shares of Common Stock then
outstanding or the average weekly trading volume of the Common Stock during the
four calendar weeks preceding the filing of a Form 144 with respect to such
sale. In addition, a person who is not deemed to have been an affiliate of
Altair at any time during the 90 days preceding a sale, and who has beneficially
owned the shares proposed to be sold for at least two years (including the
holding period of any prior owners except an affiliate), would be entitled to
sell such shares under Rule 144(k) without regard to the requirements described
above. Altair is unable to predict the effect that future sales under Rule 144
may have on the then-prevailing market price of the Common Stock.
11
<PAGE>
In addition, shares issued upon exercise of options granted pursuant to
Altair's employee stock option plans are presently registered under the
Securities Act. Subject to certain restrictions on resale by affiliates, such
shares may be sold without restriction. The sale of any substantial number of
shares of Common Stock may have a depressive effect on the market price of our
Common Stock.
We Have Never Declared a Dividend and May Not for the Foreseeable Future.
- ------------------------------------------------------------------------
Altair has never declared or paid dividends on the Common Stock.
Moreover, Altair currently intends to retain any future earnings for use in its
business and, therefore, does not anticipate paying dividends on its Common
Stock in the foreseeable future.
Risk Factors Related to Development of the Jig
Our Series 12 Jig Is Too Small for Most Commercial Uses.
- --------------------------------------------------------
To date, Altair has developed and tested a lower-capacity Series 12 Jig
and a higher-capacity Series 30 Jig. Test results on the Series 12 Jig, designed
to be capable of processing approximately 120 tons of solids per day, suggest
that commercial use of the Series 12 Jig is technically feasible. Nevertheless,
the designed capacity of the Series 12 Jig is too small for coal washing, heavy
minerals extraction, and most other intended applications of the Jig, except use
in small placer gold mines or similar operations. Even if the Series 12 Jig
performs to design specifications in subsequent tests or at a commercial
facility, Altair believes that, because of its small capacity, the potential
market for the Series 12 Jig is limited.
Testing Is Incomplete on Our Series 30 Jig.
- -------------------------------------------
The Series 30 Jig is designed to process approximately 500 tons of
solids per day. Altair believes that this designed capacity is sufficient for
heavy mineral sands processing and many other intended commercial applications.
Having completed an initial set of tests on the Series 30 Jig at a heavy
minerals sand processing facility in Northern Florida, Altair hopes that it can
begin marketing the Series 30 Jig for heavy mineral sands recovery during 2000.
Nevertheless, the Series 30 Jig may not prove attractive to potential end users.
Even if Altair is successful in leasing the Series 30 Jig to end users, the
Series 30 Jig may not prove efficient, durable, or cost-effective enough to
satisfy the expectations of end users once operated in an uncontrolled
environment. In addition, the introduction of new technologies by competitors
could render the Series 30 Jig or larger Jig obsolete or unmarketable or require
costly alterations to make it marketable.
12
<PAGE>
Performance Of the Jig in a Commercial Setting May Not Match Test Results.
- --------------------------------------------------------------------------
Although test results from controlled tests on the Series 30 Jig
suggest that it is capable of separating valuable heavy minerals from mineral
sands, the Series 30 Jig has not been operated as part of an actual commercial
mineral processing facility. When integrated into actual commercial operations,
the Series 30 Jig:
|X| may not be able to process sand at its design capacity;
|X| may not recover a commercially valuable end product at a commercial
viable rate when processing mineral sands;
|X| may break down frequently or otherwise be too costly to operate and
maintain;
|X| may be displaced or rendered obsolete by the introduction of competing
technologies or jigs and may be incompatible with developing mining or
extraction processes; and
|X| may be rendered obsolete by the absence of demand for heavy minerals or
other end product of processing.
The Jig Faces Competition from Alternative Technologies.
- --------------------------------------------------------
The centrifugal jig process may not prove superior, either technically
or commercially, to alternative technologies. Various mineral processing
technologies perform many functions similar or identical to those for which the
Jig is designed. Altair believes that, in certain applications, the Jig may
prove more efficient, cost effective, or adaptable than spirals and cones, froth
flotation devices or heavy media separation devices. Nevertheless, results from
further tests or actual operations may reveal that these alternative
technologies are better adapted to any or all of the uses for which the Jig is
intended. Moreover, regardless of test results, consumers may view any or all of
such alternative technologies as technically superior to, or more cost effective
than, the Jig.
The Jig Faces Competition from Other Jig-like Products.
- -------------------------------------------------------
Altair believes that the Jig currently faces several forms of
competition in the commercial segregation of dense particles contained in feeds
between 150 and 400 mesh, including the Kelsey Jig, Falcon concentrators and the
Knelsen batch concentrator unit, which are currently being used worldwide.
Another centrifugal jig device, the Kelsey jig, has been developed in Australia
subsequent to the invention of the Jig. According to the Kelsey jig's
manufacturer, Geo Logics Pty. Ltd., Kelsey jigs are in service worldwide. In
addition, Falcon, a Canadian company, produces a small batch concentrator as
well as a machine which is used mainly for pre-concentration and scavenging.
Their principal applications to date have been in the gold and tantalum
industries. There also exists a batch concentrator known as the Knelsen Bowl.
Knelsen units have been installed in various mining applications, primarily
gold, throughout the world. Competitors, many of whom may have significant
capital and resources, may develop, or be in the process of developing, superior
or less expensive alternatives to the Jig.
13
<PAGE>
The Market for Commodities Produced Using the Jig May Collapse.
- ---------------------------------------------------------------
If the Jig is successfully developed and manufactured, Altair intends
to use the Jig, or lease the Jig for use, to separate and recover valuable,
heavy mineral particles. Active international markets exist for gold, titanium,
zircon and many other minerals potentially recoverable with the Jig. Prices of
such minerals fluctuate widely and are beyond the control of Altair. A
significant decline in the price of minerals capable of being extracted by the
Jig could have significant negative effect on the value of the Jig. Similarly, a
significant decline in the price of minerals being produced or expected to be
produced on the Tennessee Mineral Property could have a significant negative
effect on the viability of a mine or processing facility on either such
property. In addition, because Altair intends to market the Jig primarily to
mining companies, a general economic downturn in the mining or mineral
industries may have a material adverse effect on Altair.
We Are Dependent upon Others to Manufacture the Jig.
- ----------------------------------------------------
Altair currently contracts on a per-unit basis with a machine shop
located in central Tennessee for assembly of the Jig but has no long-term
contract with such entity. If Altair completes testing of the Jig and develops a
final production model, Altair does not currently have the know-how or resources
to establish its own manufacturing facility. Management is considering options
for manufacture of the Jig, including manufacturing under a long-term contract
or through an exclusive licensing arrangement or joint venture. Altair may not
be able to obtain adequate manufacturing capacity. Moreover, even if a
manufacturer is found, it may not be able to cost-effectively produce
affordable, high-quality units capable of sustaining continuous operations with
low maintenance costs in a production environment.
Certain Patents for the Centrifugal Jig Have Expired or Will Expire in the Near
- --------------------------------------------------------------------------------
Future.
- -------
Initial patents on the Jig have been issued in the United States, South
Africa, United Kingdom, Australia and Canada. These patents expire on various
dates between May 1999 and December 2000. A series of second patents have been
issued with respect to a critical component of the Jig in the United States,
South Africa, Japan, Europe, Australia, Canada, United Kingdom, Germany and
France. These patents expire on various dates between January 2010 and January
2011. A third series of patents with respect to an efficiency enhancing
component of the Jig have been issued in the United States, Europe, Australia,
Japan, South Africa, Canada and Brazil. These patents have expiration dates
between April and November 2018.
Persons in countries in which Altair has not patented the Jig or
certain critical components may develop and market an infringing product. The
cost of enforcing patents outside of North America, and similar obstacles, may
limit Altair's ability to enforce its patents and keep infringing products out
of the market for the Jig.
14
<PAGE>
Risk Factors Related to Development of the Tennessee Mineral Property
We Have Not Completed Testing the Feasibility of Mining the Tennessee Mineral
- --------------------------------------------------------------------------------
Property.
- ---------
The Tennessee Mineral Property is currently in the exploratory stage.
An independent consultant hired by Altair has completed a pre-feasibility study
on the Tennessee Mineral Property. Based on the positive results of such study,
Altair has determined to commence a final feasibility study of the Tennessee
Mineral Property.
The final feasibility study, commenced during August 1998, will involve
the actual design, pricing, and analysis of equipment and facilities that would
be used to mine the Tennessee Mineral Property. Altair expects that the
feasibility study will be completed in late 2000. If the feasibility study
suggests that cost-effective mining of the Tennessee Mineral Property is
feasible, a mine would not be operational for 24-36 months after completion of
the study. The final feasibility study may indicate that the Tennessee Mineral
Property does not contain minable quantities of heavy minerals or that such
deposits are not amenable to large-scale, low-cost mining, as contemplated by
Altair. Even if the studies and future testing suggest that mining is
economically feasible on the Tennessee Mineral Property, Altair may be unable to
obtain the capital, resources and permits necessary to mine the Tennessee
Mineral Property. Moreover, market factors, such as a decline in the price of,
or demand for, minerals recoverable at the Tennessee Mineral Property, may
adversely affect the development of mining operations on such property.
We May Be Unable to Obtain Necessary Environmental Permits for the Tennessee
- --------------------------------------------------------------------------------
Mineral Property.
- -----------------
In order to begin construction and commercial mining on the Tennessee
Mineral Property, Altair may have to obtain additional federal, state and local
permits, none of which Altair has obtained. Because Altair has not yet commenced
design of a commercial mining facility in the Tennessee Mineral Property, Altair
is not in a position to definitively ascertain which federal, state and local
mining and environmental laws or regulations would apply to a mine on the
Tennessee Mineral Property. Nevertheless, Altair anticipates that compliance
with the Clean Air Act, the Clean Water Act, the Resource Conservation and
Recovery Act, and the Comprehensive Environmental Response Compensation
Liability Act would be necessary if Altair determined to commence construction
and operation of a mine on the Tennessee Mineral Property. See "Risk Factors
Related to the Company Generally--Our Operations Are and Will Be Subject to
Extensive Government Regulation."
In addition to these federal laws and regulations, Altair anticipates
that, if the Tennessee Mineral Property is developed, Altair will be required to
obtain a surface mining permit from the State of Tennessee under the Tennessee
Mineral Surface Mining Law of 1972. The application for such a permit must be
preceded by public notice and must include, among other things, a filing fee, a
reclamation and revegetation plan, and a bond to cover the costs of reclamation.
Moreover, in connection with its feasibility study of the Tennessee Mineral
Property, Altair has filed an application for a National Pollution Discharge
Elimination System permit for a pilot plant facility with the Tennessee
Department of Environment and Conservation. The application is currently under
review. Additional state and federal permits may be required for the
construction and operation of the pilot plant. Altair can provide no assurance
that it will be able to obtain any such permit.
15
<PAGE>
Altair is not aware of any existing local land use restrictions that
would outright prohibit mining operations on the Tennessee Mineral Property.
Altair has held preliminary discussions with state and federal officials
regarding land use issues and permitting requirements, but no decisions have
been issued by any regulatory agencies.
Any Operations on the Tennessee Mineral Property May Lead to Environmental
- --------------------------------------------------------------------------------
Liability.
- ----------
Any proposed mining or processing operation on the Tennessee Mineral
Property, or any other property acquired by Altair, will be subject to federal,
state, and local environmental laws. Under such laws, Altair may be jointly and
severally liable with prior property owners for the treatment, cleanup,
remediation, and/or removal of substances discovered on either of the Tennessee
Mineral Property or any other property used by Altair, which are deemed by the
federal and/or state government to be toxic or hazardous ("Hazardous
Substances"). Courts or government agencies may impose liability for, among
other things, the improper release, discharge, storage, use, disposal or
transportation of Hazardous Substances. Altair might use Hazardous Substances
and, although Altair intends to employ all reasonably practicable safeguards to
prevent any liability under applicable laws relating to Hazardous Substances,
companies engaged in mineral exploration and processing are inherently subject
to substantial risk that environmental remediation will be required.
Risk Factors Related to Development of the Processing
Technology and Processing Assets
We Have Not Yet Confirmed the Viability and Effectiveness of the Processing
- --------------------------------------------------------------------------------
Technology and Processing Assets.
- ---------------------------------
The Processing Technology and Processing Assets have not been used by
Altair or anyone else in a commercial setting, and may prove ineffective or
unreliable when subjected to continuous use. Altair has used the Processing
Technology and Processing Assets to effectively produce sample quantities of
TiO2 nanoparticles but has not completed testing of other product applications.
The Processing Technology and Processing Assets may prove wholly or partially
ineffective when applied by Altair on a continuous basis in a commercial
setting. In addition, the Processing Assets may break down, be costly to
maintain or prove unreliable when operated on a continuous basis in a commercial
setting. If the Processing Technology proves ineffective or the Processing
Assets prove unreliable in a commercial setting, Altair may be unable to recoup
the investment in the Processing Technology and Processing Assets.
16
<PAGE>
Nanoparticles Produced Using the Processing Technology May Be, or Be Perceived
- --------------------------------------------------------------------------------
as, Substandard.
- ----------------
In the short run, Altair plans to use the Processing Technology and
Processing Assets to produce TiO2 nanoparticles. Altair has not previously
produced or marketed TiO2 nanoparticles and, to date, has not obtained any
orders for TiO2 nanoparticles. The TiO2 nanoparticles and other products
produced using the Processing Technology and Processing Assets may be of
inferior quality to alternative products or, regardless of actual quality, may
be perceived as lacking adequate quality or reliability. Even if Altair is able
to efficiently produce TiO2 nanoparticles and other products using the
Processing Technology and Processing Assets, it may not be able to sell such
products in the marketplace.
The Current Market for TiO2 Nanoparticles Is Limited.
- -----------------------------------------------------
In the short run, Altair plans to use the Processing Technology and
Processing Assets to produce TiO2 nanoparticles. The uses for such nanoparticles
are limited--primarily cosmetics and surface coatings--and the market for such
nanoparticles is small, estimated at 3,800 tons per annum. Even if Altair is
able to effectively produce TiO2 nanoparticles and other products using the
Processing Technology and Processing Assets, it may not be able to profitably
market such products for any of the following reasons:
o there may be insufficient demand for such products;
o despite strong initial demand for such products, the market for such
products may contract or collapse as a result of a decrease in demand
for goods incorporating such mineral products, a worldwide or regional
financial crisis, or other unforeseen event;
o the increased supply of such products as a result of the entrance of
Altair or other suppliers into the market may cause the price to drop,
reducing or eliminating profitability;
o such products may be of inferior quality to alternative products or,
regardless of actual quality, may be perceived as lacking adequate
quality or reliability.
Our Cost of Production May Exceed Estimates.
- --------------------------------------------
Altair purchased the Processing Technology and Processing Assets based
on the belief that it will be able to produce TiO2 and other products more
cheaply than many competitors. Altair has not, however, produced any mineral
products using the Processing Technology and Processing Assets on a commercial
basis. Altair's actual costs of production may exceed those of competitors and,
even if its costs of production are lower, competitors may be able to sell TiO2
and other products at a lower price than is economical for Altair.
17
<PAGE>
Pending Patent Applications May Be Denied or Provide Inadequate Protection.
- --------------------------------------------------------------------------
BHP has filed numerous patent applications with the United States
Patent and Trademark Office (the "PTO") with respect to the Processing
Technology and has transferred the rights to such applications to Altair. Such
applications are being reviewed by the PTO, and no patents with respect to the
Processing Technology have been granted to date. If the applications for any
patents related to the Processing Technology are denied, the value of the
Processing Technology, and any competitive advantage gained from Altair's
ownership of the Processing Technology, will be substantially diminished. Altair
can provide no assurance that pending patent applications will be granted.
In addition, persons in jurisdictions outside of the United States in
which no application has been filed, or which do not honor United States
patents, may develop and market infringing technologies. Also, the cost of
enforcing patents outside of North America, as well as other obstacles, may
limit Altair's ability to enforce any patents related to the Processing
Technology outside of the United States.
Use of the Processing Technology May Lead to Substantial Environmental Liability
- --------------------------------------------------------------------------------
Any proposed use of the Processing Technology and Processing Assets
will be subject to federal, state, and local environmental laws. Under such
laws, Altair may be jointly and severally liable with prior property owners for
the treatment, cleanup, remediation and/or removal of substances discovered at
the leased Reno, Nevada facility or any other property used by Altair that are
Hazardous Substances. Courts or government agencies may impose liability for,
among other things, the improper release, discharge, storage, use, disposal or
transportation of Hazardous Substances. Altair might use Hazardous Substances
and, although it intends to employ all reasonably practicable safeguards to
prevent any liability under applicable laws relating to Hazardous Substances,
companies engaged in mineral exploration and processing are inherently subject
to substantial risk that environmental remediation will be required.
18
<PAGE>
THE COMPANY'S COMMON STOCK
Price Range of Common Stock
In the United States, prior to March 23, 1997, shares of Common Stock
of Altair were listed under the symbol "AIGDF" on the over-the-counter bulletin
board maintain by the National Association of Securities Dealers the ("OTCBB").
From March 24, 1997 until January 23, 1998, shares of Common Stock of Altair
were quoted on the Nasdaq SmallCap Market under the symbol "ALTIF."
Beginning on January 26, 1998, our Common Stock began trading on the
Nasdaq National Market under the symbol "ALTIF." The following table sets forth,
for the periods indicated, the high and low sales prices for the Common Stock,
as reported on the Nasdaq National Market.
<TABLE>
<CAPTION>
Fiscal Year Ended December 31, 1998 Low High
---------------- ----------------
<S> <C> <C>
1st Quarter (beginning January 26,
1998) $8.125 $15.625
2nd Quarter 7.000 9.625
3rd Quarter 3.000 10.250
4th Quarter 5.875 8.625
Fiscal Year Ended December 31, 1999 Low High
---------------- ----------------
1st Quarter $6.063 $9.875
2nd Quarter 4.125 6.875
3rd Quarter 3.875 5.000
4th Quarter 3.453 5.063
Fiscal Year to End December 31, 2000 Low High
---------------- ----------------
1st Quarter $3.688 $8.250
</TABLE>
The last sale price of the Common Stock, as reported on the Nasdaq National
Market, on May 1, 2000 was $4.3125 per share.
Outstanding Shares and Number of Shareholders
As of May 1, 2000, the number of shares of Common Stock outstanding was
17,114,185 held by 455 holders of record. In addition, as of the same date, the
Company has reserved 3,346,700 shares of Common Stock for issuance upon exercise
of options that have been, or may be, granted under its employee stock option
plans and 696,172 shares of Common Stock for issuance upon the exercise of
outstanding warrants.
19
<PAGE>
Dividends
The Company has never declared or paid dividends on its shares of
Common Stock. Moreover, the Company currently intends to retain any future
earnings for use in its business and, therefore, does not anticipate paying any
dividends on its shares of Common Stock in the foreseeable future.
Transfer Agent and Registrar
The Transfer Agent and Registrar for the Common Stock is Equity
Transfer Services, Inc., Suite 420, 120 Adelaide Street West, Toronto, Ontario,
M5H 4C3.
Canadian Taxation Considerations
Dividends paid on shares of Common Stock owned by non-residents of
Canada are subject to Canadian withholding tax. The rate of withholding tax on
dividends under the Income Tax Act (Canada) (the "Act") is 25%. However, Article
X of the reciprocal tax treaty between Canada and the United States of America
(the "Treaty") generally limits the rate of withholding tax on dividends paid to
United States residents to 15%. The Treaty further generally limits the rate of
withholding tax to 5% if the beneficial owner of the dividends is a U.S.
corporation which owns at least 10% of the voting shares of the Company.
If the beneficial owner of the dividend carries on business in Canada
through a permanent establishment in Canada, or performs in Canada independent
personal services from a fixed base in Canada, and the shares of stock with
respect to which the dividends are paid is effectively connected with such
permanent establishment or fixed base, the dividends are taxable in Canada as
business profits at rates which may exceed the 5% or 15% rates applicable to
dividends that are not so connected with a Canadian permanent establishment or
fixed base. Under the provisions of the Treaty, Canada is permitted to apply its
domestic law rules for differentiating dividends from interest and other
disbursements.
A capital gain realized on the disposition of shares of Common Stock by
a person resident in the United States (a "Non-resident") will be subject to tax
under the Act if the shares held by the Non-resident are "taxable Canadian
property." In general, shares of Common Stock will be taxable Canadian property
if the particular Non-resident used (or in the case of a Non-resident insurer,
used or held) the shares of Common Stock in carrying on business in Canada or,
pursuant to proposed amendments to the Act, where at any time during the
five-year period immediately preceding the realization of the gain, not less
than 25% of the issued and outstanding shares of any class or series of shares
of the Company were owned by the particular Non-resident, by persons with whom
the particular Non-resident did not deal at arms' length, or by any combination
thereof. If the shares of Common Stock constitute taxable Canadian property,
relief nevertheless may be available under the Treaty. Under the Treaty, gains
from the alienation of shares of Common Stock owned by a Non-resident who has
never been resident in Canada generally will be exempt from Canadian capital
gains tax if the shares do not relate to a permanent establishment or fixed base
which the Non-resident has or had in Canada, and if not more than 50% of the
value of the shares was derived from real property (which includes rights to
explore for or to exploit mineral deposits) situated in Canada.
20
<PAGE>
USE OF PROCEEDS
All proceeds from any sale of Offered Securities, less commissions and
other customary fees and expenses, will be paid directly to the Selling
Shareholders selling the Offered Securities. The Company will not receive any
proceeds from the sale of any of the Offered Securities.
DILUTION
The Company's unaudited net tangible book value at March 31, 2000 was
$8,553,076, or approximately $.454 per share of the Common Stock then
outstanding (assuming all 3,177,945 Shares were outstanding on March 31, 2000).
Accordingly, new investors who purchase Shares may suffer an immediate dilution
of the difference between the purchase price per Share and $.454.
SELLING SHAREHOLDERS
Beneficial Ownership of Selling Shareholders
The table beginning on the top of the next page sets forth, as of the
date of this Prospectus:
o the name of each Selling Shareholder,
o certain beneficial ownership information with respect to the Selling
Shareholders,
o the number of Shares that may be sold from time to time by each
Selling Shareholder pursuant to this Prospectus, and
o the amount (and, if one percent or more, the percentage) of Common
Stock to be owned by each Selling Shareholder if all Shares are sold.
Beneficial ownership is determined in accordance with SEC rules and generally
includes voting or investment power with respect to securities. Shares of Common
Stock that are issuable upon the exercise of outstanding options, warrants or
other purchase rights, to the extent exercisable within 60 days of the date of
this Prospectus, are treated as outstanding for purposes of computing each
Selling Shareholder's percentage ownership of outstanding Common Stock.
21
<PAGE>
<TABLE>
<CAPTION>
Shares Beneficially Owned
Beneficial Ownership upon Completion of the
Prior to Offering Offering(1)
--------------------------- ------------------------------
Number of
Number of Shares Being Number of
Beneficial Owner Shares Percent(2) Offered Shares Percent
- ---------------------------------- ------------- ---------- -------------- ------------ -------------
<S> <C> <C> <C> <C> <C>
Anderson LLC 1,501,564(3) 8.6% 1,501,564(3) 0 --
Toyota on Western, Inc. 250,000(4) 1.5% 250,000 0 --
de Jong & Associates, Inc. 100,000(5) * 100,000 0 --
Ladenburg Thalmann & Co., Inc. 75,078(6) * 75,078 0 --
All Selling Shareholders as a
group 1,926,642 10.9% 1,926,642 0 --
</TABLE>
* Represents less than one percent of the outstanding shares of Common
Stock.
(1) Assuming the sale by each Selling Shareholder of all of the Shares
offered hereunder by such Selling Shareholder. There can be no
assurance that any of the Shares offered hereby will be sold.
(2) The percentages set forth above have been computed assuming the number
of shares outstanding equals the sum of (a) 17,114,185, which is the
number of shares of Common Stock actually outstanding on May 1, 2000,
and (b) shares of Common Stock subject to options, Warrants and other
purchase rights held by the person(s) with respect to which such
percentage is calculated; provided, however, for purposes of the
foregoing beneficial ownership table, we have assumed that no
additional shares will be issued to Anderson LLC pursuant to the
repricing provisions described in "--Repricing Provisions and
Additional Shares." The Prospectus and the Registration Statement of
which it is a part covers the first 1,251,303 shares of Common Stock
that may be issued, if any, pursuant to such repricing provisions.
(3) Includes 250,261 Shares issuable by the Company upon exercise of
Warrants held by such entity. Such number does not include any of the
indeterminable number of Shares that may be issued pursuant to the
repricing provisions described in "--Repricing Provisions and
Additional Shares." The actual number of shares of Common Stock owned
and sold pursuant to this Prospectus by Anderson LLC will depend upon
the number of additional Shares acquired by Anderson LLC pursuant to
the repricing provisions described in "--Repricing Provisions and
Additional Shares."
(4) Includes 83,333 Shares issuable by the Company upon exercise of
Warrants held by such entity.
(5) Includes 75,000 Shares issuable by the Company upon exercise of
Warrants held by such entity.
(6) Includes 75,078 Shares issuable by the Company upon exercise of
Warrants held by such entity. The Warrants held by Ladenburg Thalmann &
Co., Inc. are the Offered Warrants offered hereunder.
The percentages set forth above have been computed assuming the number
of shares outstanding equals the sum of (a) 17,114,185, which is the number
shares of Common Stock actually outstanding on May 1, 2000, and (b) shares of
Common Stock subject to Warrants held by the person(s) with respect to which
such percentage is calculated. For purposes of the foregoing beneficial
ownership table, notwithstanding the fact that 1,251,303 of the Shares
registered hereunder are intended to cover shares issuable to Anderson LLC
pursuant to the repricing provisions described in "--Repricing Provisions and
Additional Shares," we have assumed that no additional shares will be issued to
Anderson LLC pursuant such repricing provisions. As a result of such repricing
provisions, the number and percentage of outstanding shares of Common Stock
owned by Anderson from time to time during the period of this offering may
including a presently indeterminate number of additional shares of Common Stock.
22
<PAGE>
There can be no assurance that any of the Offered Securities offered
hereby will be sold. The Company believes the persons named in the table have
sole voting and investment power with respect to all Shares shown as
beneficially owned by them, subject to community property laws, where
applicable.
Private Placement of Shares and Warrants
De Jong and Associates
----------------------
De Jong & Associates, Inc. ("De Jong") acquired 25,000 Shares and
75,000 Warrants in a private placement pursuant to the terms of a consulting
agreement dated as of February 15, 2000 (the "Consulting Agreement") in
consideration of consulting services to be provided to the Company by de Jong.
The Warrants have an exercise price of $4.00 per share and are exercisable at
any time on or before February 15, 2003. Such Warrants include standard
anti-dilution provisions pursuant to which the exercise price and number of
Shares issuable thereunder is adjusted proportionately in the event of a stock
split, stock dividend, recapitalization or similar transaction. The Shares that
may be offered pursuant to this Prospectus include the shares of Common Stock
issuable upon the exercise of such Warrants.
The Company is obligated under the Consulting Agreement to register De
Jong's Shares, including those issuable upon exercise of De Jong's Warrants, in
the first registration undertaken by the Company after the execution of the
Consulting Agreement.
Toyota on Western, Inc.
-----------------------
Toyota on Western, Inc. ("Toyota") acquired 166,667 Shares and 83,333
Warrants in a private placement pursuant to the terms of a stock purchase
agreement dated as of March 3, 2000 (the "Toyota Purchase Agreement"). Pursuant
to the Toyota Purchase Agreement, the Company sold Toyota 166,667 Shares for
$6.00 per share and granted Warrants to purchase 83,333 Shares at the exercise
price of $8.00 per share on or before the earlier of (i) March 3, 2004 and (ii)
the date thirty days following the fifth day (whether or not consecutive) the
closing price of a share of Common Stock on the Nasdaq National Market equals or
exceeds $10.00. Such Warrants include standard anti-dilution provisions pursuant
to which the exercise price and number of Shares issuable thereunder is adjusted
proportionately in the event of a stock split, stock dividend, recapitalization
or similar transaction. The Shares that may be offered pursuant to this
Prospectus include the shares of Common Stock issuable upon the exercise of such
Warrants.
Pursuant to a registration rights agreement dated as of March 3, 2000
and entered into in conjunction with the Toyota Purchase Agreement, the Company
is obligated to file a registration statement registering Toyota's Shares,
including those issuable upon exercise of Toyota's Warrant, within 90 days of
March 3, 2000.
23
<PAGE>
Ladenburg Thalmann & Co., Inc.
------------------------------
On March 31, 2000, the Company granted Ladenburg Thalmann & Co., Inc.
("Ladenburg") 75,078 Series N Warrants in return for serving as placement agent
in connection with the Anderson Purchase Agreement (defined below). Such
Warrants are the "Offered Warrants" subject to this Prospectus and the
Registration Statement of which it is a part. The Offered Warrants permit
Ladenburg to purchase up to 75,078 Shares at an exercise price of $6.75 (or
pursuant to a cashless exercise provision) at any time on or before the earlier
of (i) March 31, 2003 and (ii) the date thirty days following the fifth day
(whether or not consecutive) the closing price of a share of Common Stock on the
Nasdaq National Market equals or exceeds $9.00.
In addition, the Offered Warrants contain a provision prohibiting
assignment of such Warrants to any person who is not an employee of Ladenburg.
The purpose of registering the Offered Warrants pursuant to the registration
statement of which the Prospectus is a part is to permit transfers of such
Offered Warrants to certain employees of Landenburg.
Such Offered Warrants include standard anti-dilution provisions
pursuant to which the exercise price and number of Shares issuable thereunder is
adjusted proportionately in the event of a stock split, stock dividend,
recapitalization or similar transaction. The Shares that may be offered pursuant
to this Prospectus include the shares of Common Stock issuable upon the exercise
of such Offered Warrants.
Anderson LLC
Anderson LLC ("Anderson") acquired 1,251, 303 Shares and
250,261 Warrants in a private placement pursuant to the terms of a common stock
purchase agreement dated as of March 31, 2000 (the "Anderson Purchase
Agreement"). Pursuant to the Anderson Purchase Agreement, the Company sold
Anderson 1,251,303 Shares for an aggregate of $6,000,000 (or $4.795 per share);
provided, however, the number of Shares received by Anderson in exchange for its
$6,000,000 is subject to adjustment pursuant to the repricing provisions
described in "--Repricing Provisions and Additional Shares" below. In addition,
pursuant to the Anderson Purchase Agreement, the Company granted Anderson
Warrants to purchase 250,261 Shares at an exercise of $6.75 per Share (or
pursuant to a cashless exercise provision) at any time on or before March 31,
2003. The Shares that may be offered pursuant to this Prospectus include the
shares of Common Stock issuable upon the exercise of such Warrants.
Pursuant to the Anderson Purchase Agreement, the Company grants
Anderson a right of first refusal with respect to any issuance of Common Stock
during a period commencing on the closing date and continuing until the earlier
of (i) the date 360 days after the Shares have been registered with the SEC, or
(ii) the date the Company redeems all Common Stock subject to the Anderson
Purchase Agreement; provided, that the foregoing right does not apply to Shares
issued upon the exercise of outstanding rights, Shares issued upon the exercise
of employee options, Shares issued in connection with a joint venture or
acquisition transaction, or Shares issued in connection with a bona fide public
offering. The Anderson Purchase Agreement also prohibits, with certain
exceptions, the Company from issuing any Common Stock for a period of 180 days
after the effective date of a registration statement registering the Shares.
In connection with the Anderson Purchase Agreement, the Company and
Anderson entered into an agreement establishing a so-called equity line of
credit agreement (the "Equity Agreement"). Pursuant to the Equity Agreement,
Anderson commits to purchase up to $10,000,000 in additional Common Stock over
the course of the 18 months following the effective date of the registration
statement of which the Prospectus is a part. The per share purchase price for
such Common Stock will be 85% of the five lowest closing bid prices of the
Common Stock during the ten days preceding the Company's granting notice of its
24
<PAGE>
intent to compel a purchase. The maximum dollar amount of Common Stock Anderson
can be required to purchase in any periodic financing is $2,000,000. Anderson's
obligations under the Equity Agreement are conditioned upon, inter alia, (i) a
registration statement with respect to such Common Stock being effective, (ii)
the market price of Common Stock of the Company exceeding $2 per share, (iii)
the dollar trading volume of the Common Stock equaling 150% of the amount of the
additional financing and (iv) the shareholders having approved the Equity
Agreement or approved the transaction to the extent required by any governing
exchange regulations.
Repricing Provisions and Additional Shares
Pursuant to the Anderson Purchase Agreement, if the lowest average
closing price per share of Common Stock on the Nasdaq National Market for any
ten days during each of four 30-day "repricing periods" does not meet a certain
threshold, the Company is required to issue additional shares to Anderson for no
additional consideration. The first 30-day repricing period begins on the
earlier of the date the 1,251,303 Shares purchase by Anderson on April 7, 2000
and related warrant shares are registered with the SEC or 90 days after the date
of the Anderson Purchase Agreement. If the lowest average closing bid price for
any ten days during such period is not equal to or greater than 5.634 per Share,
the Company is required to issue additional Shares pursuant to a complex formula
set forth in the Anderson Purchase Agreement (and illustrated below). The second
30-day repricing period begins at the end of the prior period. If the lowest
average closing bid price for any ten days during such period is not equal to or
greater than 5.754 per Share, the Company is required to issue additional Shares
pursuant to a complex formula set forth in the Anderson Purchase Agreement (and
illustrated below). The third 30-day repricing period begins at the end of the
prior period. If the lowest average closing bid price for any ten days during
such period is not equal to or greater than 5.99375 per Share, the Company is
required to issue additional Shares pursuant to a complex formula set forth in
the Anderson Purchase Agreement (and illustrated below). The fourth 30-day
repricing period begins at the end of the prior period. If the lowest average
closing bid price for any ten days during such period is not equal to or greater
than 6.2335 per Share, the Company is required to issue additional Shares
pursuant to a complex formula set forth in the Anderson Purchase Agreement (and
illustrated below).
In order to illustrate the possible effects of the repricing provisions
of the Anderson Purchase Agreement, the following table sets forth how many
additional Shares will be issued to Anderson if the lowest average closing bid
price per share of Common Stock on the Nasdaq National Market for any ten days
during each of the four repricing periods is (a) $2.00 per share, (b) $3.00 per
share (c) $4.00 per share, (d) $5.00 per share, (e) $6.00 per share, and (f)
$6.2335 or greater per share. Such prices are selected for illustration purposes
only and do not reflect the Company's actual estimate of the lowest average
closing bid price during any such repricing period or reflect the actual number
of shares of Common Stock that will be issued to Anderson during any such
repricing period. The actual lowest average closing bid price for any ten days
during each of the four repricing periods will vary, and may vary materially
from the prices assumed in the following table. Accordingly, the actual number
of shares of Common Stock issued to Anderson pursuant to the repricing
provisions of the Anderson Purchase Agreement will vary, and may vary
materially, from the numbers set forth in the following table.
25
<PAGE>
Shares Issuable Under Repricing Provisions If Lowest Average
Closing Bid Price Per Share For Any Ten Days During The
Respective Repricing Period Is As Follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Repricing Period $2.00 $3.00 $4.00 $5.00 $6.00 $6.2335 or
Greater
First 568,424 274,674 127,799 39,674 None None
Second 587,174 287,174 137,174 47,174 None None
Third 624,674 312,174 155,924 62,174 None None
Fourth 662,174 337,174 174,674 77,174 12,174 None
</TABLE>
In connection with the Anderson Purchase Agreement, the Company and
Anderson executed a registration rights agreement pursuant to which the Company
is required to (i) file a registration statement on Form S-3 on or before May 5,
2000 with respect to the initial 1,251,303 shares of Common Stock issued to
Anderson and an additional 1,251,303 shares of Common Stock in order to cover
any Shares that may be issued to Anderson pursuant to the above-described
repricing provisions, and (ii) cause such registration statement to be effective
within 90 days of the initial closing date. For each day after the required
filing date or effective date the registration statement is not filed or
effective, as applicable, the Company is required to pay a specified amount as
liquidated damages. In the event the sum of the 1,251,303 Shares issued on April
7, 2000 and the number of shares of Common Stock issued to Anderson pursuant to
the above-described repricing provisions exceeds the 2,502,606 of such Shares
covered by this Prospectus and the registration statement of which it is a part,
the Company is required to, within ten (10) business days of receiving notice
from Anderson, amend the registration statement of which this prospectus is a
part or file a new registration statement registering such additional shares.
PLAN OF DISTRIBUTION
Shares
- ------
The Shares offered by this prospectus may be sold from time to time by
the Selling Shareholders, who consist of the persons named as "Selling
Shareholders" above and those persons' pledgees, donees, transferees or other
successors in interest. The Selling Shareholders may sell the Shares on the
Nasdaq National Market, or otherwise, at market prices or at negotiated prices.
They may sell Shares by one or a combination of the following:
o a block trade in which a broker or dealer so engaged will attempt
to sell the Shares as agent, but may position and resell a portion
of the block as principal to facilitate the transaction;
o purchases by a broker or dealer as principal and resale by the
broker or dealer for its account pursuant to this Prospectus;
o ordinary brokerage transactions and transactions in which a broker
solicits purchasers;
o an exchange distribution in accordance with the rules of such
exchange;
o privately negotiated transactions;
o short sales;
o if such a sale qualifies, in accordance with Rule 144 promulgated
under the Securities Act rather than pursuant to this prospectus;
o any other method permitted pursuant to applicable law.
26
<PAGE>
In making sales, brokers or dealers engaged by the Selling Shareholders may
arrange for other brokers or dealers to participate. Brokers or dealers will
receive commissions or discounts from such Selling Shareholders in amounts to be
negotiated prior to the sale. Such Selling Shareholder and any broker-dealers
that participate in the distribution may be deemed to be "underwriters" within
the meaning of Section 2(11) of the Securities Act of 1933, and any proceeds or
commissions received by them, and any profits on the resale of shares sold by
broker-dealers, may be deemed to be underwriting discounts and commissions. If a
Selling Shareholder notifies us that a material arrangement has been entered
into with a broker-dealer for the sale of Shares through a block trade, special
offering, exchange distribution or secondary distribution or a purchase by a
broker or dealer, we will file a prospectus supplement, if required pursuant to
Rule 424(c) under the Securities Act of 1933, setting forth:
o the name of each of the participating broker-dealers,
o the number of Shares involved,
o the price at which the Shares were sold,
o the commissions paid or discounts or concessions allowed to the
broker-dealers, where applicable;
o a statement to the effect that the broker-dealers did not conduct
any investigation to verify the information set out or incorporated
by reference in this prospectus, and
o any other facts material to the transaction.
The Offered Warrants
- --------------------
The Offered Warrants may be sold or otherwise transferred from time to
time by Ladenburg and Ladenburg's pledgees, donees, transferees or other
successors in interest; provided, however, the Offered Warrants may not be sold
or otherwise transferred to any person who is not an employee of Ladenburg. The
Offered Warrants may be sold or otherwise transferred at market prices or other
prices in exchange for consideration consisting of services rendered, cash or
other valuable consideration. Ladenburg has indicated to the Company that it has
not retained and does not intend to retain any underwriter, broker or dealer to
facilitate the offer or sale of the Offered Warrants offered hereby.
General
- -------
The Company is paying the expenses incurred in connection with
preparing and filing this Prospectus and the registration statement to which it
relates, other than selling commissions. In addition, in the event a Selling
Shareholder effects a short sale of Common Stock, this Prospectus may be
delivered in connection with such short sale and the shares offered by this
Prospectus may be used to cover such short sale. To the extent, if any, that a
Selling Shareholder may be considered an "underwriter" within the meaning of the
Securities Act, the sale of the shares by it shall be covered by this
Prospectus.
The Company have not retained any underwriter, broker or dealer to
facilitate the offer or sale of the Shares offered hereby. The Company will pay
no underwriting commissions or discounts in connection therewith, and the
Company will not receive any proceeds from the sale of the Shares.
In order to comply with the securities laws of certain states, if
applicable, the Offered Securities will be sold in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in certain
states the Shares may not be sold unless they have been registered or qualified
for sale in the applicable state or an exemption from the registration or
qualification requirement is available.
DESCRIPTION OF SHARES
For a description of the 3,177,945 Shares offered hereunder, please
refer to the description of the Common Stock provided in the Registration
Statement on Form 10-SB filed by the Company with the SEC on November 25, 1996.
The Offered Warrants permit the holder thereof to purchase up to 75,078
Shares at an exercise price of $6.75 (or pursuant to a cashless exercise
provision) at any time on or before the earlier of (i) March 31, 2003 and (ii)
the date thirty days following the fifth day (whether or not consecutive) the
closing price of a share of Common Stock on the Nasdaq National Market equals or
exceeds $9.00. In addition, the Offered Warrants contain a provision prohibiting
assignment of such Warrants to any person who is not an employee of Ladenburg.
Such Offered Warrants include standard anti-dilution provisions pursuant to
which the exercise price and number of Shares issuable thereunder is adjusted
proportionately in the event of a stock split, stock dividend, recapitalization
or similar transaction.
27
<PAGE>
LEGAL MATTERS
The validity of the Shares being offered hereby is being passed upon
for the Company by Goodman and Carr, Ontario, Canada.
EXPERTS
The financial statements and schedules of the Company included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1999 and
incorporated by reference in this Prospectus have been audited by McGovern,
Hurley, Cunningham, LLP independent public accountants, as indicated in their
reports with respect thereto, and are incorporated herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
reports.
Future financial statements of the Company and the reports thereon by
McGovern, Hurley, Cunningham LLP also will be incorporated by reference in the
Registration Statement in reliance upon the authority of that firm as experts in
accounting and auditing in giving those reports; provided, however, only to the
extent that said firm has audited those financial statements and consented to
the use of their reports therein.
28
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
As permitted by SEC rules, this Prospectus does not contain all of the
information that prospective investors can find in the Registration Statement or
the exhibits to the Registration Statement. The SEC permits the Company to
incorporate by reference into this Prospectus information filed separately with
the SEC. The information incorporated by reference is deemed to be part of this
Prospectus, except as superseded or modified by information contained directly
in this Prospectus or in a subsequently filed document that also is (or is
deemed to be) incorporated herein by reference.
This Prospectus incorporates by reference the documents set forth below
that the Company (File No. 1-12497) has previously filed with the SEC pursuant
to the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These
documents contain important information about the Company and its financial
condition.
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1999, filed with the SEC on April 12, 2000.
(b) All reports and other documents filed pursuant to Section
13(a) or 15(d) of the Exchange Act since the end of fiscal
year 1999.
(c) The description of the Common Stock contained in the Company's
Registration Statement on Form 10 filed under the Exchange
Act, including any amendment or report filed under the
Exchange Act for the purpose of updating such description.
The Company hereby incorporates by reference all reports and other
documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this Prospectus and prior to the termination
of this Offering.
29
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
The Company files annual, quarterly, and current reports, proxy
statements, and other information with the SEC. You may read and copy any
reports, statements, or other information that the Company files at the SEC's
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. Please
call the SEC at 1-800-SEC-0330 for further information on the Public Reference
Room. The SEC also maintains an Internet site (http://www.sec.gov) that makes
available to the public reports, proxy statements, and other information
regarding issuers, such as the Company, that file electronically with the SEC.
In addition, the Company will provide, without charge, to each person
to whom this Prospectus is delivered, upon written or oral request of any such
person, a copy of any or all of the foregoing documents (other than exhibits to
such documents which are not specifically incorporated by reference in such
documents). Please direct written requests for such copies to the Company c/o
Mineral Recovery Systems at 230 South Rock Boulevard, Suite 21, Reno, Nevada
89502, U.S.A., Attention: Ed Dickinson, Chief Financial Officer. Telephone
requests may be directed to the office of the Director of Finance at (800)
897-8245.
The Common Stock is quoted on the Nasdaq National Market. Reports,
proxy statements and other information concerning the Company can be inspected
and copied at the Public Reference Room of the National Association of
Securities Dealers, 1735 K Street, N.W., Washington, D.C. 20006.
30
<PAGE>
================================================================================
We have not authorized any dealer,
salesperson or other person to give any
information or represent anything not
contained in this Prospectus. This 3,177,945 Common Shares
Prospectus does not offer to sell or buy 75,078 Warrants
any securities in any jurisdiction where
it is unlawful. The information in this
Prospectus is current as of May 4, 2000.
-----------------------
ALTAIR INTERNATIONAL INC.
SUMMARY COMMON SHARES
TABLE OF CONTENTS COMMON SHARES
WARRANTS
(For a more detailed Table of Contents,
see page 2)
Page
Heading Page
- ------- ---- ---------------
Table of Contents............2 Prospectus
About this Prospectus........4 ---------------
Prospectus Summary...........4
Forward-Looking Statements...7
Risk Factors.................7
The Company's Common Stock..19 May 4, 2000
Use of Proceeds.............21
Dilution....................21
Selling Shareholders........21
Plan of Distribution........26
Description of Shares.......28
Legal Matters...............28
Experts.....................28
Incorporation of
Certain Documents
by Reference................28
Where You Can Find
More Information............29
--------------------
================================================================================
31
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the various expenses of the offering, sale and
distribution of the Shares being registered pursuant to this registration
statement (the "Registration Statement"). All of the expenses listed below will
be borne by the Company. All of the amounts shown are estimates except the SEC
registration fees.
Item Amount
SEC Commission registration fees $3,523
NASD registration fees $17,500
Accounting fees and expenses $1,000
Legal fees and expenses $10,000
Blue Sky fees and expenses $2,000
Printing Expenses $2,000
Miscellaneous Expenses $3,977
Total: $40,000
Item 15. Indemnification of Directors and Officers
- --------------------------------------------------
Subsection 136(1) of the Business Corporation Act, Ontario (the "Act") provides
that a corporation may indemnify a director or officer of the corporation, a
former director or officer of the corporation or a person who acts or acted at
the corporation's request as a director or officer of a body corporate of which
the corporation is or was a shareholder or creditor, and his heirs and legal
representatives, against all costs, charges and expenses, including an amount
paid to settle an action or satisfy a judgment, reasonably incurred by him or
her in respect of any civil, criminal or administrative action or proceeding to
which he is made a party by reason of being or having been a director or officer
of such corporation or body corporation, if,
(a) he acted honestly and in good faith with a view to the best interests
of the corporation; and
(b) in the case of a criminal or administrative action or proceeding that
is enforced by a monetary penalty, he had reasonable grounds for believing that
his or her conduct was lawful.
Subsection 136(2) of the Act provides that a corporation may, with the approval
of the court, indemnify a person referred to in subsection 136(1) of the Act in
respect of an action by or on behalf of the corporation or body corporate to
procure a judgment in its favor, to which the person is made a party by reason
of being or having been a director or an officer of the corporation or body
corporate, against all costs, charges and expenses reasonably incurred by the
person in connection with such action if he fulfills the conditions set out in
clauses 136(1)(a) and 136(1))(b) of the Act.
II-1
<PAGE>
Subsection 136(3) of the Act provides that despite anything in section 136 of
the Act, a person referred to in subsection 136(1) of the Act is entitled to
indemnity from the corporation in respect of all costs, charges and expenses
reasonably incurred by him in connection with the defense of any civil, criminal
or administrative action or proceeding to which he is made a party by reason of
being or having been a director or officer of the corporation or body corporate,
if the person seeking indemnity,
(a) was substantially successful on the merits in his defense of the action or
proceeding; and
(b) fulfills the conditions set out in clauses 136(1)(a) and 136(1)(b) of the
Act.
Subsection 136(4) of the Act provides that a corporation may purchase and
maintain insurance for the benefit of any person referred to in subsection
136(1) of the Act against any liability incurred by the person,
(a) in his capacity as a director or officer of the corporation, except where
the liability relates to the person's failure to act honestly and in good faith
with a view to the best interests of the corporation; or
(b) in his capacity as a director or officer of another body corporate where the
person acts or acted in that capacity at the corporation's request, except where
the liability relates to the person's failure to act honestly and in good faith
with a view to the best interests of the body corporate.
Subsection 136(5) of the Act provides that a corporation or a person referred to
in subsection 136(1) of the Act may apply to the court for an order approving an
indemnity under section 136 of the Act and the court may so order and make any
further order it thinks fit.
Subsection 136(6) of the Act provides that upon an application under subsection
136(5) of the Act, the court may order notice to be given to any interested
person and such person is entitled to appear and be heard in person or by
counsel.
The Company's By-laws, as amended, provide that subject to subsection 2 of
section 147 of the Act, every director and officer of the Company and his heirs,
executors, administrators and other legal personal representatives shall, from
time to time, be indemnified and saved harmless by the Company from and against
any liability and all costs, charges and expenses that such director or officer
sustains or incurs in respect of any action, suit or proceeding that is proposed
or commenced against him for or in respect of anything done or permitted by him
in respect of the execution of the duties of his office and all other costs,
charges and expenses that he sustains or incurs in respect of the affairs of the
Company, except such costs, charges or expenses as are occasioned by his own
willful neglect or default. In addition, the board of directors of the Company
has passed, and the shareholders have confirmed, several special By-laws
authorizing the board of directors, among other things, to borrow money and
issue bonds or debentures and to secure any such borrowing by mortgaging or
pledging all or part of the Company's assets. The special By-laws further
authorize the board of directors to delegate the foregoing powers to any
director or officer and to give indemnities to any such director or other person
acting on behalf of the Company and secure any such person against loss by
giving him by way of security a mortgage or charge upon all of the currently
owned or subsequently acquired property, undertakings, and rights of the
Company.
Pursuant to an employment agreement with William P. Long, the President, Chief
Executive Officer and a director of the Company, the Company has agreed to
assume all liability for and to indemnify, protect, save, and hold Dr. Long
harmless from and against any and all losses, costs, expenses, attorneys' fees,
claims, demands, liability, suits, and actions of every kind and character which
may be imposed upon or incurred by Dr. Long on account of, arising directly or
indirectly from, or in any way connected with or related to Dr. Long's
activities as an officer and member of the board of directors of the Company,
except as arise as a result of fraud, felonious conduct, gross negligence or
acts of moral turpitude on the part of Dr. Long. In addition, Mineral Recovery
Systems, Inc. ("MRS"), a wholly-owned subsidiary of the Company, has agreed to
assume all liability for and to indemnify, protect, save, and hold harmless
Patrick Costin (Vice President of the Company and President of MRS) from and
against any and all losses, costs, expenses, attorneys' fees, claims, demands,
liabilities, suits and actions of every kind and character which may be imposed
on or incurred by Mr. Costin on account of, arising directly or indirectly from,
or in any way connected with Mr. Costin's activities as manager, officer, or
director of MRS or the Company.
II-2
<PAGE>
Indemnification may be granted pursuant to any other agreement, bylaw, or vote
of shareholders or directors. In addition to the foregoing, the Company
maintains insurance through a commercial carrier against certain liabilities
which may be incurred by its directors and officers. The foregoing description
is necessarily general and does not describe all details regarding the
indemnification of officers, directors or controlling persons of the Company.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions or otherwise, the Company has been informed
that in the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act, and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Company of expenses incurred or paid by a director, officer or
controlling person of the Company in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
Item 16. Exhibits.
The following exhibits required by Item 601 of Regulations S-K promulgated under
the Securities Act have been included herewith or have been filed previously
with the SEC as indicated below.
<TABLE>
<CAPTION>
Exhibit No. Description Incorporated by Reference/
Filed Herewith (and Sequential Page #)
- ---------------- ---------------------------------------- -------------------------------------------------------
<S> <C> <C>
Incorporated by reference to Registration Statement
4.1 Form of Common Stock Certificate on Form 10-SB filed with the Commission on November
25, 1996.
Incorporated by reference to the Company's Current
Report on Form 8-K filed with the Commission on
4.2 Form of Warrant (related to January 13, 1998, as amended by Amendment No. 1 to
Convertible Debentures) Current Report on Form 8-K/A, filed on January 21,
1998.
Incorporated by reference to the Company's Quarterly
4.3 Form of Series J Warrant Report on Form 10-Q filed on May 15, 1999.
Incorporated by reference to the Company's Annual
4.4 Form of Series K Warrant Report on Form 10-K filed with the Commission on
April 12, 2000.
Incorporated by reference to the Company's Annual
4.5 Form of Series L Warrant Report on Form 10-K filed with the Commission on
April 12, 2000.
4.6 Form of Series M Warrant Filed herewith on Page II-8
4.7 Form of DeJong Warrant Filed herewith on Page II-19
4.8 Form of Series N Warrant Filed herewith. on Page II-22
Shareholders Rights Plan Agreement
dated November 27, 1998, between Incorporated by reference to the Company's Current
4.9 Altair International Inc. and Equity Report on Form 8-K filed with the Commission on
Transfer Services Inc. December 29, 1998.
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Amended and Restated Shareholder
Rights Plan dated October 15, 1999, Incorporated by reference to the Company's Current
4.10 between the Company and Equity Report on Form 8-K filed with the Commission on
Transfer Services, Inc. November 19, 1999.
Opinion of Goodman and Carr as to
5 legality of securities offered To be filed in pre-effective amendment
23.1 Consent of McGovern, Hurley, Filed herewith on Page II-34
Cunningham, LLP
23.2 Consent of Goodman and Carr Included in Exhibit No. 5.
24 Powers of Attorney Included on Page II-6 of the Registration Statement.
27 Financial Data Schedule Filed herewith on Page II-35
- -----------------------
</TABLE>
Item 17. Undertakings.
- ----------------------
(a) The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made of
the securities registered hereby, a post-effective amendment to this
Registration Statement:
(i) To include any Prospectus required by section 10(a)(3) of the
Securities Act;
(ii) To reflect in the Prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this Registration Statement;
notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii)
To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned Company hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the Company's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act
that is incorporated by reference in the Registration Statement shall be deemed
to be a new Registration Statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-4
<PAGE>
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company, the Company has been informed that in the opinion of the SEC such
indemnification is against public policy as expressed in the Securities Act, and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Company certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-3 and has duly caused this Registration
Statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Cody, State of Wyoming, on May 3, 2000.
ALTAIR INTERNATIONAL INC.
By /s/ William P. Long
-----------------------
William P. Long
President and Chief Executive Officer
POWER OF ATTORNEY AND ADDITIONAL SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person whose signature to this
Registration Statement appears below hereby constitutes and appoints William P.
Long and Patrick Costin, and each of them, as his true and lawful
attorney-in-fact and agent, with full power of substitution, to sign on his
behalf individually and in the capacity stated below and to perform any acts
necessary to be done in order to file all amendments and post-effective
amendments to this Registration Statement, and any and all instruments or
documents filed as part of or in connection with this Registration Statement or
the amendments thereto and each of the undersigned does hereby ratify and
confirm all that said attorney-in-fact and agent, or his substitutes, shall do
or cause to be done by virtue hereof.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William P. Long President, Chief Executive Officer, and Director May 3, 2000
- ------------------- (Principal Executive Officer and authorized
William P. Long representative of the Company in the United States)
/s/ Edward H. Dickinson Chief Financial Officer May 3, 2000
- ----------------------- (Principal Financial Officer and Principal
Edward H. Dickinson Accounting Officer)
/s/ James I. Golla Secretary and Director May 3, 2000
- ------------------
James I. Golla
/s/ George E. Hartman Director May 3, 2000
- ---------------------
George E. Hartman
/s/ Robert Sheldon Director May 3, 2000
- ------------------
Robert Sheldon
</TABLE>
II-6
<PAGE>
II-7
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit No. Description Incorporated by Reference/
Filed Herewith (and Sequential Page #)
- ---------------- ---------------------------------------- -------------------------------------------------------
<S> <C> <C>
Incorporated by reference to Registration Statement
4.1 Form of Common Stock Certificate on Form 10-SB filed with the Commission on November
25, 1996.
Incorporated by reference to the Company's Current
Report on Form 8-K filed with the Commission on
4.2 Form of Warrant (related to January 13, 1998, as amended by Amendment No. 1 to
Convertible Debentures) Current Report on Form 8-K/A, filed on January 21,
1998.
Incorporated by reference to the Company's Quarterly
4.3 Form of Series J Warrant Report on Form 10-Q filed on May 15, 1999.
Incorporated by reference to the Company's Annual
4.4 Form of Series K Warrant Report on Form 10-K filed with the Commission on
April 12, 2000.
Incorporated by reference to the Company's Annual
4.5 Form of Series L Warrant Report on Form 10-K filed with the Commission on
April 12, 2000.
4.6 Form of Series M Warrant Filed herewith on Page II-8
4.7 Form of DeJong Warrant Filed herewith on Page II-19
4.8 Form of Series N Warrant Filed herewith. on Page II-22
Shareholders Rights Plan Agreement
dated November 27, 1998, between Incorporated by reference to the Company's Current
4.9 Altair International Inc. and Equity Report on Form 8-K filed with the Commission on
Transfer Services Inc. December 29, 1998.
Amended and Restated Shareholder
Rights Plan dated October 15, 1999, Incorporated by reference to the Company's Current
4.10 between the Company and Equity Report on Form 8-K filed with the Commission on
Transfer Services, Inc. November 19, 1999.
Opinion of Goodman and Carr as to
5 legality of securities offered To be filed in a pre-effective amendment
23.1 Consent of McGovern, Hurley, Filed herewith on Page II-34
Cunningham, LLP
23.2 Consent of Goodman and Carr Included in Exhibit No. 5.
24 Powers of Attorney Included on Page II-6 of the Registration Statement.
27 Financial Data Schedule Filed herewith on Page II-35
- -----------------------
</TABLE>
II-7
Exhibit 4.6
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS AND HAVE BEEN TAKEN
FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO OR FOR SALE IN CONNECTION
WITH ANY DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, IS IN EFFECT WITH RESPECT TO SUCH SECURITIES OR THE COMPANY HAS
RECEIVED AN OPINION IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY PROVIDING
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF
1933, AS AMENDED, IS AVAILABLE.
ALTAIR INTERNATIONAL INC.
COMMON SHARE PURCHASE WARRANT
83,333 Series M Warrants Warrant Certificate No. M-1
Void after 5:00 p.m., Mountain Standard Time
on March 3, 2004 or on such earlier date specified herein
ALTAIR INTERNATIONAL INC.
(Incorporated under the laws of Ontario)
This Series M_ Warrant Certificate ("Warrant Certificate") is to certify that,
for value received, Toyota On Western, Inc., or registered assigns (the
"Holder") shall have the right to purchase from Altair International Inc.
(hereinafter called the "Corporation") one fully paid and non-assessable Common
Share of the Corporation (a "Common Share") for each Series M Warrant
(individually, a "Warrant") represented by this Warrant Certificate at any time
up to 5:00 p.m. (Mountain Standard time) on the earlier of (i) March 3, 2004,
and (ii) the date thirty days following the fifth day (whether or not
consecutive) the closing price of the Common Shares on the Nasdaq National
Market equals or exceeds U.S. $10.00 (the "Expiry Time"). The exercise price for
the purchase of each such Common Share shall be U.S. $8.00 per share (the
"Exercise Price"). The number of Common Shares to be received upon the exercise
of each Warrant and the Exercise Price may be adjusted from time to time as
hereinafter set forth.
The Warrants shall be subject to the following terms and conditions:
1. For the purposes of this Warrant, the term "Common Shares" means common
shares without nominal or par value in the capital of the Corporation
as constituted on the date hereof; provided that in the event of a
change, subdivision, redivision, reduction, combination or
consolidation thereof or any other adjustment under clause 10 hereof,
or successive such changes, subdivisions, redivisions, reductions,
combinations, consolidations or other adjustments, then subject to the
adjustments, if any, having been made in accordance with the provisions
of this Warrant Certificate, "Common Shares" shall thereafter mean the
shares, other securities or other property resulting from such change,
subdivision, redivision, reduction, combination or consolidation or
other adjustment.
1
<PAGE>
2. This Warrant Certificate shall be signed by an officer of the
Corporation holding office at the time of signing, or any successor or
replacement person and notwithstanding any change in any of the persons
holding said offices between the time of actual signing and the
delivery of the Warrant Certificate and notwithstanding that such
officer signing may not have held office at the date of the delivery of
the Warrant Certificate, the Warrant Certificate so signed shall be
valid and binding upon the Corporation.
3. All rights under any of the Warrants in respect of which the right of
subscription and purchase therein provided for shall not theretofore
have been exercised shall wholly cease and determine and such Warrants
shall be wholly void and of no valid or binding effect after the Expiry
Time.
4. The right to purchase Common Shares pursuant to the Warrants may only
be exercised by the Holder at or before the Expiry Time by:
(a) duly completing and executing a Subscription Form in the form
attached hereto, in the manner therein indicated; and
(b) surrendering this Warrant Certificate and the duly completed
and executed Subscription Form to the Corporation at the
address specified in clause 22 below together with payment of
the purchase price for the Common Shares subscribed for in the
form of cash or a certified cheque payable to the Corporation
in an amount equal to the then applicable Exercise Price
multiplied by the number of Common Shares subscribed for.
5. Upon receipt of the Subscription Form, this Warrant Certificate, and
payment as aforesaid, the Corporation shall cause to be issued to the
Holder the number of Common Shares to be issued and the Holder shall
become a shareholder of the Corporation in respect of such Common
Shares, effective as of the date of receipt by the Corporation of such
Subscription Form, Warrant Certificate, and payment and shall be
entitled to delivery of a certificate or certificates evidencing such
shares. The Corporation shall cause such certificate or certificates to
be mailed to the Holder at the address or addresses specified in such
Subscription Form within ten (10) business days of such receipt and
payment as herein provided or, if so instructed by the Holder, held for
pick-up by the Holder at the principal office of the registrar and
transfer agent of the Common Shares, Equity Transfer Services Inc. (the
"Transfer Agent").
6. No fractional shares or stock representing fractional shares shall be
issued upon the exercise of any Warrant. In lieu of any fractional
shares which would otherwise be issuable, the Corporation shall either
pay cash equal to the product of such fraction multiplied by the fair
market value of one share of Common Stock on the date of exercise, as
determined in good faith by the Corporation's Board of Directors, or
issue the next largest whole number of Common Shares at the
Corporation's option.
7. The Warrants may not be exercised unless at the time of exercise (i) a
registration statement registering the Common Shares issuable upon such
exercise is effective under the Securities Act of 1933, as amended (the
"1933 Act"), or the transaction in which such shares are to be issued
is exempted from the application of the registration requirements of
the 1933 Act, and (ii) the Common Shares issuable upon exercise of the
2
<PAGE>
Warrants have been registered or qualified under any applicable Canadian,
provincial, state securities laws or an exemption from registration or
qualification is available under such laws. The Common Shares issuable upon
exercise of this Warrant are and will be "restricted securities" under the 1933
Act inasmuch as they are being acquired from the Corporation in a transaction
not involving a public offering, and that, under the 1933 Act and applicable
regulations thereunder, such securities may be resold without registration under
the 1933 Act only in certain limited circumstances. Unless a registration
statement registering the Common Shares issuable upon exercise of any Warrant is
effective under the 1933 Act at the time such Common Shares are issued, the
certificates evidencing such Common Shares shall bear the legend set forth
below, together with any other legends required by the laws of the Province of
Ontario and any other state or province with jurisdiction:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS
AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO
OR FOR SALE IN CONNECTION WITH ANY DISTRIBUTION THEREOF. THESE
SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS A
REGISTRATION STAEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, IS
IN EFFECT WITH RESPECT TO SUCH SECURITIES OR THE COMPANY HAS RECEIVED
AN OPINION IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY PROVIDING
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT OF 1933, AS AMENDED, IS AVAILABLE.
The legend set forth above shall be removed by the Corporation from any
certificate evidencing the Common Shares issuable upon exercise of the Warrants
only (i) upon receipt by the Corporation of an opinion in form and substance
satisfactory to the Corporation that such legend may be removed pursuant to Rule
144 promulgated under the 1933 Act, (ii) upon confirmation that a registration
statement under the 1933 Act is at that time in effect with respect to such
Common Shares and that such transfer will not jeopardize the exemption or
exemptions from registration pursuant to which the respective Common Shares were
issued.
8. The holding of a Warrant shall not constitute the Holder a shareholder
of the Corporation nor entitle him to any right or interest in respect
thereof except as herein expressly provided.
9. The Corporation covenants and agrees that until the Expiry Time, while
any of the Warrants shall be outstanding, it shall reserve and there
shall remain unissued out of its authorized capital a sufficient number
of Common Shares to satisfy the right of purchase herein provided, as
such right of purchase may be adjusted pursuant to clauses 10 and 11
hereof. All Common Shares which shall be issued upon the exercise of
the right to purchase herein provided for, upon payment therefor of the
amount at which such Common Shares may at the time be purchased
pursuant to the provisions hereof, shall be issued as fully paid and
non-assessable shares and the holders thereof shall not be liable to
the Corporation or its creditors in respect thereof.
10. (a) If and whenever at any time after the date hereof and prior to
the Expiry Time the Corporation shall (i) subdivide, redivide
or change its then outstanding Common Shares into a greater
number of Common Shares, (ii) reduce, combine or consolidate
its then outstanding Common Shares into a lesser number of
3
<PAGE>
Common Shares or (iii) issue Common Shares (or securities
exchangeable for or convertible into Common Shares) to the
holders of all or substantially all of its then outstanding
Common Shares by way of a stock dividend or other distribution
(any of such events herein called a "Common Share
Reorganization"), then the Exercise Price shall be adjusted
effective immediately after the effective date of any such
event in (i) or (ii) above or the record date at which the
holders of Common Shares are determined for the purpose of any
such dividend or distribution in (iii) above, as the case may
be, by multiplying the Exercise Price in effect on such
effective date or record date, as the case may be, by a
fraction, the numerator of which shall be the number of Common
Shares outstanding on such effective date or record date, as
the case may be, before giving effect to such Common Share
Reorganization and the denominator of which shall be the
number of Common Shares outstanding immediately after giving
effect to such Common Share Reorganization including, in the
case where securities exchangeable for or convertible into
Common Shares are distributed, the number of Common Shares
that would be outstanding if such securities were exchanged
for or converted into Common Shares.
(b) If and whenever at any time after the date hereof and prior to
the Expiry Time, the Corporation shall distribute any class of
shares or rights, options or warrants or other securities
(other than those referred to in clause 10(a) above),
evidences of indebtedness or property (excluding cash
dividends paid in the ordinary course) to holders of all or
substantially all of its then outstanding Common Shares, the
number of Common Shares to be issued by the Corporation under
this Warrant shall, at the time of exercise of the right of
subscription and purchase under this Warrant Certificate, be
appropriately adjusted and the Holder shall receive, in lieu
of the number of the Common Shares in respect of which the
right to purchase is then being exercised, the aggregate
number of Common Shares or other securities or property that
the Holder would have been entitled to receive as a result of
such event, if, on the record date thereof, the Holder had
been the registered holder of the number of Common Shares to
which the Holder was theretofore entitled upon the exercise of
the rights of the Holder hereunder.
(c) If and whenever at any time after the date hereof and prior to
the Expiry Time there is a capital reorganization of the
Corporation or a reclassification or other change in the
Common Shares (other than a Common Share Reorganization) or a
consolidation or merger or amalgamation of the Corporation
with or into any other corporation or other entity (other than
a consolidation, merger or amalgamation which does not result
in any reclassification of the outstanding Common Shares or a
change of the Common Shares into other securities), or a
transfer of all or substantially all of the Corporation's
assets to another corporation or other entity in which the
holders of Common Shares are entitled to receive shares, other
securities or other property (any of such events being called
a "Capital Reorganization"), the Holder, where he has not
exercised the right of subscription and purchase under this
Warrant Certificate prior to the effective date of such
Capital Reorganization, shall be entitled to receive and shall
accept, upon the exercise of such right, on such date or any
time thereafter, for the same aggregate consideration in lieu
of the number of Common shares to which he was theretofore
entitled to subscribe for and purchase, the aggregate number
of shares or other securities or property which the Holder
would have been entitled to receive as a result of such
Capital Reorganization if, on the effective date thereof, he
had been the registered holder of the number of Common Shares
to which he was theretofore entitled to subscribe for and
purchase.
4
<PAGE>
(d) If and whenever at any time after the date hereof and prior to
the Expiry Time, any of the events set out in clause 10(a),
(b) or (c) shall occur and the occurrence of such event
results in an adjustment of the Exercise Price pursuant to the
provisions of this clause 10, then the number of Common Shares
purchaseable pursuant to this Warrant shall be adjusted
contemporaneously with the adjustment of the Exercise Price by
multiplying the number of Common Shares then otherwise
purchaseable on the exercise thereof by a fraction, the
numerator of which shall be the Exercise Price in effect
immediately prior to the adjustment and the denominator of
which shall be the Exercise Price resulting from such
adjustment.
(e) If the Corporation takes any action affecting its Common
Shares to which the foregoing provisions of this clause 10, in
the opinion of the board of directors of the Corporation,
acting in good faith, are not strictly applicable, or if
strictly applicable would not fairly adjust the rights of the
Holder against dilution in accordance with the intent and
purposes hereof, or would otherwise materially affect the
rights of the Holder hereunder, then the Corporation may
execute and deliver to the Holder an amendment hereto
providing for an adjustment in the application of such
provisions so as to adjust such rights as aforesaid in such
manner as the board of directors of the Corporation may
determine to be equitable in the circumstances, acting in good
faith. The failure of the taking of action by the board of
directors of the Corporation to so provide for any adjustment
on or prior to the effective date of any action or occurrence
giving rise to such state of facts will be conclusive evidence
that the board of directors has determined that it is
equitable to make no adjustment in the circumstances.
11. The following rules and procedures shall be applicable to the
adjustments made pursuant to clause 10:
(a) any Common Shares owned or held by or for the account of the
Corporation shall be deemed not be to outstanding except that,
for the purposes of clause 10, any Common Shares owned by a
pension plan or profit sharing plan for employees of the
Corporation or any of its subsidiaries shall not be considered
to be owned or held by or for the account of the Corporation;
(b) no adjustment in the Exercise Price shall be required unless a
change of at least 1% of the prevailing Exercise Price would
result, provided, however, that any adjustment which, except
for the provisions of this clause 11(b), would otherwise have
been required to be made, shall be carried forward and taken
into account in any subsequent adjustment;
(c) the adjustments provided for in clause 10 are cumulative and
shall apply to successive subdivisions, consolidations,
dividends, distributions and other events resulting in any
adjustment under the provisions of such clause;
(d) in the absence of a resolution of the board of directors of
the Corporation fixing a record date for any dividend or
distribution referred to in clause 10(a)(iii) above, the
Corporation shall be deemed to have fixed as the record date
therefor the date on which such dividend or distribution is
effected;
(e) if the Corporation sets a record date to take any action and
thereafter and before the taking of such action abandons its
plan to take such action, then no adjustment to the Exercise
Price will be required by reason of the setting of such record
date;
5
<PAGE>
(f) forthwith after any adjustment to the Exercise Price or the
number of Common Shares purchaseable pursuant to the Warrants,
the Corporation shall provide to the Holder a certificate of
an officer of the Corporation certifying as to the amount of
such adjustment and, in reasonable detail, describing the
event requiring and the manner of computing or determining
such adjustment; and
(g) any question that at any time or from time to time arises with
respect to the amount of any adjustment to the Exercise Price
or other adjustment pursuant to clause 10 shall be
conclusively determined by a firm of independent chartered
accountants (who may be the Corporation's auditors) selected
by the board of directors of the Corporation and shall be
binding upon the Corporation and the Holder.
12. At least 10 days prior to the latter of the effective date or record
date, as applicable, of any event referred to in clause 10, the
Corporation shall notify the Holder of the particulars of such event
and the estimated amount of any adjustment required as a result
thereof.
13. On the happening of each and every such event set out in clause 10, the
applicable provisions of this Warrant, including the Exercise Price,
shall, ipso facto, be deemed to be amended accordingly and the
Corporation shall take all necessary action so as to comply with such
provisions as so amended.
14. The Corporation shall not be required to deliver certificates for
Common Shares while the share transfer books of the Corporation are
properly closed, having regard to the provisions of clauses 10 and 11
hereof, prior to any meeting of shareholders or for the payment of
dividends or for any other purpose and in the event of the surrender of
any Warrant in accordance with the provisions hereof and the making of
any subscription and payment for the Common Shares called for thereby
during any such period delivery of certificates for Common Shares may
be postponed for not more than five (5) days after the date of the
re-opening of said share transfer books. Provided, however, that any
such postponement of delivery of certificates shall be without
prejudice to the right of the Holder so surrendering the same and
making payment during such period to receive after the share transfer
books shall have been re-opened such certificates for the Common Shares
called for, as the same may be adjusted pursuant to clauses 10 and 11
hereof as a result of the completion of the event in respect of which
the transfer books were closed.
15. Subject as hereinafter provided, all or any of the rights conferred
upon the Holder by the terms hereof may be enforced by the Holder by appropriate
legal proceedings. No recourse under or upon any obligation, covenant or
agreement contained herein shall be had against any shareholder or officer of
the Corporation either directly or through the Corporation, it being expressly
agreed and declared that the obligations under the Warrants are solely corporate
obligations and that no personal liability whatever shall attach to or be
incurred by the shareholders or officers of the Corporation or any of them in
respect thereof, any and all rights and claims against every such shareholder,
officer or director being hereby expressly waived as a condition of and as a
consideration for the issue of the Warrants.
6
<PAGE>
16. (a) The Warrants may not be assigned or transferred except as provided
herein and in accordance with and subject to the provisions of the 1933 Act and
the Rules and Regulations promulgated thereunder and any applicable state,
Canadian, and provincial securities laws. Assignment of a Warrant will be
permitted only (i) upon receipt by the Corporation of an opinion in form and
substance satisfactory to the Corporation that the Warrant may be transferred
pursuant to Rule 144 promulgated under the 1933 Act, or (ii) upon confirmation
that a registration statement under the 1933 Act is at that time in effect with
respect to the Warrant and that such transfer will not jeopardize the exemption
or exemptions from registration pursuant to which the Warrant was issued. Any
purported transfer or assignment made other than in accordance with this Section
16 shall be null and void and of no force and effect.
(b) Any assignment permitted hereunder shall be made by surrender of
this Warrant Certificate to the Corporation at its principal office with the
Assignment Form annexed hereto duly executed and funds sufficient to pay any
transfer tax. In such event, the Corporation shall, without charge, execute and
deliver a new Warrant Certificate in the name of the assignee named in such
Assignment Form, and the Warrants represented by this Warrant Certificate shall
promptly be cancelled. This Warrant Certificate may be divided or combined with
other Warrants which carry the same rights upon presentation thereof at the
principal office of the Corporation together with a written notice signed by the
Holder thereof, specifying the names and denominations in which new Warrants are
to be issued. The terms "Warrant" and "Warrants" as used herein include any
Warrants in substitution for or replacement of this Warrant, or into which the
Warrant represented by this Warrant Certificate may be divided or exchanged.
17. The Holder may subscribe for and purchase any lesser number of Common
Shares than the number of shares expressed in this Warrant Certificate. In the
case of any subscription for a lesser number of Common Shares than expressed in
this or any successor Warrant Certificate or a transfer of any of the Warrants
pursuant to clause 16, the Holder shall be entitled to receive at no cost to the
Holder a new Warrant Certificate in respect of the balance of Warrants not then
exercised or transferred. Any new Warrant Certificate(s) shall be mailed to the
Holder or assignee by the Corporation or, at its direction, the Transfer Agent,
within five (5) business days of receipt by the Corporation of all materials
required by clauses 5 or 16, as applicable.
18. Each Holder of this Warrant, the Warrant Shares or any other security
issued or issuable upon exercise of this Warrant shall indemnify and
hold harmless the Corporation, its directors and officers, and each
person, if any, who controls the Corporation, against any losses,
claims, damages or liabilities, joint or several, to which the
Corporation or any such director, officer or any such person may become
subject under the 1933 Act or statute or common law, insofar as such
losses, claims, damages or liabilities, or actions in respect thereof,
arise out of or are based upon the disposition by such Holder of the
Warrant the Common Shares issuable upon the exercise of this Warrant in
violation of the terms of this Warrant Certificate.
19. If any Warrant Certificate becomes stolen, lost, mutilated or
destroyed, the Corporation shall, on such terms as it may in its
discretion acting reasonably impose, issue and sign a new Warrant
Certificate of like denomination, tenor and date as the Warrant
Certificate so stolen, lost, mutilated or destroyed for delivery to the
Holder.
20. The Corporation and the Transfer Agent may deem and treat the
registered holder of any Warrant Certificate as the absolute owner of
the Warrants represented thereby for all purposes, and the Corporation
and neither the Corporation nor the Transfer Agent shall be affected by
any notice or knowledge to the contrary except where the Corporation or
the Transfer Agent is required to take notice by statute or by order of
7
<PAGE>
a court of competent jurisdiction. A Holder shall be entitled to the
rights evidenced by such Warrant Certificate free from all equities or
rights of set-off or counterclaim between the Corporation and the
original or any intermediate holder thereof and all persons may act
accordingly and the receipt by any such Holder of the Common Shares
purchaseable pursuant to such Warrant shall be a good discharge to the
Corporation and the Transfer Agent for the same and neither the
Corporation nor the Transfer Agent shall be bound to inquire into the
title of any such Holder except where the Corporation or the Transfer
Agent is required to take notice by statute or by order of a court of
competent jurisdiction.
21. The Holders of Warrants shall have the power from time to time by an
extraordinary resolution (as hereinafter defined):
(a) to sanction any modification, abrogation, alteration or
compromise of the rights of the Holders of Warrants against
the Corporation which shall be agreed to by the Corporation;
and/or
(b) to assent to any modification of or change in or omission from
the provisions contained herein or in any instrument ancillary
or supplemental hereto which shall be agreed to by the
Corporation; and/or
(c) to restrain any Holder of a Warrant from taking or instituting
any suit or proceedings against the Corporation for the
enforcement of any of the covenants on the part of the
Corporation conferred upon the Holders by the terms of the
Warrants.
Any such extraordinary resolution as aforesaid shall be binding upon
all the Holders of Warrants whether or not assenting in writing to any
such extraordinary resolution, and each Holder of any of the Warrants
shall be bound to give effect thereto accordingly. Such extraordinary
resolution shall, where applicable, be binding on the Corporation which
shall give effect thereto accordingly.
The Corporation shall forthwith upon receipt of an extraordinary
resolution provide notice to all Holders of the date and text of such
resolution. The Holders of Warrants assenting to an extraordinary
resolution agree to provide the Corporation forthwith with a copy of
any extraordinary resolution passed.
The expression "extraordinary resolution" when used herein shall mean a
resolution assented to in writing, in one or more counterparts, by the
Holders of Warrants calling in the aggregate for not less than
seventy-five per cent (75%) of the aggregate number of shares called
for by all of the Warrants which are, at the applicable time,
outstanding.
8
<PAGE>
22. All notices to be sent hereunder shall be deemed to be validly given to
the Holders of the Warrants on the date of receipt if personally
delivered, sent by telecopier or overnight courier, charges prepaid, or
five days after deposit in the United States mail, by registered or
certified mail, postage prepaid, addressed to such holders at their
post office addresses appearing in the register of Warrant holders
caused to be maintained by the Corporation. All notices to be sent
hereunder shall be deemed to be validly given to the Corporation on the
date of receipt if personally delivered, sent by telecopier or
overnight courier, charges prepaid, or five days after deposit in the
United States mail, by registered or certified mail, postage prepaid,
addressed to the Corporation at 1725 Sheridan Avenue, Suite 140, Cody,
Wyoming 82414 or such other address as the Corporation shall have
designated by written notice to such registered owner.
23. This Warrant shall be governed by the laws of the State of Nevada and
the federal laws of the United States applicable therein (within
reference to the conflict of laws provisions thereof).
IN WITNESS WHEREOF the Corporation has caused this Warrant Certificate
to be signed by its duly authorized officer.
DATED as of the _____________ day of ______, ____.
ALTAIR INTERNATIONAL INC.
By: _______________________________________
Its: ______________________________________
Acknowledged and agreed to as of the ____________ day of March, 2000.
)
- -------------------------------- ) -----------------------
Witness ) Witness
)
9
<PAGE>
SUBSCRIPTION FORM
TO BE COMPLETED IF WARRANTS ARE TO BE EXERCISED:
The undersigned hereby subscribes for ________________ common shares of Altair
International Inc. according to the terms and conditions set forth in the
annexed warrant certificate (or such number of other securities or property to
which such warrant entitles the undersigned to acquire under the terms and
conditions set forth in the annexed warrant certificate). The subscriber
acknowledges and agrees that any legend required by applicable law may be placed
on any certificates representing common shares delivered to the undersigned.
Address for Delivery of Shares: ____________________________________
------------------------------------
------------------------------------
------------------------------------
Attention: _________________________
Tendered (U.S. $_____ per share) Exercise Price $______________________
Dated at ________________, this _______ day of _______________, _______
Witness: ) ____________________________________
) Holder's Name
)
)
) ---------------------------
) Authorized Signature
)
)
) ---------------------------
) Title (if applicable)
Signature guaranteed:
10
<PAGE>
ASSIGNMENT FORM
TO BE COMPLETED IF WARRANTS ARE TO BE ASSIGNED:
TO: ALTAIR INTERNATIONAL INC.
1725 Sheridan Avenue
Suite 140
Cody, Wyoming 82414
<PAGE>
By signing below, the undersigned represents, warrants and certifies to
Altair International Inc. as follows:
(a) the undersigned is the record and beneficial owner of the
Warrant(s) represented by the Warrant Certificate attached hereto; and
(b) either
_____ (i) attached hereto is an opinion in form and substance
satisfactory to the Corporation that the Warrant(s) to be transferred
hereby may be transferred pursuant to Rule 144 promulgated under the
1933 Act, or
______ (ii) a registration statement under the 1933 Act is at
that time in effect with respect to the Warrant(s) to be transferred
hereby and transfer of such Warrant(s) will not jeopardize the
exemption or exemptions from registration pursuant to which such
Warrant(s) were issued.
By signing below, the undersigned hereby transfers, assigns and conveys all
right, title and interest in and to _________ of the Warrants represented by
this Warrant Certificate to _____________________________
____________________________ residing at
________________________________________ for good and valuable consideration.
You are hereby instructed to take the necessary steps to effect this transfer.
Dated at ___________________, this ______ day of _____________, _____.
Witness: ) ____________________________________
) Holder's Name
)
) ---------------------------
) Authorized Signature
)
)
) ---------------------------
) Title (if applicable)
)
Signature guaranteed: )
11
Exhibit 4.7
Altair International, Inc./de Jong & Associates Inc. Agreement
WARRANT TO PURCHASE SHARES
Neither this Warrant nor the securities issuable upon exercise hereof have been
registered under the Securities Act of 1933, as amended, or under any State
Securities Laws and may not be transferred in violation of such Act or Laws, the
Rules and Regulations thereunder, or the provisions of this Warrant.
Warrant to purchase 75,000 shares of common stock of Altair International, Inc.
February 15, 2000
This Is To Certify That de Jong & Associates, Incorporated of 345 S.
Coast Hwy 101, Suite 3, Encinitas, California 92024 (hereinafter referred to as
the "Warrantholder") is entitled, upon the due exercise hereof and subject to
the terms and conditions hereof, at any time commencing on the date of this
warrant (the "Commencement Date"), and ending on the third anniversary of the
Commencement Date (the "Expiration Date"), to purchase from Altair
International, Inc. (the "Company"), and the Company shall issue and sell to the
Warrantholder, the number of shares of common stock (the "Common Stock"), of the
Company (the "Warrant Shares") set forth above upon presentation of this
Warrant, together with the notice of exercise at the office of the Company, and
upon simultaneous payment therefor at an exercise price per Warrant Share equal
to U.S. $4.00 (Four dollars U.S. funds) (the "Exercise Price"). The number of
Warrant Shares issuable upon exercise of this Warrant and the Exercise Price are
subject to adjustment as provided in Section 3 of this Warrant.
1. Transfer Restrictions
The Warrantholder acknowledges that it may not sell, transfer, assign,
hypothecate, or otherwise dispose of this Warrant after the Commencement Date,
unless such sale, transfer assignment, hypothecation, or other disposition is in
accordance with applicable federal and state securities laws, and the
Warrantholder's counsel has issued a favorable opinion regarding such transfer.
In connection with the Warrantholder's compliance with applicable federal and
state securities laws, the Company may require such other documentation
reasonably satisfactory to the Company evidencing compliance with such laws.
2. Time of Exercise
This Warrant may be exercised in whole or in part, and from time to time, at any
time after the date hereof, but not after 5:00 p.m. on the Expiration Date.
1
<PAGE>
3. Adjustments
If the Company shall at any time declare or pay a dividend or make any other
distribution upon any capital stock of the Company payable in Common Stock or
securities convertible into Common Stock, subdivide its outstanding Common Stock
into a greater number of shares, the total number of Warrant Shares then
remaining subject to purchase hereunder shall be changed in proportion to such
change in issued shares of Common Stock as if the Warrant Shares remaining
subject to purchase hereunder shall be changed in proportion to such change in
issued shares of Common Stock as if the Warrant Shares remaining subject to
purchase under this Warrant were issued shares of Common Stock on the record
date for such stock dividend, stock split, or stock combination and the Exercise
Price per Warrant Share shall be adjusted so that the total consideration
payable to the Company upon the purchase of all Warrant Shares not theretofore
purchased shall not be changed. Appropriate readjustment shall be made in the
event that any dividend referred to in this Section shall be lawfully abandoned.
4. Investment Intent
The Warrantholder is acquiring this Warrant, and will acquire any Warrant Shares
upon the exercise hereof, for investment purposes only and not with a view to a
distribution thereof.
5. Delivery of Warrant Shares
As promptly as practicable after the receipt of this Warrant, the Notice of
Exercise, and the Exercise Price, the Company shall deliver to the Warrantholder
the requested certificates for the Warrant Shares issuable upon such exercise.
Such exercise shall be deemed to have been effected at the close of business on
the date of which the Notice of Exercise and the Exercise Price shall have been
received by the Company regardless of any delay in the actual issuance of stock
certificates.
6. Loss or Destruction
Upon receipt of evidence satisfactory to the Company of the loss, theft,
mutilation, or destruction of any Warrant, and in the case of any such loss,
theft or destruction upon delivery of a bond of indemnity in such form and
amount as shall be reasonably satisfactory to the Company, or in the event of
such mutilation upon surrender and cancellation of the Warrant, the Company will
make and deliver a new Warrant of like tenor, in lieu of such lost, stolen,
destroyed, or mutilated Warrant. Any new Warrant issued under the provisions of
this Section 7 in lieu of any Warrant alleged to be lost, destroyed, or stolen,
or in lieu of any mutilated Warrant, shall constitute an original contractual
obligation on the part of the Company.
7. Successors and Assigns
This Warrant and the right evidenced hereby shall inure to the benefit of and be
binding upon the successors and assigns of the Company and the Warrantholder.
2
<PAGE>
8. Amendment
This Warrant may not be modified or amended except by an instrument in writing
signed by the Company and the holder hereof.
9. Governing law
This Warrant shall be governed by and construed in accordance with the internal
substantive laws of the State of California.
In Witness Whereof, the Company has caused this Warrant to be executed
and delivered on the date first above written.
ALTAIR INTERNATIONAL, INC.
By:/s/William P.Long
--------------------
William P. Long, President
Exhibit 4.8
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS AND HAVE BEEN TAKEN
FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO OR FOR SALE IN CONNECTION
WITH ANY DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED UNLESS A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, IS IN EFFECT WITH RESPECT TO SUCH SECURITIES OR THE COMPANY HAS
RECEIVED AN OPINION IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY PROVIDING
THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF
1933, AS AMENDED, IS AVAILABLE.
ALTAIR INTERNATIONAL INC.
COMMON SHARE PURCHASE WARRANT
75,078 Series N Warrants Warrant Certificate No. N-1
Void after 5:00 p.m., Mountain Standard Time
on March 31, 2003 or on such earlier date specified herein
ALTAIR INTERNATIONAL INC.
(Incorporated under the laws of Ontario)
This Series N Warrant Certificate ("Warrant Certificate") is to certify that,
for value received, Ladenburg Thalmaan & Co., Inc., or registered assigns (the
"Holder") shall have the right to purchase from Altair International Inc.
(hereinafter called the "Corporation") one fully paid and non-assessable Common
Share of the Corporation (a "Common Share") for each Series M Warrant
(individually, a "Warrant") represented by this Warrant Certificate at any time
up to 5:00 p.m. (Mountain Standard time) on the earlier of (i) March 31, 2003,
and (ii) the date thirty days following the fifth day (whether or not
consecutive) the closing price of the Common Shares on the Nasdaq National
Market equals or exceeds U.S. $9.00 (the "Expiry Time"). The exercise price for
the purchase of each such Common Share shall be U.S. $6.75 per share (the
"Exercise Price"). The number of Common Shares to be received upon the exercise
of each Warrant and the Exercise Price may be adjusted from time to time as
hereinafter set forth.
The Warrants shall be subject to the following terms and conditions:
1. For the purposes of this Warrant, the term "Common Shares" means common
shares without nominal or par value in the capital of the Corporation
as constituted on the date hereof; provided that in the event of a
change, subdivision, redivision, reduction, combination or
consolidation thereof or any other adjustment under clause 10 hereof,
or successive such changes, subdivisions, redivisions, reductions,
combinations, consolidations or other adjustments, then subject to the
adjustments, if any, having been made in accordance with the provisions
of this Warrant Certificate, "Common Shares" shall thereafter mean the
shares, other securities or other property resulting from such change,
subdivision, redivision, reduction, combination or consolidation or
other adjustment.
1
<PAGE>
2. This Warrant Certificate shall be signed by an officer of the
Corporation holding office at the time of signing, or any successor or
replacement person and notwithstanding any change in any of the persons
holding said offices between the time of actual signing and the
delivery of the Warrant Certificate and notwithstanding that such
officer signing may not have held office at the date of the delivery of
the Warrant Certificate, the Warrant Certificate so signed shall be
valid and binding upon the Corporation.
3. All rights under any of the Warrants in respect of which the right of
subscription and purchase therein provided for shall not theretofore
have been exercised shall wholly cease and determine and such Warrants
shall be wholly void and of no valid or binding effect after the Expiry
Time.
4. The right to purchase Common Shares pursuant to the Warrants may only
be exercised by the Holder at or before the Expiry Time by:
(a) duly completing and executing a Subscription Form in the form
attached hereto, in the manner therein indicated;
(b) surrendering this Warrant Certificate and the duly completed
and executed Subscription Form to the Corporation at the
address specified in clause 22 below together with payment of
the purchase price for the Common Shares subscribed for in the
form of cash or a certified cheque payable to the Corporation
in an amount equal to the then applicable Exercise Price
multiplied by the number of Common Shares subscribed for;
(c) either (i) paying the purchase price for the Common Shares
subscribed for in the form of cash or a certified cheque
payable to the Corporation in an amount equal to the then
applicable Exercise Price multiplied by the number of Common
Shares subscribed for, or (ii) in lieu of payment of the
purchase price in cash, electing to effect a "cashless
exercise" by means of tendering this Warrant Certificate to
the Company to receive a number of Common Shares equal in
Market Value (as defined below) to the difference between (i)
the aggregate Market Value of the Common Shares issuable upon
exercise of this Warrant, and (ii) the aggregate cash Exercise
Price of the Common Shares issuable upon exercise of this
Warrant. For the purposes of this subsection (c), "Market
Value" per Common Share shall be an amount equal to the
average closing bid price for a Common Share for the ten (10)
days preceding the Company's receipt of a Subscription Form
duly exercised.
5. Upon receipt of the Subscription Form, this Warrant Certificate, and
payment as aforesaid, the Corporation shall cause to be issued to the
Holder the number of Common Shares to be issued and the Holder shall
become a shareholder of the Corporation in respect of such Common
Shares, effective as of the date of receipt by the Corporation of such
Subscription Form, Warrant Certificate, and payment and shall be
entitled to delivery of a certificate or certificates evidencing such
shares. The Corporation shall cause such certificate or certificates to
be mailed to the Holder at the address or addresses specified in such
Subscription Form within ten (10) business days of such receipt and
payment as herein provided or, if so instructed by the Holder, held for
pick-up by the Holder at the principal office of the registrar and
transfer agent of the Common Shares, Equity Transfer Services Inc. (the
"Transfer Agent").
6. No fractional shares or stock representing fractional shares shall be
issued upon the exercise of any Warrant. In lieu of any fractional
shares which would otherwise be issuable, the Corporation shall either
pay cash equal to the product of such fraction multiplied by the fair
market value of one share of Common Stock on the date of exercise, as
determined in good faith by the Corporation's Board of Directors, or
issue the next largest whole number of Common Shares at the
Corporation's option.
7. The Warrants may not be exercised unless at the time of exercise (i) a
registration statement registering the Common Shares issuable upon such
exercise is effective under the Securities Act of 1933, as amended (the
"1933 Act"), or the transaction in which such shares are to be issued
is exempted from the application of the registration requirements of
the 1933 Act, and (ii) the Common Shares issuable upon exercise of the
Warrants have been registered or qualified under any applicable
Canadian, provincial, state securities laws or an exemption from
registration or qualification is available under such laws. The Common
2
<PAGE>
Shares issuable upon exercise of this Warrant are and will be
"restricted securities" under the 1933 Act inasmuch as they are being
acquired from the Corporation in a transaction not involving a public
offering, and that, under the 1933 Act and applicable regulations
thereunder, such securities may be resold without registration under
the 1933 Act only in certain limited circumstances. Unless a
registration statement registering the Common Shares issuable upon
exercise of any Warrant is effective under the 1933 Act at the time
such Common Shares are issued, the certificates evidencing such Common
Shares shall bear the legend set forth below, together with any other
legends required by the laws of the Province of Ontario and any other
state or province with jurisdiction:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR QUALIFIED UNDER APPLICABLE STATE
SECURITIES LAWS AND HAVE BEEN TAKEN FOR INVESTMENT PURPOSES
ONLY AND NOT WITH A VIEW TO OR FOR SALE IN CONNECTION WITH ANY
DISTRIBUTION THEREOF. THESE SECURITIES MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED UNLESS A REGISTRATION STAEMENT UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, IS IN EFFECT WITH RESPECT
TO SUCH SECURITIES OR THE COMPANY HAS RECEIVED AN OPINION IN
FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY PROVIDING THAT
AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT OF 1933, AS AMENDED, IS AVAILABLE.
The legend set forth above shall be removed by the Corporation from any
certificate evidencing the Common Shares issuable upon exercise of the Warrants
only (i) upon receipt by the Corporation of an opinion in form and substance
satisfactory to the Corporation that such legend may be removed pursuant to Rule
144 promulgated under the 1933 Act, (ii) upon confirmation that a registration
statement under the 1933 Act is at that time in effect with respect to such
Common Shares and that such transfer will not jeopardize the exemption or
exemptions from registration pursuant to which the respective Common Shares were
issued.
8. The holding of a Warrant shall not constitute the Holder a shareholder
of the Corporation nor entitle him to any right or interest in respect
thereof except as herein expressly provided.
9. The Corporation covenants and agrees that until the Expiry Time, while
any of the Warrants shall be outstanding, it shall reserve and there
shall remain unissued out of its authorized capital a sufficient number
of Common Shares to satisfy the right of purchase herein provided, as
such right of purchase may be adjusted pursuant to clauses 10 and 11
hereof.
10. (a) If and whenever at any time after the date hereof and prior to
the Expiry Time the Corporation shall (i) subdivide, redivide
or change its then outstanding Common Shares into a greater
number of Common Shares, (ii) reduce, combine or consolidate
its then outstanding Common Shares into a lesser number of
Common Shares or (iii) issue Common Shares (or securities
exchangeable for or convertible into Common Shares) to the
holders of all or substantially all of its then outstanding
Common Shares by way of a stock dividend or other distribution
(any of such events herein called a "Common Share
Reorganization"), then the Exercise Price shall be adjusted
effective immediately after the effective date of any such
event in (i) or (ii) above or the record date at which the
holders of Common Shares are determined for the purpose of any
3
<PAGE>
such dividend or distribution in (iii) above, as the case may
be, by multiplying the Exercise Price in effect on such
effective date or record date, as the case may be, by a
fraction, the numerator of which shall be the number of Common
Shares outstanding on such effective date or record date, as
the case may be, before giving effect to such Common Share
Reorganization and the denominator of which shall be the
number of Common Shares outstanding immediately after giving
effect to such Common Share Reorganization including, in the
case where securities exchangeable for or convertible into
Common Shares are distributed, the number of Common Shares
that would be outstanding if such securities were exchanged
for or converted into Common Shares.
(b) If and whenever at any time after the date hereof and prior to
the Expiry Time, the Corporation shall distribute any class of
shares or rights, options or warrants or other securities
(other than those referred to in clause 10(a) above),
evidences of indebtedness or property (excluding cash
dividends paid in the ordinary course) to holders of all or
substantially all of its then outstanding Common Shares, the
number of Common Shares to be issued by the Corporation under
this Warrant shall, at the time of exercise of the right of
subscription and purchase under this Warrant Certificate, be
appropriately adjusted and the Holder shall receive, in lieu
of the number of the Common Shares in respect of which the
right to purchase is then being exercised, the aggregate
number of Common Shares or other securities or property that
the Holder would have been entitled to receive as a result of
such event, if, on the record date thereof, the Holder had
been the registered holder of the number of Common Shares to
which the Holder was theretofore entitled upon the exercise of
the rights of the Holder hereunder.
(c) If and whenever at any time after the date hereof and prior to
the Expiry Time there is a capital reorganization of the
Corporation or a reclassification or other change in the
Common Shares (other than a Common Share Reorganization) or a
consolidation or merger or amalgamation of the Corporation
with or into any other corporation or other entity (other than
a consolidation, merger or amalgamation which does not result
in any reclassification of the outstanding Common Shares or a
change of the Common Shares into other securities), or a
transfer of all or substantially all of the Corporation's
assets to another corporation or other entity in which the
holders of Common Shares are entitled to receive shares, other
securities or other property (any of such events being called
a "Capital Reorganization"), the Holder, where he has not
exercised the right of subscription and purchase under this
Warrant Certificate prior to the effective date of such
Capital Reorganization, shall be entitled to receive and shall
accept, upon the exercise of such right, on such date or any
time thereafter, for the same aggregate consideration in lieu
of the number of Common shares to which he was theretofore
entitled to subscribe for and purchase, the aggregate number
of shares or other securities or property which the Holder
would have been entitled to receive as a result of such
Capital Reorganization if, on the effective date thereof, he
had been the registered holder of the number of Common Shares
to which he was theretofore entitled to subscribe for and
purchase.
(d) If and whenever at any time after the date hereof and prior to
the Expiry Time, any of the events set out in clause 10(a),
(b) or (c) shall occur and the occurrence of such event
results in an adjustment of the Exercise Price pursuant to the
provisions of this clause 10, then the number of Common Shares
4
<PAGE>
purchaseable pursuant to this Warrant shall be adjusted
contemporaneously with the adjustment of the Exercise Price by
multiplying the number of Common Shares then otherwise
purchaseable on the exercise thereof by a fraction, the
numerator of which shall be the Exercise Price in effect
immediately prior to the adjustment and the denominator of
which shall be the Exercise Price resulting from such
adjustment.
(e) If the Corporation takes any action affecting its Common
Shares to which the foregoing provisions of this clause 10, in
the opinion of the board of directors of the Corporation,
acting in good faith, are not strictly applicable, or if
strictly applicable would not fairly adjust the rights of the
Holder against dilution in accordance with the intent and
purposes hereof, or would otherwise materially affect the
rights of the Holder hereunder, then the Corporation may
execute and deliver to the Holder an amendment hereto
providing for an adjustment in the application of such
provisions so as to adjust such rights as aforesaid in such
manner as the board of directors of the Corporation may
determine to be equitable in the circumstances, acting in good
faith. The failure of the taking of action by the board of
directors of the Corporation to so provide for any adjustment
on or prior to the effective date of any action or occurrence
giving rise to such state of facts will be conclusive evidence
that the board of directors has determined that it is
equitable to make no adjustment in the circumstances.
11. The following rules and procedures shall be applicable to the
adjustments made pursuant to clause 10:
(a) any Common Shares owned or held by or for the account of the
Corporation shall be deemed not be to outstanding except that,
for the purposes of clause 10, any Common Shares owned by a
pension plan or profit sharing plan for employees of the
Corporation or any of its subsidiaries shall not be considered
to be owned or held by or for the account of the Corporation;
(b) no adjustment in the Exercise Price shall be required unless a
change of at least 1% of the prevailing Exercise Price would
result, provided, however, that any adjustment which, except
for the provisions of this clause 11(b), would otherwise have
been required to be made, shall be carried forward and taken
into account in any subsequent adjustment;
(c) the adjustments provided for in clause 10 are cumulative and
shall apply to successive subdivisions, consolidations,
dividends, distributions and other events resulting in any
adjustment under the provisions of such clause;
(d) in the absence of a resolution of the board of directors of
the Corporation fixing a record date for any dividend or
distribution referred to in clause 10(a)(iii) above, the
Corporation shall be deemed to have fixed as the record date
therefor the date on which such dividend or distribution is
effected;
(e) if the Corporation sets a record date to take any action and
thereafter and before the taking of such action abandons its
plan to take such action, then no adjustment to the Exercise
Price will be required by reason of the setting of such record
date;
(f) forthwith after any adjustment to the Exercise Price or the
number of Common Shares purchaseable pursuant to the Warrants,
the Corporation shall provide to the Holder a certificate of
an officer of the Corporation certifying as to the amount of
such adjustment and, in reasonable detail, describing the
event requiring and the manner of computing or determining
such adjustment; and
5
<PAGE>
(g) any question that at any time or from time to time arises with
respect to the amount of any adjustment to the Exercise Price
or other adjustment pursuant to clause 10 shall be
conclusively determined by a firm of independent chartered
accountants (who may be the Corporation's auditors) selected
by the board of directors of the Corporation and shall be
binding upon the Corporation and the Holder.
12. At least 10 days prior to the latter of the effective date or record
date, as applicable, of any event referred to in clause 10, the
Corporation shall notify the Holder of the particulars of such event
and the estimated amount of any adjustment required as a result
thereof.
13. On the happening of each and every such event set out in clause 10, the
applicable provisions of this Warrant, including the Exercise Price,
shall, ipso facto, be deemed to be amended accordingly and the
Corporation shall take all necessary action so as to comply with such
provisions as so amended.
14. The Corporation shall not be required to deliver certificates for
Common Shares while the share transfer books of the Corporation are
properly closed, having regard to the provisions of clauses 10 and 11
hereof, prior to any meeting of shareholders or for the payment of
dividends or for any other purpose and in the event of the surrender of
any Warrant in accordance with the provisions hereof and the making of
any subscription and payment for the Common Shares called for thereby
during any such period delivery of certificates for Common Shares may
be postponed for not more than five (5) days after the date of the
re-opening of said share transfer books. Provided, however, that any
such postponement of delivery of certificates shall be without
prejudice to the right of the Holder so surrendering the same and
making payment during such period to receive after the share transfer
books shall have been re-opened such certificates for the Common Shares
called for, as the same may be adjusted pursuant to clauses 10 and 11
hereof as a result of the completion of the event in respect of which
the transfer books were closed.
15. Subject as hereinafter provided, all or any of the rights conferred
upon the Holder by the terms hereof may be enforced by the Holder by
appropriate legal proceedings. No recourse under or upon any
obligation, covenant or agreement contained herein shall be had against
any shareholder or officer of the Corporation either directly or
through the Corporation, it being expressly agreed and declared that
the obligations under the Warrants are solely corporate obligations and
that no personal liability whatever shall attach to or be incurred by
the shareholders or officers of the Corporation or any of them in
respect thereof, any and all rights and claims against every such
shareholder, officer or director being hereby expressly waived as a
condition of and as a consideration for the issue of the Warrants.
16. (a) The Warrants may not be assigned or transferred except as provided
herein and in accordance with and subject to the provisions of the 1933
Act and the Rules and Regulations promulgated thereunder and any
applicable state, Canadian, and provincial securities laws. Assignment
of a Warrant will be permitted only to individuals who are employees of
Laidenburg Thalmann & Co., Inc. and(i) upon receipt by the Corporation
of an opinion in form and substance satisfactory to the Corporation
6
<PAGE>
that the Warrant may be transferred pursuant to Rule 144 promulgated
under the 1933 Act, or (ii) upon confirmation that a registration
statement under the 1933 Act is at that time in effect with respect to
the Warrant and that such transfer will not jeopardize the exemption or
exemptions from registration pursuant to which the Warrant was issued.
Any purported transfer or assignment made other than in accordance with
this Section 16 shall be null and void and of no force and effect.
(b) Any assignment permitted hereunder shall be made by surrender of
this Warrant Certificate to the Corporation at its principal office
with the Assignment Form annexed hereto duly executed and funds
sufficient to pay any transfer tax. In such event, the Corporation
shall, without charge, execute and deliver a new Warrant Certificate in
the name of the assignee named in such Assignment Form, and the
Warrants represented by this Warrant Certificate shall promptly be
cancelled. This Warrant Certificate may be divided or combined with
other Warrants which carry the same rights upon presentation thereof at
the principal office of the Corporation together with a written notice
signed by the Holder thereof, specifying the names and denominations in
which new Warrants are to be issued. The terms "Warrant" and "Warrants"
as used herein include any Warrants in substitution for or replacement
of this Warrant, or into which the Warrant represented by this Warrant
Certificate may be divided or exchanged.
17. The Holder may subscribe for and purchase any lesser number of Common
Shares than the number of shares expressed in this Warrant Certificate.
In the case of any subscription for a lesser number of Common Shares
than expressed in this or any successor Warrant Certificate or a
transfer of any of the Warrants pursuant to clause 16, the Holder shall
be entitled to receive at no cost to the Holder a new Warrant
Certificate in respect of the balance of Warrants not then exercised or
transferred. Any new Warrant Certificate(s) shall be mailed to the
Holder or assignee by the Corporation or, at its direction, the
Transfer Agent, within five (5) business days of receipt by the
Corporation of all materials required by clauses 5 or 16, as
applicable.
18. Each Holder of this Warrant, the Warrant Shares or any other security
issued or issuable upon exercise of this Warrant shall indemnify and
hold harmless the Corporation, its directors and officers, and each
person, if any, who controls the Corporation, against any losses,
claims, damages or liabilities, joint or several, to which the
Corporation or any such director, officer or any such person may become
subject under the 1933 Act or statute or common law, insofar as such
losses, claims, damages or liabilities, or actions in respect thereof,
arise out of or are based upon the disposition by such Holder of the
Warrant the Common Shares issuable upon the exercise of this Warrant in
violation of the terms of this Warrant Certificate.
19. If any Warrant Certificate becomes stolen, lost, mutilated or
destroyed, the Corporation shall, on such terms as it may in its
discretion acting reasonably impose, issue and sign a new Warrant
Certificate of like denomination, tenor and date as the Warrant
Certificate so stolen, lost, mutilated or destroyed for delivery to the
Holder.
20. The Corporation and the Transfer Agent may deem and treat the
registered holder of any Warrant Certificate as the absolute owner of
the Warrants represented thereby for all purposes, and the Corporation
and neither the Corporation nor the Transfer Agent shall be affected by
any notice or knowledge to the contrary except where the Corporation or
the Transfer Agent is required to take notice by statute or by order of
a court of competent jurisdiction. A Holder shall be entitled to the
rights evidenced by such Warrant Certificate free from all equities or
7
<PAGE>
rights of set-off or counterclaim between the Corporation and the
original or any intermediate holder thereof and all persons may act
accordingly and the receipt by any such Holder of the Common Shares
purchaseable pursuant to such Warrant shall be a good discharge to the
Corporation and the Transfer Agent for the same and neither the
Corporation nor the Transfer Agent shall be bound to inquire into the
title of any such Holder except where the Corporation or the Transfer
Agent is required to take notice by statute or by order of a court of
competent jurisdiction.
21. All notices to be sent hereunder shall be deemed to be validly given to
the Holder of the Warrants on the date of receipt if personally
delivered, sent by telecopier or overnight courier, charges prepaid, or
five days after deposit in the United States mail, by registered or
certified mail, postage prepaid, addressed to such holders at their
post office addresses appearing in the register of Warrant holders
caused to be maintained by the Corporation. All notices to be sent
hereunder shall be deemed to be validly given to the Corporation on the
date of receipt if personally delivered, sent by telecopier or
overnight courier, charges prepaid, or five days after deposit in the
United States mail, by registered or certified mail, postage prepaid,
addressed to the Corporation at 1725 Sheridan Avenue, Suite 140, Cody,
Wyoming 82414 or such other address as the Corporation shall have
designated by written notice to such registered owner.
22. This Warrant shall be governed by the laws of the State of Nevada and
the federal laws of the United States applicable therein (within
reference to the conflict of laws provisions thereof).
IN WITNESS WHEREOF the Corporation has caused this Warrant Certificate
to be signed by its duly authorized officer.
DATED as of the 7th day of April, 2000.
ALTAIR INTERNATIONAL INC.
By: _______________________________________
Its: ______________________________________
Acknowledged and agreed to as of the ____________ day of April, 2000.
)
- -------------------------------- ) ---------------------------
Witness ) Witness
)
8
<PAGE>
SUBSCRIPTION FORM
TO BE COMPLETED IF WARRANTS ARE TO BE EXERCISED:
The undersigned hereby subscribes for ________________ common shares of Altair
International Inc. according to the terms and conditions set forth in the
annexed warrant certificate (or such number of other securities or property to
which such warrant entitles the undersigned to acquire under the terms and
conditions set forth in the annexed warrant certificate). The subscriber
acknowledges and agrees that any legend required by applicable law may be placed
on any certificates representing common shares delivered to the undersigned.
Address for Delivery of Shares: ____________________________________
------------------------------------
------------------------------------
------------------------------------
Attention: _________________________
____ Tendered (U.S. $_____ per share) Exercise Price $______________________
____ Cashless Exercise as provided in Section 4(c)
____ Dated at ________________, this _______ day of _______________, _______
Witness: ) ____________________________________
) Holder's Name
)
)
) ---------------------------
) Authorized Signature
)
)
) ---------------------------
) Title (if applicable)
Signature guaranteed:
9
<PAGE>
ASSIGNMENT FORM
TO BE COMPLETED IF WARRANTS ARE TO BE ASSIGNED:
TO: ALTAIR INTERNATIONAL INC.
1725 Sheridan Avenue
Suite 140
Cody, Wyoming 82414
By signing below, the undersigned represents, warrants and certifies to
Altair International Inc. as follows:
(a) the undersigned is the record and beneficial owner of the
Warrant(s) represented by the Warrant Certificate attached hereto; and
(b) the transferer designated below is an employee of Ladenburg
Thalmann & Co., Inc.
(c) either
_____ (i) attached hereto is an opinion in form and substance
satisfactory to the Corporation that the Warrant(s) to be transferred
hereby may be transferred pursuant to Rule 144 promulgated under the
1933 Act, or
______ (ii) a registration statement under the 1933 Act is at
that time in effect with respect to the Warrant(s) to be transferred
hereby and transfer of such Warrant(s) will not jeopardize the
exemption or exemptions from registration pursuant to which such
Warrant(s) were issued.
By signing below, the undersigned hereby transfers, assigns and conveys all
right, title and interest in and to _________ of the Warrants represented by
this Warrant Certificate to _____________________________
____________________________ residing at
________________________________________ for good and valuable consideration.
You are hereby instructed to take the necessary steps to effect this transfer.
Dated at ___________________, this ______ day of _____________, _____.
Witness: ) ____________________________________
) Holder's Name
)
) ---------------------------
) Authorized Signature
)
)
) ---------------------------
) Title (if applicable)
)
Signature guaranteed: )
10
Exhibit 23.1
[Letter Head of McGovern, Hurley, Cunningham, LLP]
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement on
Form S-3 filed by Altair International Inc. ("Altair"), pertaining to 3,177,945
common shares of Altair to be offered by Altair, of our report dated March
February 17, 2000 (except as to Note 17 which is as of April 7, 2000) appearing
in the Annual Report on Form 10-K of Altair International Inc. for the year
ended December 31, 1999, and to references to our firm under the heading
"Experts" in the Prospectus which is a part of this Registration Statement.
/s/ McGovern, Hurley, Cunningham,LLP
--------------------------------
McGovern, Hurley, Cunningham,LLP
Chartered Accountants
North York, Canada
May 4, 2000
