Western Uranium & Vanadium Corp. (CSE: WUC) (OTCQX: WSTRF)
(“
Western” or the “
Company”) is
providing clarifications to one of the items of business proposed
for consideration at the shareholder meeting that has been called
for June 21, 2019 (the “
Meeting”). As described in
the management information circular for the meeting (the
“
Circular”), as well as in the related notice of
Meeting, form of proxy and notice and access notification to
shareholders (collectively the “
Ancillary
Documents”), management has proposed that shareholders
adopt a special resolution authorizing an amendment to the current
articles of incorporation of the Company (the “
Amendment
Proposal”). The Circular and Ancillary Documents have been
posted under the Company’s profile at www.sedar.com, on Western’s
website at http://western-uranium.com/annual-general-meetings.html,
and on the website of the Company’s transfer agent’s at
http://capitaltransferagency.ca/.
As described in the Circular, if the Amendment
Proposal is approved by Western’s shareholders at the Meeting and
the corresponding amendment to the Company’s articles of
incorporation (as previously amended up to the date of this news
release, the “Current Articles”) is completed, in
addition to being able to issue Common Shares (the sole class of
shares the Company is currently authorized to issue), the Company
would also be authorized to issue a new class of shares that are
identified as “Class A Common Shares” in the Circular and Ancillary
Documents. In this news release, that new class of shares is now
being referred to as “Subordinate Voting Shares”
and, for the purpose of the Amendment Proposal, the Company is
seeking approval to create “Subordinate Voting
Shares”. As a result, if the Amendment Proposal is
approved and implemented, the corresponding amendment to the
Current Articles would identify the new class of shares as
“Subordinate Voting Shares”, or a substantially
similar name.
These Subordinate Voting Shares would be equal
to the Common Shares of the Company in most respects, but the
voting rights attributed to them could not be equal to or greater
than the rights attributed to the Common Shares, and those
Subordinate Voting Shares could not be convertible into Common
Shares at a ratio greater than on a one for one (1:1) basis. If
approved by shareholders, the Amendment Proposal would authorize
the Board to decide in its sole discretion whether or not to
proceed with filing the documents that would authorize the issuance
of the Subordinate Voting Shares, as well as whether and when to
actually issue any such Subordinate Voting Shares. Management’s
reasons for presenting the Amendment Proposal at the Meeting are
discussed on page 10 of the Circular.
OSC Rule 56-501 – Restricted Shares
(“Rule 56-501”), as well as National Instrument
41-101 General Prospectus Requirements and National Instrument
51-102 Continuous Disclosure Requirements (“NI
51-102”), impose certain disclosure requirements on
issuers that distribute, or have outstanding, securities that are
considered to be “restricted shares” under Rule 56-501. Pursuant to
those restrictions, because the Subordinate Voting Shares do not
qualify as "common shares" for purposes of Rule 56-501, management
of Western acknowledges that the Circular and Ancillary Documents
should not have referred to the Subordinate Voting Shares as a kind
of “common share”, and should also have made it clear that the
Subordinate Voting Shares are “restricted shares” and “subordinate
voting shares” as described under Rule 56-501. (Pursuant to Rule
56-501, a "restricted share" means, among other things, any share
that is not a common share and a “subordinate voting share” means a
restricted share that carries where there are shares of another
class of shares outstanding that carry a greater right to vote on a
per share basis. Accordingly, because the new class of shares
proposed would carry a right to vote that would be less than the
right to vote carried by the Shares of the Company, the proposed
new shares would be ”subordinate voting shares” within the meaning
of Rule 56-501 and “restricted securities” within the meaning of NI
51-102, and the Circular and Ancillary Documents should therefore
have referred to the proposed new class of shares as “Subordinate
Voting Shares”.
In addition, Rule 56-501 generally removes the
availability of prospectus exemptions
under Ontario securities law and regulations for
distributions of securities that are considered to be “restricted
shares” under Rule 56-501 if “minority approval”, as defined under
that rule, was not been obtained for either the distribution of
those securities or the reorganization that resulted in the
creation of those securities.
Rule 56-501 defines “minority approval” as
approval by a majority of the votes cast by shareholders who are
not “affiliates” (as defined in the Securities Act (Ontario)) or
“control persons” (as defined in Rule 56-501) of Western. Western
currently has only Common Shares outstanding, and no affiliates of
Western hold (directly or indirectly) any Common Shares. Also,
management of Western is not aware (after reasonable enquiry) of
any party qualifying as a “control person” of Western, because
management of Western is not aware of any shareholder or
shareholder group holding 20% or more of the outstanding Common
Shares.
The Circular and Ancillary Documents explain
that in order to pass at the Meeting, the Amendment Proposal must
be approved by special resolution of the shareholders (i.e. holders
of at least two thirds of the Common Share voting in person or by
proxy at the Meeting). Because there are no shareholders of Western
whose shares would have to be excluded from a vote of shareholders
conducted to obtain “minority approval” (as defined under Rule
56-501) of the Amendment Proposal, if the Amendment Proposal is
approved by a special resolution of shareholders, “minority
approval” will have been obtained as required under Rule 56-501. As
a result, Western would thereafter be entitled to use prospectus
exemptions if/when any resulting Subordinate Voting Shares are
issued.
Management of Western also clarifies that if the
Amendment Proposal is approved by a special resolution of
shareholders at the Meeting, Western must satisfy any and all
requirements of corporate and securities laws and regulations, as
well as the policies of the CSE (or any other stock exchange having
jurisdiction) that apply to the resulting amendment to the Current
Articles, as well as to any designation and issuance of Subordinate
Voting Shares. These requirements may include a requirement that
take-over protective provisions be in place for those Subordinate
Voting Shares on terms satisfactory to the CSE (or any other stock
exchange having jurisdiction).
About Western Uranium & Vanadium
Corp.
Western Uranium & Vanadium Corp. is a
Colorado based uranium and vanadium conventional mining company
focused on low cost near-term production of uranium and vanadium in
the western United States, and development and application of
Ablation Mining Technology.
Cautionary Note Regarding
Forward-Looking Information: Certain information contained
in this news release constitutes “forward-looking information” or
“forward-looking statements” within the meaning of applicable
securities laws (collectively, “forward-looking statements”).
Statements of that nature include statements relating to, or that
are dependent upon: the Company’s expectations, estimates and
projections regarding exploration and production plans and results;
the timing of planned activities; whether the Company can raise any
additional funds required to implement its plans; whether
regulatory or analogous requirements can be satisfied to permit
planned activities; and more generally to the Company’s business,
and the economic and political environment applicable to its
operations, assets and plans. All such forward-looking statements
are subject to important risk factors and uncertainties, many of
which are beyond the Company’s ability to control or predict.
Please refer to the Company’s most recent Management’s Discussion
and Analysis, as well as its other filings at www.sec.gov and/or
www.sedar.com, for a more detailed review of those risk factors.
Readers are cautioned not to place undue reliance on the Company’s
forward-looking statements, and that these statements are made as
of the date hereof. While the Company may do so, it does not
undertake any obligation to update these forward-looking statements
at any particular time, except as and to the extent required under
applicable laws and regulations.
FOR ADDITIONAL INFORMATION, PLEASE
CONTACT:
George GlasierPresident and
CEO970-778-9195gglasier@western-uranium.com
Robert KleinChief Financial
Officer908-872-7686rklein@western-uranium.com
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