AIS.V · 2018-12-21 12:00:00

A.I.S. Resources Announces Continuation of Corporation to the Jurisdiction of British Columbia, Canada

Corporate Updates

A.I.S. Resources Announces Continuation of Corporation to the

Jurisdiction of British Columbia, Canada

Vancouver, British Columbia – December 21, 2018 – A.I.S. Resources Limited (TSX: AIS,

OTCQB: AISSF ) (the “Company” or “AIS”) announces that the Company has continued as a

British Columbia corporation under the provisions of the Business Corporations Act (British

Columbia) (the “BC Act ”) and has applied for discontinuance of the Company in the

Commonwealth of the Bahamas. The continuance in B.C. (the “Continuance”) will not affect the

Company’s status as a listed company on The TSX Venture Exchange or as a reporting issuer

under the securities legislation of British Columbia, Alberta and Quebec, and the Company will

remain subject to the requirements of such legislation.

As management and the head office of the Company is located in British Columbia, management

believes that it will be more efficient and cost-effective for the Company to be governed by the

laws of British Columbia. Management also believes that the Continuance will provide the

Company with increased opportunities and flexibility in obtaining financing.

The Company was, until recently, subsisting under the Commonwealth of the Bahamas

Companies Act, 1992 (No. 18 of 1992), as amended (the “Bahamas Act”). On September 14,

2018 the Company continued its jurisdiction under the Commonwealth of the Bahamas

International Business Corporations Act and on December 20, 2018 completed the Continuance

under the BC Act. The Company is now subject to the BC Act as through it had been incorporated

under the BC Act. Section 305 of the BC Act provides that upon continuance of a foreign

corporation as a corporation under the BC Act:

(a) the BC Act applies to the continued company to the same extent as if the company

had been incorporated under the BC Act,

(b) the continued company has, as its notice of articles, the notice of articles contained

in the continuation application,

property, rights and interests of the continued company,

(d) the continued company continues to be liable for the obligations of the foreign

corporation,

(e) an existing cause of action, claim or liability to prosecution is unaffected,

(f) a legal proceeding being prosecuted or pending by or against the foreign

corporation may be prosecuted or its prosecution may be continued, as the case

may be, by or against the continued company, and

(g) a conviction against, or a ruling, order or judgment in favour of or against, the

foreign corporation may be enforced by or against the continued company.

The Continuance to British Columbia and adoption of the new charter documents has not resulted

in any substantive changes to the constitution, powers or management of the Company, except

as described below.

Comparison Between the BC Act and the Bahamas Act

The following is a summary only of certain differences between the BC Act, the statute that now

governs the corporate affairs of the Company, and the Bahamas Act, the statute which until

September 14, 2018 governed the corporate affairs of the Company.

Nothing that follows should be construed as legal advice to any particular shareholder, all of whom

are advised to consult their own legal advisors respecting all of the implications of the

Continuance.

Charter Documents

Under the BC Act, the charter documents consist of “Notice of Articles”, which sets forth the name

of the Company and the amount and type of authorized capital, and “Articles” which govern the

management of the Company (collectively, the “Charter Documents”). Under the Bahamas Act,

the Company had a “Memorandum of Association”, which, among other things, set forth the name

of the Company and the amount and classes of authorized share capital, and “Articles of

Association” (collectively, the “Bahamas Articles ”) which governed the management of the

Company. Upon the Continuance becoming effective, the Bahamas Articles were replaced with

the Charter Documents.

The Notice of Articles and Articles under the BC Act provide for authorized capital consisting of

unlimited number of common shares without par value and unlimited number of preferred shares

without par value, whereas the authorized capital of the Company under the Bahamas Act was

$15,000,000 in the currency of the United States of America which could be issued in any

combination of common or preferred shares of no par value and convert all of the issued shares

to no par value common shares. The attributes of the Common Shares are, in most material

respects, similar to the attributes of the common shares previously outstanding under the

Bahamas Act. The Preferred Shares may include one or more series and, subject to the BC Act,

the directors of the Company may, by resolution, if none of the shares of that particular series are

issued, do one or more of the following:

(a) determine the maximum number of shares of that series that the Company is

authorized to issue, determine that there is no such maximum number, or alter any

such determination;

(b) create an identifying name for the shares of that series, or alter any such identifying

name; and

special rights or restrictions.

Vote Required for Certain Transactions

Under the BC Act, certain extraordinary corporate actions, such as certain amalgamations,

continuations and sales, leases or dispositions of all or substantially all a company’s undertaking

other than in the ordinary course of business, and other extraordinary corporate actions such as

liquidations, and (if ordered by a court) arrangements, are required to be approved by special

resolution. A special resolution is a resolution (i) passed at a meeting by not less than two‐thirds

of the votes cast by the shareholders who voted in respect of the resolution, or (ii) approved in

writing by all shareholders entitled to vote on the matter.

The Bahamas Act provides for mergers and consolidations, in certain circumstances, and in such

case would require, unless otherwise specified in the Articles, consent of an ordinary resolution

of shareholders. The Bahamas Act also provides that upon a merger or consolidation, the holders

of not less than 90% of the shares may direct the company to redeem the shares held by the

remaining shareholders.

Amendments to Corporate Charter

Any substantive change to the corporate charter of a company under the BC Act, such as an

alteration of the restrictions, if any, of the business carried on by the Company, a change in the

name of the company or an increase or reduction of the authorized capital of the company

requires a special resolution passed by not less than two‐thirds of the votes cast by shareholders

voting in person or by proxy at a general meeting of the company, unless another type of majority

is specified in its Articles. The Company has adopted Articles which alter the requirements for

special resolutions in certain instances, as more particularly described below. Other fundamental

changes such as an alteration of the special rights and restrictions attached to issued shares,

also require a special resolution passed by not less than two‐thirds of the votes cast by the holders

of shares of each class entitled to vote at a general meeting of the Company. The holders of all

classes of shares adversely affected by an alteration of special rights and restrictions must vote

by separate class votes.

As mentioned above, the Articles adopted by the Company provide in Article 10.1 that the

following matters may be approved by resolution of the directors:

(a) the creation of one or more classes or series of shares or, if none of the shares of

a class or series of shares are allotted or issued, the elimination that class or series

of shares;

(b) any increase, reduction or elimination of the maximum number of shares that the

Company is authorized to issue out of any class or series of shares or establishing

a maximum number of shares that the Company is authorized to issue out of any

class or series of shares for which no maximum is established;

value;

(d) if the Company is authorized to issue shares of a class of shares with par value:

(i) decrease the par value of those shares; or

(ii) if none of the shares of that class of shares are allotted or issued, increase

the par value of those shares;

(e) a change of all or any of its unissued, or fully paid issued, shares with par value

into shares without par value or any of its unissued shares without par value into

shares with par value;

(f) the alteration of the identifying name of any of its shares;

(g) the consolidation of all or any of its unissued, or fully paid issued shares without

par value; or

(h) the alteration otherwise of its shares or authorization of share structure when

required or permitted to do so by the BC Act.

Further, Article 10.3 of the Articles to be adopted by the Company permits an alteration to the

Company’s Notice of Articles in order to change its name or adopt or change any translation of

that name.

Under the Bahamas Act, the Bahamas Articles may be amended by ordinary resolution, which

requires the approval of a majority of the votes cast at a meeting (or such greater number as may

be specified by the Articles of Association) or approval in writing by all shareholders entitled to

vote on the matter. The Board may not effect amendments to the Bahamas Articles on its own.

Dissent Rights

The BC Act provides that shareholders who dissent to certain actions being taken by the Company

may exercise a right of dissent and require the Company to purchase the Common Shares held

by such shareholder at the fair value of such Common Shares. The dissent right is applicable

where any court order permits the dissent or where the Company proposes:

(a) by resolution to alter the articles to alter restrictions on the powers of the Company

or on the business it is permitted to carry on;

(b) by resolution to adopt an amalgamation agreement;

(d) by resolution to approve an arrangement, the terms of which arrangement permit

dissent;

(e) by resolution to authorize or ratify the sale, lease or other disposition of all or

substantially all of the Company’s undertaking;

(f) by resolution to authorize the continuation of the Company into a jurisdiction other

than British Columbia; or

(g) to ask shareholders to approve any other resolution, if dissent is authorized by the

resolution.

The Bahamas Act provides that shareholders are entitled to payment of the fair value of their

share upon dissenting from:

(a) a merger;

(b) a consolidation;

of the value or business of the company in certain circumstances;

(d) an arrangement, if authorized by the court; and

(e) redemption by the company following a merger or consolidation.

Oppression Remedies

Under the BC Act, a shareholder, or any other person whom the court considers to be an

appropriate person to make an application, has the right to apply to court on the grounds that:

(a) the affairs of the Company are being or have been conducted, or that the powers

of the directors are being or have been exercised, in a manner oppressive to one

or more of the shareholders, including the applicant, or

(b) some act of the Company has been done or is threatened, or that some resolution

of the shareholders or of the shareholders holding shares of a class or series of

shares has been passed or is proposed, that is unfairly prejudicial to one or more

of the shareholders, including the applicant.

On such an application, the court may make such order as it sees fit including an order to prohibit

any act proposed by the Company.

The Bahamas Act does not provide for a similar remedy.

Derivative Action

Under the BC Act, a shareholder or director of the Company may, with leave of the court,

prosecute a legal proceeding in the name and on behalf of the Company to enforce a right, duty

or obligation owed to the Company that could be enforced by the Company itself or to obtain

damages for any breach of such a right, duty or obligation.

The Bahamas courts have recognized derivative suits by shareholders in some limited

circumstances. The Bahamas courts ordinarily would be expected to follow English precedent,

which would permit a minority shareholder to commence an action against or a derivative action

in the name of the company only:

(a) where the act complained of is alleged to be beyond the corporate power of the

company or illegal;

(b) where the act complained of is alleged to constitute a fraud against the minority

perpetrated by those in control of the company;

shareholders than actually approved it; or

(d) where there is an absolute necessity to waive the general rule that a shareholder

may not bring such an action in order that there not be a denial of justice or a

violation of the company’s memorandum of association.

Duties of Directors and Officers

Under the BC Act, in exercising their powers and discharging their duties, directors and officers

must act honestly and in good faith, with a view to the best interests of the Company and exercise

the care, diligence and skill that a reasonably prudent person would exercise in comparable

circumstances. No provision in the corporation’s notice of articles, articles, resolutions or contracts

can relieve a director or officer of these duties.

Fiduciary obligations of directors under Bahamas Act are substantially the same as under the BC

Act. The Bahamas Act does not directly address the issue of the limitation of a director’s liability,

however, Bahamas public policy will not allow the limitation of a director’s liability for his or her

own fraud, willful neglect or willful default. In addition, the Bahamas courts would be expected to

follow English precedent in respect of fiduciary duties of the directors and officers of a company.

Indemnification of Officers and Directors

The BC Act allows a corporation to indemnify a director or former director or officer or former

officer of a corporation or its affiliates against all liability and expenses reasonably incurred by him

in a proceeding to which he is made party by reason of being or having been a director or officer

if he acted honestly and in good faith with a view to the best interests of the corporation and, in

cases where an action is or was substantially successful on the merits of his defence of the action

or proceeding against him in his capacity as a director or officer.

Under the Bahamas Act a company may provide for the indemnification of its directors, officers,

employees and agents if he acted honestly and in good faith with a view to the best interests of

the corporation and, in the case of a criminal or administrative action or proceeding that is

enforced by a monetary penalty, had reasonable grounds for believing that his conduct was lawful.

Income Tax Considerations

Shareholders should consult their own tax advisers with respect to the income tax consequences

to them of the Continuance under federal, provincial, territorial and other applicable tax legislation.

About A.I.S. Resources

A.I.S. Resources Ltd. is a TSX-V listed investment issuer, was established in 1967 and is

managed by experienced, highly qualified professionals who have a long track record of success

in lithium exploration, production and capital markets. Through their extensive business and

scientific networks, they identify and develop projects worldwide that have strong potential for

growth with the objective of providing significant returns for shareholders. The Company’s current

activities are focused on the exploration and development of lithium brine projects in northern

Argentina.

On Behalf of the Board of Directors,

AIS Resources Ltd.

Phillip Thomas, President & CEO

Corporate Contact

Phillip Thomas Martyn Element

President & CEO Chairman

T: 747 200 9412 T: 604 687 6820

E: [email protected] E: [email protected]

Website: www.aisresources.com

ADVISORY: This press release contains forward-looking statements. Although the Corporation

believes that the expectations reflected in these forward-looking statements are reasonable,

undue reliance should not be placed on them because the Corporation can give no assurance

that they will prove to be correct. Since forward-looking statements address future events and

conditions, by their very nature they involve inherent risks and uncertainties. The forward-looking

statements contained in this press release are made as of the date hereof and the Corporation

undertakes no obligations to update publicly or revise any forward-looking statements or

information, whether as a result of new information, future events or otherwise, unless so required

by applicable securities laws. Neither TSX Venture Exchange nor its Regulation Services Provider

(as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the

adequacy or accuracy of this release.

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