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INTERNATIONAL RANWICK LIMITED

Report of the Directors

TO THE SHAREHOLDERS.

Your Directors ore pleossdjp submit the Annual Report of your Company for the year ended December 3T^\ 958)ogether with the audited balance sheet and related financial statements. As there were many new activities undertaken by your Company during the year, two Progress Reports were moiled to the registered shareholders, one doted June 2, 1958 and a second doled October 8,1958.

RYAN LAKE PROPERTY

As mentioned in the las! Annual Report, a working option was acquired on the Ryan Lake Property of Mln-Ore Mines limited. Mo t eh e won district, Ontario. The mine was re-opened and a thorough program of sampling was undertaken Indicating that, in addition to copper, molybdenum was present in commercial amounts. The 150-ton mill was started and o trial run of ore was commenced. However, it was found that owing to the high proportion of talc in the South Zone ore, on effective separation of the molybdenum from the copper could not be attained. Accordingly, .on experienced metallurgist, Mr. Walter Galloway, was engaged, and since last August he 'has been conducting test work on the separation of copper and molybdenum. Early In 1959, the results of this work indicated that commercial grade concentrates of both copper and molybdenum could be produced, Subsequent to the year end the mine was re-opened and underground diamond drilling is now underway to test the North Zone ore below the 4 \\\ level. Also a 3rd level development heading was resumed eastward on the North Zone in order to test the prospects for additional ore reserves lo the ecst. This work has initially met with considerable encouragement. Your Directors hope that, os a result of this work, it will be possible lo resume mining operations at an early date.

Oo

PETERS-QUIITY PROPERTY 1158

'

During the yegr^your Company acquired on option on a molybdenum prospect near Hawk Junction on. 'h* Algomn C*n*f9! Railway north ot Sault Ste. Marie, Ontario. ArT extensive program of surface trenching and sampling was undertaken indicating the presence of commercial-grade molybdenum over on extensive area. As the financial requirements for complete development of this prospect were considered beyond the means of your Company, on agreem*'' 'or further development of the property was

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concluded with the M. V. Billiton Company of Holland through their agent, J. C. Dumbrllle. Additional trenching ond three diamond drill holes were completed by the M. V. Billiton Company; but the results of this drilling wore Inconclusive ond further consideration is now being given to the next stage of exploration of the deposit.

During the year the Regnery Motols Property in the some district was optioned ond underground sampling and diamond drilling was undertaken to chock records of earlier work Indicating the presence of molybdenum and beryllium. However, these metals were not found to be present in commercial quantities.

MATTAGAMI PROPERTY

Two diamond drill holes were completed during the year on o group of mineral claims in the Mattagami district of northern Quebec. Your Company acquired a 50*^ Interest in on option on these claims; but the drilling was suspended owing to severe winter conditions and the results of the first two holes were considered not sufficient!/ encouraging to justify further exploration at this time.

COPPER BASIN PROPERTY, ARIZONA

No work was done on the Copper Basin Property during the year except, o small amount of exploration in order to bring certain claims to patent. Work done earlier by your Company on this property indicated minimum ore reserves of 14,643,000 tons grading ,64*)b copper and .1007o molybdenite. One of the deposits contains o minimum of 443,000 tons with an overage grade of .94 "X* copper ond .24% molybdenite.

The claims at Copper Basin are intimately associated with the claims owned by Phelps Dodge Corporation. Your Directors feel that any development of this property should be undertaken jointly with that Company. -

URANIUM PROPERTY* tV

The uranium properties at Chorlebois Lake, Saskatchewan, and those north of Sault Ste. Marie, Ontario, were maintained in good standing during the year. A considerable tonnage of low-grade ond uranium-bearing material has been Indicated by underground work on the Saul) Ste. Marie property, and by extensive diamond drilling on the Chorlebois Lake properties.

FINANCIAL

During the year, in order to provide funds for tho various projects that were undertaken, 200,000 shares of the capital slock of your. Company were underwritten ot 15 cents per shore and 200,000 shores were also underwritten ot 20 cents per shore to provide an additional 470,000 working capital. Later in the year o further 250,000 snares were old at 40 cents per share to provide a further J 1 00,000. Subsequent to the year-end, 300,000 shares were underwritten ot 30 cents per shore thus providing an additional (90,000. Your Directors ore considering additional Financing to provide funds for the re-opening of the Ryan Lake mine.

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You will note thot o Speciol Generol Meeting of shareholder! has been called In conjunction with the Annual General Meeting of shareholders In order to opprrve o special resolution changing the name of your Company lo International Molybdenum Mines limited. All the various operations on which your Company has been concentrating during the post year ond o holi are essentially molybdenum deposits, ond your Directorl feel thot this metol should be reflected in the nome of your Company. A turvey of the molybdenum, market, which has been very steady and strong for several months, indicates thot the price will not only remain stable but will probably rise over the next two years. Therefore, it '- the intention of your Company to concentrate on the development of molybdenum deposits.

YD Directors take pleasure In expressing appreciation of the loyal services of employees ond consultants.

On behalf of the Board,

V. N. HARBINSON,President.

May 27, 1959.

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litINTERNATIONAL

AND ITS WHOLLY-OWN!

Consolidated Balance l

ASSETS

Currents

Coih ..........,........................................:...........,,.....,. S 2,269.87Accounts receivable ......................................,........... 6,717.25

Total current assets ........................................... ) 8,987.12

Mining claims in Canadaand related expenditures (note 2):

Charlebois lake area Mining claims acquired os

part consideration (or the issue of 614,526 shoresond 542,531.25 cosh ..,, l 259,999.85 i

Exploration, development andadministration .................. 240,051.99 4 500,051.84

Sault Ste. Marie area ' , Mining claims acquired for -v- -

10,000 shores of capitalstock valued at S50.000ond J7.028.50 cosh ........ S 57,028.50

Exploration, development ondodminiwrotion .................. 166,139.46 223,167.96 723,219.80

Mining properties in Arizona and related expenditures at costi

Copper Basin property Lease option payments ...................................... ) 118,714.25Exploration, development and administration 62,015.15 180,729.40

Deferred exploration, development and otherexpenditures (statement 3) ...................,.............. 247,197.63

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I,160,133.95

The notes to consolidated finondol stoiements or) on Integral port of O

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lWICK LIMITEDDIARY RANWICK, INC.'

STATIMINT t

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December 37, 7958

V

LIABILITIES

Current:

Bonk overdraft ..........................................................Accounts payab'e and accrued charges ..................Balance of lease bonus payable on Menlove-Dolton

property, now abandoned ................................

Total current liabilities .....,........................Shareholders' equity:

Capital (note 3)Authorized — .5,000,000 shores of 41 par valveIssued -3,753,520 shores ........................ 43755,520.00Less discount on shares issued .......................... 1,633,033.54

4 11,106.0115,614.83

50,000.00

5 76720.84

S2.120,486.46 Deduct deficit (statement 2) ................................... 1,037,073.35 1,083/413.11

Approved on behalf of the Board: V. N. HARBINSON, Director. J. D. BATEMAN, Dirertor. '

41,160,133.95

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bruolidoted balance sheet ond should be read in conjunction therewith.

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SU1WINT 2

INTERNATIONAL RANWICK LIMITED

Statement of Consolidated Operations and Deficit

For The Year Ended December 31/ 1958

Administrative and other expenditures:Audit fees and expenses .................................................. J l,696.26Consultants' fees ................................................................ 1,050.00Directors' fees ........................................................,........... 1,250.00Filing fees and loxe* .......................................................... 1,069.97legal fees and expenses ............,..............................,....... 3,022.20Miscellaneous ...............................,...................................... 1,818.44Office services .................................................................... 2,693.30Officer'1 salary ,............................................................. 1,542.25Shareholders' reports ........................................................ 1,335.84Telephone and telegraph .................................................. 1,291.65Transfer agents' feet and expenses .................................. 2,370.45Travelling ............................................................................ 1,183.45lots on foreign exchange .................................................. 42.51Profit on sole of furniture previous!/ written off ........... ... (2,387.87)Sundry revenue ........................................................... ,'.V (1,600.00) S 16,378.45

Exploration, development and other expenditureswritten off (statement 3) ...............................,................... 41,359.71

los* of exploration subsidiary (U.S. *670.23) ......... . ... ...... 650.54Loss on sole of interest in oil properties in Louisiana and Texas 66,450.48

Total losses and expense* charged to deficit In 1958 .., ........ S 124,839.18Deficit at December 31, 1957 .................................................... 912,234.17

Deficit ot December 31, 1958 .................................................. ^1,037,073.35

The notes to consolidated financial statements are an integral part of the obove. statement of consolidated operations and deficit and should

be read In conjunction therewith.

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INTERNATIONAL RANWICK LIMITED

Notes Consolidated Financial S tatements

X* A t December 31, 1958

1. Basis of exchange conversion

Assets and liabilities in United Slates currency ore converted into Conodion funds ot the current quoted rotet of exchange at December 31, 1958, except for the mining properly in Arizona and related expenditures which ore converted ot the rotes of i ichange prevailing when the expenditures were made.

Expenses in United States currency ore converted Into Conodion funds ot approxi mately the average monthly quoted rotes of exchange.

2. Mining claims In Canada

No operations have been conducted since 1954 on the mining claims in Canada which ore being held for future possibilities. The potential uranium ore bodies which hove been indicated on these claims ore of o sub-marginal category and cannot ot presjni be profitably mined. The ultimate value of these claims and of the related explorolion, development and administration expenies-'Vomed in the balance sheet is dependent on future events.

3. Capital

During 1958 the company issued 850,000 shores of its capital stock for 5220,000 cosh and subsequent to December 31, 1958 issued on additional 300.000 shores for J90,000 cosh.

At December 31, 1958 there was on option outstanding lo sell 5,000 presently unissued shares of the company's authorized capital stock ot a price of ' '. per share exerciioble on or before September 3,1959.

Subsequent to December 31, 1958 the compcny granted options on its unissued capital slock os follows:

'.00,000 sHorei jt 35? per shore exerciioble on or before July 15, 1959 ICO.OCO shores at 350 per shore exercitable on or before October 13, 1959 100,000 shores a* 40? per shor* exercisobl* on or befor* January 11. 1960 100,000 shores at 40? per shore exercisoble tn or before April 11,1960

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OfficeSuite 007, BO Richmond Street Wot Toronto, Ontario - .^ t t .,

OfficersV. N. HARBINSON PresidentJ. D. BATEMAN

MAXWELL BRUCE, Secretary-Treasurer

*'ttMl RESOURCES DIVISIM;i -v- "-———— -V -. ^.... ^^ ^

A UG 27 1963RECHIVEDOTTAWA, CANADA i

DirectorsJOHN L. AGNEW J. D. HATF.MAN W. E. N. BELL MAXWELL BRUCE L. A. CLRF, JR. V. N. HARBINSON DR. BRUCE C. HARDY

Transfer Agent and RegistrarCANADA PERMANENT TORONTO GENERAL TRUST COMPANY Toronto

Audi l or iCLARKSON, GORDON fi: Co. Toronto

Annual Meeting oj ShareholdersWednesday, July 24,1963Suite 607, 80 Richmond Street WestToronto2.00 o'clock p.m. (Toronto Time)

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PAX -JC -imOATlONAL MINES LIMITEDdiurnal ftepoit 1962

REPORT OF THE DIRECTORS

To THE SHAREHOLDERS:Your Directors submit herewith the Annual

Report of your Company for the year ended December 31, 1962, together with the financial statements and auditors' report thereon.

FINANCIALSince the year end the Company has received

an additional 970,000.00 as the result of the sale of 400,000 treasury shares, and there arc options outstanding on 600,000 additional treasury shares at prices ranging from 22/j cents a share to 32/j cents a share each.

PROPERTYRyan Lake Property, Matachewan, Ontario (lease) ^

During the year the Company mined and milled several thousand tons of molybdenum- copper ore from a substantial open pit porphyi y type of deposit. A bulk concentrate was pre pared and arrangements made with Gco-Mct Reactors Limited of Ottawa, Ontario, for further processing. These tests have been en couraging and the material has been convened to ferromolybdenum containing 70^c molyb denum, 29J) sulphide and .6^0 copper. They have also produced a ferromolybdenum con taining GO'/o molybdenum and lO^o copper.

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This material will bc evaluated by two r Canadian steel corjxuationt in July of this year.

Surface prospecting on the properly ha* resulted in the discovery of a new copper /one which will bc tested by diamond drilling very shortly.

: 'Oil* ttilll; ininine plnpS !*fM nnrforftroiindworkings at tlio property have been mafniahied in good condition.

Pax Sand fc GravelThis is a wholly owned division of your

Company, located near Peterborough, Ontario, and contains many millions of tons of good quality material. The pit has been approved as a commercial source of aggregates by the government and other users. Recently an agreement was entered into with Griffin Con struction (Ontario) Limited for the ncccssar/

, crushing plant, auxiliary equipment and trucks for the development and processing of materials, in return for which Griffin is to receive a net profits interest in the operation.

OtherThe Company maintains a group of claims

in the Thunder Bay Mining Division (Marathon area) of Ontario which is a copper prospect, together with the ,Pctcrs.-.Qmlty^jTiolybdcnite property in the Sauk sic. Alarie area. In acldi- lion the original Ranwick property in the latter area has been maintained in good standing.

On behalf of the Board,

V. N. l IARBINSON, Prejident,

PAX INTERNATI(formtitr Internal*

(Incorporate*AND ITS WHOUY-OW

Consolidated Balance

OUMKENTI

Marketable"iccurith at tost (*pproximiV| Accounts receivable —

Associated company .......~.........Other ..................~-....—-——••••-

Inventory of sand and aggregates at tl*c l Prepaid expenses

Total currents asset* .............. .ADVANCE TO ETHEL COPPER MINES LIMIIEII, FIXED:

Grav'cl pit, at cost ....................—-————Plant and equipment, at COM ..............-—.

IA.-SS accumulated depreciation ........BONDS ])Ei'osm:n WITH TIIK

at cost (market value ?3,725)MINING CLAIMS ANO ReLATEo

ofT — Sault Sic. Marie .......DEFERRED EXPLORATION,

statement ................AND C

L!CURRENT:

Bank indebtedness (secured) ................,..Accounts payable and accrued chnrprs .~.

Total current liabilities .............SnARUIlOLOKRS* EQUITY:

CSpital (notes 2 and 3) —Authorized: 4,000,000 shares of fi pa Issued: 2,208,390 tliarcs . .................

Less discount on shares issued

Toronto, Canada June 27,1963

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Contributed surplus

Deduct deficit ........

On belialf of llie Board:V. N. HAJUUNSOM, DJrectc J. D. BATEMAN,. Director.

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iMincl Limited) lOmario)

" rKANWICK, INC.

December 31, 1962

market

npany

5 104.383,600.00

5 3,250.002,757.31 6,007.31

5 0CO.OO567.00

5 15,478.6917,500.00

,..................... 5162,614.81 ^5 22,511.04

4.259.92 18.251.12 180,865.93ISION OK ON j ARID,

'amounts written

w.*, JX.T attached

3,745.00

1.00

117.868.785335.459.40

$ 17,896.848.934.53

5 26,831.37

52,208,390.00896.257.50

51,312,132.501,197,106.46

52,509,238.962,200,610.93 308.628.03

5335,459.40

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PAX INTERNATIONAL MINES LIMITED

Statement of Consolidated Deferred Exploration, Development and

other Expenditures For the Year fnded December 3 1, 1 962

B*Unc* Expenditure* Drcrmbrr during Urcrinlxr )l. 1961 ihf yr.r il.

Ryan laic: Salaries and waft* ........M........ ...

Klrriric power ...-. ..... .....,..., — ..

UrprrriatioH ol'uiachiiiciy

CuiuulilHli' irrt — . ........ ... n .... Acmxr lutt and In. r (nyiumti

Mccovrry Iron luitling vpcf^tioiit

Fricn Qutliy: Option ixynxau ............ —— ,.^.—. Salaiin and wafn ........ ...,.-.—... Suttulm .H M. .H M.Coitullanli' lcvt n.........-.~........ Eriu!|mirn| rental and

Trtntpomiion ———————— ......

Filin* (m . ___

Cravxl pit at Pclcrbore: '

Co^tuliant^' fm : ^^ ^ i--,--i- Tc^tiim ntatcriatt H.^Hn.^.MWM...^....

Ofticf mtl . ^^ - - -- ^ ^ ^ ^ j v -j

Drpnciatioa of lurniturt - —— —~ Munwipal and county lain -.— ,

Salo ot travel. K*- rtcl cwU —

|33.tW.Wii.ncsocI4.UOC.J1 4.9JO.OJ

| I.918.C6 9.146.64 J.061.40

674.0U 160.19 41.50

S.7S7.11 (21.298.78)

} 1.91S CC 152.241.07

110.500.00 | 500.00 I3.W1.C5 3.101.702,106.90

1.061.101.U10.11

798.51 7000

197.00 3^6302 109.91

W.IU.2) t 603.91

t 1.100.00 1. 121.12 1.741.02 1.200.00

927. to 307.50 792.00 711.70 1946V 3M.ft

l.WJI (2.227.72)

116.911.91

t 31.610.50 11.008.06)4.(W?3 4.9W.OO

4.0U.W 2,0.1.40

624.00 160 19

I.787J1 {21^98.78)

I^.ii9.n

1 2r.ooo.ool).Ut.61A 1.IOJ7H*2,3*0.90

I.OW.M1.019.11

798.JJ 7000

197.W1 3.467.11

t 4C.79U.I4

\ 1 ,100.00 1.8M.12 1.741.0} I.200.IU

972.U 90.MO 792.00 711.20 194.62 3M.6I

1^02.11 (2,227.73)

t 16.91t.91

t48.104.89 t69.763.89 tll7.tM.7U

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PAX INTERNATIONAL MINES LIMITED-

Statement of Consolidated ; Operations and Deficit

for the Year Fndccf December 31, 1962•j^v- -fi?: Revenue from investments:'.'•C-.'.' Intereit .......................... J 668.26K;. : Dividcndi.................,...... 18.00*.i' Net profit on sale offv securities.................... 248.00 } 934.26T^r. ^-i. J l l li. l

Administrative md otherexpenses: ^ Legal fees and expenses.. 9 5,011.32 Administrative charge

from auociaiedcompany ..................... 4,600.00

Transfer agents' feesand expenses .............. 2,742.19

Listing fees .................... 1,624.31Audit fees........................ 1.200.00Travel ............................. 1,192.85General exploration ...... C25.UOShareholders' meeting

and report .................. 791.38Interest paid .................. 550.67Directors' fees ................ 550.00Capital and place of

business tax ................ 204.88Miscellaneous ................. 2,975.02

?22,267.62Leu adjustment of ex

penses applicable to prior years.™............... 1,389.07 20,878.55

Net loss for year .................................... ? 19,944.29Deficit at December 31,1961 ................ 2,180,666.64

Deficit at December 31,1962 ........*...... ^2.200,610.9J

See notes lo consolidated financial statements.

AUDITORS' RETORT

l f To Ik* Shareliolden el|. Pai International Mine) Umilcd:V' We have e\uninrd llic eonwlidaled balance tlieet ol Tax Intrmitiunal

. ; Xlino Limited dormeilc Inlernatinnal Molybdenum Miuri Limited) aitd l '"III oliolly-owncd inbiidiiry, Kanuirk, Inc., at al Detrrmber 31, I9C2 andYlk* iimrni.nl ol cunwilidalrO uprrilioitv and ilrln.il lor tlie year llirn

I euitrtl. Our rxaiuinatiun iucludtd a pnirral rrvirw ol ilie accounting 1 1? proceejurvt and luck levtk bl arriiuniinv reeuni* and oilirr kuppurlinf 1 idcnce at v i coniidcrrd necnvaiy i* Uie circunivlance-t. , ~.,. ;" Ir* our uoinion the arvompanyiu^ convolidtftrd balance iliecl and

J "tfitatemenl ol contolidaleil uncriiivni and drucil present lairly ike lg financial |Kx!lion iJ the cnuipainet ai al Drceniber 31, 19u*' and tlie |"?rtM)lll nt llieir operaliuni far the year linn ended, in accurdanre oilli IK'irnrrally acrepltd arrounlinx prineiplei applied on n baiu conkUlrnt l^wllh Ui*l ol the preceding year.l*'-' 1 CLARKSON, CORDON It CO.,

Chartered AtruuuUnU. .ile. Canada, r ;2,1*3.

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PAX INTERNATIONAL MINES LIMITED

Notes to Consolidated FinancialStatements

December 3!, 1962 Pv

t. The company i* emitlrd lo a royally of J* lor each ton of mineral- brarinx material miMil til not ircainl M oatle) Iron certain mining pruiicrlMt i* Ilw Stale vi Aruviu, lormcrly ownej by ike tubtidiary compa*y.

2. Ourinf ike year Ike following e\eali octurrrd:

la) the foninaftv rrcrivcj tupi'lrnx-aliry lellen paleni dated January 11. 1962 under vhich(i) ike mute ol tlir company wai chanted from International

Molybdenum M mo Liimifd lo fa\ laternational Mi*a Limited;

(ii) the autkorurd C4f4tal wu decreatrd Irom ti.fWO.OOO t* *l,9i9.DU) by eancellinf pi* ma J.tHO.I'W mimt tbam witk n par value ol \ \ e*ck;

liii) Ike notkoriied eagi'nal val inrreated lo H.000.000 by ermine an nW.lloml 2,tMO.I40 ikaret vitk a par value ol {l uck, r*nkm( on a parity oitk the raining tkaret ol the company.

(b) ike company nirckaird all ike auett ol I'M Atkabaica Uranium XI inn Limited in consideration fur -~ (i) ike nuuBinign ol all tkr tubilitici ol fa* Alkabitca Uranium

Win(ii) lh* nuuniption el all tke totlt el M i

Uraniumup r*u Alka o

(iii) Ik* iuuc nl 951,010 aharn ol iu capital nock (ol wkich 90* were pUctd !n etcruw).

(c) the eonitiaay juutd-300,UOO tXam vi iu capita) Hue* lor |X),000

3. Tke cnaiifn in the txurd (Hart capital durinf ike year may b* *uminarUrd a* lollwwv

Contiibutix) Slurp Parvnlne R'rtcount lurplut

Halance December 51, 1691

Cancellation ol J.W0.140 ikare* rrlrrred t* in ootaJ!a) above 3,040.140 3.040,14000 ^.040,140.00

DUcount on kkare* Mriitrn off agairut cuuliihulrd

I.OU.VW 11,013^0.00 tl,W3,OJ3.M (3,040,140.00

(l.t41.ttH.M)

tkue ol 901,010 tKam n-lrrred lo in note LM) *\tovr (valued at ^

1,013,380 }l, 013X1.00

K'ue ci JOO.OtO ikaretlor uik ~.

Balance December 31, I5U -. ~

y94,OIO

NO.UUO

593,010,00

200.000.00 1)0.000.00

, J.M8.J90 896.t37.iO 11.197.1064*

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PAX INTERNATIONAL MINES LIMITED

REPORT OF THE DIRECTORS

To THE SHAREHOLDERS :

Your Directors submit herewith the Annual Report of your Company for the year ended December .31, 1963, together with the financia1 statements and Auditors' Report thereon. Notice of an Annual and Special General Meeting of the Shareholders called for July 16, 1964, is also enclosed.

Since the last Annual Report your Company's association with Geo-Met Reactors Ltd., of Ottawa, has seen completion of the development of a process designed to produce high grade molybdic oxide concentrates, in which process your Company has a bQ'fr royalty interest. Results of this work have been very encouraging and royalties from this source should provide Pax with a future source of income. Further, a contract has been entered into with Metal Traders Inc. of New York for the sale of roasted molybdenite concentrate. It is the intention of your Directors to examine the possibility of further processing of its concentrates with special regard to production of high purity molybdenum disulphidc for use as a lubricant

During the past several months, re-evaluation studies have been under way on your Company's leased Ryan Lake property. The results to date have permitted a substantial increase in the estimated potential of the mine. Production at the mine commenced early in June, 1964. There are some 50 miners and other personnel now at the mine and it would be apropriatc to express appreciation for the efforts of all in bringing the mine into production in record time and on schedule. New life has been engendered in the community and we look forward to a mutually rewarding relationship with residents of the area. Your Directors have been negotiating for some time with the owner of this properly, Min-Ore Mines Limited ("Min-Orc") for the outright purchase by your Company of the property, including the mine workings ai mil). This would eliminate sharing of profits and simplify future financing. A proposal has, after careful consideration, now been agreed to by your Directors which is subject to the approval of the shareholders of Min-Orc, who arc meeting for the purpose immediately preceding/your coming meeting. This will involve the issue of 900,000 of your Corri)any's shares to Min-Ore (909o escrowed) which your Directors consider to be in all the circumstances a fair consideration from your Company's standpoint, and they believe it is in your Company's best interest to complete this purchase as soon as possible.

Concurrently with these favourable developments, interest in your Company's shares has permitted it to secure a new underwriting and option agreement superseding outstanding options in order to supply funds for present operations. A copy of the agreement appears as a schedule to the enclosed notice. Financing in 19G4 to date has provided your Company with ?14?,500. Application is being made to the Canadian Stock Exchange, Montreal, for the listing of your Company's shares thereon.

The option on the Pcters-Quilty molybdenite property in the Sault Ste. K* trie area ha^bcen maintained in good standing. The status ot the agreement with Phelps jJodge corporation as to your Company's royalty interest in the Arizona copper property is unchanged.

The sand and gravel division at Peterborough, Ontario, is being maintained on an inactive basis, pending study of an integrated operation. The potential value of thJr property increases its the availability of product in the Metropolitan Toronto area decreases.

The copper prospect in the Thunder Bay Mining Division (Marathon Area) of Ontario optioned last year was examined with negative results and the option was dropped in November.

On behalf of the Board,

June 19, 1964.JOHN L. AGNEW,

Prtridtnt,

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PAX INTERNATIONAL MINES LIMITED(Incorporated uwJcr ihe Uwi of OnUrio)

BALANCE SHEET —DECEMBER 31, 1963

ASSETSCURRENT:

Marketable securities at cost {approximate market value 52,300) .............. 5 1,717.20Accounts receivable ,........................................................................................... 2,979.35Inventory of sand and aggregates, at the lower of cost or market ................ 7.893.58Prepaid expenses ..........,..............,...................................................................... 411.00

Total current asset*............................................................................ 5 13,001.13INVESTMENT IN WHOLLY-OWNED SUBSIDIARY COMPANY,

RANWICK INC. at cost less amounts written off ........................................ . 104.38ADVANCE TO ETHEL COPPER MINES LIMITED, an associated

company ............................................................................................................. 17,500.00FIXED:

Gravel pit, at cost ........................................... ................................................. S 162,614.81Plant and equipment at cost .........................^............................. 5 22,511.0-1

Less accumulated depreciation ........................................... 6,511.02 16,000.02 178,614.83

BONDS, DEPOSITED WITH THE HYDRO-ELECTRIC POWERCOMMISSION OF ONTARIO, at cost (market value 53,710) ............... 3,745.00

MINING CLAIMS AND RELATED EXPENDITURES, at cost less amounts written off —

Sault Ste. Marie .................................................................,....................... 1.00DEFERRED EXPLORATION, AND DEVELOPMENT EXPENDITURES,

per attached statement ......,.............................................................................. 164,605.79

,V 5377,572.13LIABILITIES B—————rzr

CURRENT:Bank indebtedness (secured) .............................................................,.............. 5 3,606.44Accounts payable and accrued charges —

Associated company ..............,.................................................................... 5 1,750.00Other ...............................................................................^.......................... 6,453.24 8,203.24

Total current liabilities ...................................................................... 5 11,809.68SHAREHOLDERS' EQUITY:

Capital (notes 2 and 3) —Authorized: 4,000,000 shares of 51 par valueIssued: 2,858,390 shares .....,..................................................................... 52,858,390.00

Less discount on slu.-es issued .........................................,................ 1,438,757.50

51,419,632.50 Contributed surplus ,....................................................................,...........,...,..... 1,197,106.46

52,616,738.96 Deduct deficit .,..,,....,..,,..,,..,,..,,........,..:...,..........,.........,....,......,,,,. 2,250,976.51 365,762.45

On behalf of the Board:JOHN L. AGNEW, Director. J. D. BATEMAN, Director.

See notes to financial statements.

5377,572.13

SB*?*:.B-H'' m^;:K:.-^--:

PAX INTERNATIONAL MINES LIMITED

MEN? RK PwtvW tt^wtfKftWHft ANti DEVELOPMENT EXPEN'DITURESFOR THE YEAR ENDED DECEMBER 31, 1963

Pm-

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Ryan Lake (note): Salaries and wages ...............................................................Supplies ..................................................................................Electric power .......................................,..............................Equipment rental and maintenance ..................................,Depreciation of machinery and equipment ......................,Insurance ................................................................................Consultants' fees .......................................,...........................Acreage taxes and lease payments ...........,...........................Assays ....................................................................................Drilling ...................................................................................Shares issued for services in obtaining a sales contract ...., Research and development ........... ......................................Miscellaneous ........................................... ............................Recovery from milling operations .. .................................

Peters Quilty: Option payments ..................................................................,Salaries and wages ......,.......................................... ..... .........Supplies ..................................................,............... ..............Consultants' fees ..................................................................Equipment icntal and maintenance ...................................Legal fees .....................,.................. .....................................Transportation ...........................................................,..........Assays .....................................................................................Filing fees .......;.......................................................................Miscellaneous expenses ........................................................,

Balance December 31,1962

...... 5 33,650.50

...... 15,008.06,.... 14,066.23

4,990.004,065.302,061.40

624.00160.1945.50

2,787.33...... (23,298.78)

5 54,159.73^

...... 5 21,000.00

...... 13,641.657 1 01 702,386.901,065.301 QW ril

798.557000

1 07 no3,467.53

5 46,790.14

5100,949.87

Expenditure! during

the year

5 8,349.07286.51

4,322.821,787.692,056.481 Q28 40^ *U** 47

328.5018,527.8015,000.00 4 IT* 002,189.29

G48.98

5 63,102.01

S Wkon

V) 01

5 553.91

5 63,655.92

Balance December 31.1963

5 41,999.5715,29-1.5718,389.056,777.696,121.783,989.803,967.47

160.19174 00

18,527.8015.000.00 4,333.004,976.62

(22,649.80)

5117,261.74

5 O1 fcftft Aft

33,641.653,103.702,386.001,065.301,059.51

798.5570.00

107 oo•l M I 44

5 47,344.05

5164,605.79

i:NOTE: The agreement in connection with the Ryan Lake property provides that Pax International is first

to recover its cost of bringing the property into production and thereafter the profits arc to be j on the basis of Pax, 70?o, and the owner of the property,,

IT

-

PAX INTERNATIONAL MINES LIMITED

NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1963

1. The company K entitled to a royalty of 3 f for each ton of mineral-bearing material mined (if not treated as waste) from certain mining properties in the State of Arizona, formerly owned by the subsidiary company.

2. The changes in the issued share capital during the year may bc summarized as follows:Shares Par value Discount

Balance December 31, 1962 .......................................................... 2,208,390 52,208,390.00 5 896,257.50Shares issued:

For cash .......,,............,....,,.,,....,.,.......,........,,.,,,.,..,. 500,000 500,000.00 407,500.00For services in obtaining a sales contract ............................ 150,000 150,000.00 135,000.00

Halancc December 31, 1963 ..............................................,......... 2,858.390 52,858.390.00 51.438,757.50

3. (a) At December 31, 19G3 there was an option outstanding to J'urchase shares of the company's capital as follows:

*100.000 shares at 22/jj4 ^z: share within 6 months of August H, 1963 100,00!) vhrircs at 27^,f per share within 9 months of August 14, 1963100,000 i! -ftesat 27/Kf per share within 12 months of August 34, 1963 100,000 sli... - -sat 32/aC per share within 15 months of August 14, 1963 100,000 shares at Z1Vi( j jci -Jiarc within 18 months of August 14, 1963

That portion of the option covering 100,000 shares at 22/s? per share was exercised subsequent to I)cccinWr3l, 1963.

H the optionee fail, to purchase any [Million of any block of shares listed above within the respective limes pir.scribed, the option on ihe remaining blocks of shares shall terminate. While this option is in force the company has agrrcd that il will not, without the written consent of the optionee, among other things change its capital structure, sell or grant options on its share capital, declare or pay dividends, etc.

(b) Subsequent to December 31, 196'J, subject to obtaining approval of the company's shareholders, options were granted to an officer and an rmploycc to purchase shares of the company as follows:

20,000 shares at 30? prr shanc on or before March 10, 1966 100,000 shares at 20? per share on or before February 3, 1967

The option on the 100,000 shares is subject to certain specific performance conditions.

4. At DcccmluT 31, 1963 there was a legal action outstanding against the company which was subsequently settled for ^13,750. No provision for this settlement has been made in the attached financial statements.

AUDITORS' REPORTTo the Director! ofPax International Minei Limited:

We have examined the balance sheet of Tax International Mines Limited as at December 31, 1963 and the statement of operations and deficit for the year then ended. Our examination included a general review of the accounting procedures and such tests of accounting records and other supporting evidence as we considered necessary in the circumstances.

In our opinion the accompanying balance sheet and statement of operations and deficit, when read in conjunction with the notes appended thereto, present fairly the financial position of the company as at December 31, 1963 and the result) of iis operations for the year then ended, in accordance with generally accepted accounting principles applied on a bails consistent with that of the preceding year.

Toronto, Canada, April 2,1964.

CLARKSON, CORDON * Co.,Chartered Accountant*.

O

Norman H. UrsclP.EHO. ONTARIO. M IHIHO

283.0087

69 RICHMOND Sf*tCT WtH

TOHONTO l. OW1A*IO

June 19,196*.To: TUB SHAREHOLDERS, v~

PAX INTERNATIONAL MINES LIMITED.Reappraisal of your property at Ryan Lake held under lease from Min-orc Mines Limited, began in

February of this year. This investigation is based on the successful separation 01 copper and motybdcnum attained by Gco-Mct Reactors Limited in Ottawa using normal flotation procedures in conjunction with pyromctallurgical and hydrometallurgical processes. Rehabilitation of mine and mill began in March. The details are as follows:

Property and HistoryThe property consists of ten leased mining claims in Powell Township four miles from the *31agc of

Matachewan on Highway 566; and eighteen adjoining claims to the north and west of the ten claim* group, staked by your company early this year.

The ten claim group was operated as a copper mine during the period 1950-1938. It is, therefore, fully serviced by hydro-electric power. Water supply and other ancillary services necessary for a small mine operation arc also established.Geology and the Mine

The property lies approximately one mile north of the postulated western extension of the Kirkland Larder Lake break. It straddles a contact between Keewatin lavas and Tcmiskaming scdimcn'- ciossing the property on a trend slightly north of west evidenced by a strong shear zone and highly altered, caifconatizcd rocks. A peridotite mass is found within the lavas in the Mine area. Intrusivcs appear to bc abundant ranging from lamprophyre dikes to acid porphyries. Alteration is widespread.

For convenience of description the property is divided into "North", "Main" and "South Zones" in the mine area and the "North Porphyry Bodies".

tV*Underground detailed mapping began in March. Mr. Martin Kierans was employed to carry out

this phase of the program under the writer's supervision. Mr. Kierans' excellent work in the short time available allows the following tentative conclusions subject to revision as more data becomes available:

The most conspicuous single structure in the mine is the "Great" Dike. This is a vertical dike-like mnss of syenite and syenite porphyry which is near the north boundary of a large mass of blue-grey peridotite. In part it forms the contact oi this mass with volcanics to the north and in part it transects this contact. It appears to bc a zone of "sycnitic" alteration following a very strong fault zone. Tb*s major structure has a consistent N65-70 W strike and an average thickness of 60 feet. Its importance has not been completely settled but it appears that E-W and N 70 E faults diverge from this zone and these fauh zones are enriched in quartz, chalcopyrite and molybdenite.

South of the Great Dike is the Ryan Lake fault zone or the original Main Zone. Within thh zone N 70 'i set of fractures which intersect the E-W Ryan Lake Zone arc apparently molybdenite cnrtcSed.

A second parallel fault or fracture south of the Main Zone is predominantly E-W in strike and has been mined for copper. Dips in both zones are very steep and miy bc steeply north or steeply south-

The major directions of fracturing are quite consistent and arc reflected on a regional -scale by various large geological lineaments. Within the mine most (over 95^fe) of the fractures mapped were on one of these directions.

Additional "Syenitic" alteration areas occur in the mine — in addition to the Great Dike area. These are (l) A persistent satellite dike parallel to the Great Dike itself. (2) Irregular masses of mineralized syenitic alteration encountered on the second level. (3) Persistent sleep narrow dikes parallel to or within E-W zones of faulting and shearing.

Important sulphide mineralization has-been noted to bc associated with the above directions of fracturing (predominantly the N 70 E direction). This mineralization is in or near quartz tension veins on

s of thickness from inches to feet of white quartz. The direction of the tension fracturing U irregular i:;and may bc in any direction or at any dip and intensity — in places the iiuinlx.-! of such large quartz filled

fractures arc limited enough to form the basis for small stoping operations on individual quartz veins. In '•f other places they are very numerous and form a stockwork.

~Orc Reserves and Potential Reservesi®S ^rc rc!(ervcs immediately available for mining between the fourth and second levels were estimated fl; in 1958 to bc 41,380 tons grading 1.33CJ, Cu and D.%% MoS2 after allowing for twenty percent dilution. fe.Thc sectors of the mine considered in these calculations were the "07", "05" and "03" veins in the "North gi:,' Zone" and the 410W, 302 W, and 201E sectors in the "Main Zone".i4, ; The present program has provided evidence that greatly increases the above slated reserves and i;,Vf'* holds mm li promise for :v larger mining operation than now established on the property.^1". Jn the "Main Tone" sectors of ore grade copper and molybdenum mineralization are known to be ||!; larger and more extensive- than prcvio-.sly estimated. The western extension and downward continuation of |;'4 this zone is apparent from close examination of the mine and available records. Full appraisal of tonnage ' available requires additional exploration.K

tIn the "South Zone"-important ore grade values in copper and molybdenum over wide sections are

known on the second and third levels where it has been developed. Self potential survey results and limited diamond drill'.'; indicate possible extension of this zone eastward.

The "North Zone" which from present data may be regarded as bounded on the south by the Great Dike holds much promise for large tonnage possibility. The presently developed "05", "07" and "03" arc high grade sections in this zone. The dimensions cannot bc firmly slated at this time other than

•important ore reserve possibilities exist in this sector.In addition to the mine workings there exist on the properly other excellent possibilities of

developing additional ore. TJjs most significant at this time is the "North Porphyry Body" which lies'- approximately 1,500 feet north of the mine area. Surface trenching and bulk sampling indicate good grade{0.2596 to 0.5070) molybdenite ore over an apparent length of approximately 400 feet and width of60 feet. Limited drilling shows the continuation of this zone to a depth of 150 feet.

Present StatusBoth mine and mill are now in operation. Concurrent with production from the known higher grade

sectors of the mine, underground diamond drilling and exploration development arc in progress in the mine area to fully assess larger tonnage implications.

Immediate plans also call for surface detailed geological mapping, geophysical survey and surface diamond drilling to fully appraise the potential of the property.

The present evidence and indicated reserves allow plans for increase in mill capacity.

All of which is respectfully submitted,

W•feM

NORMAN H. URSEL, P.Eso.

GEO-MET REACTORS LIMITED

C**Lt, OCOMET OTTAWA, CANADA

Titt^MONfi

6*2.1108

f.o. MOX toe. cLouciiTtn P.O.. ONTARIO

UktOftATOftllt:

ALCION ROAD OTTAWA. CANADA

June 19, 1964.

TO: THE SHAREHOLDERS,PAX INTERNATIONAL MINES LIMTTZD

Extensive test work has been carried out on recovery of molybdenum and copper concentrates by flotation from bulk ore samples taken from several locations in the mine.

Results of the test work have been entirely satisfactory indicating high sulphide recoveries. Concurrently with their test work Geo-Mct Reactors Limited has expedited renovation of the mill at the Ryan Lake property 10 that molybdenum and copper concentrates could bc produced in as short a time as possible. The latter work, which began at the beginning of April, was completed cm June 15, 1964, at which time the first mill runs were made. Rct-A-eries of 95^o of the molybdenum and 84^e of the copper were made from initial operations on development ore. The operation was then changed over to take a highgrade ore, and has since been operating at 100 tons per day capacity. Meanwhile plans are underway to increase the mill capacity.

tV

Initial test work on the production of pure lubricant grade molybdenum disulphidc from 1'ax concentrates has sjiown that a new hydromctnllurgical technique is feasible. Further work is underway to determine the factors that control the particle size of precipitated molybdenum sulfides because this is an extremely important factor in the quality of the lubricant.

The flowsheet for the leaching of copper from Pax concentrates has now been completed and will be operating on a commercial scale in June, 1964.

D. E. C. KINO,Supervisor of Millingand Hydrometallurgy Group.

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PRES.DENT H - , PA \'1^

VICE PRESIDENT OR MANAGING DIRECTOR \^UCJL^^\J-^-^- VV~pv" V

SECRETARY THEASURtR L) * \ TN^l |-fcl*idl C^*tt*GENERAL MANAGER ' -^VlVA. J V V.V ^ 1XC? W Vi-T ^- T^S"'

MINE MANAGE* ' fc' V ' "

NAME ON INCORPORATION i{aiTMic^" Unnluffl Hinss jj^mitodINCORPORATED UNDER A OnturiO CHARTER DATED 5 Oct. 19A9 SOURCE V-H t . C .'- lv 1 - i '.

•UCCEEDINO NAMES (Jottsolidated^ Hanwlck Uranium Llines Limited oiA-ll-l9^3Cnt. 1 :- 1^-i - ;-Intnrn.-itlonnl HnnvH rfc Ll^Ar.iad 30-6-39^5 t-nt . ,3'J-Y- 1 :V'

I'a^: Intcrnational'v.lnes Limited ll-l-l^o? Ont.PA-P-l ^-j.Ueo-Fax tines Limited 3O-9-1VC/0 Ont.l9-10-i .-.

RECI9TRATIONS ' DATE SOURCE

PROVINCE

PROVINCE

. PROVINCE

PROVINCEPROVINCE .

. PROVINCE

CMARTER SURRENOeCEO OR CANCELLED Dissolved SA^e 16 I'P.'*' 1976 SOUdCC ' *^ - V ~~."lfj(f

MINE OFFICE ADDRESS:

MEAD orr,c8 ADDRESS T 72 S )3cnk Street , Ottmra, Ontario

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