<PAGE>
 
                                                                     Exhibit 2.3


                           STOCK PURCHASE AGREEMENT



                                    BETWEEN



                               ATLAS CORPORATION


                                      AND


                  CORNERSTONE INDUSTRIAL MINERALS CORPORATION



                               December 13, 1996
                                        
<PAGE>
 
                           STOCK PURCHASE AGREEMENT


     THIS AGREEMENT is entered into on the 13th day of December, 1996, by and
between Atlas Corporation, a Delaware corporation (the "Seller"), and
Cornerstone Industrial Minerals Corporation (formerly Phoenix Financial Holdings
Inc.), an Ontario corporation (the "Buyer").  The Buyer and the Seller are
referred to collectively herein as the "Parties".

     The Seller owns all of the outstanding capital stock of Atlas Perlite, Inc.
("API"), an Oregon corporation. The Buyer and the Seller are parties to a letter
agreement, dated July 3, 1996 (the "Letter Agreement"), which contemplates a
transaction in which the Buyer will purchase from the Seller, and the Seller
will sell to the Buyer, all of the issued and outstanding shares of common stock
of API (being all of the issued and outstanding shares) (the "API Shares") in
return for cash, Common Shares and the Royalty.  The Letter Agreement provides
that the Buyer and the Seller will enter into this Agreement in order to set
forth the definitive terms and conditions of the transaction.

     NOW THEREFORE, in consideration of the foregoing premises and the promises
and covenants herein made, together with other good and valuable consideration
the receipt and sufficiency of which is hereby acknowledged, the Parties agree
as follows:

1.   Definitions.

     "Affiliate" has the meaning set forth in Rule 12b-2 of the regulations
     promulgated under the Securities Exchange Act of 1934, as amended.

     "API" has the meaning set forth in the preface above.

     "API Financial Statements" means the unaudited financial statements of API
     as at and for the year ended December 31, 1995 and the unaudited interim
     financial statements of API as at and for the nine months ended September
     30, 1996;

     "API Shares" has the meaning set forth in the preface above.

     "Approval" means approval given at the Meeting by the minority shareholders
     of the Buyer of the purchase and sale of the API Shares contemplated hereby
     in accordance with Policy Statement No. 9.1 of the Ontario Securities
     Commission.

     "Automatic Termination Date" means December 31, 1996.

     "Base Load Contracts" means agreements for the supply of perlite mined from
     the Project to customers which set forth: (i) a minimum of a three year
     delivery schedule; (ii) price per ton and tonnage which result in a price
     per ton times annual tonnage of at least $1,350,000; and (iii) specified
     dates for initial delivery.
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                                       2


     "Buyer" has the meaning set forth in the preface above.

     "Buyer Financial Statements" means the published audited financial
     statements of the Buyer as at and for the year ended December 31, 1995 and
     the published unaudited financial statements of the Buyer as at and for the
     six months ended June 30, 1996.

     "Closing" has the meaning set forth in paragraph 2(c) below.

     "Closing Date" has the meaning set forth in paragraph 2(c) below.

     "Code" means the Internal Revenue Code of 1986, as amended.

     "Commercial Production" means the initial delivery of perlite under the
     Base Load Contracts.

     "Common Shares" means the common shares without par value in the capital of
     the Buyer after giving effect to the Reorganization.

     "Confidential Information" has the meaning set forth in paragraph 12 below.

     "Definitive Project Financing" means financing for the Project on
     reasonable commercial terms in an amount not less than $2,000,000 plus the
     amount by which costs and expenses incurred on the Project by the Seller
     and API after November 30, 1995 and prior to the commencement of Commercial
     Production exceeds $1,746,000.

     "Environmental Costs" means any clean-up costs, remediation, removal, or
     other response costs, legal expenses (including reasonable attorneys'
     fees), investigation costs (including reasonable fees of consultants,
     counsel and other experts in connection with any environmental
     investigation or testing), losses, liabilities, obligations, payments,
     fines, penalties (civil and criminal) and damages.

     "Environmental Law" means any federal, state, provincial, regional,
     territorial, municipal, local or foreign statute code, ordinance, rule,
     regulation, policy, guideline, permit, consent, approval, license,
     judgment, order, writ, decree, injunction or other authorization, relating
     to:

     (a)  emissions, discharges, releases or threatened releases of Hazardous
          Substances into the natural or human environment, including, without
          limitation, air, soil, sediments, land surface or subsurface, surface
          water, ground water, buildings or facilities, treatment works,
          drainage systems or septic systems; or

     (b)  the generation, treatment, storage, disposal, use, handling,
          manufacturing, transportation or shipment of Hazardous Substances; or
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                                       3


     (c)  mining or mined land reclamation; or

     (d)  otherwise relating to the pollution or protection of health or safety
          or the environment, solid waste handling, treatment or disposal or
          operation or reclamation of mines.

     "Hazardous Substances" means (i) hazardous materials, pollutants,
     contaminants, constituents, toxic substances, hazardous wastes and
     hazardous substances as those terms are defined in the following statutes
     and their implementing regulations: the Hazardous Materials Transportation
     Act, 49 U.S.C. (S) 1801 et seq., the Resource Conservation and Recovery
     Act, 42 U.S.C. (S) 6901 et seq., the Comprehensive Environmental Response,
     Compensation and Liability Act, as amended by the Superfund Amendments and
     Reauthorization Act 42 U.S.C. (S) 1906 et seq., the Clean Water Act,33
     U.S.C. (S) 1251 et seq., the Toxic Substances Control Act, 15 U.S.C. (S)
     2601 et seq., and the Clean Air Act, 42 U.S.C. (S) 7401 et seq., (ii)
     petroleum, including crude oil and any fractions thereof, (iii) natural
     gas, synthetic gas and any mixtures thereof, (iv) asbestos and/or asbestos-
     containing materials, (v) PCBs, or PCB-containing materials or fluids, (vi)
     any other substance with respect to which any federal, state or local
     agency or other governmental entity may require either an environmental
     investigation or an environmental remediation, and (vii) any other
     hazardous or noxious substance, material, pollutant or solid or liquid
     waste that is required by, or forms the basis of liability under, any
     environmental law.

     "Internal Financial Statements" means unaudited statements of income and
     cash flows of the Buyer to be prepared by management of the Buyer in
     accordance with generally accepted accounting principles.

     "Meeting" means the annual and special meeting of shareholders of the Buyer
     held on September 3, 1996 to consider, among other things, the purchase and
     sale of the API Shares contemplated hereby and the Reorganization.

     "Mineral Leases" means 66.5 acres of state mineral leases owned by the
     Seller that comprise part of the Tucker Hill Property.

     "Operating Permits" means all permits necessary for commencement of mining
     operations for the Project.

     "Party" has the meaning set forth in the preface above.

     "Person" means an individual, a partnership, a corporation, an association,
     a joint stock company, a trust, a joint venture, an unincorporated
     organization, or a governmental entity (or any department, agency, or
     political subdivision thereof).

     "Process Plant Land" means the land described in Schedule "A" covering
     approximately 26 acres in the northern outskirts of Lakeview, Oregon which
     includes approximately 700
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                                       4

     feet of dedicated rail siding upon which construction is underway for a
     process plant capable of processing the raw perlite mined from the Tucker
     Hill Property.

     "Project" means, collectively, the Process Plant Land and the Tucker Hill
      Property.

     "Reorganization" means the amendment to the articles of the Buyer approved
     at the Meeting and made effective September 3, 1996 pursuant to which the
     articles were amended to, among other things: (i) create an unlimited
     number of Common Shares; (ii) change each of the issued and outstanding
     Class A Subordinate Voting Shares and Class B Multiple Voting Shares of the
     Buyer into one Common Share; and (iii) cancel all remaining unissued Class
     A Subordinate Voting Shares and Class B Multiple Voting Shares of the
     Buyer.

     "Representatives" means the officers, directors, employees and agents,
     including legal counsel and outside accountants, of a Party.

     "Royalty" means a 2% gross proceeds royalty on sales from the Tucker Hill
     Property calculated as set forth in the Royalty Deed annexed hereto as
     Schedule "C".

     "Securities Act" means the United States Securities Act of 1933, as
     amended;

     "Seller" has the meaning set forth in the preface above.

     "Subsidiary" means any corporation with respect to which a specified Person
     (or a Subsidiary thereof) owns a majority of the common stock or has the
     power to vote or direct the voting of sufficient securities to elect a
     majority of the directors.

     "Tucker Hill Property" means the land described in Schedule "B" consisting
     of 45 unpatented lode mining claims and the Mineral Leases located in Lake
     County, Oregon.

2.   Purchase and Sale of API Shares.

     (a)  Basic Transaction.  On and subject to the terms and conditions of this
          Agreement, the Buyer agrees to purchase from the Seller, and the
          Seller agrees to sell to the Buyer, all of the API Shares for
          aggregate consideration of $2,000,000 plus the Royalty, such
          $2,000,000 to be paid in the manner specified below:

          (i)   At the Closing, the Buyer shall pay to the Seller $125,000 and
                shall issue to the Seller 1,205,998 Common Shares;

          (ii)  On the later of: (A) the Closing; or (B) two business days
                following delivery by the Seller to the Buyer of evidence
                satisfactory to the Buyer, acting reasonably, of the issuance of
                the Operating Permits and the successful resolution of any
                related appeals, the Buyer shall pay the Seller $500,000 and
                shall issue to the Seller 4,823,993 Common Shares;
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                                       5

          (iii) On the later of: (A) the Closing; or (B) two business days
                following delivery by the Seller to the Buyer of evidence
                satisfactory to the Buyer, acting reasonably, of the execution
                by API of Base Load Contracts the Buyer shall pay the Seller
                $125,000 and shall issue to the Seller 1,205,998 Common Shares;

          (iv)  On the later of: (A) the Closing; or (B) two business days
                following delivery by the Seller to the Buyer of evidence
                satisfactory to the Buyer, acting reasonably, of the execution
                of an agreement for Definitive Project Financing, the Buyer
                shall pay the Seller $125,000 and shall issue to Seller
                1,205,998 Common Shares; and

          (v)   On the later of: (A) the Closing; or (B) two business days
                following delivery by the Seller to the Buyer of evidence
                satisfactory to the Buyer, acting reasonably, of the
                commencement of Commercial Production, the Buyer shall pay the
                Seller $125,000 and shall issue to the Seller 1,205,999 Common
                Shares.

          For the purposes of this Agreement, the Common Shares shall have an
          ascribed value of $0.1036 (C $0.1415) per share.

          It is acknowledged and agreed that the payments set forth above are to
          be made sequentially, in the order set forth above, as each condition
          precedent to payment is satisfied. As an example and for greater
          certainty, the payment referred to in subparagraph (iii) is not to be
          made until the conditions set forth in subparagraph (i) and (ii) have
          been satisfied and the payments called for therein have been made.

     (b)  In addition to the consideration to be paid by the Buyer as set forth
          in subparagraph 2(a), the Buyer shall also reimburse the Seller
          concurrently with the payment provided for in subparagraph 2(a)(v) for
          all expenditures incurred by the Seller on or for the benefit of the
          Project from December 1, 1995 to the date of Commencement of
          Commercial Production.  Such costs will be accounted for in a separate
          accrual account by API and will include the payment by the Seller of
          any API accounts payable in addition to those shown on the balance
          sheet of API as at November 30, 1995, being in the aggregate amount of
          $36,422.  The Seller represents and warrants to the Buyer that as to
          the date hereof the total of such expenditures is approximately $1.7
          million.

     (c)  In the event the Buyer is unable to make the cash payments provided
          for in subparagraphs 2(a) and 2(b) or is unable to pay for development
          capital expenditures for the Project as and when required, the Seller
          will defer such cash payments or will advance the funds required for
          such expenditures, as the case may be on such terms as may be agreed
          upon by the Buyer and the Seller.  All
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                                       6

          amounts deferred or advanced by the Seller pursuant to this
          subparagraph 2(c) and not otherwise repaid to the Seller shall be
          repaid at the option of the Seller from either the Definitive Project
          Financing or income from the Project.

     (d)  The Closing.  The transfer of the API Shares by the Seller to the 
          Buyer (the "Closing") shall take place at the offices of the Buyer and
          the Seller in Denver, Colorado, commencing at 11:00 a.m. local time on
          December 16, 1996 or at such other place or time on such other date as
          the Buyer and the Seller may mutually determine (the "Closing Date");
          provided, however, that in no event shall the Closing Date be later
          than the Automatic Termination Date. The Buyer acknowledges and agrees
          that, except as otherwise specifically provided herein to the
          contrary, upon its acquisition of the API Shares, API and its assets
          will be subject to all of the liabilities of API, known or unknown,
          and whether now in existence or hereafter arising.

     (e)  Deliveries at the Closing. At the Closing, (i) the Seller will deliver
          to the Buyer: (A) the various certificates, instruments, and documents
          referred to in subparagraph 8(a) below; (B) stock certificates
          representing all of the API Shares, endorsed in blank or accompanied
          by duly executed assignment documents, and (C) a declaration that the
          Seller holds the Mining Leases in trust for API; and (ii) the Buyer
          will deliver to the Seller: (A) the various certificates, instruments,
          and documents referred to in subparagraph 8(b) below; (B) the cash and
          share consideration specified in subparagraph 2(a) (as applicable)
          above, including, without limitation, share certificates representing
          the requisite number of Common Shares; and (C) the Royalty Deed.

     (f)  Deliveries after Closing. On the dates specified in subparagraphs
          2(a)(ii)-(v) and 2(b), the Buyer shall deliver to the Seller the cash
          and share consideration specified in such subparagraphs, including,
          without limitation, certificates representing the requisite number of
          Common Shares.

3.   Representations and Warranties Concerning the Transaction.

     (a)  Representations and Warranties of the Seller.  The Seller represents
          and warrants to the Buyer that the statements contained in this
          subparagraph 3(a) are correct and complete as of the date of this
          Agreement and will be correct and complete as of the Closing Date (as
          though made then and as though the Closing Date were substituted for
          the date of this Agreement throughout this subparagraph 3(a)):

          (i)  Organization of the Seller.  The Seller is a corporation duly
               organized, validly existing, and in good standing under the laws
               of the State of Delaware.

          (ii) Authorization of Transaction.  The Seller has full corporate
               power and authority to execute and deliver this Agreement and to
               perform its
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                                       7

                 obligations hereunder.  This Agreement has been duly
                 authorized, executed and delivered by the Seller and
                 constitutes the valid and legally binding obligation of the
                 Seller, enforceable in accordance with its terms and
                 conditions, subject to: (A) bankruptcy, insolvency,
                 reorganization, moratorium and other laws relating to or
                 affecting creditors' rights generally; (B) the qualification
                 that equitable remedies, including without limitation, specific
                 performance and injunction, may be granted only in the
                 discretion of a court of competent jurisdiction; and (C) the
                 qualification that rights to indemnity may be limited by
                 applicable law.

          (iii)  Noncontravention.  Neither the execution and the delivery of
                 this Agreement, nor the consummation of the transactions
                 contemplated hereby, will violate (A) any provision of the
                 Articles of Incorporation or Bylaws of the Seller; (B) any
                 provision of law; (C) any order of any court or other agency of
                 government; (D) any provision of any indenture, agreement or
                 other instrument to which Seller or API is a party or by which
                 the Project is bound; or (E) be in conflict with, result in a
                 breach of or constitute (with due notice and lapse of time) a
                 default under any such indenture, agreement or other
                 instrument.  To the knowledge of the Seller, there is no law,
                 rule or regulation, nor is there any judgment, decree or order
                 of any court or governmental authority binding on Seller or API
                 which would be contravened by the execution, delivery,
                 performance or enforcement of this Agreement or any instrument
                 or agreement required hereunder.

          (iv)   Brokers' Fees.  The Seller has no liability or obligation to
                 pay any fees or commissions to any broker, finder, or agent
                 with respect to the transactions contemplated by this Agreement
                 for which the Buyer could become liable or obligated.

          (v)    Investment.  The Seller understands that the shares of the
                 Buyer to be issued hereunder have not been and will not be
                 registered under the Securities Act or under any state
                 securities laws. The Seller is a sophisticated investor with
                 knowledge and experience in business and is not acquiring such
                 shares with a view to or for sale in connection with any
                 distribution thereof within the meaning of the Securities Act.

          (vi)   API Shares.  The Seller holds of record and owns beneficially
                 all of the API Shares, free and clear of any restrictions on
                 transfer (other than restrictions under applicable securities
                 laws), taxes, security interests, options, warrants, purchase
                 rights, contracts, commitments, equities, claims or demands and
                 no voting trust, proxy, or other agreement or understanding
                 exists with respect to the voting of the API Shares.
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                                       8

          (vii)  Consents, Approvals.  No consent, approval, licence, order,
                 authorization, regulation or declaration of, or filing with,
                 any governmental authority or other Person is required by the
                 Seller or API, in connection with (a) the Closing or (b) the
                 execution and delivery by the Seller of this Agreement or the
                 other documents to be delivered by the Seller to the Buyer
                 hereunder or (c) the observance and performance by the Seller
                 of its obligations under this Agreement or such other
                 documents.

          (viii) Title to Mineral Leases.  Except as disclosed in the title
                 report prepared by Morrison and Foerster LLP and the documents
                 referred to therein, (collectively the "Title Report"), a copy
                 of which has been provided to the Buyer by the Seller, to the
                 Seller's knowledge:

                 (A)  the Seller is the registered owner of the Mineral Leases
                      and the Mineral Leases are free and clear of all liens,
                      encumbrances or other burdens on production or claims of
                      third parties other than API;

                 (B)  the Seller holds the Mineral Leases in trust exclusively
                      for API and API is the sole beneficial owner of the
                      Mineral Leases;

                 (C)  the Mineral Leases are in good standing under all
                      applicable laws; and

                 (D)  there are no actions or administrative or other
                      proceedings pending or threatened against or affecting the
                      Mineral Leases

    (b)   Representations and Warranties of the Buyer.  The Buyer represents and
          warrants to the Seller that the statements contained in this paragraph
          3(b) are correct and complete as of the date of this Agreement and
          will be correct and complete as of the Closing Date (as though made
          then and as though the Closing Date were substituted for the date of
          this Agreement throughout this paragraph 3(b)) and will remain correct
          and complete until such time as the Seller has received all of the
          consideration to which it is entitled hereunder as set forth in
          paragraph 2:

          (i)  Organization of the Buyer.  The Buyer is a corporation duly
               organized, validly existing, and in good standing under the laws
               of the Province of Ontario.

          (ii) Authorization of Transaction.  The Buyer has full corporate power
               and authority to execute and deliver this Agreement and to
               perform its obligations hereunder.  This Agreement has been duly
               authorized, executed and delivered by the Buyer and constitutes
               the valid and legally binding obligation of the Buyer,
               enforceable in accordance with its terms and conditions, subject
               to: (A) bankruptcy, insolvency, reorganization,
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                                       9

                 moratorium and other laws relating to or affecting creditors'
                 rights generally (B) the qualification that equitable remedies,
                 including, without limitation, specific performance and
                 injunction, may be granted only in the discretion of a court of
                 competent jurisdiction; and (C) the qualification that rights
                 to indemnity may be limited by applicable law.

          (iii)  Shareholder Approval.  The Buyer has received the Approval.

          (iv)   Noncontravention.  Neither the execution and the delivery of
                 this Agreement, nor the consummation of the transactions
                 contemplated hereby, will violate (A) the charter or bylaws of
                 the Buyer; (B) any provision of law; (C) any order of any court
                 or other agency of government; (D) any provision of any
                 indenture, agreement or other instrument to which Buyer is a
                 party or by which its properties or assets are bound; or (E) be
                 in conflict with, result in a breach of or constitute (with due
                 notice and lapse of time) a default under any such indenture,
                 agreement or other instrument. To the knowledge of the Buyer,
                 there is no law, rule or regulation, nor is there any judgment,
                 decree or order of any court or governmental authority binding
                 on the Buyer which would be contravened by the execution,
                 delivery, performance or enforcement of this Agreement or any
                 instrument or agreement required hereunder.

          (v)    Brokers' Fees.  The Buyer has no liability or obligation to pay
                 any fees or commissions to any broker, finder, or agent with
                 respect to the transactions contemplated by this Agreement for
                 which the Seller could become liable or obligated.

          (vi)   Investment.  The Buyer understands that the API Shares have not
                 been and will not be registered under the Securities Act or
                 under any state securities laws. The Buyer is a sophisticated
                 investor with knowledge and experience in business and is not
                 acquiring the API Shares with a view to or for sale in
                 connection with any distribution thereof within the meaning of
                 the Securities Act.

          (vii)  The Common Shares.  The Reorganization was approved by the
                 shareholders of the Buyer at the Meeting and on the date of
                 this Agreement, the authorized capital of the Buyer consists of
                 an unlimited number of Common Shares of which 23,997,938 have
                 been validly issued and are outstanding.  All of the Common
                 Shares to be issued to the Seller hereunder have been duly
                 authorized for issuance and allotted to the Seller and, when
                 issued in accordance with the terms hereof, all such shares
                 shall be validly issued as fully paid and nonassessable, free
                 and clear of all liens, charges and encumbrances.  There does
                 not exist any pre-emptive right in favour of any person with
                 respect to any of such shares.  No Person has any agreement or
                 any option, right or privilege capable of becoming
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                                      10

            an agreement, for the purchase, subscription or issuance of any
            unissued shares of the Buyer, other than as set forth in the
            Financial Statements, or otherwise publicly disclosed or as
            contemplated hereby.

    (viii)  Financial Statements and Reports. The Buyer Financial Statements and
            the notes thereto were prepared in accordance with the books and
            records of the Buyer and fairly present the financial condition and
            results of the operations of the Buyer at the date and for the
            periods covered thereby all in accordance with Canadian generally
            accepted accounting principles consistently applied. None of the
            Buyer Financial Statements contained, as of its date, any untrue
            statement of a material fact or any omission to state a material
            fact required to be stated therein or necessary in order to make the
            statements therein, in light of the circumstances under which they
            were made, not misleading. Each of the balance sheets included in
            the Buyer Financial Statements (including any related notes)
            presents fairly in all material respects the financial position of
            the Buyer as of its date and the Buyer Financial Statements
            (including any related notes) present fairly in all material
            respects the results of operations, changes in financial position,
            cash flows and changes in stockholders' equity, as the case may be,
            of Buyer for the periods therein set forth, subject, in the case of
            unaudited financial statements, to normal year-end audit
            adjustments, in each case in accordance with generally accepted
            accounting principles consistently applied during the periods
            involved (except as otherwise stated therein).

       (ix) No Material Changes. Since June 30, 1996, there has not been, except
            as publicly disclosed or as contemplated hereby,

            (A)   any material adverse change, however caused, in the business,
                  assets, liabilities (actual or contingent), results of
                  operations, prospects, financial or other condition or
                  operations of Buyer;

            (B)   any change in Buyer's authorized or actual equity
                  capitalization;

            (C)   any damage, destruction or casualty loss, materially and
                  adversely affecting the business, assets, liabilities (actual
                  or contingent), results of operations, prospects, or financial
                  or other condition or operations of Buyer, whether or not
                  insured;

            (D)   any incurrence by the Buyer of long-term debt or any other
                  material liability or obligation, actual or contingent, other
                  than current liabilities incurred in the ordinary and usual
                  course of business consistent with past practices;
<PAGE>
 
                                      11


          (E) entry into, or agreement or commitment to enter into, any
              agreement, commitment or transaction by the Buyer (including,
              without limitation, any borrowing, capital expenditure or
              financing or any amendment, modification or termination of any
              existing agreement, commitment or transaction) other than in the
              ordinary and usual course of business consistent with past
              practices;

          (F) acquisition or disposition of, or entry into any agreement by the
              Buyer with respect to the acquisition or disposition of a
              significant amount of assets; or

          (G) any agreement with respect to any of the foregoing.

4.   Representations and Warranties Concerning API. The Seller represents and
     warrants to the Buyer that the statements contained in this paragraph 4 are
     correct and complete as of the date of this Agreement and will be correct
     and complete as of the Closing Date (as though made then and as though the
     Closing Date were substituted for the date of this Agreement throughout
     this paragraph 4):

     (a)  Organization, Qualification, and Corporate Power. API is a corporation
          duly organized, validly existing, and in good standing under the laws
          of the State of Oregon. API is duly authorized to conduct business and
          is in good standing under the laws of the State of Oregon. API has the
          corporate power and authority to carry on the businesses in which it
          is engaged and to own and use the properties owned and used by it. No
          proceedings have been taken or authorized by API or, to the best of
          the Seller's knowledge, any other Person, with respect to the
          bankruptcy, insolvency, liquidation, dissolution or winding up of API
          or with respect to any amalgamation, merger, consolidation,
          arrangement or reorganization relating to API.

     (b)  Capitalization. The API Shares are the only issued and outstanding
          equity securities of API and the API Shares have been duly authorized,
          are validly issued, fully paid, and nonassessable. No Person has any
          agreement or any option, right or privilege capable of becoming an
          agreement for the purchase, subscription or issuance of any securities
          of API or any securities convertible into or exchangeable for
          securities of API.

     (c)  Brokers' Fees. API does not have any liability or obligation to pay
          any fees or commissions to any broker, finder, or agent with respect
          to the transactions contemplated by this Agreement.

     (d)  Employees.  API has no employees.

     (e)  Subsidiaries.  API has no Subsidiaries.
<PAGE>
 
                                       12

     (f)  Royalties. Except as set forth in Schedule 4(f), to Seller's knowledge
          there are no royalties or other burdens on production affecting the
          Tucker Hill Property.

     (g)  Permits and Licenses. A list of all currently active material permits,
          licenses, consents, approvals, authorizations, and qualifications
          obtained by API in connection with its operations on the Tucker Hill
          Property as of the date of this Agreement, true and correct copies of
          each of which have been made available to Buyer, is set forth on
          Schedule 4(g)(i); the only other permits, licenses, consents,
          approvals, authorizations and qualifications required in order to
          operate the Project in the normal course of business are set forth in
          Schedule 4(g)(ii). To Seller's knowledge, API's ownership and
          operation of the Tucker Hill Property is not in violation of and has
          resulted in no liability (other than liability for compliance with
          existing permits and laws, including but not limited to performance of
          reclamation) under any statute, rule or regulation of any governmental
          authority applicable to the Tucker Hill Property, other than
          violations or liability, if any, which have not resulted and would not
          be reasonably expected to result in any material loss or liability.

     (h)  Title to Claims. Except as disclosed in the Title Report, to Seller's
          knowledge, as to the unpatented mining claims comprising the Tucker
          Hill Property (the "Claims") subject to the paramount title of the
          United States:

          (A) API is in exclusive possession thereof; free and clear of all
              liens, encumbrances or other burdens on production or claims of
              third parties arising by, through or under API;

          (B) since API acquired the Claims, assessment work, intended in good
              faith to satisfy the requirements of state and federal laws and
              regulations and generally regarded in the mining industry as
              sufficient, for all assessment years up to and including the
              assessment year ending September 1, 1992, was timely performed on
              or for the benefit of the Claims and affidavits evidencing such
              work were timely recorded;

          (C) since API acquired the Claims, claim rental and maintenance fees
              required to be paid under federal law in lieu of the performance
              of assessment work, in order to maintain the Claims commencing
              with the assessment year ending on September 1, 1993 and through
              the assessment year ending on September 1, 1996, have been timely
              and properly paid, and affidavits or other notices evidencing such
              payments and required under federal or state laws or regulations
              have been timely and properly filed or recorded;

          (D) since API acquired the Claims, all filings with the Bureau of Land
              Management with respect to the Claims which are required under the

<PAGE>
 
                                       13

              Federal Land Policy and Management Act of 1976 have been timely
              and properly made, and

          (E) there are no actions or administrative or other proceedings
              pending or threatened against or affecting the Claims. Nothing
              herein shall be deemed a representation that any of the Claims
              contain a discovery of valuable minerals.

     (i)  Title to Assets. Except as otherwise set forth or contemplated herein,
          API has good and marketable title to all of its assets (including,
          without limiting the generality of the foregoing, the Process Plant
          Land), free and clear of all liens, encumbrances or claims of third
          parties.

     (j)  Environmental Compliance. To the knowledge of Seller, there are no
          conditions or activities at or on the Project which would result in a
          violation of or liability under applicable Environmental Laws, except
          for such matters as would not have a material adverse effect on the
          Project taken as a whole. To the knowledge of Seller, there have been
          issued under applicable Environmental Laws no notices of violation or
          consent orders to which API (with respect to its operations at the
          Project) or the Project are subject, except for such matters as would
          not have a material adverse effect on the Project taken as a whole.
          There are no pending or, to the knowledge of Seller, threatened
          proceedings by or before any court or other governmental authority
          against API with respect to its operation or ownership of the Project
          alleged to be, or have been, in violation of, under, any Environmental
          Law, except for such matters as would not have a material adverse
          effect on the Project taken as a whole.

     (k)  Material Contracts and Commitments. A list of all contracts,
          agreements, mortgages, indentures and leases (including equipment
          leases) to which API is a party (collectively the "Contracts") is set
          forth in Schedule 4(k). True and correct copies of all of the
          Contracts have been provided by the Seller to the Buyer prior to the
          date hereof. To Seller's knowledge, API has performed all material
          obligations required to be performed by it under the Contracts and is
          not in default, and will not be in default as a result of the
          consummation of the transactions contemplated herein, under any
          Contract or any license, judgment, injunction, decree, order,
          determination, restriction, or other instrument to which it is subject
          in connection with the Project, except for such matters as would not
          have a material effect on the Project taken as a whole.

     (l)  Legality. To the knowledge of Seller, API's operations on the Project
          have been conducted in material compliance with applicable laws,
          rules, ordinances and other governmental regulations, including
          without limitation, those relating to zoning, condemnation, mining,
          reclamation, environmental matters, equal employment, and federal,
          state, or local health and safety laws, rules, and
<PAGE>
 
                                      14

          regulations, except for such violations as would not materially 
          adversely affect the Project.

      (m) Litigation and Claims. To the knowledge of Seller, other than matters
          affecting the U.S. mining industry as a whole, there are no actions,
          suits or proceedings pending or threatened against or affecting the
          Project, including any actions, suits, or proceedings being prosecuted
          by any federal, state, or local department, commission, board, bureau,
          agency, or instrumentality. To the knowledge of Seller, API is not in
          any material default with respect to, or subject to, any order, writ,
          injunction, judgment or decree of any court or any federal, state or
          local department, commission, board, bureau, agency or instrumentality
          which relates to the Project.

     (n)  Consents. API has obtained all consents, approvals, authorizations,
          declarations, or filing required by any federal, state, local, or
          other authority, or any lenders, lessors, creditors, and other third
          parties in connection with the consummation of the transactions
          contemplated hereby.

     (o)  Taxes. API, so long as it has been in possession of the Project, has
          duly and timely filed, in correct form, all federal, state and local
          income, excise, property and other tax returns, reports or statements
          required to be filed by it with respect to the Project and has fully
          paid all taxes, fees, assessments, penalties, and interest due in
          respect of any such returns, reports, or statements, except for such
          matters as would not have a material adverse effect on the Project
          taken as a whole.

     (p)  API Financial Statements. The API Financial Statements:

          (A)  have been prepared in accordance with generally accepted
               accounting principles, applied on a basis consistent with that of
               the preceding periods;

          (B)  are complete and accurate in all material respects;

          (C)  accurately disclose the assets, liabilities (whether accrued,
               absolute, contingent or otherwise) and financial condition of API
               and the results of the operations of API, as at the dates thereof
               and for the periods covered thereby;

          (D)  reflect all proper accruals as at the dates thereof and for the
               periods covered thereby of all amounts which, though not payable
               until a time after the end of the relevant period, are
               attributable to activities undertaken during that period; and

          (E)  contain or reflect adequate reserves for all liabilities and
               obligations of API of any nature, whether absolute, contingent or
               otherwise, matured or unmatured, as at the date thereof.
<PAGE>
 
                                      15

          No information has become available to API that would render the API
          Financial Statements incomplete or inaccurate. There have been no
          significant changes in API's financial condition since September 30,
          1996 as reflected in the API Financial Statements.

     (q)  Undisclosed Liabilities. API has no liabilities (whether accrued,
          absolute, contingent or otherwise, matured or unmatured) of any kind
          except:

          (A)  liabilities disclosed or provided for in the API Financial 
               Statements; and

          (B)  liabilities incurred in the ordinary course of business since
               September 30, 1996, which are consistent with past practice, are
               not, in the aggregate, material and adverse to API, the API
               Shares or the Project and do not violate any covenant contained
               in this Agreement or constitute a breach of any representation or
               warranty made in or pursuant to this Agreement.

     (r)  Absence of Changes. Since September 30, 1996:

          (A)  API has conducted its business in the ordinary course, has not
               incurred any debt, obligation or liability out of the ordinary
               course of business or of an unusual or extraordinary nature and
               has used its best efforts to preserve its business and assets;

          (B)  there has not been any change in the condition of API's business
               or assets other than changes in the ordinary course of business,
               and such changes have not, either individually or in the
               aggregate, been materially adverse and have not had nor may they
               be reasonably expected to have, either before or after the
               closing time, a material adverse effect on the condition of API's
               business or assets;

          (C)  to the Seller's knowledge, there has not been any change in, or
               creation of, any applicable law, any termination, amendment or
               revocation of any license or any damage, destruction, loss,
               labour dispute or other event, development or condition of any
               character (whether or not covered by insurance) which has had, or
               could have, a material adverse affect on API's business or
               assets; and

          (D)  there has not been any change in the accounting principles,
               policies, practices or procedures of API or their application to
               API.

     (s)  Absence of Unusual Transactions. Since September 30, 1996 API has not:
 
          (A)  transferred, assigned, sold or otherwise disposed of any of its 
               assets or cancelled any debts or claims;


<PAGE>
 
                                      16

(B)  incurred or assumed any obligation or liability (fixed or contingent) other
     than obligations or liabilities included in the API Financial Statements
     and obligations and liabilities incurred since September 30, 1996 in the
     ordinary course of business;

(C)  settled any liability, claim, dispute, proceedings, suit or appeal pending 
     against it or against any of its assets;

(D)  discharged or satisfied any lien or encumbrance, or paid any obligation or
     liability (fixed or contingent) other than liabilities included in the API
     Financial Statements and liabilities incurred since September 30, 1996;

(E)  made any material change with respect to any method of management operation
     or accounting in respect of its business;

(F)  waived or omitted to take any action in respect of any rights of
     substantial value or entered into any commitment or transaction if such
     loss, rights, commitment or transaction is or would be material in relation
     to its assets or business;

(G)  created any encumbrance on any of its assets or suffered or permitted any 
     such encumbrance that has arisen on its assets since that date to remain;

(H)  modified, amended or terminated any contract, agreement or arrangement to
     which it is or was a party, or waived or released any right which it has or
     had, other than in the ordinary course of its business;

(I)  incurred any debt, liability or obligation for borrowed money, or incurred
     any other debt, liability or obligation except in the ordinary course of
     its business;

(J)  issued or sold any securities or issued, granted or delivered any right,
     option or other commitment for the issuance of any securities;

(K)  declared or paid any dividend or other distribution in respect of any 
     shares in its capital or purchased or redeemed any such shares;

(L)  modified, amended or terminated any contract, agreement or arrangement to
     which it is or was a party, or waived or released any right which it has or
     had, other than in the ordinary course of its business; or

(M)  authorized or agreed or otherwise become committed to do any of the 
     foregoing.
<PAGE>
 
                                      17

(t)  Absence of Guarantees. API has not given nor agreed to give, and is not a
     party to or bound by, any guarantee of indebtedness or other obligations of
     third parties nor any other commitment by which API is, or is contingently,
     responsible for such indebtedness or other obligations.

(u)  Restrictions on Business. API is not a party to any agreement, lease,
     mortgage, security document, obligation or instrument, or subject to any
     restriction in its articles, by-laws or its directors' or shareholders'
     resolutions or subject to any restriction imposed by any governmental
     authority or subject to any applicable law or order which could materially
     restrict or interfere with the conduct of its business or its use of assets
     or which could materially limit or restrict or otherwise adversely affect
     the shares or the assets or business of API, other than statutory
     provisions and restrictions of general application to its business.

(v)  Conditions of Assets. All material tangible assets of API are in good
     working condition and good repair and comply with all standards and
     requirements of all applicable governmental authorities.

(w)  Insurance. API is insured by reputable insurers against liability, loss and
     damage in such amounts and against such risks as are customarily carried
     and insured against by owners of comparable businesses, properties and
     assets, and such insurance coverage will be continued in full force and
     effect to and including the Closing Date. True and complete copies of all
     of the most recent inspection reports, if any, received from insurance
     underwriters as to the condition of the assets and the business have been
     delivered to the Buyer. API is not in default will respect to any of the
     provisions contained in any such insurance policy and there are no current
     claims that have not been settled or finally determined. All such policies
     of insurance are in full force and effect and API is not in default,
     whether as to the payment of premium or otherwise, under the terms of any
     such policy.

(x)  No Expropriation. API has not received any notice of expropriation of all
     or any of its assets and API is not aware of any expropriation proceeding
     pending or threatened against or affecting its assets nor of any
     discussions or negotiations which could lead to any such expropriation.

(y)  Government Grants. There are no contracts or agreements relating to grants
     or other forms of assistance, including loans with interest at below market
     rates, received by API from any governmental authority.

(z)  Restrictive Covenants. API is not a party to or bound or affected by any
     commitment, agreement or document which limits the freedom of API to
     compete in any line of business, transfer or move any of its assets or
     operations or which does or could adversely affect the business practices,
     operations or conditions of API after the Closing.
<PAGE>
 
                                      18

(aa)  Books and Records. The Seller has made available to the Buyer all books
      and records of or relating to API. Such books and records fairly and
      correctly set out and disclose in all respects the financial position of
      API in accordance with good business practice and all financial
      transactions relating to API have been accurately recorded in such books
      and records. The books and records,

      (A)  accurately reflect the basis for the financial condition of API shown
           in the API Financial Statements; and

      (B)  together with all disclosures made in this Agreement or in the
           schedules hereto, present fairly the financial condition of API as of
           and to the date hereof.

No information, records or systems pertaining to the operation or administration
of API are in the possession of, recorded, stored, maintained by or otherwise
dependent on any other person. The Seller has disclosed the existence of and
made available for review by the Buyer all the books and records.

(bb)  No Joint Venture Interests. API has not nor has it agreed to become, a
      partner, member, owner, proprietor or equity investor of or in any
      partnership, joint venture co-tenancy or other similar jointly-owned
      business undertakings or to acquire or lease any other business operation
      and does not have any other significant investment interests in any
      similar business owned or controlled by any third party.

(cc)  Bank Accounts. The name of each bank or other depository in which API
      maintains any bank account, trust account or safety deposit box is set
      forth in Schedule 4(cc), along with the names of all persons authorized to
      draw thereon or who have access thereto.

(dd)  Disclosure. No representation or warranty in this agreement contains any
      untrue statement of a material fact and the representations and warranties
      contained in this Agreement do not omit to state any material fact
      necessary to make any of the representations or warranties contained
      herein not misleading to a prospective purchaser of the API Shares seeking
      full information as to the API Shares, API and API's business and assets.
      Without limiting the scope of the foregoing, the Seller is not aware of
      any change, event or occurrence that has taken place or is pending that
      has, or in the future could have, a material adverse effect on the value
      or ownership of the API Shares, API or API's business and its assets, or
      the ability of the Buyer to operate API's business subsequent to the
      Closing in the manner in which it has been operated by API prior to the
      Closing or which could materially increase the costs incurred by the Buyer
      in operating API's business subsequent to the Closing, including any
      pending or present change in any
<PAGE>
 
                                      19
 
          applicable law or other requirement, including the obtaining or 
          maintenance of licenses or approvals.

5.   Pre-Closing Covenants. The Parties agree as follows with respect to the 
     period between the execution of this Agreement and the Closing.

     (a)  General. Each of the Parties will use his or its reasonable best
          efforts to take all action and to do all things necessary, proper, or
          advisable in order to consummate and make effective the transactions
          contemplated by this Agreement (including satisfaction, but not
          waiver, of the closing conditions set forth in paragraph 8 below).

     (b)  Notices and Consents. Each of the Parties will (and the Seller will
          cause API to) give any notices to, make any filings with, and use its
          reasonable best efforts to obtain any required authorizations,
          consents, and approvals of governments and governmental agencies in
          connection with the transactions contemplated by this Agreement.

     (c)  Operation of Business. The Seller will not cause or permit API to
          engage in any practice, take any action, or enter into any transaction
          outside the ordinary course of business of API consistent with the
          past practice and custom of API.

     (d)  For so long as the Seller is holding the Mineral Leases in trust for
          API and until such time as API becomes the registered owner of the
          Mineral Leases, the Seller will not sell, transfer or encumber the
          Mineral Leases.

     (e)  Full Access for Due Diligence. The Seller will cause API to permit the
          Buyer and its Representatives to have full access at all reasonable
          times, and in a manner so as not to interfere with the normal business
          operations of API, to all premises, properties, personnel, books,
          records (including tax records), contracts, and documents of or
          pertaining to API, which may relate, in the good faith judgment of the
          Buyer, to the titles held by API and to its properties, to the
          financial condition of API, to environmental matters related to API
          and its properties, and to the ore reserve calculations of API. The
          Buyer and Seller hereby acknowledge and agree that the Seller makes no
          representation or warranty as to the reliability, accuracy or
          completeness of any of the information or date referred to in this
          paragraph 5(d). The Buyer (and its Representatives) will treat and
          hold as Confidential Information any and all information received from
          the Seller, API and their Representatives in the course of the review
          contemplated by this paragraph 5(d).
<PAGE>
 
                                      20
 
     (f)  Exclusivity.  Unless and until this Agreement is terminated prior to 
          Closing pursuant to paragraph 10 hereof, the Seller will not (and will
          not cause or permit API to) solicit, initiate, or encourage the
          submission of any proposal or offer from any Person relating to the
          acquisition of all or substantially all of the capital stock or assets
          of API (including any acquisition structured as a merger,
          consolidation or share exchange), unless such proposal or offer
          pertains to the Seller as a whole and is made subject to this
          Agreement.

     6.   Post-Closing Covenants.  The Parties agree as follows with respect to 
          the period following the Closing.

     (a)  General.  In case at any time after the Closing any further action 
          is necessary to carry out the purposes of this Agreement, each of the
          parties will take such further actions (including the execution and
          delivery of such further instruments and documents) as any other Party
          reasonably may request, all at the sole cost and expense of the
          requesting Party (unless the requesting Party is entitled to
          indemnification hereunder).

     (b)  Litigation Support.  In the event and for so long as any Party 
          actively is contesting or defending against any third party action,
          suit, proceeding, hearing, investigation, charge, complaint, claim, or
          demand in connection with (i) any transaction contemplated under this
          Agreement or (ii) any fact, situation, circumstance, status,
          condition, activity, practice, plan, occurrence, event, incident,
          action, failure to act, or transaction on or prior to the Closing Date
          involving API, the other Party shall cooperate with it and its counsel
          in the defense or contest, make available its personnel, and provide
          such testimony and access to its books, records and properties as
          shall be necessary in connection with the defense or contest, all at
          the sole cost and expense of the contesting or defending Party (unless
          the contesting or defending Party is entitled to indemnification
          therefor hereunder).

     (c)  Transition.  The Seller will not take any action that is designed or 
          intended to have the effect of discouraging any material lessor,
          licensor, customer, supplier, or other business associate of API from
          maintaining substantially the same business relationships with API
          after the Closing as it maintained with API prior to the Closing.
<PAGE>
 
                                      21
 
     (d)  Tax Treatment.

          (i)  Post-Closing Taxes.  It is understood by the Parties that the 
               Buyer shall pay, or cause to be paid, and the Buyer and API shall
               jointly and severally indemnify the Seller and its Affiliates
               against and hold them harmless from any liability of API for
               taxes, additions to tax, interest, penalties or other tax
               detriment (which shall include, but not be limited to, the
               utilization of any tax credits or other tax attributes) for
               periods after the Closing Date or arising from any action or
               failure to act by the Buyer or any Affiliate of the Buyer
               (including API) from and after the Closing, including without
               limitation, any sale or other disposition of assets by the API.

          (ii) Prior Tax Agreements.  As of the Closing, API will not be a party
               to, bound by, or subject to any obligation under any tax sharing
               or similar agreement.

     (e)  Bonding.  For a period not to exceed 90 days (the "Bond Period") 
          following the Closing, the Seller shall maintain full force and effect
          all reclamation and other bonds presently maintained by or for the
          benefit of API. The Buyer's pro rata share (not to exceed 3/12) of all
          actual costs and expenses incurred by the Seller in maintaining such
          bonds shall be included in the amounts to be reimbursed to the Seller
          pursuant to subparagraph 2(b) hereof. As soon as possible following
          the Closing, and in any event within the Bond Period, the Buyer shall
          replace all such outstanding bonds with substitute bonds, letters of
          credit or other financial assurances acceptable to the Bureau of Land
          Management or the other authorities which require or have jurisdiction
          over such bonds.

     (f)  Corporate Records.  As soon as practicable after the Closing Date the 
          Seller shall deliver to the Buyer all corporate records of API which
          are maintained by the Seller or its agents or Affiliates provided that
          the Buyer and the Seller shall coordinate and agree upon a mutually
          acceptable schedule for the assembly and delivery of such documents.
          Following the Closing the Buyer shall afford the Seller reasonable
          access to such documents upon reasonable notice and during regular
          business hours.

     (g)  Internal Financial Statements.  The Buyer will prepare Internal 
          Financial Statements in respect of each calendar month until such time
          as the Seller has received all of the consideration to which it may
          become entitled hereunder and the Buyer will deliver to the Seller
          within 15 days of the end of each calendar month a copy of the
          Internal Financial Statements for the previous month.
<PAGE>
 
                                      22

7.   Indemnity.

     (a)  Environmental Indemnity to Buyer. The Seller shall indemnify, defend
          and hold harmless the Buyer and its Affiliates (collectively the
          "Buyer Indemnitees") from any and all Environmental Costs
          (collectively "Losses") sought or claimed by any Person, including any
          governmental agency, which are based upon the violation or alleged
          violation by Seller or API of, or liability imposed on Seller or API
          by, any Environmental Law, or relating to the use, treatment,
          handling, storage, disposal or release of Hazardous Substances on or
          in connection with the Project, with respect to all such Losses which
          arise as the result of or in connection with acts, omissions or
          conditions occurring or arising from and after October 24, 1988 (with
          respect to the Tucker Hill Property) and from and after May 1, 1996
          (with respect to the Process Plant Land), up to and including the
          Closing Date, and regardless of whether such Losses arise as a result
          of or on connection with acts, omissions, conditions or occurrences
          which are known to either of the Parties upon the date of this
          Agreement or on the Closing Date. The indemnity for Environmental
          Costs provided for by this subparagraph (7)a constitutes a principal
          element of the consideration for the transactions contemplated by this
          Agreement, and the maximum amount of the Seller's liability under this
          indemnity may exceed the purchase price paid by the buyer for the API
          Shares.


     (b)  Environmental Indemnity to Seller. The Buyer shall indemnify, defend
          and hold harmless the Seller and its Affiliates (collectively the
          "Seller Indemnitees") from any and all Environmental Costs
          (collectively "Losses") sought or claimed by any Person, including any
          governmental agency, which are based upon the violation or alleged
          violation of, or liability imposed by, any Environmental Law, or
          relating to the use, treatment, handling, storage, disposal or release
          of Hazardous Substances on or in connection with any properties or
          assets of API, with respect to all such Losses which arise as the
          result of or in connection with acts, omissions or conditions
          occurring or arising from and after the Closing Date, and regardless
          of whether such Losses arise as a result of or in connection with
          acts, omissions, conditions or occurrences which are known to either
          of the Parties upon the date of this Agreement or on the Closing Date.
          The indemnity for Environmental Costs provided for by this
          subparagraph 7(b) constitutes a principal element of the consideration
          for the transactions contemplated by this Agreement, and the maximum
          amount of the Buyer's liability under this indemnity may exceed the
          purchase price paid by the buyer for the API Shares.

     (c)  Additional Indemnification of Buyer. Seller hereby indemnifies and
          agrees to hold Buyer, its successors and assigns, harmless from and
          against any and all liabilities, claims, damages, losses, or expenses,
          including interest and penalties, reasonable attorneys' fees, and
          other reasonable expenses of defending any actions relating thereto
          (collectively "Losses"), incurred or sustained by Buyer in or as a
          result of or arising out of or attributable to any breach of the
          specific
<PAGE>
 
                                      23
 
          representations and warranties made by Seller herein, or the breach of
          any of the agreements, covenants, conditions, and obligations of
          Seller contained in this Agreement.

     (d)  Additional Indemnification of Seller. Buyer hereby indemnifies and
          agrees to hold Seller, its successors and assigns, harmless from and
          against any and all liabilities, claims, damages, losses, or expenses,
          including interest and penalties, reasonable attorneys' fees and
          other reasonable expenses of defending any actions relating thereto,
          (collectively "Losses"), incurred or sustained by Seller in or as a
          result of or arising out of or attributable to any breach of the
          specific representations and warranties made by Buyer herein, or the
          breach by Buyer of any of the agreements, covenants, conditions, and
          obligations of Buyer contained in this Agreement.

     (e)  Indemnification Procedure. In the case of any claim for
          indemnification brought under this paragraph 7, the Buyer Indemnitee
          or the Seller Indemnitee, (an "Indemnitee") , as the case may be,
          shall give the Buyer or Seller (the "Indemnitor"), as the case may be,
          reasonably prompt notice of the Losses which give rise to such claim;
          provided, however, that the failure to so notify the Indemnitor shall
          not affect the obligation of the Indemnitor to indemnify the
          Indemnitee hereunder unless the Indemnitor shall have been materially
          prejudiced by such failure to so notify. The Indemnitor shall, at its
          option, be entitled to assume the defense of any action, suit or
          proceeding ("Action") related to such claim at its sole cost and
          expense and with counsel reasonably satisfactory to the Indemnitee;
          provided, however, that the Indemnitee shall have the right to
          participate in such defense at its own expense. If the Indemnitor
          fails to defend any Action, any defense by the Indemnitee thereof
          shall be at the sole cost and expense of the Indemnitor. The party
          defending an Action shall control the conduct thereof. The Parties
          agree to make available to each other, their counsel and accountants,
          any information and documents reasonably available to them which
          relate to such Action and their employees, and the Parties hereto
          agree to render to each other such assistance as they may reasonably
          require of each other in order to insure the proper and adequate
          defense of any Action.

8.   Conditions of Obligation to Close.

     (a)  Conditions to Obligation of the Buyer. The obligation of the buyer to
          consummate the transactions to be performed by it in connection with
          the Closing is subject to satisfaction of the following conditions:

          (i)    the representations and warranties set forth in paragraph 3(a)
                 and paragraph 4 hereof shall be true and correct in all
                 material respects at and as of the Closing Date;
<PAGE>
 
                                      24
 
          (ii)   the Seller shall have performed and complied with all of its
                 covenants hereunder in all material respects through the
                 Closing;

          (iii)  there shall not be any injunction, judgment, order, decree,
                 ruling, or charge in effect preventing consummation of any of
                 the transactions contemplated by this Agreement;

          (iv)   the Seller shall have delivered to the Buyer a certificate to
                 the effect that each of the conditions specified above in
                 paragraph 8(a)(i)-(iii) is satisfied in all respects;

          (v)    the Seller shall have delivered to the Buyer a copy of the
                 resolutions of the Board of Directors of the Seller authorizing
                 the execution, delivery and performance of this Agreement by
                 the Seller, certified by the corporate secretary of the Seller;
                 and

          (vi)   all actions to be taken by the Seller in connection with
                 consummation of the transactions contemplated hereby and all
                 certificates, instruments, and other documents required to
                 effect the transactions contemplated hereby will be reasonably
                 satisfactory in form and substance to the Buyer.

The Buyer may waive any condition specified in this paragraph 8(a) (other than 
those referred to in paragraph (iii)) by notice in writing given at or prior to 
the Closing.

     (b)  Conditions to Obligation of the Seller. The obligation of the Seller
          to consummate the transactions to be performed by it in connection
          with the Closing is subject to satisfaction of the following
          conditions:

          (i)    the representations and warranties set forth in paragraph 3(b)
                 above shall be true and correct in all material respects at and
                 as of the Closing Date;

          (ii)   the Buyer shall have performed and complied with all of its
                 covenants hereunder in all material respects through the
                 Closing;

          (iii)  there shall not be any injunction, judgment, order, decree,
                 ruling, or charge in effect preventing consummation of any of
                 the transactions contemplated by this Agreement;

          (iv)   the Buyer shall have delivered to the Seller a certificate to
                 the effect that each of the conditions specified above in
                 paragraph 8(b)(i)-(iii) is satisfied in all respects;

          (v)    the Buyer shall have delivered to the Seller a copy of the
                 resolutions of the Board of Directors of the Buyer authorizing
                 the execution, delivery and

<PAGE>
 
                                      25

            performance of this Agreement by the Buyer, certified by the
            corporate secretary of the Buyer; and

      (vi)  all actions to be taken by the buyer in connection with consummation
            of the transactions contemplated hereby and all certificates,
            instruments, and other documents required to effect the transactions
            contemplated hereby will be reasonably satisfactory in form and
            substance to the Seller.

The Seller may waive any condition specified in this paragraph 8(b) (other than 
that referred to in paragraph (iii) by notice in writing given at or prior to 
the Closing.

9.   Survival of Representations and Warranties. Except as set forth in
subparagraph 3(b), the representations and warranties of the Buyer and the
Seller contained herein shall survive the Closing for a period of one year
thereafter with the exception of the representations and warranties of the
Seller set forth in subparagraphs 3(a)(viii), 4(b) and 4(i), which shall survive
for a period of two years from the Closing Date, and the representations and
warranties of the Buyer set forth in subparagraph 3(b)(vii), which shall survive
for a period of one year following the last issuance of Common Shares to the
Seller pursuant to paragraph 2.

10.  Termination.

     (a)  Termination of Agreement by the Parties. Certain of the Parties may 
          terminate this Agreement as provided below:

          (i)    the Buyer and the Seller may terminate this Agreement by mutual
                 written consent at any time prior to the Closing; or

          (ii)   the Buyer may terminate this Agreement by giving written notice
                 to the Seller at any time prior to the Closing in the event the
                 Seller has breached any material representation, warranty, or
                 covenant contained in this Agreement in any material respect,
                 the Buyer has notified the Seller of the breach, and the Seller
                 has not disputed the existence or nature of such breach or such
                 breach has not been cured by the Automatic Termination Date; or

          (iii)  the Seller may terminate this Agreement by giving written
                 notice to the Buyer at any time prior to the Closing in the
                 event the Buyer has breached any material representation,
                 warranty, or convenant contained in this Agreement in any
                 material respect, the Seller has notified the Buyer of the
                 breach, and the Buyer has not disputed the existence or nature
                 of such breach or such breach has not been cured by the
                 Automatic Termination Date.

     (b)  Automatic Termination. This Agreement shall automatically terminate,
          without further action on the part of either Party in the event that
          the Closing has not












  
<PAGE>
 

                                      26


                 occurred, for any reason, before the close of business on the 
                 Automatic Termination Date.

          (c)    Effect of Termination. If either Party terminates this
                 Agreement (or if it terminates automatically) pursuant to this
                 paragraph 10 all rights and obligations of the Parties
                 hereunder shall terminate without any liability of either Party
                 to the other Party except for any liability of any Party then
                 in breach; provided, however, that the confidentiality
                 provisions of paragraph 12 shall survive termination.

     11.  Rescission of Transaction. In the event the Closing occurs prior to
     the Automatic Termination Date but API has not received the Operating
     Permits on or before the Automatic Termination Date, the Buyer may elect to
     rescind its purchase of the API Shares by giving written notice to the
     Seller at any time from the Automatic Termination Date until 5:00 p.m.
     (Denver time) on January 15, 1997. In the event of such rescission: (i) the
     Buyer will forthwith transfer the API Shares to the Seller; and (ii) the
     Seller will forthwith (a) return to the Buyer for cancellation any Common
     Shares issued to the Seller hereunder and (b) pay the Buyer an amount equal
     to the aggregate of all cash payments theretofore made to the Seller
     hereunder, together with simple interest calculated at the rate of 10% per
     annum. Subject to the foregoing, all rights and obligations of the Parties
     hereunder shall terminate upon such rescission without any liability of
     either Party to the other Party except for any liability of any Party then
     in breach; provided, however, that confidentiality provisions of paragraph
     12 shall survive such rescission on the same basis as would apply if this
     Agreement had been terminated prior to the Closing.

     12.  Confidentiality. The Buyer acknowledges that any and all information
     concerning the businesses, properties and affairs of API which is disclosed
     to the Buyer or its Representatives by the Seller or its Representatives or
     by API or its Representatives, or which is discovered by the Buyer or its
     Representatives in the course of the due diligence contemplated by
     paragraph 5(d) hereof constitutes the unique, proprietary and confidential
     information of the Seller (collectively "Confidential Information").
     Notwithstanding the foregoing, however, "Confidential Information" shall
     not include any information or data which is in, or becomes a part of, the
     public domain by any means other than the breach by the Buyer or its
     Representatives of the obligations hereunder. Until the earlier to occur of
     the Closing or the second anniversary of the termination of this Agreement
     pursuant to paragraph 10 hereof the Buyer shall maintain all Confidential
     Information disclosed to or received by it pursuant to this Agreement in
     confidence and shall not disclose the same to any third party unless
     required to do so by court order or by law, in which case the Buyer shall
     notify the Seller, in writing, prior to making such disclosure and shall
     cooperate with the Seller to preserve and protect the confidentiality of
     the Confidential Information to the fullest extent possible. Additionally,
     except as specifically contemplated by this Agreement, the Buyer shall not
     utilize any Confidential Information for its own benefit or for the benefit
     of any other party until the earlier to occur of the Closing or the second
     anniversary of the termination of this Agreement in accordance with the
     provisions of paragraph 10 hereof. If this Agreement is terminated, for any
     reason whatsoever, the Buyer and its Representatives will return to the
     Seller all tangible embodiments (and all copies) of the Confidential
     Information which are in their possession.
<PAGE>
 

                                      27


     13.  Miscellaneous.

     (a)  Report of Micon International Limited. The Buyer acknowledges receipt
          from the Seller of a report prepared by Micon International Limited
          which states that the Tucker Hill Property has proven reserves to
          provide a mine life of at least three years.

     (b)  Disclosure of Information Concerning API. The Seller has instructed
          its Representatives, and the Representatives of API to answer
          questions concerning the businesses, affairs, operations and
          properties of API which are addressed to them by the Buyer and its
          Representatives during the course of the due diligence conducted by
          the Buyer pursuant to paragraph 5(d) hereof. Additionally, the Seller
          has instructed its Representatives and the Representatives of API to
          provide to the Buyer and its Representatives copies of documents
          requested by the Buyer and its Representatives in the course of the
          due diligence conducted by the Buyer pursuant to paragraph 5(d) hereof
          and to otherwise cooperate with and assist the Buyer and its
          Representatives in such due diligence efforts. The Parties acknowledge
          and agree that all such information and documents are Confidential
          Information.

     (c)  Press Releases and Public Announcements. No Party shall issue any
          press release or make any public announcement relating to the subject
          matter of this Agreement prior to the Closing without the prior
          written approval of the Buyer and the Seller; provided, however, that
          any Party may make any public disclosure it believes in good faith is
          required by applicable law or any listing or trading agreement
          concerning its publicly-traded securities (in which case the
          disclosing Party will use its best efforts to advise the other Party
          prior to making the disclosure).

     (d)  No Third-Party Beneficiaries. This Agreement shall not confer any
          rights or remedies upon any Person other than the Parties and their
          respective successors and permitted assigns.

     (e)  Entire Agreement. This Agreement (including the Exhibits referred to
          herein) constitutes the entire agreement among the Parties and their
          Affiliates in regard to the subject matter hereof and supersedes any
          prior understandings, agreements, or representations (specifically
          including the Letter Agreement) by or among the Parties or their
          Affiliates, written or oral, to the extent they relate in any way to
          the subject matter hereof.

     (f)  Succession and Assignment. This Agreement shall be binding upon and
          inure to the benefit of the Parties named herein and their respective
          successors and permitted assigns. No Party may assign either this
          Agreement or any of its rights, interests, or obligations hereunder
          without the prior written approval of the Buyer and the Seller;
          provided, however, that the Seller may (i) assign any or all of its
<PAGE>
 
                                      28
 
          rights and interests hereunder to one or more of its Affiliates and
          (ii) designate one or more of its Affiliates to perform its
          obligations hereunder (in any or all of which case the Seller
          nonetheless shall remain responsible for the performance of all of its
          obligations hereunder).

     (g)  Counterparts. This Agreement may be executed in one or more
          counterparts, each of which shall be deemed an original but all of
          which together will constitute one and the same instrument.

     (h)  Headings. The paragraph headings contained in this Agreement are
          inserted for convenience only and shall not affect in any way the
          meaning or interpretation of this Agreement.

     (i)  Notices. All notices, requests, demands, claims, and other
          communications hereunder shall be in writing. Any notice, request,
          demand, claim, or other communication hereunder shall be deemed duly
          given if sent by prepaid overnight courier or transmitted by
          telecopier addressed to the intended recipient as set forth below:

     If to the Seller:

          Atlas Corporation
          Suite 3050
          Republic Plaza
          370 17th Street
          Denver, Colorado
          80202
          Attention: Jerome C. Cain, Secretary-Treasurer  
          Telecopier No.:  (303) 629-2445

     If to the Buyer:

          Cornerstone Industrial Minerals Corporation
          Suite 3050
          Republic Plaza
          370 17th Street
          Denver, Colorado
          80202
          Attention: John Leahy, President
          Telecopier No.:  (303) 629-2445

Any notice, request, demand, claim, or other communication hereunder sent to the
intended recipient at the address set forth above shall be deemed to have been 
duly given on the business day following the day upon which it is given to the 
courier or on the day (or the next business day is such day is not a business 
day) upon which it is telecopied. Any Party may change the 
     
<PAGE>
 

                                      29


address to which notices, requests, demands, claims, and other communications 
hereunder are to be delivered by giving the other Party notice in the manner 
herein set forth.

     (j)  Governing Law. This Agreement shall be governed by and construed in
          accordance with the domestic laws of the State of Oregon without
          giving effect to any choice or conflict of law provision or rule
          (whether of the State of Oregon or any other jurisdiction) that would
          cause the application of the laws of any jurisdiction other than the
          State of Oregon.

     (k)  Amendments and Waivers. No amendment of any provision of this
          Agreement shall be valid unless the same shall be in writing and
          signed by the Buyer and the Seller. No waiver by any Party of any
          default, misrepresentation, or breach of warranty or covenant
          hereunder, whether intentional or not, shall be deemed to extend to
          any prior or subsequent default, misrepresentation, or breach of
          warranty or covenant hereunder or affect in any way any rights arising
          by virtue of any prior or subsequent such occurrence.

     (l)  Severability. Any term or provision of this Agreement that is invalid
          or unenforceable in any situation in any jurisdiction shall not affect
          the validity or enforceability of the remaining terms and provisions
          hereof or the validity or enforceability of the offending term or
          provision in any other situation or in any other jurisdiction.

     (m)  Expenses. Each of the Buyer and the Seller will bear its own costs and
          expenses (including legal fees and expenses) incurred in connection
          with this Agreement and the transactions contemplated hereby.

     (n)  Currency. All dollar amounts contained herein are expressed in lawful
          currency of the United States of America.

     (o)  Construction. The Parties have participated jointly in the negotiation
          and drafting of this Agreement in the event an ambiguity or question
          of intent or interpretation arises, this Agreement shall be construed
          as if drafted jointly by the Parties and no presumption or burden of
          proof shall arise favouring or disfavouring any Party by virtue of the
          authorship of any of the provisions of this Agreement. Any reference
          to any federal, state, local or foreign statute or law shall be deemed
          also to refer to all rules and regulations promulgated thereunder,
          unless the context requires otherwise. The word "including" shall mean
          including without limitation.

     (p)  Incorporation of Schedules. The Schedules identified in this Agreement
          are incorporated herein by reference and made a part hereof.

     (q)  Arbitration of Disputes.
<PAGE>
 
                                      30

     (i)    Unresolved Disputes. Any disagreement or dispute arising out of or
            relating to this Agreement, its existence, interpretation,
            performance or enforcement (including but not limited to the
            existence of a default) not resolved by the Parties within fifty
            (50) days after the date on which one party notifies the other of
            any such disagreement or dispute shall be settled by arbitration in
            accordance with this paragraph 13(q).

     (ii)   Rules. Matters subject to arbitration shall be settled by
            arbitration before a panel of three arbitrators in Denver, Colorado,
            in accordance with the commercial arbitration rules of the American
            Arbitration Association in effect at the time of arbitration. In the
            event of a conflict between those commercial arbitration rules and
            this paragraph 13(p), this paragraph 13(p) shall control. The
            judgment of the arbitrators as to such matters shall be binding upon
            the parties to this Agreement, and judgment upon any award rendered
            by the arbitrators may be entered in any court having jurisdiction
            under the provision of the Colorado Revised Statutes pertaining to
            arbitration and award as they may be amended from time to time.

     (iii)  Demand. To demand arbitration any party (the "demanding party")
            shall give written notice to the other party (the "responding
            party"). Such notice shall specify the nature of the issues in
            dispute, the amount involved, and the remedy requested. Within
            twenty (20) days of the receipt of the notice, the responding party
            shall answer the demand in writing, specifying the issues that party
            disputes. The parties shall thereupon each select one arbitrator,
            who shall be qualified by skill and experience in the subject matter
            under dispute. Within fifteen (15) days thereafter, the two
            appointed arbitrators shall jointly select a third arbitrator
            similarly qualified.

     (iv)   Proceedings. Within twenty (20) days after the third arbitrator has
            been selected or appointed, each party to the dispute shall submit
            to the arbitrators a written statement of its position as to the
            matter being arbitrated, including its position on the necessity for
            discovery or a formal hearing. The arbitrators shall, within fifteen
            (15) days after submission of statements, establish a schedule for
            the arbitration proceedings and issues orders relating to the
            conduct of such proceedings, governing, among other matters, the
            extent and nature of any discovery to be allowed and the necessity
            of a formal hearing. If a hearing is held, the arbitrators shall
            issue a decision as to the resolution of the dispute within fifteen
            (15) days after the hearing. A majority ruling by the arbitrators
            shall be binding on the parties. All costs, expenses and fees, plus
            reasonable attorneys' fees, shall be recoverable by or paid to the
            substantially prevailing party in any dispute resolved by
            arbitration.
<PAGE>
 

                                      31
 

     IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be 
executed by their duly authorized representatives upon the date first herein 
written.

                                       BUYER:

                                       CORNERSTONE INDUSTRIAL MINERALS
                                       CORPORATION


                                       By: /s/ John R. Leahy
                                           ---------------------------
                                           John R. Leahy, President



                                       SELLER:
     
                                       ATLAS CORPORATION  

                   
                                       By: /s/ Jerome C. Cain
                                           ---------------------------
                                           Name:   Jerome C. Cain
                                           Title:  V.P. - Finance, Treasurer &
                                                   Secretary