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Exhibit 99.1
 
 The Westaim Corporation
 Annual Information Form
 For the Year Ended December 31, 2005
 MARCH 27, 2006




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THE WESTAIM CORPORATION
ANNUAL INFORMATION FORM
For the Year Ended December 31, 2005
 March 27, 2006
 TABLE OF CONTENTS
 PAGECORPORATE STRUCTURE
    
    
    1GENERAL DEVELOPMENT OF THE BUSINESS
    
    
    2DESCRIPTION OF THE BUSINESS
    
    
    3IFIRE TECHNOLOGY CORP.
    
    
    3NUCRYST PHARMACEUTICALS CORP.
    
    
    6INVESTMENTS
    
    
    14REVENUE BY SEGMENT
    
    
    14FINANCIAL INSTRUMENTS
    
    
    14SUPPLIES AND RAW MATERIALS
    
    
    14ENVIRONMENTAL
    
    
    15EMPLOYEES
    
    
    15RISK FACTORS
    
    
    15FORWARD-LOOKING STATEMENTS
    
    
    16MANAGEMENTS DISCUSSION AND ANALYSIS
    
    
    17CAPITAL STRUCTURE
    
    
    17DIVIDENDS
    
    
    17MARKET FOR SECURITIES
    
    
    17ESCROWED SECURITIES
    
    
    18TRANSFER AGENT AND REGISTRAR
    
    
    18EXPERTS
    
    
    18DIRECTORS AND OFFICERS
    
    
    18AUDIT COMMITTEE
    
    
    20CODES OF CONDUCT
    
    
    21AUDIT FEES
    
    
    21PRE-APPROVAL OF AUDIT AND NON AUDIT SERVICES BY INDEPENDENT AUDITORS
    
    
    21ADDITIONAL INFORMATION
    
    
    21AUDIT COMMITTEE CHARTER
    
    Appendix A




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CORPORATE STRUCTURE
 Business
Corporations Act
  th
  
 1




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GENERAL DEVELOPMENT OF THE BUSINESS
 The following summarizes significant events that have influenced the general development of
the business in the past three financial years. As noted in the chart above, the Company holds its
interest in its two emerging technologies through common shares in incorporated subsidiaries.
         2




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DESCRIPTION OF THE BUSINESS
   IFIRE TECHNOLOGY CORP.
 Overview
     3




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Partnership Agreements
      4




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Technology Development Progress
  2
 STRUCTURE OF IFIRES DISPLAY PANEL
 
 TOP GLASS AND ELECTRONICS ATTACHMENT
 COLOR BY BLUE LAYER
  PATTERNED ITO COLUMN ELECTRODES
  BLUE PHOSPHOR
  PRINTED THICK FILM DIELECTRIC
  PRINTED METAL ROW ELECTRODES
  GLASS SUBSTRATE
   5




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iFire Additional Information
   NUCRYST PHARMACEUTICALS CORP.
 Overview
  
  6




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Nanocrystalline Technology Platform
    Wound Care Products
  TM
  7




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Staphylococcus aureus
  Acticoat and Acticoat Burn Dressings
 Acticoat 7 Dressing
 Acticoat Absorbent Dressings
 Acticoat Moisture Control Dressings
  Other Medical Device Products
  8




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Pharmaceutical Products
 Overview
     Clinical Development Program
  9




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10




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Government Regulation
     11




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Competition
  Smith & Nephew Agreements
    12




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Nucryst Additional Information
  13




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TM TM
 INVESTMENTS
    REVENUE BY SEGMENT
 Year Ended
    
    
    Year Ended(in thousands of Canadian dollars)
    
    December 31, 2005
    
    
    December 31, 2004Nucryst Pharmaceuticals(1)
    
    $
    28,560
    
    
    $
    31,907Consolidated operations(2)
    
    $
    28,722
    
    
    $
    32,241
 (1)
    
    Nucryst revenues are earned from one customer, Smith & Nephew.(2)
    
    Consolidated operations include revenue from the discontinued Ambeon division.
 FINANCIAL INSTRUMENTS
  SUPPLIES AND RAW MATERIALS
  14




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ENVIRONMENTAL
     EMPLOYEES
 
 RISK FACTORS
  15




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FORWARD-LOOKING STATEMENTS
 Forward-looking statements involve significant risks, uncertainties and assumptions, and
Westaims actual results could differ materially from those anticipated by these forward-looking
statements for various reasons generally beyond Westaims control.
 TM TM
  16




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MANAGEMENTS DISCUSSION AND ANALYSIS
  CAPITAL STRUCTURE
   DIVIDENDS
  MARKET FOR SECURITIES
  TSX Activity Summary  2005VolumeMonth
    
    $High
    
    $Low
    
    (thousands of shares)January
    
    
    3.11
    
    
    
    2.85
    
    
    
    1,480February
    
    
    3.77
    
    
    
    2.92
    
    
    
    7,712March
    
    
    3.64
    
    
    
    2.99
    
    
    
    2,429April
    
    
    3.25
    
    
    
    2.88
    
    
    
    1,999May
    
    
    3.49
    
    
    
    2.93
    
    
    
    3,516June
    
    
    3.94
    
    
    
    3.20
    
    
    
    7,312July
    
    
    4.85
    
    
    
    3.63
    
    
    
    5,585August
    
    
    4.89
    
    
    
    3.93
    
    
    
    3,730September
    
    
    4.19
    
    
    
    3.70
    
    
    
    2,418October
    
    
    4.14
    
    
    
    3.70
    
    
    
    4,632November
    
    
    4.50
    
    
    
    3.72
    
    
    
    3,413December
    
    
    4.80
    
    
    
    3.86
    
    
    
    3,054Year
    
    
    4.89
    
    
    
    2.85
    
    
    
    47,280
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ESCROWED SECURITIES
  TRANSFER AGENT AND REGISTRAR
  EXPERTS
  DIRECTORS AND OFFICERS
  Name and Residency
    
    Principal Occupation at Present5
    
    Period of Service as DirectorNeil Carragher2,4
    
    Chairman of The Corporate Partnership Ltd.Ontario, Canada
    
    (a management consulting group)
    
    May 1996 to dateIan W. Delaney4
Ontario, Canada
    
    Chairman of Sherritt International Corporation(a nickel/cobalt mining and refining, oil and gas
exploration and production, electricity generation and
coal mining company)
    
    May 1996 to dateRoger G. H. Downer2,4County Clare, Ireland
    
    President and Vice-Chancellor of the University of
Limerick, Ireland
    
    October 2004 to dateBarry M. Heck
Alberta, Canada
    
    President and Chief Executive Officer of the Company
    
    January 2003 to dateFrank W. King1,4
Alberta, Canada
    
    President of Metropolitan Investment Corporation(a capital investment and management services company)
    
    May 1996 to dateEdward M. Lakusta3,4
Alberta, Canada
    
    Private Business and Energy Consultant
    
    May 1996 to dateDaniel P. Owen1,3,4
Ontario, Canada
    
    Chairman of Molin Holdings Limited(an investment management company)
    
    May 1996 to dateGuy J. Turcotte2,3,4
Alberta, Canada
    
    Chairman of Western Oil Sands Inc.(an oil sands production company)
and Fort Chicago Energy Partners L.P.
    
    April 1998 to dateBruce V. Walter1,4
Ontario, Canada
    
    President and Chief Executive Officer of Dynatec
Corporation(a mining, drilling and metallurgical technologies
company)
    
    May 1997 to date
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(1)
    
    Messrs. King, Owen and Walter are members of the Audit Committee.(2)
    
    Messrs. Carragher, Downer and Turcotte are members of the Human Resources and Compensation
Committee.(3)
    
    Messrs. Lakusta, Owen and Turcotte are members of the Environmental, Health and Safety
Committee.(4)
    
    Messrs. Carragher, Delaney, Downer, King, Lakusta, Owen, Turcotte and Walter are members of the
Corporate Governance Committee.(5)
    
    Each of the Directors has been engaged for more than five years in his present principal
occupation except the following:Barry M. Heck  Prior to becoming President and Chief Executive Officer of the Company
on January 15, 2003, Mr. Barry Heck was Senior Vice President of the Company from January
1997.Guy J. Turcotte  Prior to becoming Chairman of Western Oil Sands Inc., Mr. Turcotte
was Chief Executive Officer of Western Oil Sands Inc. from July 1999 to January 2002 and
President from January 2002 to April 2005. He has held the position of Chairman of Fort
Chicago Energy Partners L.P. since December 1997 and was Chief Executive Officer of that
company from December 1997 to December 2002.Bruce V. Walter  Prior to becoming President and Chief Executive Officer of Dynatec
Corporation in January 2005, Mr. Walter was Vice-Chairman of Dynatec Corporation from
March 2002 to December 2004. He was Chief Executive Officer of Four Mile Investments Inc.
from August 1993 and Managing Director, BMO Nesbitt Burns Inc. from February 1999 to
November 2001.   Names and Residency
    
    Office with CompanyIan W. Delaney,
Ontario, Canada
    
    Chairman of the Board (non-employee)Barry M. Heck,
Alberta, Canada
    
    President and Chief Executive OfficerG.A. (Drew) Fitch,
Alberta, Canada
    
    Senior Vice President and Chief Financial OfficerAnthony B. Johnston,
Alberta, Canada
    
    Senior Vice PresidentBrian D. Heck,
Alberta, Canada
    
    Vice President, General Counsel and Corporate Secretary
   
  Additional Disclosure for Directors and Executive Officers
  19




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AUDIT COMMITTEE
      20




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CODES OF CONDUCT
 www.westaim.com
 AUDIT FEES
  (in thousands of Canadian dollars)
    
    2005
    
    
    2004Audit fees Audit of the Companys annual consolidated financial statements(1)
    
    $
    500.8
    
    
    $
    257.6 Nucryst Pharmaceuticals Corp. initial public offering
    
    
    224.7
    
    
    
     Review of short-form prospectus dated July 23, 2004
    
    
    
    
    
    
    75.1 Consultation on financial accounting and reporting standards
    
    
    29.2
    
    
    
    51.6Tax fees Tax compliance and consulting
    
    
    144.0
    
    
    
    91.0All other fees
    
    
    8.5
    
    
    
    18.3$
    907.2
    
    
    $
    493.6
 
 (1)
    
    Includes reviews of quarterly consolidated financial statements and review/audit of the
Companys subsidiaries or divisions financial statements, and services related to regulatory
filings. PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES BY INDEPENDENT AUDITORS
  ADDITIONAL INFORMATION
  21




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www.sedar.com www.westaim.com
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APPENDIX A
 THE WESTAIM CORPORATION
 AUDIT COMMITTEE CHARTER
 (Revised December 2005)
 A.
    
    Overview and MandateThe Audit Committee (the Committee) is responsible to the Board of Directors (the Board)
of The Westaim Corporation (the Corporation). The Committee shall review the annual
consolidated financial statements of the Corporation and shall report thereon to the Board
before such annual consolidated financial statements are approved by the Board, and shall
oversee the accounting and financial reporting processes of the Corporation and the audits
of the financial statements of the Corporation. The Committee also shall perform the duties
as described under Duties and Responsibilities below.The Committee, in its capacity as a committee of the Board, shall be directly responsible
for the appointment, compensation, retention and oversight of the work of any registered
public accounting firm engaged (including for the resolution of disagreements between
management and the auditor regarding financial reporting) for the purpose of preparing or
issuing an audit report or performing other audit, review or attest services for the
Corporation (the auditor), and each auditor must report directly to the Committee.It is recognized that the Committee will be acting only within the terms of reference set
out herein and it is not intended that the Committee shall usurp any of the powers or
responsibilities of the Board as set out in the Business Corporations Act and/or the By-laws
of the Corporation.The Committee may engage independent counsel or other advisors as it determines necessary to
carry out its duties.The Corporation shall provide for appropriate funding, as determined by the Committee in its
capacity as a committee of the Board, for payment of:
 a.
    
    compensation to any auditor;b.
    
    compensation to any independent counsel or adviser employed by the Committee
pursuant to this charter; andc.
    
    ordinary administrative expenses of the Committee that are necessary or
appropriate in respect of the performance by the Committee of its duties.
 B.
    
    Membership and Attendance at Meetings1.
    
    The members of the Committee shall consist of not fewer than three (3) independent Directors,
all of whom shall meet the qualifications required by any applicable regulatory authority,
including The Nasdaq Stock Market, Inc. (NASDAQ) and The Toronto Stock Exchange (the TSX).
The Chairman of the Committee shall be appointed by the Board.2.
    
    Members shall serve one-year terms and may serve consecutive terms.3.
    
    The auditor of the Corporation is entitled to receive notice of every meeting of the
Committee and be heard thereat.
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C.
    
    Duties and ResponsibilitiesThe Committee shall fulfill the following duties arising from its mandate set out above:1.
    
    Review and assess the adequacy of this charter on an annual basis, or more often if deemed
appropriate.2.
    
    Review the annual consolidated financial statements of the Corporation and the notes thereto
following the examination thereof by the auditor and prior to their approval by the directors
and report to the directors thereon.3.
    
    Review and approve the quarterly financial statements, notes thereto and quarterly management
discussion and analysis (MD&A) and related press releases of the Corporation prior to their
release.4.
    
    Review the annual MD&A, and other public disclosure documents and related press releases,
including a prospectus prior to their approval by the directors.5.
    
    Review, and approve, the planned scope of the examination of the annual and quarterly
consolidated financial statements and all related audit activities by the auditor of the
Corporation, including expected related audit fees.6.
    
    Review the accounting principles and practices to be applied and followed by the Corporation
during the fiscal year and any significant changes from those applied and followed during the
previous year.7.
    
    Review the adequacy of the systems of internal accounting and audit policies, practices and
controls established by the Corporation, and discuss with the auditor the results of its
reviews and reports.8.
    
    Review all litigation and claims involving or against the Corporation which could materially
adversely affect its financial position and which the auditor or any officer of the
Corporation may refer to the Committee.9.
    
    Ensure the auditors ultimate accountability to the Board and the Committee as
representatives of the shareholders and as such representatives, to evaluate the performance
of the auditor and review and report to the directors regarding the nomination and the
remuneration and other material terms of the engagement of the auditor, and the performance by
the auditor thereunder, and to recommend to the shareholders the reappointment or replacement
of the auditor.10.
    
    Ensure that the auditor submits on a periodic basis to the Committee, a formal written
statement delineating all relationships between the auditor and the Corporation, consistent
with Canadian and U.S. auditor independence standards, and to review such statement and to
actively engage in a dialogue with the auditor with respect to any disclosed or undisclosed
relationships or services that may impact on the objectivity and independence of the auditor,
and to review the statement and the dialogue with the Board of Directors and recommend to the
Board of Directors appropriate action to ensure the independence of the auditor.11.
    
    Provide a line of communication between the auditor and the Board of Directors, and
communicate directly with the auditor and with any internal auditor of the Corporation.12.
    
    Meet with the auditor at least once per quarter without management present to allow a candid
discussion regarding any concerns the auditor may have and to resolve any disagreements
between the auditor and management regarding the Corporations financial reporting.13.
    
    Review and pre-approve non-audit services provided by the auditor.14.
    
    Review and approve hiring policies regarding partners, employees, and former partners and
employees of the present and former external auditors of the Corporation.
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15.
    
    Review the annual Internal Audit Plan and review all reports arising from such internal audit
activity.16.
    
    Approve the Corporations Disclosure Policy and review and assess the adequacy of the policy
on an annual basis, or more often if deemed appropriate.17.
    
    Review and approve all related party transactions, as defined by the rules of the U.S.
Securities and Exchange Commission.18.
    
    Review the status of taxation matters of the Corporation and its major subsidiaries.19.
    
    Review the short term investment strategies respecting the cash balance of the Corporation.20.
    
    Review the hedging strategies of the Corporation.21.
    
    Review the adequacy of all insurance policies maintained by the Corporation.22.
    
    Establish procedures for:
 a.
    
    the receipt, retention, and treatment of complaints received by the Corporation
regarding accounting, internal accounting controls, or auditing matters; andb.
    
    the confidential, anonymous submission by employees of the Corporation of
concerns regarding questionable accounting or auditing matters..
 23.
    
    The Committee shall review regular reports from management and others with respect to the
Corporations compliance with laws and regulations having a material impact on the financial
statements of the Corporation.24.
    
    The Committee shall review annually the Corporations reserves with respect to environmental,
health and safety matters.25.
    
    Conduct or undertake such other duties as may be required from time to time by any applicable
regulatory authorities, including NASDAQ and the TSX.26.
    
    At least annually, undertake a self assessment of the Committees performance of its duties.D.
    
    Meetings1.
    
    Meetings of the Committee are held as required and at least quarterly.2.
    
    Committee meetings may be called by the Committee Chairman or by a majority of the Committee
members.3.
    
    A quorum for the transaction of business at any meeting of the Committee is a majority of
appointed members.4.
    
    Meetings may be held by way of telephone conference call.5.
    
    A written resolution signed by all Committee members entitled to vote on that resolution at a
meeting of the Committee is as valid as one passed at a Committee meeting.6.
    
    The Corporate Secretary will ensure that minutes of the proceedings of all meetings of the
Committee are maintained and available to the Board when requested.
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E.
    
    ReportingThe Committee shall report on its review of the audited consolidated financial statements of
the Corporation to the Board of Directors of the Corporation prior to the approval of
financial statements by the Board of Directors. In addition, the Chairman of the Committee
shall, when deemed necessary or when requested by the Chairman of the Board of Directors,
report to the Board of Directors from time to time on the activities of the Committee.
 4