SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 and 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): September 11, 2000
CRESTED CORP.
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Exact Name of Registrant as Specified in its Charter)
Colorado 0-8773 84-0608126
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File No.) Identification No.)
877 North 8th West
Riverton, WY 82501
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (307) 856-9271
Not Applicable
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(Former Name, Former Address or Former Fiscal Year,
if Changed From Last Report)
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Item 5. Other Events (Settlement of Litigation with Kennecott Uranium
Company and Kennecott Energy Company).
This Form 8-K Report contains "forward-looking" statements which include
use of the words "will" and "closing" and similar words. These statements are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995 which amended section 21 E of the Securities Exchange Act of
1934. Forward-looking statements inherently involve risks and uncertainties that
could cause actual results to differ materially from the forward-looking
statements. Settlement of Litigation with Kennecott
Background. Crested Corp. ("Crested" or the "Registrant") and its affiliate
the USECC joint venture ("USECC") consisting of its parent U.S. Energy Corp.
("USE") and Crested together owned approximately 50% of the Green Mountain
Mining Venture (the "GMMV"), a Wyoming joint venture partnership formed in June
1990, which owns the Green Mountain unpatented uranium claims in south- central
Wyoming, the Jackpot Mine and support facilities (the mine is in the development
stage) and the Sweetwater Mill (a uranium mill currently on standby located
about 20 miles south of the Jackpot Mine). In the context of the GMMV and in
this report, the term "USE Parties" means USE, Crested and USECC.
Kennecott Uranium Company ("Kennecott") owns approximately 50% of the GMMV.
KUC is a 100% subsidiary of Kennecott Energy Company ("KEC"), and KEC is a 100%
subsidiary of Rio Tinto plc, one of the largest mining companies in the world.
Differences arose between the GMMV partners on the operations of the GMMV
and on November 10, 1999, Kennecott and KEC filed a complaint in a Wyoming
district court against the USE Parties. Kennecott and KEC were seeking
dissolution of the GMMV and a judicial plan of liquidation by which they would
try to sell their interest in the GMMV. The USE Parties filed an answer and
counterclaims against Kennecott and KEC and a cross complaint against
Kennecott's parent Rio Tinto plc. Thereafter, the parties entered into
negotiations to settle the lawsuit
On September 11, 2000, the parties executed a settlement agreement and
related documentation and releases (the "Settlement"). Under the Settlement, the
USE Parties will sell all of their interests in the GMMV and the GMMV
properties, including those within a described Area of Interest to an affiliate
of Kennecott. The purchase consideration is $3,250,000 in cash and a 4% net
profits royalty
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interest in certain of the mining claims at the Big Eagle and Jackpot Mines. The
USE Parties received various mining equipment and supplies, and have the right
to receive certain mining claims that may be abandoned by Kennecott. Kennecott
has posted reclamation bonds in the amount of $26,084,079 and agreed to assume
all reclamation obligations (to the extent required by applicable regulatory
authority) on the GMMV properties.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CRESTED CORP.
Dated: September 12, 2000 By: /s/ Daniel P. Svilar
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Daniel P. Svilar, Secretary
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