SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): March 30, 1998
YELLOW GOLD OF CRIPPLE CREEK, INC.
(Exact Name of Registrant as Specified in Charter)
Colorado 0-9015 84-0768695
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
57 West 200 South, Suite 310, Salt Lake City, Utah 84101
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (801) 359-9309
Item 1. Changes in Control of Registrant
(a) On March 30, 1998, the Registrant issued 2,015,500 post-reverse split
shares of its common stock to Kip Eardley, an officer and a director of the
Registrant, for settlement of a debt owed by the Registrant to Mr. Eardley in
the amount of $20,155 owed by the Registrant for cash advances to the
Registrant. As of February 11, 1998, the shares issued to Mr. Eardley
represented approximately 80.44% of the outstanding common stock of the
Registrant. Mr. Eardley assumed control of the Registrant by virtue of the
number of shares acquired from the Registrant in this transaction. Mr.
Eardley has granted an option to sell such shares as set forth below.
(b) On February 11, 1998, Howard M. Oveson, a director and officer, and
shareholder of the Registrant entered into an agreement with 1st Zamora Corp.
("1st Zamora") to sell 11,102,500 pre-reverse split shares (277,563
post-reverse split shares) of common stock of the Registrant owned by Milagro
Holdings, Inc. ("Milagro"), a corporation owned and controlled by Mr. Oveson.
The option provided for an expiration date of March 31, 1998. On or about
March 31, 1998, 1st Zamora paid an additional $50,000 to Milagro to extend the
option to June 30, 1998, and to decrease the exercise price to $120,000. In
addition, Mr. Eardley granted an option to 1st Zamora to purchase the
2,015,500 shares owned by him for $20,000 exercisable on or before June 30,
1998. During the extended term of the option Milagro and Mr. Eardley have
agreed not to sell, transfer, assign, convey, or encumber the shares or any
interest therein. However, Milagro and Mr. Eardley shall remain at all times
during the extended term of the option the legal owners of their shares having
all rights of ownership with respect to the shares, including voting rights,
dividend and liquidation rights, and any and all other rights inherent in the
ownership of the shares, subject only to the terms of the amended option. The
option rights of 1st Zamora may be exercised only by it or its successors and
are not transferable. The exercise of the option would result in a change of
control of the Registrant by virtue of such party obtaining a majority of the
outstanding stock of the Registrant.
Item 7. Exhibits
Exhibit No. Description Location
10.1 Debt Settlement Agreement Attached
10.2 Amendment No. 1 to Stock Option Agreement Attached
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
YELLOW GOLD OF CRIPPLE CREEK, INC.
Date: June 3, 1998 By /s/ Howard M. Oveson, President and
Principal Financial Officer
EXHIBIT 10.1
DEBT SETTLEMENT AGREEMENT
This Debt Settlement Agreement (the "Agreement"), entered into this 11th
day of February, 1998, is by and between Yellow Gold of Cripple Creek, Inc., a
Colorado corporation with offices at 57 West 200 South, Suite 310, Salt Lake
City, Utah 84101 (hereinafter the "Company"), and Kip Eardley (hereinafter the
"Creditor").
RECITALS:
WHEREAS, the Creditor has advanced funds to the Company for its
operations for which it has received no compensation;
WHEREAS, the Creditor is willing to accept, and the Company is willing to
issue, shares of commons stock of the Company to the Creditor in full and
complete satisfaction of monies owed by the Company to the Creditor;
NOW, THEREFORE, in consideration of the terms and conditions of this
Agreement, the parties hereto agree as follows:
1. Issuance of Shares. The Company shall, and hereby agrees to,
issue to the Creditor 2,015,500 shares of common stock of the Company
(hereinafter the "Shares") in full and complete satisfaction of $20,155 owed
by the Company to the Creditor. Immediately upon execution of this Agreement
by the Creditor, the Company shall instruct the transfer agent for the common
stock of the Company to issue to the Creditor one or more stock certificates
representing the Shares.
2. Forgiveness of Debt. The Creditor, for himself, and for his
administrators, executors, and assigns, shall, and by these presents does,
accept, receive, and take the Shares from the Company as full and complete
satisfaction of the $20,155 owed to him by the Company.
3. Representations and Warranties of the Company. The Company
represents and warrants to the Creditor as set forth below. These
representations and warranties are made as an inducement for the Creditor to
enter into this Agreement and, but for the making of such representations and
warranties and their accuracy, the Creditor would not be parties hereto.
a. Organization and Good Standing. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Colorado with full power and authority to enter into and perform the
transactions contemplated by this Agreement.
b. Performance of This Agreement. The execution and performance
of this Agreement and the issuance of the Shares contemplated hereby have been
authorized by the board of directors of the Company.
c. Legality of Shares to be Issued. The Shares to be issued by
the Company pursuant to this Agreement, when so issued and delivered, will
have been duly and validly authorized and issued by the Company and will be
fully paid and nonassessable.
d. Accuracy of All Statements Made by the Company. No
representation or warranty by the Company in this Agreement, nor any
statement, certificate, schedule, or exhibit hereto furnished or to be
furnished by the Company pursuant to this Agreement, nor any document or
certificate delivered to the Creditor pursuant to this Agreement or in
connection with actions contemplated hereby, contains or shall contain any
untrue statement of material fact or omits to state or shall omit to state a
material fact necessary to make the statements contained therein not
misleading.
4. Representations and Warranties of the Creditor. The Creditor
represents and warrants to the Company as set forth below. These
representations and warranties are made as an inducement for the Company to
enter into this Agreement and, but for the making of such representations and
warranties and their accuracy, the Company would not be a party hereto.
a. Restricted Securities. The Creditor understands that the
Shares to be issued to him will not have been registered pursuant to the
Securities Act of 1933, or any state securities act, and thus will be
restricted securities as defined in Rule 144 promulgated by the Securities and
Exchange Commission (the "SEC"). Therefore, under current interpretations and
applicable rules, he will probably have to retain such shares for a period of
at least one year and at the expiration of such one year period his sales may
be confined to brokerage transactions of limited amounts requiring certain
notification filings with the SEC and such disposition may be available only
if the issuer is current in its filings with the SEC under the Securities
Exchange Act of 1934, as amended, or other public disclosure requirements.
b. Non-distributive Intent. The Creditor acknowledges that the
Shares are acquired for his own account and not with the present view towards
the distribution thereof and he will not dispose of such shares except (i)
pursuant to an effective registration statement under the Securities Act, or
(ii) in any other transaction which, in the opinion of counsel acceptable to
the issuer, is exempt from registration under the Securities Act, or the rules
and regulations of the SEC thereunder, and that an appropriate legend will be
placed upon each of the certificates representing the Shares, and stop
transfer instructions shall be placed with the transfer agent for the
securities.
c. Evidence of Compliance with Private Offering Exemption. The
Creditor has such knowledge and experience in business and financial matters
that he is capable of evaluating the risks of the prospective investment, and
that the financial capacity of the Creditor is of such proportion that the
total cost of such person's commitment in the Shares would not be material
when compared with its total financial capacity.
d. Access to Information. The Creditor has received and read
and is familiar with information concerning the Company furnished to him, and
confirms that all documents, records, and books pertaining to this proposed
investment have been made available to him.
e. Opportunity to Ask Questions. The Creditor has had the
opportunity to question and receive answers from representatives of the
Company concerning the terms and conditions of the proposed investment and the
business of the Company. In addition, the Creditor has received all requested
additional information and documents.
f. Limitations on Transfer of Shares. The Creditor acknowledges
that he is aware that there are substantial restrictions on the
transferability of the Shares. Since the Shares will not be registered under
the Securities Act or any applicable state securities laws, the Shares may not
be, and the Creditor agrees that they shall not be, transferred unless the
Shares are registered under the Securities Act and state securities laws or
unless such sale is exempt from such registration under the Securities Act and
any other applicable state securities laws or regulations. The Creditor
further acknowledges that the Company is under no obligation to aid it in
obtaining any exemption from the registration requirements. The Creditor also
acknowledges that it shall be responsible for compliance with all conditions
on transfer imposed by any securities administrator of any state and for any
expenses incurred by the Company for legal or accounting services in
connection with reviewing such a proposed transfer and/or issuing opinions in
connection therewith. However, the Company agrees to cooperate with the
Creditor in regard to any such transfer.
g. Accuracy of All Statements Made by the Creditor. No
representation or warranty by the Creditor in this Agreement, nor any
statement, certificate, schedule, or exhibit hereto furnished or to be
furnished by the Creditor pursuant to this Agreement, nor any document or
certificate delivered to the Company pursuant to this Agreement or in
connection with actions contemplated hereby, contains or shall contain any
untrue statement of material fact or omits to state or shall omit to state a
material fact necessary to make the statements contained therein not
misleading.
5.Miscellaneous Provisions
a. Default Costs. Should any party to this Agreement default in
any of the covenants, conditions, or promises contained herein, the defaulting
party shall pay all costs and expenses, including a reasonable attorney's fee,
which may arise or accrue from enforcing this Agreement, or in pursuing any
remedy provided hereunder or by the statutes of the State of Utah.
b. Rights Are Cumulative. The rights and remedies granted to
the parties hereunder shall be in addition to and cumulative of any other
rights or remedies either may have under any document or documents executed in
connection herewith or available under applicable law. No delay or failure on
the part of a party in the exercise of any power or right shall operate as a
waiver thereof nor as an acquiescence in any default nor shall any single or
partial exercise of any power or right preclude any other or further exercise
thereof or the exercise of any other power or right.
c. Waiver and Amendment. Neither this Agreement nor any
provision hereof may be changed, waived, terminated or discharged orally, but
only by an instrument in writing signed by the party against whom enforcement
of the change, waiver, termination or discharge is sought.
d. Notices. All communications provided for herein shall be in
writing and shall be deemed to be given or made on (a) the date of delivery,
if delivered in person, by nationally recognized overnight delivery service,
or by facsimile, or (b) three days after mailing if mailed from within the
continental United States by registered or certified mail, return receipt
requested, to the party entitled to receive the same, if to the initial
parties hereto, to the address set forth herein, or at such other address or
facsimile number as shall be designated by any party hereto in written notice
to the other party hereto delivered pursuant to this Paragraph.
e. Governing Law. This Agreement and the rights and duties of
the parties hereto shall be construed and determined in accordance with the
laws of the State of Utah, and any and all actions to enforce the provisions
of this Agreement, shall be brought in a court of competent jurisdiction in
the State of Utah and in no other place.
f. Successors and Assigns. This Agreement shall be binding upon
the parties and their successors and assigns and shall inure to the benefit of
the other parties and successors and assigns.
g. Counterparts. This Agreement may be executed in any number
of counterparts and all such counterparts taken together shall be deemed to
constitute one instrument.
h. Entire Agreement. This Agreement constitutes the entire
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all negotiations, representations, prior discussions,
and preliminary agreements between the parties hereto relating to the subject
matter of this Agreement.
i. Interpretation of Agreement. This Agreement shall be
interpreted and construed as if equally drafted by all parties hereto.
j. Survival of Covenants, Etc. All covenants, representations
and warranties made herein shall survive the making of this Agreement and
shall continue in full force and effect until the obligations of this
Agreement have been fully satisfied.
k. Partial Invalidity. If any term of this Agreement shall be
held to be invalid or unenforceable, such term shall be deemed to be severable
and the validity of the other terms of this Agreement shall in no way be
affected thereby.
l. Headings. The descriptive headings of the various Sections
or parts of this Agreement are for convenience only and shall not affect the
meaning or construction of any of the provisions hereof.
m. Number and Gender. Wherever from the context it appears
appropriate, each term stated in either the singular or the plural shall
include the singular and the plural, and pronouns stated in either the
masculine, the feminine, or the neuter gender shall include the masculine,
feminine, and neuter.
n. Further Assurances. At any time, and from time to time,
after the effective date, each party will execute such additional instruments
and take such action as may be reasonably requested by the other party to
confirm or perfect title to any property interests transferred hereunder or
otherwise to carry out the intent and purposes of this Agreement.
o. Full Knowledge. By their signatures, the parties acknowledge
that they have carefully read and fully understand the terms and conditions of
this Agreement, that each party has had the benefit of counsel, or has been
advised to obtain counsel, and that each party has freely agreed to be bound
by the terms and conditions of this Agreement.
IN WITNESS WHEREOF, the undersigned have executed and delivered this
document the day and year first above written.
COMPANY: Yellow Gold of Cripple Creek, Inc.
By /s/ Howard M. Oveson, President
CREDITOR: /s/ Kip Eardley
8823 South Cameo Way
Sandy, Utah 84093
EXHIBIT 10.2
AMENDMENT NO. 1
TO THE
STOCK OPTION AGREEMENT
DATED FEBRUARY 11, 1998
This amendment is entered into effective the 31st day of March 1998, by,
between, and among Milagro Holdings, Inc. ("Milagro"), Kip Eardley ("Mr.
Eardley"), and 1st Zamora Corp. ("Optionee").
RECITALS:
WHEREAS, Milagro and Optionee entered into a Stock Option Agreement dated
February 11, 1998 (the "Option Agreement"), whereby Milagro granted an option
to Optionee to purchase 11,102,500 pre-reverse split shares of Yellow Gold of
Cripple Creek, Inc. (the "Issuer") for $190,000;
WHEREAS, on or about February 11, 1998, the Issuer settled an outstanding
obligation in the approximate amount of $20,155 owed by the Issuer for
advances paid to the Issuer by issuing 2,015,500 post-reverse split shares of
common stock of the Issuer to Mr. Eardley;
WHEREAS, Optionee wishes to acquire the stock of Mr. Eardley as well as
the stock of Milagro; and
WHEREAS, Milagro is willing to continue, and Mr. Eardley is willing to
grant, options to Optionee to acquire such stock;
NOW THEREFORE, in consideration of the mutual terms and conditions of
this Amendment No. 1, the parties hereto agree as follows:
1. Extension of Exercise Period. For and in consideration of $50,000
received by Milagro, Milagro hereby extends the Option Agreement, and the
exercise period for the options granted in the Option Agreement, until June
30, 1998. Milagro hereby reduces the exercise price for the options to
$120,000.
2. Grant of Option by Mr. Eardley. For valuable consideration, the
receipt and sufficiency of which is acknowledged by Mr. Eardley, Mr. Eardley
hereby grants to Optionee an option to purchase the 2,015,500 shares owned by
him at an exercise price of $20,000. This option shall be concurrent with and
subject to the same terms and conditions as the option granted by Milagro
pursuant to the Option Agreement, and Mr. Eardley agrees to be bound by the
terms and conditions of the Option Agreement and this Amendment No. 1.
3. Option Agreement Terms. All other terms and conditions of the
Option Agreement not otherwise modified by this Amendment No. 1 shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties have executed this document to be
effective the day and year first above written.
Milagro Holdings, Inc.
By /s/ Howard M. Oveson, President
1st Zamora Corp.
By /s/ Laura Madsen, President
/s/ Kip Eardley
