INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the registrant [ X ]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[ X ] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
BRUSH CREEK MINING AND DEVELOPMENT CO., INC.
(Name of Registrant as Specified in Its Charter)
BRUSH CREEK MINING AND DEVELOPMENT CO., INC.
(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[ X ] No fee required.
[ ] Fee computed on the table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction applies: N/A
(2) Aggregate number of securities to which transaction applies: N/A
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11: N/A
(4) Proposed maximum aggregate value of transaction: N/A
(5) Total fee paid: N/A
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid: N/A
(2) Form, schedule or registration statement no.: N/A
(3) Filing party: N/A
(4) Date filed: N/A
<PAGE>
BRUSH CREEK MINING AND DEVELOPMENT CO., INC.
970 EAST MAIN STREET, SUITE 200
GRASS VALLEY, CALIFORNIA 95945
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 8, 1998
To the Shareholders:
The Annual Meeting of Shareholders (the "Annual Meeting") of Brush Creek
Mining and Development Co., Inc. (the "Company") will be held on January 8,
1998, at 10:00 a.m. (PST), at the Miners' Foundry located at 325 Spring Street,
Nevada City, California 95959, for the following purposes:
1. To elect four Directors to serve as the Board of Directors of the
Company until the next Annual Meeting of Shareholders and until
their successors shall be elected and shall qualify;
2. To ratify the selection of Brown Armstrong Randall & Reyes as the
Company's independent auditors for the fiscal year ending June 30,
1998; and
3. To transact such other business as may properly come before the
Annual Meeting or any adjournment thereof.
The close of business on November 12, 1997 has been fixed as the record
date for determining shareholders entitled to receive notice of and to vote at
the Annual Meeting and at any adjournment thereof.
Your attention is called to the proxy statement on the following pages.
We hope that you will attend the Annual Meeting. If you do not plan to attend,
please sign, date and mail the enclosed proxy card in the enclosed envelope,
which requires no postage if mailed in the United States.
By Order of the Board of Directors,
JAMES S. CHAPIN,
Chairman
Grass Valley, California
November 18, 1997
<PAGE>
BRUSH CREEK MINING AND DEVELOPMENT CO., INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY 8, 1998
_____________________________
This Proxy Statement is being furnished to shareholders of Brush Creek
Mining and Development Co., Inc., a Nevada corporation (the "Company"), in
connection with the solicitation of proxies by the Board of Directors of the
Company (the "Board of Directors") for use at the Annual Meeting of
Shareholders of the Company to be held on January 8, 1998, at 10:00 a.m. (PST),
at the Miners' Foundry located at 325 Spring Street, Nevada City, California
95959, and at any adjournment thereof (the "Annual Meeting").
The Board has fixed the close of business on November 12, 1997 as the
record date for the determination of shareholders entitled to receive notice
of, and vote at, the Annual Meeting (the "Record Date"). Accordingly, only
shareholders of record on the books of the Company at the close of business on
the Record Date will be entitled to vote at the Annual Meeting. On the Record
Date, the Company had outstanding approximately 44,529,483 shares of Common
Stock, par value $.0001 per share (the "Common Stock") which are the only
outstanding voting securities of the Company. On all matters, each share of
Common Stock is entitled to one vote.
The cost of soliciting proxies will be borne by the Company. In addition
to solicitation by mail, officers, directors and other employees of the Company
may solicit proxies by personal contact, telephone, facsimile or other
electronic means without additional compensation. This Proxy Statement and the
accompanying proxy card are first being mailed to shareholders on or about
November 18, 1997.
Proxies in the accompanying form which are properly executed, duly
returned and not revoked, will be voted in accordance with the instructions
thereon. If no instructions are indicated thereon, proxies will be voted FOR
all matters listed in the Notice of Annual Meeting of Shareholders and in
accordance with the discretion of the person(s) voting the proxies with respect
to all other matters properly presented at the Annual Meeting. Execution of a
proxy will not prevent a shareholder from attending the Annual Meeting and
voting in person. Any shareholder giving a proxy may revoke it at any time
before it is voted by delivering to the Secretary of the Company written notice
of revocation bearing a later date than the proxy, by delivering a later-dated
proxy, or by voting in person at the Annual Meeting. Attendance at the Annual
Meeting will not, in and of itself, constitute revocation of a proxy. The
holders of a majority of the shares of Common Stock outstanding and entitled
to vote as of the Record Date, present in person or represented by proxy, shall
constitute a quorum for the transaction of business at the Annual Meeting. A
plurality of the votes cast at the Annual Meeting will be required for the
election of directors. The ratification of the selection of Brown Armstrong
Randall & Reyes as independent auditors requires the affirmative vote of a
majority of the votes cast at such meeting. If a shareholder, present in
person or represented by proxy, abstains on any matter, the shareholder's
shares will not be voted on such matter. Thus, an abstention from voting on a
matter has the same legal effect as a vote "against" the matter, even though
the shareholder may interpret such action differently.
PRINCIPAL SHAREHOLDERS AND SECURITY OWNERSHIP OF MANAGEMENT
The following table sets forth, as of October 28, 1997, (i) the number of
shares of Common Stock owned of record or beneficially, or both, by each
person who owned of record, or is known by the Company to have beneficially
owned, individually, or with his associates, more than 5% of such shares then
outstanding; (ii) the number of shares owned beneficially by each Director of
the Company, each person nominated to be a Director and each named executive
officer of the Company; and (iii) the number of shares owned beneficially by
all Directors and executive officers as a group. Except as otherwise indicated
below, each of the persons listed below has sole voting and investment power
with respect to his or her shares.
Amount and Nature Percent
Name of Beneficial Owner of Beneficial Ownership of Class
James S. Chapin 1,505,877(1)(2) 3.2%
970 E. Main Street, Suite 200
Grass Valley, CA 95945
Howard I. Kalodner 937,005(1)(2) 2.0%
55 Riverview Terrace
Springfield, MA 01108
Albert E. Miller 658,334(1)(2) 1.4%
250 Westmont
West Hartford, CT 06117
Kenneth S. Friedman 1,095,200(1)(2) 2.4%
26 Willow Lane
Blackhawk, CO 80422
Ariel Holdings LLC 4,050,000 9.1%
5151 Collins Avenue
Miami Beach, FL 33140
David Werner 4,100,000 9.2%
36 West 44th Street
New York, NY 10036
All Executive Officers 4,196,416(1)(2) 8.8%
and Directors
as a Group (four persons)
__________________
(1) Includes shares which may be acquired within 60 days pursuant
to the exercise of options, as follows: Mr. Chapin, 975,000
shares; Mr. Kalodner, 500,000 shares; Mr. Miller, 500,000 shares;
and Mr. Friedman, 485,000 shares; and all executive officers and
directors as a group, 2,460,000 shares.
(2) Figure includes shares owned by a spouse.
ELECTION OF DIRECTORS
A Board of Directors consisting of four members is to be elected by the
shareholders, to hold office until the next Annual Meeting of Shareholders and
until their successors are duly elected and qualify.
<PAGE>
Unless authority is withheld, it is intended that proxies will be voted
for the election of the four nominees below, each of whom is currently serving
as a director. The Board of Directors does not contemplate that any of these
nominees will be unable or will decline to serve. However, if any of them is
unable or declines to serve, the persons named in the accompanying proxy may
vote for another person or persons in their discretion.
INFORMATION CONCERNING NOMINEES
The following table sets forth certain information with respect to the
four nominees for election to the Board of Directors.
PRESENT POSITION HAS SERVED AS
NAME AGE AND OFFICES DIRECTOR SINCE
James S. Chapin 42 Chief Executive Officer, 1994
Chief Financial Officer,
Chairman of the Board
and Director
Howard I. Kalodner 63 Director 1994
Albert E. Miller 70 Director 1994
Kenneth S. Friedman 55 Director 1995
JAMES S. CHAPIN has been a Director of the Company since April 1994. Since
April 1994, Mr. Chapin has also served as the Chief Executive Officer and Chief
Financial Officer of the Company. Prior to working with the Company, Mr. Chapin
was a registered representative with the Hartford, Connecticut offices of
Tucker Anthony, a securities broker-dealer from 1988 to April 1994. He
previously served in executive positions from 1977 to 1983 with IBM and from
1983 to 1988 with the securities firm of Smith Barney.
HOWARD I. KALODNER has been a Director of the Company since March 1994.
Mr. Kalodner is a professor of law and, from 1977 to 1994, served as the dean
of Western New England College School of Law in Springfield, Massachusetts. He
is a member of the American Law Institute (ALI).
ALBERT E. MILLER has been a Director of the Company since March 1994. From
1976 to 1991, Mr. Miller was chairman and chief executive officer of Royalpar
Industries, a publicly owned human resources company. He retired from Royalpar
in July 1991 when it was acquired by another company.
KENNETH S. FRIEDMAN has been a Director of the Company since January
1995. Mr. Friedman has served as president and chief executive officer of
Strathmore Resources Ltd. from December 1996 to the present. From 1993 to the
present, he has also served as president of Nonlinear Resource Corp. and, from
1991 to 1993, he served as director of research for Dickinson & Co. He served
as the natural resources analyst for Kemper Securities, a securities firm, from
1990 to 1991 and the metal and mining analyst for Boettcher Co., a brokerage
firm, from 1989 to 1990.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF EACH NOMINEE
FOR DIRECTOR NAMED ABOVE.
<PAGE>
THE COMPANY'S EXECUTIVE OFFICERS
There are no executive officers of the Company other than those named
above.
EXECUTIVE COMPENSATION
The following summary compensation table sets forth information concerning
the annual and long-term compensation for services in all capacities to the
Company for the fiscal years ended June 30, 1997, 1996 and 1995, of those
persons who were, at June 30, 1997 (i) the chief executive officer and (ii) the
other most highly compensated executive officers of the Company, whose annual
base salary and bonus compensation was in excess of $100,000 (the named
executive officers):
SUMMARY COMPENSATION TABLE
ANNUAL LONG-TERM
COMPENSATION COMPENSATION
AWARDS PAYOUTS
NAME AND PRINCIPAL FISCAL OPTIONS ALL OTHER
POSITION YEAR SALARY BONUS (SHARES) COMPENSATION
James S. Chapin, 1997 $110,000 $100,000(1) 375,000(2) $0
Chief Executive
Officer 1996 $110,000 $0 250,000(3) $0
and Chief
Financial 1995 $110,000 $0 25,000(3) $23,512(4)
Officer
__________________
(1) Represents amount which was released to Mr. Chapin in January 1997 from
$100,000 which had been held in trust by the Company in connection with
certain severance arrangements which existed between the Company and Mr.
Chapin. Due to the release of said funds, such severance arrangements
have been terminated. See " - Employment Agreements and Termination of
Employment Arrangements".
(2) In March 1997, Mr. Chapin was granted options to acquire 375,000 shares of
the Company's Common Stock. In connection therewith, all previously
granted options to Mr. Chapin were cancelled.
(3) Such options have been cancelled (see footnote (2) above).
(4) Represents payments made by the Company for living expenses.
STOCK OPTION PLANS
The Company has an incentive stock option plan under which five and ten-
year options may be granted to key employees to purchase up to 33,333 shares of
the Company's Common Stock at the market price on the date of grant. At June
30, 1997, no options had been granted under this plan. A total of 33,333
shares of the Company's unissued Common Stock has been reserved for this plan.
The Company has a nonqualified stock option plan, under which options to
purchase a total of 1,186,000 shares from $.23 to $4.13 were outstanding and
exercisable at June 30, 1997.
The following tables set forth certain information with respect to stock
options granted to the persons named in the Summary Compensation Table during
the fiscal year ended June 30, 1997.
<PAGE>
OPTION GRANTS IN FISCAL 1997
INDIVIDUAL GRANTS
PERCENT OF TOTAL
NUMBER OF OPTIONS GRANTED
SECURITIES TO EXERCISE OR
UNDERLYING OPTIONS EMPLOYEES IN BASE PRICE
NAME GRANTED FISCAL YEAR ($/SH)
James S. Chapin 375,000 100% $.225
MARKET
PRICE
ON
DATE OF EXPIRATION
GRANT (1) DATE
$117,188 3/7/2002
_______________________
(1) Based on the average of the closing bid and asked prices of the Company's
Common Stock on the date of grant. The actual value, if any, an optionee
will realize upon exercise of an option will depend on the excess of the
market value of the Common Stock over the exercise price on the date the
option is exercised.
The following table set forth certain information as to each exercise of
stock options during the year ended June 30, 1997, by the persons named in the
Summary Compensation Table and the fiscal year-end value of unexercised
options:
AGGREGATED OPTION EXERCISES IN FISCAL 1997 AND YEAR-END OPTION VALUE
NUMBER OF SECURITIES
SHARES UNDERLYING UNEXERCISED
ACQUIRED OPTIONS AT JUNE 30, 1997
ON VALUE
EXERCISE REALIZED EXERCISABLE UNEXERCISABLE
James S. Chapin -0- -0- 375,000 -0-
VALUE OF UNEXERCISED
IN-THE-MONEY OPTIONS
AT JUNE 30, 1997 (1)
EXERCISABLE UNEXERCISABLE
$56,250 -0-
_______________________
(1) Realizable values are reported net of the option exercise price but before
any income taxes that the executive may have to pay. Actual gains, if any,
on stock option exercises are dependent on the future performance of the
Common Stock as well as the option holder's continued employment through
the vesting period. The amounts reflected in this table may never be
obtained.
LONG TERM INCENTIVE PLANS
Other than the stock option plans described above, the Company does not
have any plan providing compensation to its executive officers for performance
to occur over a period longer than one fiscal year.
PENSION PLANS
The Company does not have any pension plan available to its executive
officers.
COMPENSATION OF DIRECTORS
The independent Directors of the Company are entitled to compensation at a
rate of $1,500 per month for their services. During the fiscal year ended June
30, 1997, however, no fees were paid to Directors. Certain expenses incurred in
connection with such services, including travel to meetings, may also be
reimbursed. In addition the Board has awarded options to acquire Common Stock
of the Company to directors in recognition of services.
<PAGE>
EMPLOYMENT AGREEMENTS AND TERMINATION OF EMPLOYMENT ARRANGEMENTS
The Company has an employment agreement with James S. Chapin, which
provides that Mr. Chapin's employment will commence April 4, 1994, and continue
through April 3, 1995, following which his employment is to continue for an
indefinite term, subject to certain notice provisions. In addition, the
Company agreed to pay Mr. Chapin $100,000 as severance compensation if he was
terminated other than "for cause" which amount would be held in trust and
secured by an irrevocable letter of credit. Upon completion of five consecutive
years of employment with the Company this obligation would terminate.
Notwithstanding the foregoing, in January 1997, the Board of Directors resolved
to award Mr. Chapin such amount as a bonus. In connection therewith, such
severance arrangements which existed between the Company and Mr. Chapin were
terminated.
REPRICING OF OPTIONS
In March 1997, the Company cancelled all previously issued options to its
four directors (which included Mr. Chapin, the Company's named executive
officer) and issued in place thereof 960,000 options exercisable at $.225 per
share. All previously granted options which were cancelled were exercisable at
prices ranging from $1.13 to $2.98 per share. The exercise price of $.225 per
share for the options issued in place of the cancelled options represented 90%
of the closing bid price of the Company's Common Stock on the date immediately
prior to the date of grant.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than 10%
of a registered class of the Company's equity securities, to file with the
Securities and Exchange Commission initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of the
Company. Officers, directors and greater than 10% shareholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file.
Based solely on the Company's review of such reports and written
representations from certain of such persons, the Company believes that, during
the fiscal year ended June 30, 1997, all Section 16(a) filing requirements
applicable to its officers, directors and greater than 10% beneficial owners
were complied with except James S. Chapin filed two reports late relating to a
total of three transactions, Howard I. Kalodner filed two reports late relating
to a total of two transactions, Albert E. Miller filed one report late relating
to a total of one transaction, and Kenneth S. Friedman filed one report late
relating to one transaction and failed to file two reports relating to two
transactions.
TRANSACTIONS WITH MANAGEMENT AND OTHERS
The Company has a policy of following Section 78.140 of the Nevada Revised
Statutes regarding transactions involving interested directors or officers. In
general, all transactions involving interested directors or officers will be
submitted to the board, after disclosure of the financial interest, for
approval without counting the vote of the interested director. For purposes of
a quorum, pursuant to Section 78.140, the attendance by the interested
directors will be counted.
MATERIAL PROCEEDINGS
There are no material proceedings to which any director or executive
officer of the Company is a party adverse to the Company or any if its
subsidiaries or has a material interest adverse to the Company or any of its
subsidiaries.
<PAGE>
ADDITIONAL INFORMATION
During the fiscal year ended June 30, 1997, the Board of Directors held 13
formal meetings. In addition, the Board of Directors took action by unanimous
written consent and met informally on other occasions during the period. The
Company does not currently have a standing audit or nominating committee. The
compensation committee is comprised of Howard I. Kalodner and Albert E. Miller.
The compensation committee did not meet during the fiscal year ended June 30,
1997. No incumbent director, excepting Kenneth S. Friedman, participated in
fewer than 75% of all meetings of the Board of Directors and the Committees, if
any, upon which such director then served during the 1997 fiscal year.
SELECTION OF AUDITORS
The Board of Directors has appointed Brown Armstrong Randall & Reyes,
independent certified public accountants, as the Company's independent auditors
for the fiscal year ending June 30, 1998, subject to ratification by the
Company's shareholders. Said firm has acted as auditors for the Company since
July 1994. It is expected that a representative of Brown Armstrong Randall &
Reyes will be present at the Annual Meeting, with the opportunity to make a
statement if he or she desires to do so, and will be available to respond to
appropriate questions. THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS
RATIFY THE SELECTION OF BROWN ARMSTRONG RANDALL & REYES AS THE COMPANY'S
INDEPENDENT AUDITORS BY VOTING FOR THIS PROPOSAL.
SHAREHOLDERS' PROPOSALS
Any shareholder who wishes to present a proposal for action at the next
Annual Meeting of Shareholders and who wishes to have it set forth in the proxy
statement and identified in the form of proxy prepared by management must
notify management of the Company so that such notice is received by management
at its principal executive offices at 970 East Main Street, Suite 200, Grass
Valley, California 95945 by July 21, 1998 and is in such form as is required
under the rules and regulations promulgated by the Securities and Exchange
Commission.
MISCELLANEOUS
The Board of Directors knows of no other business to be presented at the
Annual Meeting but if other matters properly do come before the meeting, it is
intended that the persons named in the accompanying proxy will vote the shares
for which they hold proxies in accordance with their judgment.
<PAGE>
The Company's Annual Report for the fiscal year ended June 30, 1997 is
being delivered to the Company's shareholders with this Proxy Statement. The
Annual Report is not to be considered part of the soliciting material.
By Order of The Board of Directors,
/s/James S. Chapin
James S. Chapin,
Chairman
Dated:November 18, 1997
Grass Valley, California
<PAGE>
APPENDIX
FORM OF PROXY CARD
PROXY
BRUSH CREEK MINING AND DEVELOPMENT CO., INC.
ANNUAL MEETING OF SHAREHOLDERS
JANUARY 8, 1998
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints James S. Chapin and John L.
McGillivray, and each of them, with power of substitution as proxies for
the undersigned to act and vote at the Annual Meeting of Shareholders of
Brush Creek Mining and Development Co., Inc. (the "Company") to be held on
January 8, 1998, at 10:00 a.m. (PST), at the Miners' Foundry located at 325
Spring Street, Nevada City, California, and any adjournments thereof for
the following purposes:
1. Election of Directors - Nominees: James S. Chapin, Howard I.
Kalodner, Albert E. Miller and Kenneth S. Friedman.
[ ] FOR [ ] FOR ALL EXCEPT [ ] WITHHOLD
INSTRUCTION: To withhold your vote for any nominee(s), mark "For All
Except" and write that nominee's name on the line below.
2. Proposal to ratify the selection of Brown Armstrong Randall &
Reyes as the Company's auditors for the fiscal year ending June 30, 1998.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. To transact such other business as may properly come before the
Annual Meeting or any adjournments thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. UNLESS OTHERWISE SPECIFIED, THE
SHARES WILL BE VOTED FOR PROPOSALS 1 AND 2.
Signatures of Shareholder(s)
Date:
NOTE: Please sign your name exactly as it appears on this Proxy. Jointly
held shares require only one signature. If you are signing this Proxy as
an attorney, administrator, agent, corporation, officer, executor, trustee
or guardian, etc., please add your full title to your signature.
IMPORTANT: IF YOU RECEIVE MORE THAN ONE CARD, PLEASE SIGN AND RETURN
ALL CARDS IN THE ACCOMPANYING ENVELOPE.
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY TODAY
