<PAGE> 1
As filed with the Securities and Exchange Commission on September 6, 1996.
Registration No. 333-___________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------
CANYON RESOURCES CORPORATION
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 14142 DENVER WEST PARKWAY, SUITE 250 84-0800747
(State or other jurisdiction of GOLDEN, COLORADO 80401 (I.R.S. Employer
incorporation or organization) (303) 278-8464 Identification Number)
(Address, including zip code, and
telephone number, including area code,
of Registrant's principal executive office)
</TABLE>
GEORGE S. YOUNG
14142 DENVER WEST PARKWAY, SUITE 250
GOLDEN, COLORADO 80401
(303) 278-8464
(Name, address, including zip code, and telephone number,
including area code, of agent for service of process)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
========================================================================================================
Proposed Proposed
maximum maximum
offering aggregate
Titles of securities Amount to be price per offering Amount of
to be registered registered share price(1) registration fee
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 150,000 Shares $2.85(1) $427,500 $147.41
========================================================================================================
Common Stock, $.01 par
value, issuable upon
exercise of a Warrant to
Purchase Common Stock 300,000 Shares $2.85(2) $855,000 $294.83
========================================================================================================
Total Fee Paid Herewith $442.24
========================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
and based upon the average high and low market prices of Canyon Common
Stock on September 3, 1996.
(2) Estimated solely for the purpose of calculating the registration fee
and based upon the average high and low market prices of Canyon Common
Stock on September 3, 1996.
<PAGE> 2
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE> 3
***************************************************************************
* *
* INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. *
* A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED *
* WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY *
* NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE *
* REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT *
* CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY *
* NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH *
* SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO *
* REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH *
* STATE. *
* *
***************************************************************************
SUBJECT TO COMPLETION, DATED SEPTEMBER 6, 1996
PROSPECTUS
CANYON RESOURCES CORPORATION
-----------------
450,000 SHARES OF
COMMON STOCK
This Prospectus covers 450,000 shares (the "Shares") of the Common
stock, $.01 par value ("Common Stock"), of Canyon Resources Corporation
("Canyon" or the "Company") which are being offered by the Selling Shareholders
through brokers' and dealers' transactions, not involving any underwriter. The
Company will not receive any of the proceeds from the sale of the Shares by the
Selling Shareholders. (See "Selling Shareholders".)
Brokers or dealers through whom the Shares are sold may receive
compensation in the form of commissions from the Selling Shareholder and/or the
purchasers of the Shares for whom they act as agent. (See "Plan of
Distribution".)
The Company's Common Stock is traded in the over-the-counter market
and is quoted on The American Stock Exchange under the symbol "CAU." On
September __, 1996, the closing price of the Common Stock on The American Stock
Exchange was ______.
--------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
--------------------------------
FOR A DISCUSSION OF CERTAIN MATTERS THAT
SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS
OF THE SECURITIES, SEE "PRINCIPAL RISK FACTORS."
--------------------------------
The date of this Prospectus is _____________, 1996.
<PAGE> 4
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained or
incorporated by reference in this Prospectus in connection with the offer
contained in this Prospectus and, if given or made, such information or
representations must not be relied upon as having been authorized by the
Company. Neither the delivery of this Prospectus nor any sale hereunder shall,
under any circumstances, create any implication that there has been no change
in the affairs of the Company since the date hereof. This Prospectus does not
constitute an offer to sell, or a solicitation of an offer to buy any security
other than the securities covered by this Prospectus, nor does it constitute an
offer or solicitation by anyone in any jurisdiction in which such offer or
solicitation is not authorized, or in which the person making such offer or
solicitation is not qualified to do so, or to any person to whom it is unlawful
to make such offer or solicitation.
AVAILABLE INFORMATION
The Company is subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended, and accordingly files reports, proxy
statements, and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy statements, and other information
filed with the Commission are available for inspection and copying at the
public reference facilities maintained by the Commission at Room 1024, 450
Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and at certain of
the Commission's regional offices located at Northwestern Atrium Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60604; and 7 World Trade
Center, New York, New York 10048, upon payment of the charges prescribed
therefor by the Commission.
The Company has filed with the Commission a registration statement on
Form S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement. Copies of the Registration Statement are
available from the Commission as set forth above.
The Common Stock of the Company is currently traded in the
over-the-counter market and is quoted on The American Stock Exchange. Reports,
proxy statements and other information filed by the Company therewith can be
inspected at the American Stock Exchange, 86 Trinity Place, New York, New York
10006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company (File No. 0-14329) with
the Commission are incorporated herein by reference:
1. Annual Report on Form 10-K for the fiscal year ended December
31, 1995.
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<PAGE> 5
2. Quarterly Reports on Form 10-Q for the periods ended March 31,
1996, and June 30, 1996.
3. A description of the Company's Common Stock contained in the
Registration Statement on Form 8-A as declared effective by
the Securities and Exchange Commission on March 18, 1986.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Common Stock shall be deemed to
be incorporated by reference into this Prospectus and to be a part hereof from
the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom a Prospectus is delivered, upon written or oral
request of such person, a copy of any or all of the documents which are
incorporated by reference herein, other than exhibits to such documents which
are not specifically incorporated by reference herein. Requests should be
directed to Canyon Resources Corporation, 14142 Denver West Parkway, Suite 250,
Golden, CO 80401, Attention: George S. Young (telephone 303-278-8464).
CANYON RESOURCES CORPORATION
Canyon Resources Corporation, a Delaware corporation (the "Company" or
"Canyon"), is a Colorado-based company which was organized in 1979 to explore,
acquire, develop, and produce mineral properties. The Company, in doing
business, acts on its own behalf and through its subsidiaries. The "Company"
or "Canyon" is also used to refer to all of the wholly owned and majority owned
subsidiaries of Canyon Resources Corporation. The Company filed a Registration
Statement and completed its initial public offering of securities in 1986.
From 1986, when the Company became a reporting company, to August 16, 1996, the
Company's securities were traded on NASDAQ. Since August 19, 1996, the
Company's common stock has been traded on the American Stock Exchange ("AMEX").
The Company is involved in all phases of the mining business from
early stage exploration, exploration drilling, development drilling,
feasibility studies and permitting, through construction, operation and final
closure of mining projects.
3
<PAGE> 6
The Company has gold and industrial mineral production operations in
the Western United States. The Company also conducts exploration activities in
the search for valuable mineral properties in the western United States. In
the past two years, the Company has commenced an exploration program in many
areas of increasing interest throughout Latin America and Africa. The
Company's exploration and development efforts emphasize precious metals (gold
and silver) and industrial minerals.
Once acquired, mineral properties are evaluated by means of geologic
mapping, rock sampling, and geochemical analyses. Properties having favorable
geologic conditions and anomalous geochemical results usually warrant further
exploration by the Company. In almost all cases, exploration or development
drilling is required to further test the mineral potential of each property.
If a property has been adequately evaluated and does not warrant additional
work, the property is marketed to another company or abandoned.
Properties which have a demonstrated inventory of mineralized rock of
a potentially economic nature are further evaluated by conducting various
studies including calculation of tonnage and grade, metallurgical testing,
development of a mine plan, environmental baseline studies and economic
feasibility studies. If economics of a project are favorable, a plan of
operations is developed and submitted to the required governmental agencies for
review. Depending on the magnitude of the proposed project and its
environmental impact, an environmental analysis report or environmental impact
statement may be required prior to issuance of permits for the construction of
a mining operation.
The Company conducts a portion of its mineral exploration and
development through joint ventures with other companies. The Company has also
independently financed the acquisition of mineral properties and conducted
exploration and drilling programs and implemented mine development and
production from mineral properties in the western United States and exploration
programs in Latin American and Africa.
The Company is continually evaluating its properties and other
properties which are available for acquisition, and will acquire, joint
venture, market to other companies, or abandon properties in the ordinary
course of business.
The Company's principal executive office is located at 14142 Denver
West Parkway, Suite 250, Golden, Colorado 80401, telephone (303) 278-8464.
PRINCIPAL RISK FACTORS
GENERAL RISKS RELATED TO THE MINING INDUSTRY
Nature of Mineral Exploration and Production. Exploration for
minerals is highly speculative and involves greater risks than many other
businesses. Many exploration programs do not result in the discovery of
mineralization and any mineralization discovered may not be of sufficient
quantity
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<PAGE> 7
or quality to be profitably mined. Uncertainties as to the metallurgical
amenability of any minerals discovered may not warrant the mining of these
minerals on the basis of available technology. The Company's operations are
subject to all of the operating hazards and risks normally incident to
exploring for and developing mineral properties, such as encountering unusual
or unexpected formations, environmental pollution, personal injury and
flooding. All of these factors may result in losses in relation to amounts
spent which are not recoverable. The Company has experienced losses of this
type from time to time.
Competition and Scarcity of Mineral Lands. Many companies and
individuals are engaged in the mining business, including large, established
mining companies with substantial capabilities and long earnings records.
There is a limited supply of desirable mineral lands available for claim
staking, lease or other acquisition in the United States and other areas where
the Company contemplates conducting exploration activities. The Company may be
at a competitive disadvantage in acquiring mining properties since it must
compete with these individuals and companies, many of which have greater
financial resources and larger technical staffs than the Company. From time to
time, specific properties or areas which would otherwise be attractive to the
Company for exploration or acquisition are unavailable due to their previous
acquisition by other companies.
Fluctuation in the Price of Minerals. The market price of minerals is
extremely volatile and beyond the control of the Company. Gold prices are
generally influenced by basic supply/demand fundamentals. The market dynamics
of supply/demand can be heavily influenced by economic policy, i.e., central
banks sales/purchases, political unrest, conflicts between nations, and general
perceptions about inflation. Fluctuating metal prices may have a significant
impact on the Company's results of operations and operating cash flow.
Furthermore, if the price of a mineral should drop dramatically, the value of
the Company's properties which are being explored or developed for that mineral
could also drop dramatically and the Company might not be able to recover its
investment in those properties. The decision to put a mine into production, and
the commitment of the funds necessary for that purpose, must be made long
before the first revenues from production will be received. During the last
five years, the average annual market price of gold has fluctuated between $344
per ounce and $415 per ounce. Price fluctuations between the time that such a
decision is made and the commencement of production can change completely the
economics of the mine. Although it is possible to protect against price
fluctuations by hedging in certain circumstances, the volatility of mineral
prices represents a substantial risk in the mining industry generally which no
amount of planning or technical expertise can eliminate. The Company's practice
has generally been to sell its minerals at spot prices, unless price hedging
was required in connection with securing loan facilities.
Environmental Controls. Compliance with environmental quality
requirements and reclamation laws imposed by federal, state, and local
governmental authorities may necessitate significant capital outlays, may
materially affect the economics of a given property, or may cause material
changes or delays in the Company's intended activities. New or different
environmental standards imposed by any governmental authority in the future may
adversely affect the Company's activities. The Company experienced significant
delays and incurred costs over those originally anticipated in connection with
the environmental review and permitting process for the Briggs Mine. At the
Briggs Project, the Company originally estimated a permitting time of 24 months
and a cost
5
<PAGE> 8
for permitting of $2 million. However, the actual permitting time stretched to
33 months, and costs increased to $4 million. In California, both the federal
government and the state government require environmental review documents --
an environmental impact statement ("EIS") under federal law and an
environmental impact report ("EIR") under state law. The United States
Department of Interior Bureau of Land Management ("BLM") and Inyo County became
the lead agencies for the federal and the state permitting processes,
respectively. Notwithstanding the fact that a Memorandum of Understanding was
signed during the first few months of the process between the BLM and Inyo
County, under which the BLM and Inyo County cooperated as co-lead agencies in
the preparation of one environmental review document to satisfy both federal
and state requirements (an EIS/EIR), significant additional time and numerous
administrative drafts of the EIS/EIR were required during the process to
harmonize and satisfy the needs and requirements of both the BLM and Inyo
County. Costs increased due to the significant additional expense of the
numerous administrative drafts which were required to be completed, due to
other additional costs which were incurred in satisfying both agencies, and due
to additional fixed and other costs as a result of the extended period of time
required to complete the permitting process.
Uncertainty of Title. Most of the Company's mining properties are
unpatented mining claims to which the Company has only possessory title.
Because title to unpatented mining claims is subject to inherent uncertainties,
it is difficult to determine conclusively ownership of such claims. In
addition, in order to retain title to an unpatented mining claim, a claim
holder must have met annual assessment work requirements ($100 per claim)
through September 1, 1992 and must have complied with stringent state and
federal regulations pertaining to the filing of assessment work affidavits.
Moreover, after September 1, 1992, the right to locate or maintain a claim
generally is conditional upon payment to the United States of a rental fee of
$100 per claim per year for each assessment year instead of performing
assessment work. State law may, in some instances, still require performance
of assessment work.
The present status of the Company's properties as unpatented mining
claims located on public lands of the U.S. allows the claimant the exclusive
right to mine and remove valuable minerals, such as precious and base metals
and industrial minerals, found therein, and also to use the surface of the land
solely for purposes related to mining and processing the mineral-bearing ores.
However, legal ownership of the land remains with the U.S. Accordingly, with an
unpatented claim, the U.S. retains many of the incidents of ownership of land,
the U.S. regulates use of the surface, and the Company remains at risk that the
claims may be forfeited either to the U.S. or to rival private claimants due to
failure to comply with statutory requirements as to location and maintenance of
the claims. If there exists a valuable deposit of locatable minerals (which is
the requirement for the unpatented claim to be valid in the first place), and
provided certain levels of work and improvements have been performed on an
unpatented mining claim, the Mining Law of 1872 authorizes claimants to then
seek to purchase the full title to the claim, thereby causing the claim to
become the private property of the claimant. Such full ownership expands the
claimant's permissible uses of the property (to any use authorized for private
property) and eliminates the need to comply with maintenance and reporting
requirements necessary to protect rights in an unpatented claim.
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<PAGE> 9
Because the Company believes that it has established the existence of
valuable mineral deposits in certain of its properties, and has maintained and
improved the claims in the manner required by law, it has sought to enhance its
rights in those properties by seeking issuance of mineral patents. In July of
1992, the Company caused four applications for mineral patent for the 20 lode
mining claims comprising the then-known ore reserves at the Briggs property to
be filed with the Bureau of Land Management ("BLM"). However, due to
administrative backlogs in the California State Office of the BLM, processing
of those applications has not proceeded. On December 30, 1993, the Company
caused five applications for mineral patent for the 15 placer mining claims
which encompass known ore reserves on public lands for the diatomite operations
conducted by the Company's subsidiary, CR Minerals, to be filed with the Nevada
State Office of the BLM. Those applications have been processed to the point
where the purchase price for the claims has been accepted.
On October 1, 1994, while the patent applications were pending,
Congress imposed a moratorium on accepting and processing mineral patent
applications within the Department of the Interior. Under the terms of the
continuing statutory moratorium (as interpreted by the Secretary of the
Interior), and solely as a result of the actions or inactions of the respective
state offices prior to the time the moratorium became effective, the Secretary
considers the California applications not to be exempt from the moratorium, and
therefore will not allow them to be processed while the moratorium remains in
effect, but the Nevada applications are considered exempt and should be
adjudicated. The Company instituted litigation in the U.S. District Court for
the District of Nevada to attempt to force the Secretary to construe all of the
applications as exempt from the moratorium and to diligently process all of
them, either by granting patents or by contesting the claims. However, the
Court has declined to compel the Secretary to expedite processing of the
applications. The Court's decision does not determine the validity of the
claims, nor does it directly affect the Company's basic ability to conduct
mining operations on the claims.
The Company has no reason to believe that grounds exist for denial of
any of the patents when and if they are ultimately adjudicated. However, there
can be no assurance that such patents will be granted.
Proposed Legislation Affecting the Mining Industry. For the last
several Congressional sessions, bills have been repeatedly introduced in the
U.S. Congress which would supplant or radically alter the provisions of the
Mining Law of 1872. As of September 1, 1996, no such bills have passed. If
enacted, such legislation could substantially increase the cost of holding
unpatented mining claims and could impair the ability of companies to develop
mineral resources on unpatented mining claims. Under the terms of certain
proposed legislation, the ability of companies to obtain a patent on unpatented
mining claims would be nullified or substantially impaired. Moreover, certain
forms of such proposed legislation contain provisions for the payment of
royalties to the federal government in respect of production from unpatented
mining claims, which could adversely affect the potential for development of
such claims and the economics of operating existing mines on federal unpatented
mining claims. The Company's financial performance could therefore be affected
adversely by passage of such legislation. It is impossible to predict at this
point what any legislated royalties might be, but a potential three to four
percent gross royalty, assuming a gold price of $400 per ounce,
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<PAGE> 10
would have an approximated $12 to $16 per ounce impact on the Company's costs
of production from unpatented mining claims.
SPECIFIC RISKS RELATED TO THE COMPANY
Permitting Risks at the McDonald Facilities. Mining activity in the
United States is subject to the granting of numerous permits under applicable
Federal and State statutes, including, but not limited to, the National
Environmental Policy Act, the Clean Water Act, the Clean Air Act, and the
Montana Environmental Policy Act. It is not legal to engage in mining activity
without securing the permits required by these and other statutes. Initiation
of gold production at the McDonald project will thus require the granting of
numerous permits, some of which are discretionary.
Major permits include the Operating Permit from the Montana Department
of Environmental Quality (DEQ), the Operating Plan from the Montana Department
of Natural Resources and Conservation (DNRC), the Air Quality Permit (DEQ), the
Montana Pollutant Discharge Elimination System Permit (DEQ), a Non-Degradation
Authorization (DEQ), a Stormwater Discharge Permit (DEQ), a Water Rights Permit
(DNRC), a Section 404 Dredge and Fill Permit from the U.S. Army Corps of
Engineers (COE), and a Fiscal Impact Plan which must be approved by the Montana
Hard Rock Impact Board and numerous local government units.
An Environmental Impact Statement (EIS) is currently being prepared by
three co-lead agencies, DEQ, DNRC, and COE. This EIS will be used to support
all of the major permit decisions. Agency decisions on the permits are
anticipated to be forthcoming by the end of 1997. In April 1996, certain
environmental groups brought an action against the DEQ challenging its
determination in March of 1996 that the permit application for the McDonald
Project is complete. In addition, certain environmental groups have qualified
an initiative petition related to water quality regulation for placement on
the ballot during the general election in Montana in November of 1996. If
passed in the election in November, such an initiative could have a materially
adverse effect on the permitting process at McDonald. No assurance can be given
that such permits will be issued, or if issued, in what time frame such
issuance would occur.
Permitting, Construction and Start-up Risk at the Briggs Project. The
Company has received all of its permits and approvals for the development and
operation of the Briggs Project, and has obtained financing estimated to cover
100% of project development costs of $34 million for construction of project
facilities and $10 million for mining equipment. However, the granting of
certain of the permits has been appealed. Although the Company believes that
each of the appeals will be dismissed, no assurance can be given that one or
more of the appeals might not be successful in overturning the granting of a
permit. Construction commenced in December 1995, with project start-up and
commercial gold production scheduled to commence in the second half of 1996 at
a production rate of approximately 75,000 ounces of gold per year. However, no
assurance can be given that the project will be constructed and placed into
production successfully or within either the time frame or capital costs
described above.
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Limited Remaining Life of the Kendall Mine. The Company's principal
revenue and income producing asset is the Kendall Mine, located near Lewistown,
Montana. The Kendall Mine has produced over 300,000 ounces of gold. Mining
activity at the Kendall Mine ceased in January, 1995, and the Company estimates
that gold produced by the Kendall Mine will no longer be sold profitably after
1996. Thus, the ability of the Company to generate increased revenues or
earnings is dependent on its ability to bring into production additional
facilities, such as the Briggs Mine.
Uncertainty of Funding for Exploration. Prior to 1986, the Company
funded its exploration and acquisition activities through joint venture
arrangements, which minimized the cost of such activities to the Company and
allowed it to explore and acquire a greater number of properties than it would
otherwise have been able to explore or acquire on its own. Since 1986, the
Company has funded a portion of its exploration activities without joint
venture participation, resulting in increased costs to the Company. The
Company has been successful in raising such funds for its exploration
activities. Additional funding from existing partners or third parties,
however, may be necessary to conduct detailed and thorough evaluations of, and
to develop certain properties. The Company's ability to obtain this financing
will depend upon, among other things, the price of gold and the industry's
perception of its future price. Therefore, availability of funding is
dependent largely upon factors outside of the Company's control, and cannot be
accurately predicted. The Company does not know from what sources it will
derive any required funding. If the Company is not able to raise additional
funds (as to which there can be no assurance), it will not be able to fund
certain exploration activities on its own.
Uncertainty of Funding for Production. The Company believes that its
producing properties have been adequately financed for current and ongoing
production. If the Company's continuing exploration and/or development
activities indicate economically minable ore on other properties now owned or
hereafter acquired by the Company, however, the Company will be required to
expend potentially large sums to put such properties into production. The
amount of such financing could be reduced if the Company sells assets or enters
into joint ventures on one or more of its properties. The Company may need to
seek additional funding for the Seven-Up Pete/McDonald project. The
development capital budget for the Seven-Up Pete/McDonald Project will be
determined on an annual or longer basis pursuant to the budgetary approval
process between Phelps Dodge Exploration, Inc., the operator and majority
participant in the joint venture, and the Company, in accordance with the
Seven-Up Pete Venture Agreement previously filed as an exhibit to the Company's
Reports on Form 10-K filed with the Securities and Exchange Commission.
The Seven-Up Pete Venture Agreement provides for Phelps Dodge, as the
manager of the venture, to submit a proposed budget for review by the venture
participants at least two months prior to the period to be covered by the
budget. Within thirty days of submission of the proposed budget, the
non-managing participant has the option to approve the proposed budget as
submitted or propose modifications to it, in which case the participants must
seek to develop a budget which is mutually acceptable in accordance with the
procedures of the Seven-Up Pete Venture Agreement.
Within twenty days of a final vote adopting a budget, which vote is
determined by an affirmative vote of the majority of the participating
interests, each party can elect to participate to the
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full extent of its participating interest in such budget, or in some lesser
amount. If a participant elects to contribute to a budget in an amount less
than its full participating interest, its participating interest will
thereafter be reduced in proportion to the total contributions made by both
parties up to the time of the election, together with the amounts elected to be
contributed to such budget, all in accordance with the formula established in
the Seven-Up Pete Venture Agreement. If a participant defaults in making a
required contribution to an adopted budget, the non-defaulting participant has
the option to advance the amount of default on behalf of the defaulting
participant as a demand loan, or to have the defaulting participant's
participating interest reduced in relation to the amounts contributed by the
parties; provided that the defaulted amount shall be subtracted from the
defaulting participant's previous contributions in calculating the
participant's new interest.
In the event a development capital budget is approved which calls for
amounts to be contributed by the Company in excess of that which the Company is
able to expend, the Company may be subject to a dilution of its interest as
described above. There can be no assurance that additional funding would be
available to meet the Company's needs in avoiding dilution. It is estimated
that the initial capital costs for the McDonald Project would be approximately
$188 million. The Company's 27.75% share of that amount would be approximately
$52 million. However, the Company believes that project financing on reasonable
terms could be obtained for the McDonald Project for at least 70% or more of
the initial capital cost requirements. In that event, the Company's share of
the remaining 30% of the initial capital cost requirements would be
approximately $16 million in order to retain its current participating interest
of 27.75%. The total amounts spent to date on the McDonald Project are in
excess of $24 million, of which the Company has expended 27.75%, or
approximately $6.7 million.
Uncertainty of Development and Operating Property Economics and Ore
Grades at Development Properties. Decisions as to whether any of the mineral
development properties which the Company now holds or which it may acquire in
the future contain commercially minable deposits, and whether such properties
should therefore be brought into production, depend upon the results of
exploration programs and/or feasibility analyses and the recommendations of
duly qualified engineers or geologists. Such decisions involve consideration
and evaluation of several significant factors, including, but not limited to,
the (a) costs of bringing a property into production, including exploration and
development work, preparation of production feasibility studies and
construction of production facilities, (b) availability and costs of financing,
(c) ongoing costs of production, (d) market prices for the mineral to be
produced, and (e) the amount and grades of reserves or mineralized material.
There can be no assurance that any of the development properties now held by
the Company, or which may be acquired by the Company, contains a commercially
minable mineral deposit, and therefore no assurance that the Company will ever
generate a positive cash flow from production operations on such properties.
The potential development properties and the properties under construction on
which minable reserves have been defined include the Seven-Up Pete/McDonald
deposits in Montana and the Briggs Project in California. There can be no
assurance that these development properties can attain profitable operations.
Both the Briggs and McDonald Projects have predicted average gold grades (.030
and .034 ounces per ton, respectively) less than the average grade produced
during mining operations at the Kendall Mine since 1990 of .051 ounces per ton.
In addition, once a property is placed into production, risks still exist that
the amount and
10
<PAGE> 13
grade of its reserves will not actually be as predicted. To the extent that
lower amounts and/or grades of reserves are experienced, costs per unit
produced and profitability can be adversely affected. Depending upon the extent
of such an effect in any of the Company's properties, the Company could incur a
writedown on its investment in any such property.
No Dividends. For the foreseeable future, it is anticipated that the
Company will use any earnings to finance its growth and that dividends will not
be paid to shareholders. Further, pursuant to the Guarantee, Equity
Contribution and Pledge Agreement dated as of December 6, 1995 ("Guarantee
Agreement") executed by the Company in favor of its wholly owned subsidiary, CR
Briggs Corporation, in connection with the Loan Agreement of the same date
("Loan Agreement") for the Briggs Project with Banque Paribas and others, the
Company has agreed to maintain certain levels of working capital, tangible net
worth, and leverage ratios and make equity contributions to complete the Briggs
Project in the event of cost overruns in excess of the $6 million currently
available for such purpose, which could restrict the payment of dividends where
such payment would result in a failure to maintain such levels or make such
contributions. See Items 5 and 7 and Notes 6 and 7 to the Financial Statements
in the Company's Report on Form 10-K for the period ending December 31, 1995
filed with the Securities and Exchange Commission. In particular, the Company,
at any time during the term of the Guarantee Agreement, must maintain a
tangible net worth of not less than $38 million; a working capital ratio of the
aggregate current assets to aggregate current liabilities of the Company and
its subsidiaries of at least 1.75 to 1.0; and must maintain a leverage ratio,
defined as the ratio of total liabilities to tangible net worth, of at least
1.22 to 1. Similarly, CR Briggs Corporation is prohibited from repaying the
Company for advances or from paying dividends to the Company from the Briggs
Project revenues unless certain conditions relating to the financial
performance of the Briggs Project are met. These conditions and the financial
performance are referred to in Notes 6 and 7 to the Financial Statements
included in the Company's Report on Form 10-K for the period ending December
31, 1995 filed with the Securities and Exchange Commission. In addition to
those conditions specifically discussed in Notes 6 and 7, CR Briggs Corporation
must maintain a future debt cover ratio, defined as the net present value of
the future cash flow for the Briggs Project to the aggregate outstanding
principal amount of loans remaining to be paid on any given date, of at least
1.5 to 1 in order to be able to make any dividend or other payment to the
Company from the proceeds of the Briggs Project. The Company is currently in
compliance with all of the above-described conditions of the Loan Agreement and
the Guarantee Agreement and believes it will be able to stay in compliance
throughout the term of such agreements; however, no assurance can be provided
that the Company will always be in complete compliance with all such
conditions.
Lack of Profitability. The Company's operating history has resulted
in losses from operations in the fiscal years ending December 31, 1993, 1994
and 1995. While certain of the Company's operations may be profitable during a
given fiscal year, the Company's operations as a whole may be unprofitable due
to exploration and development costs on properties from which no revenue is
derived, to continuing corporate general and administrative costs and to
interest expense associated with long term debt.
11
<PAGE> 14
Change in Control Provisions. Effective June 15, 1989, the Company's
shareholders adopted certain measures designed to make it more difficult and
time-consuming to change majority control of the Company's Board of Directors
and to reduce the vulnerability of the Company to an unsolicited offer to take
over the Company, particularly an offer which does not contemplate the
acquisition of all the Company's outstanding shares or which does contemplate
the restructuring or sale of all or part of the Company. These measures
included (i) classification of the Board of Directors into three classes, each
class to serve for three years, (ii) a provision that the Company's directors
may be removed only for cause and only with the approval of the holders of at
least 66-2/3% of the voting power of the Company entitled to vote for the
election of directors, (iii) a provision that any vacancy on the Board may be
filled by the remaining directors then in office, though less than a quorum,
and (iv) a provision requiring a 66-2/3% shareholder vote to amend or repeal,
or to adopt any provision inconsistent with the foregoing measures. The
foregoing measures may have certain negative consequences, including an affect
on the ability of shareholders of the Company or other individuals to (i)
change the composition of the incumbent board of directors; (ii) benefit from
certain transactions which are opposed by the incumbent board of directors;
(iii) make a tender offer or otherwise attempt to gain control of the Company,
even if such attempt was beneficial to the Company and its shareholders. Since
such measures may also discourage accumulations of large blocks of the
Company's stock by purchasers whose objective is to have such stock repurchased
by the Company at a premium, they could tend to reduce the temporary
fluctuations in the market price of the Company's stock which are caused by
such accumulations. Accordingly, shareholders may be deprived of certain
opportunities to sell their stock at a temporarily higher market price. The
provisions relating to the removal of directors and the filling of vacancies
will reduce the power of shareholders, even those with a majority interest in
the Company, to remove incumbent directors and to fill vacancies on the board
of directors.
Volatility of Price for Common Stock. The market price for shares of
the Company's Common Stock may be highly volatile depending on news
announcements or changes in general market conditions. In recent years the
stock market has experienced extreme price and volume fluctuations.
Gold Prices over the Last Five Years. The following table shows the
COMEX Gold month-end closing price for the last five years and seven months:
<TABLE>
<CAPTION>
COMEX GOLD MONTH-END CLOSING PRICE
----------------------------------
YEAR JAN. FEB. MAR. APR. MAY JUN. JUL. AUG. SEPT. OCT. NOV. DEC.
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1991 $382 $383 $369 $367 $371 $377 $371 $353 $357 $359 $368 $354
1992 $368 $363 $352 $344 $342 $348 $361 $345 $349 $340 $334 $332
1993 $336 $334 $344 $361 $384 $383 $411 $376 $357 $370 $370 $387
1994 $392 $392 $402 $386 $396 $394 $389 $391 $398 $385 $381 $384
1995 $393 $392 $405 $399 $394 $392 $388 $387 $386 $384 $387 $387
1996 $406 $400 $396 $392 $391 $380 $388 ---- ---- ---- ---- ----
</TABLE>
12
<PAGE> 15
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the
Shares offered hereby. See "Selling Shareholders." Upon exercise of the
warrant to purchase 300,000 shares of the Company's Common Stock, the Company
will receive proceeds in the amount of $1,125,000.00.
SELLING SHAREHOLDERS
The 450,000 Shares registered for sale hereunder are comprised of
(i) 150,000 shares issued to one Selling Shareholder in connection with the
assignment to the Company of certain royalty rights; and (ii) 300,000 shares to
be issued to one Selling Shareholder upon the exercise by such Selling
Shareholder of a warrant to purchase 300,000 shares of the Company's Common
Stock at an exercise price of $3.75 per share. The Selling Shareholders own no
other securities of the Company and intend to offer for sale all of the Shares
registered hereunder.
PLAN OF DISTRIBUTION
The Selling Shareholders may, from time to time, offer the Shares
through dealers or brokers, who may receive compensation in the form of
commissions from the Selling Shareholders and/or the purchasers of the Shares
for whom they may act as agents. As of the date hereof, the Selling
Shareholders have not advised the Company that they have entered into any
agreement or understanding with any dealer or broker for the offer or sale of
the Shares. The Selling Shareholders may enter into such agreements or
understandings in the future. The Selling Shareholders may also offer some or
all of the Shares through market transactions on ("AMEX"), on which the
Company's Common Stock is traded. Sales of the Shares through brokers may be
made by any method of trading authorized by AMEX, including block trading in
negotiated transactions. Without limiting the foregoing, such brokers may act
as dealers by purchasing any or all of the Shares covered by the Prospectus.
Sales of Shares are, in general, expected to be made at the market price
prevailing at the time of each such sale; however, prices in negotiated
transactions may differ considerably. Neither Selling Shareholder has advised
the Company that it anticipates paying any consideration, other than usual and
customary broker's commissions, in connection with sales of the Shares. The
Selling Shareholders are acting independently of the Company in making
decisions with respect to the timing, manner and size of each sale.
LEGAL MATTERS
Certain legal matters with respect to the legality of the
securities offered hereby and the organization and existence of the Company
have been passed upon for the Company by Parcel, Mauro, Hultin & Spaanstra,
P.C., 1801 California Street, Suite 3600, Denver, Colorado 80202.
13
<PAGE> 16
EXPERTS
The consolidated financial statements of the Company as of
December 31, 1995 and 1994 and for the three years in the period ended December
31, 1995, which are incorporated by reference in this Prospectus, have been
audited by Coopers & Lybrand L.L.P., independent public accountants, as
indicated in their report which includes an explanatory paragraph regarding the
Company's change in accounting for impairments of long-lived assets, dated
March 27, 1996, with respect thereto, and are incorporated herein by reference
in reliance upon the authority of said firm as experts in accounting and
auditing.
The Engineering Report by Davy International referred to in the
Company's Annual Report on Form 10-K, which is incorporated by reference in
this Prospectus, has been included herein in reliance on their report, given on
the authority of that firm as experts in mining engineering.
The "Fatal Flaw Review" and Executive Summary prepared by Roberts
& Schaefer Company for the Company's Feasibility Study at Briggs, referred to
in the Company's Annual Report on Form 10-K, which is incorporated by reference
in this Prospectus, has been included herein in reliance on their report, given
on the authority of that firm as experts in mining and processing engineering.
The "Fatal Flaw Review" of the ore reserves, mine plan, and
mining capital and operating costs prepared by Mine Reserves Associates, Inc.
for the Company's Feasibility Study at Briggs, referred to in the Company's
Annual Report on Form 10-K, which is incorporated by reference in this
Prospectus, has been included herein in reliance on their review, given on the
authority of that firm as experts in geology and reserves.
The review of the environmental and permitting aspects of the
Company's Feasibility Study at Briggs performed by Remy and Thomas, Attorneys
at Law, referred to in the Company's Annual Report on Form 10-K, which is
incorporated by reference in this Prospectus, has been included herein in
reliance on their review, given on the authority of that firm as experts in
California environmental law.
The additional opinion on the gold recovery at Briggs provided by
Chamberlin & Associates, as referred to in the Company's Annual Report on Form
10-K, which is incorporated by reference in this Prospectus, has been included
herein in reliance on their opinion, given on the authority of that firm as
experts in metallurgical engineering.
14
<PAGE> 17
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table sets forth the various expenses payable by the Registrant
in connection with the sale and distribution of the securities being
registered. All of the amounts shown are estimated except for the Securities
and Exchange Commission registration fee.
<TABLE>
<S> <C>
SEC registration fee $442.24
Printing and mailing $1,000.00
expenses
Legal fees and $3,000.00
expenses
Accounting fees and $3,500.00
expenses
Total* $7,942.24
</TABLE>
*All amounts are estimated other than the SEC registration fee.
Item 14. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law provides as
follows:
145. INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS;
INSURANCE. (a) A corporation may indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon
15
<PAGE> 18
a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(b) A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the act that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit was
brought shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the Court
of Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or
agent of a corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in subsections (a) and
(b) of this section, or in defense of any claim, issue or matter therein, he
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) of
this section (unless ordered by a court) shall be made by the corporation only
as authorized in the specific case upon a determination that indemnification of
the director, officer, employee or agent is proper in the circumstances because
he has met the applicable standard of conduct set forth in subsections (a) and
(b) of this section. Such determination shall be made (1) by a majority vote
of the directors who are not parties to such action, suit or proceeding, even
though less than a quorum, or (2) if there are no such directors, or if such
directors so direct, by independent legal counsel in a written opinion, or (3)
by the stockholders.
(e) Expenses (including attorney's fees) incurred by an
officer or director in defending any civil, criminal, administrative or
investigative action, suit or proceeding may be paid by the corporation in
advance of the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of such director or officer to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this section. Such expenses
(including attorney's fees) incurred by other employees and agents may be so
paid upon such terms and conditions, if any, as the board of directors deems
appropriate.
16
<PAGE> 19
(f) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested director or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.
(g) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or arising out
of his status as such, whether or not the corporation would have the power to
indemnify him against such liability under this section.
(h) For purposes of this section, references to "the
corporation" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed
in a consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers, and
employees or agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was serving at the
request of such constituent corporation as director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise,
shall stand in the same position under this section with respect to the
resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
(i) For purposes of this section, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on a person with respect to any employee
benefit plan; and references to "serving at the request of the corporation"
shall include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in a
manner he reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the corporation" as referred to in
this section.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
(k) The Court of Chancery is hereby vested with exclusive
jurisdiction to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement, vote
of stockholders or disinterested directors, or otherwise. The Court of
Chancery may summarily determine a corporation's obligation to advance expenses
(including attorney's fees).
17
<PAGE> 20
Article VI of the Registrant's Bylaws provides as follows:
The corporation, to the fullest extent permitted by the General
Corporation Law of the State of Delaware and by the common law of the State of
Delaware, shall indemnify each person who is or was an officer, director or
employee of the corporation acting in his capacity as such and may indemnify
each person who is or was an agent of the corporation acting in his capacity as
such. The indemnification rights provided by this Article VI are deemed a
contract between the corporation and its officers, directors, and employees,
and any repeal or modification of those rights will not affect any right of
such persons to be indemnified against claims relating to events occurring
prior to such repeal or modification. To assure indemnification under this
Article VI of all such persons who are or were "fiduciaries" of an employee
benefit plan governed by the Act of Congress entitled "Employee Retirement
Income Security Act of 1974," as amended from time to time, Section 145 of said
statute shall, for the purposes hereof, be interpreted as follows: "other
enterprise" shall be deemed to include an employee benefit plan; the
corporation shall be deemed to have requested a person to serve an employee
benefit plan where the performance by such person of his duties to the
corporation also imposes duties on, or otherwise involves services by, such
person to the plan or participants or beneficiaries of the plan; excise taxes
assessed on a person with respect to an employee benefit plan pursuant to said
Act of Congress shall be deemed "fines"; and action taken or omitted by a
person with respect to an employee benefit plan in the performance of such
person's duties for a purpose reasonably believed by such person to be in the
interest of the participants and beneficiaries of the plan shall be deemed to
be for a purpose which is not opposed to the best interests of the corporation.
Article TWELFTH of the Registrant's Certificate of Incorporation
provides as follows:
No director of the corporation shall be liable to the corporation
or its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty of
loyalty to the corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
the law, (iii) for paying dividends or approving a stock purchase or redemption
which is illegal or otherwise impermissible or prohibited under the Delaware
General Corporate Law, or (iv) for any transaction from which the director
derived an improper personal benefit.
The effect of the foregoing provisions is to permit, under
certain circumstances, indemnification of the Company's officers and directors
for civil and criminal liability, such as negligence, gross negligence, and
breach of duty, so long as such person acted in good faith in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, and which he reasonably believed to be lawful.
18
<PAGE> 21
Item 15. Exhibits.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
3.1 Amended Certificate of Incorporation of the Company (1)
3.2 Bylaws of the Company, as amended (1)
4.1 Specimen Common Stock Certificate (2)
5.1* Opinion of Parcel, Mauro, Hultin & Spaanstra, P.C. as to the legality of the Shares.
23.1* Consent of Coopers & Lybrand L.L.P.
23.2* Consent of Davy International
23.3* Consent of Roberts and Schaefer Company
23.4* Consent of Mine Reserves Associates, Inc.
23.5* Consent of Remy and Thomas
23.6* Consent of Chamberlin & Associates
23.7* Consent of Parcel, Mauro, Hultin & Spaanstra, P.C. (contained in Exhibit 5.1)
</TABLE>
* Filed herewith
- ---------------------------------------------
(1) Incorporated by reference from the Company's Registration
Statement on Form S-3 as declared effective by the Securities
and Exchange Commission on May 14, 1996.
(2) Incorporated by reference from the Company's Registration
Statement on Form 8-A as declared effective by the Securities and
Exchange Commission on March 18, 1986.
Item 16. Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement
to include any material information with
19
<PAGE> 22
respect to the plan of distribution not previously disclosed in
the registration statement or any material change to such
information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post- effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to
section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(5) That, insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
20
<PAGE> 23
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant hereby certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement and any amendment thereto to be signed
on its behalf of the undersigned, thereunto duly authorized, in the City of
Golden, State of Colorado on September 6, 1996.
CANYON RESOURCES CORPORATION
Date: September 6, 1996 /s/ Richard H. DeVoto
-----------------------------
Richard H. De Voto
Principal Executive Officer
Date: September 6, 1996 /s/ Gary C. Huber
-----------------------------
Gary C. Huber
Principal Financial and
Accounting Officer
Pursuant to the requirements of the Securities Exchange Act of 1933,
as amended, this Registration Statement and any amendment thereto has been
signed below by the following persons on behalf of the Company in the
capacities and on the dates indicated.
Date: September 6, 1996 /s/ Richard H De Voto
-----------------------------
Richard H. De Voto, Director
Date: September 6, 1996 /s/ Gary C. Huber
-----------------------------
Gary C. Huber, Director
Date: September 6, 1996 /s/ William W. Walker
-----------------------------
William W. Walker, Director
21
<PAGE> 24
Date: September 6, 1996 /s/ Paul A. Bailly
-----------------------------
Paul A. Bailly, Director
Date: September 6, 1996 /s/ Leland O. Erdahl
-----------------------------
Leland O. Erdahl, Director
Date: September 6, 1996 /s/ George W.Holbrook, Jr.
-----------------------------
George W. Holbrook, Jr.,
Director
Date: September 6, 1996 /s/ Frank M. Monninger
-----------------------------
Frank M. Monninger, Director
Date: September 6, 1996 /s/ William C. Parks
-----------------------------
William C. Parks, Director
Date: September 6, 1996 /s/ Christopher M.T. Thompson
-----------------------------
Christopher M. T. Thompson,
Director
Document No. 73543.2
22
<PAGE> 25
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
3.1 Amended Certificate of Incorporation of the Company (1)
3.2 Bylaws of the Company, as amended (1)
4.1 Specimen Common Stock Certificate (2)
5.1* Opinion of Parcel, Mauro, Hultin & Spaanstra, P.C. as to the legality of the Shares.
23.1* Consent of Coopers & Lybrand L.L.P.
23.2* Consent of Davy International
23.3* Consent of Roberts and Schaefer Company
23.4* Consent of Mine Reserves Associates, Inc.
23.5* Consent of Remy and Thomas
23.6* Consent of Chamberlin & Associates
23.7* Consent of Parcel, Mauro, Hultin & Spaanstra, P.C. (contained in Exhibit 5.1)
</TABLE>
* Filed herewith
<PAGE> 1
Exhibit 5.1
PARCEL, MAURO, HULTIN & SPAANSTRA, P.C.
1801 CALIFORNIA ST., STE. 3600
DENVER, CO 80202
(303) 292-6400
September 6, 1996
Canyon Resources Corporation
14142 Denver West Parkway, Suite 250
Golden, Colorado 80401
Re: Registration Statement on Form S-3
Covering the Registration of
450,000 Common Shares of
Canyon Resources Corporation
Gentlemen and Ladies:
We have acted as counsel for Canyon Resources Corporation, a Delaware
corporation (the "Company"), in connection with the registration for sale of
450,000 shares of the Company's Common Stock (the "Securities") in accordance
with the registration provisions of the Securities Act of 1933, as amended.
In such capacity we have examined, among other documents, the
Registration Statement on Form S-3 filed by the Company with the Securities and
Exchange Commission on or about September 6, 1996, as may be further amended
from time to time (the "Registration Statement"), covering the registration of
the Securities.
Based upon the foregoing and upon such further examinations as we have
deemed relevant and necessary, we are of the opinion that:
1. The Company is a corporation duly organized and validly
existing under the laws of the State of Delaware.
2. The Shares have been legally and validly authorized under the
Company's Certificate of Incorporation, as amended, and constitute (or will
constitute upon due exercise of the warrants as described in the Registration
Statement) duly and validly issued and outstanding and fully paid and
nonassessable shares of the Company.
<PAGE> 2
Canyon Resources Corporation
September 6, 1996
Page 2
We hereby consent to the use of our name beneath the caption "Legal
Matters" in the Prospectus forming a part of the Registration Statement and to
the filing of a copy of this opinion as Exhibit 5.1 thereto.
Very truly yours,
/s/ Parcel, Mauro, Hultin & Spaanstra, P.C.
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the Registration
Statement of Canyon Resources Corporation on Form S-3 of our report, which
includes an explanatory paragraph regarding the Company's change in accounting
for impairments of long-lived assets, dated March 27, 1996, on our audits of
the consolidated financial statements of Canyon Resources Corporation, as of
December 31, 1995 and 1994, and for the years ended December 31, 1995, 1994 and
1993. We also consent to the reference to our firm under the caption
"Experts."
/s/ Coopers & Lybrand, L.L.P.
Denver, Colorado
September 6, 1996
<PAGE> 1
Exhibit 23.2
Kvaerner Davy
2440 Camino Ramon
Murray N. Hutchison San Ramon, CA 94583
Senior Vice President Tel: (510) 866-1166
Telex: 470670
Fax: (510) 866-6520
August 27, 1996
Canyon Resources Corporation
14142 Denver West Parkway, Suite 250
Golden, CO 80401
Gentlemen:
We hereby consent to the incorporation by reference into the Registration
Statement of Canyon Resources Corporation (the "Company") on Form S-3 covering
the registration of 450,000 shares of the Company's common stock, of our Mine
Plan and Preliminary Feasibility Study dated September 1993 pertaining to the
Company's McDonald Property as referred to in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1995.
Very truly yours,
/s/Murray N. Hutchison
Murray N. Hutchison
MNH:smr
<PAGE> 1
Exhibit 23.3
ROBERTS & SCHAEFER COMPANY
Engineers & Contractors
Western Operation
5225 Wiley Post Way #300
Salt Lake City, Utah 84116
Phone: (801) 364-0900
Fax: (801) 364-0909
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August 27, 1996
Canyon Resources Corporation
14142 Denver West Parkway, Suite 250
Golden, CO 80401
Gentlemen:
We hereby consent to the incorporation by reference, into the Registration
Statement of Canyon Resources Corporation (the "Company") on Form S-3 governing
the registration of 450,000 shares of the Company's common stock, of our
reports entitled "Fatal Flaw Review of the Briggs Gold Project Feasibility
Study" and "Briggs Gold Project Feasibility Study - Volume 1 - Executive
Summary" both dated February 1994, as referred to in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1995.
Sincerely,
ROBERTS & SCHAEFER COMPANY
/s/Brian C. Petersen
Brian C. Petersen
Vice President of Operations
<PAGE> 1
Exhibit 23.4
MINE RESERVES ASSOCIATES, INC.
4860 Ward Road, Suite 202
Wheat Ridge, Colorado 80033-2122
Phone: (303) 421-9656 Fax: (303) 421-9470
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August 27, 1996
Canyon Resources Corporation
14142 Denver West Parkway
Suite 250
Golden, CO 80401
Gentlemen:
We hereby consent to the incorporation by reference into the Registration
Statement of Canyon Resources Corporation (the "Company") on Form S-3 covering
the registration of 450,000 shares of the Company's common stock, of our report
dated February 1994, pertaining to Ore Reserves and Mine Plan Review of the
Briggs Gold Project Feasibility Study as referred to in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1995.
Very truly yours,
MINE RESERVES ASSOCIATES, Inc.
/s/ William L. Rose
William L. Rose
Vice President and
Principal Mining Engineer
<PAGE> 1
Exhibit 23.5
REMY, THOMAS and MOOSE
Attorneys at Law
Michael H. Remy 455 Capitol Mall, Suite 210 Georganna Foondos
Tina A. Thomas Sacramento, California 95814 Land Use Analyst
James G. Moose
Whitman F. Manley (916) 443-2745
John H. Mattox FAX (916) 443-9017
Courtney A Kaylor
Danae J. Aitchison
Andrea M. Klein
September 5, 1996
Canyon Resources Corporation
14142 Denver West Parkway, Suite 250
Golden, Colorado 80401
To Whom It May Concern:
Remy, Thomas and Moose hereby consents to the incorporation by
reference into the Registration Statements of Canyon Resources Corporation (the
"Company") on Form S-3 covering the registration of 450,000 shares of the
Company's common stock, of its letter dated January 31, 1994, pertaining to the
discussion of environmental and permitting issues in the Briggs Gold Project
Feasibility Study as referred to in the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1995.
Very truly yours,
/s/ Michael H. Remy
Michael H. Remy
MHR:aj
<PAGE> 1
Exhibit 23.6
Chamberlin & Associates
- --------------------------------------------------------------------------------
7463 W. Otero Place
Littleton, CO 80123
Tele/FAX - 303-979-6753
August 27, 1996
Canyon Resources Corporation
14142 Denver West Parkway, Suite 250
Golden, CO 80401
Gentlemen:
We hereby consent to the incorporation by reference into the Registration
Statement of Canyon Resources Corporation (the "Company") on Form S-3 covering
the registration of 450,000 shares of the Company's common stock, of our report
dated February 1994, pertaining to metallurgy Review of the Briggs Gold Project
Feasibility Study as referred to in the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1995.
Very truly yours,
/s/ P. D. Chamberlin
CHAMBERLIN & ASSOCIATES
Paul D. Chamberlin
Owner
