<PAGE> 1
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. THESE
SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE
TIME A FINAL PROSPECTUS SUPPLEMENT AND ACCOMPANYING PROSPECTUS ARE
DELIVERED. THIS PRELIMINARY PROSPECTUS SUPPLEMENT AND ACCOMPANYING
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
OR OTHER JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE OR OTHER JURISDICTION.
FILED PURSUANT TO RULE 424(B)(3)
REGISTRATION NO. : 333-18449
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS SUPPLEMENT DATED DECEMBER 19, 1997
PROSPECTUS SUPPLEMENT
- ------------------------------------
(TO PROSPECTUS DATED JANUARY 7, 1997)
CANYON RESOURCES CORPORATION
UP TO U.S. $5,000,000
UP TO 5,000,000 SHARES OF COMMON STOCK
---------------------
All of the 5,000,000 shares (the "Shares") of common stock, $.01 par value
(the "Common Stock"), offered hereby are being sold by Canyon Resources
Corporation, a Delaware corporation (the "Company"). The minimum offering (the
"Minimum Offering") will consist of 2,500,000 shares with an aggregate purchase
price of $2,500,000. The maximum offering (the "Maximum Offering") will consist
of 5,000,000 shares with an aggregate purchase price of $5,000,000. The
Company's Common Stock is traded on the American Stock Exchange ("AMEX") under
the symbol "CAU." On December 17, 1997, the closing price for the Common Stock
as quoted on AMEX was $1.25. See "Market for the Company's Common Stock."
THE COMMON STOCK OFFERED HEREBY WILL BE FOREIGN PROPERTY FOR THE PURPOSES
OF PART XI OF THE INCOME TAX ACT (CANADA). SEE "CERTAIN CANADIAN FEDERAL INCOME
TAX CONSIDERATIONS."
---------------------
FOR A DISCUSSION OF CERTAIN MATTERS THAT SHOULD BE CONSIDERED BY PROSPECTIVE
PURCHASERS OF THE SECURITIES, SEE "PRINCIPAL RISK FACTORS" IN THE PROSPECTUS ON
PAGES 4 THROUGH 10 AND "RECENT DEVELOPMENTS" IN THIS PROSPECTUS SUPPLEMENT ON
PAGES S-4 THROUGH S-7.
---------------------
<TABLE>
<CAPTION>
==================================================================================================================
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC DISCOUNT(1) COMPANY(2)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Share.................. $1.00 $0.08 $0.92
- ------------------------------------------------------------------------------------------------------------------
Total Minimum.............. $2,500,000 $200,000 $2,300,000
- ------------------------------------------------------------------------------------------------------------------
Total Maximum.............. $5,000,000 $400,000 $4,600,000
==================================================================================================================
</TABLE>
(1) The Company has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under applicable securities laws. See
"Underwriting."
(2) Before deducting expenses payable by the Company estimated at $250,000.
---------------------
The Shares are being offered through RBC Dominion Securities Inc. (the
"Underwriter") and other broker-dealers selected by the Underwriter (the
"Selected Dealers"), subject to certain conditions, including the Company's
right to reject orders in whole or in part. Such offering is on a "best efforts,
all or none" basis with respect to the Minimum Offering and a "best efforts"
basis with respect to the remaining Shares, whereby the Underwriter has no firm
obligation to purchase any such Shares. The term of the offering will be until
the earlier of the sale of all of the Shares or until December 30, 1997, which
the Company and the Underwriter have the right to mutually extend for up to an
additional 30 days (the "Expiration Date"). All proceeds of the offering will be
held in escrow by , , Toronto, Canada, as escrow agent,
until the Minimum Offering is achieved. It is expected that delivery of the
Shares will be made in New York, New York as promptly as practicable following
the receipt of payment of the Minimum Offering and, thereafter, as promptly as
practicable following the receipt of payment for additional Shares.
RBC DOMINION SECURITIES INC.
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS , 1997
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES AT
LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE AMERICAN STOCK EXCHANGE OR OTHERWISE. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
EXCHANGE RATE INFORMATION
THE COMPANY PUBLISHES ITS CONSOLIDATED FINANCIAL STATEMENTS IN UNITED
STATES DOLLARS. IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS,
UNLESS OTHERWISE SPECIFIED OR THE CONTEXT OTHERWISE REQUIRES, ALL DOLLAR AMOUNTS
ARE EXPRESSED IN U.S. DOLLARS. ON NOVEMBER 6, 1997, THE INVERSE OF THE NOON
BUYING RATE AS REPORTED BY THE BANK OF CANADA WAS CDN. $1.00 = U.S. $.7134.
S-2
<PAGE> 3
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 precious metals and industrial minerals. 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.
The Company has gold and industrial mineral production operations in the
western United States. The Company also conducts mineral exploration activities
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 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 is prepared under direction of
one or more governmental agencies, prior to issuance of permits for the
construction of a mining operation.
The Company conducts its mineral exploration and development independently
and through joint ventures with other companies. 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 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 quoted on the Nasdaq Stock Market. Since August 19,
1996, the Company's common stock has been traded on AMEX.
The Company's principal executive office is located at 14142 Denver West
Parkway, Suite 250, Golden, Colorado 80401, telephone (303) 278-8464. The
Company, in doing business, acts on its own behalf and through its subsidiaries.
The "Company" or "Canyon" is also used herein to refer to Canyon Resources
Corporation together with all of its wholly-owned subsidiaries.
FORWARD-LOOKING STATEMENTS
Certain information contained in this Prospectus Supplement, the related
Prospectus and the documents incorporated by reference herein and therein
constitute "Forward-looking Statements" within the meaning of Section 27A of the
United States Securities Act of 1933, as amended (the "Securities Act"), and
Section 21E of the United States Securities Exchange Act of 1934, as amended
(the "Exchange Act"), which can be identified by the use of forward-looking
terminology such as "may," "will," "expect," "anticipate," "estimate" or
"continue" or the negatives thereof or other variations thereon or comparable
terminology. The statements in "Recent Developments" on pages S-4 through S-6 of
this Prospectus Supplement constitute cautionary statements identifying
important factors, including certain risks and uncertainties with respect to
such statements that could cause the actual results, performance or achievements
of the Company to differ materially from those reflected in such forward-looking
statements.
S-3
<PAGE> 4
RECENT DEVELOPMENTS
SEVEN-UP/MCDONALD PROJECT
On September 25, 1997, the Company, together with its wholly owned
subsidiary CR Montana Corporation ("CR Montana"), purchased a 72.25%
participating interest and underlying assets in the Seven-Up Pete Venture
("Venture") from CR Montana's partner in the Venture, Phelps Dodge Corporation
("Phelps Dodge"). The Company and its wholly-owned subsidiary now own 100% of
the Venture. The Venture includes the McDonald Gold Project near Lincoln,
Montana, which is currently in the permitting stage.
The Company has made an initial payment of $5 million from its existing
cash balance as part of a total purchase price which will be no less than $100
million and no more than $150 million, assuming all applicable permits for the
McDonald Gold Project are obtained. At present, the Company is pursuing various
options with respect to the remaining purchase price obligation which may
include, among others, sale of equity, mergers, or joint venture participation.
There can be no assurance, however, that any of these financing efforts will be
successful.
A discretionary payment of $20 million can be made to Phelps Dodge toward
the balance of the total purchase price for the interest in the Venture. Subject
to the Company making the discretionary payment within one year after the
closing, a further payment of at least $75 million but no more than $125 million
will be made once all permits for the McDonald Gold Project have been obtained
or construction is underway, based on a price of $20 per mineable reserve ounce
attributable to the former Phelps Dodge ownership interest as determined by a
final feasibility study. Should the Company not make the discretionary payment
and permits are obtained or construction commences on or before the second
anniversary of the closing, a further payment of at least $95 million plus the
product of $1,666,666 and the number of months between the first anniversary
date of the closing and the month in which permits are obtained or construction
commences but no more than $145 million will instead be made, based on a price
of $20 per mineable reserve ounce attributable to the former Phelps Dodge
ownership interest plus the product of $0.833 times the number of months between
the first anniversary date of the closing and the earlier to occur of (i) the
month when the discretionary or other payments reach $20 million, and (ii) the
month in which permits are obtained or construction commences. Should the
Company not make the discretionary payment and permits are obtained or
construction commences after the second anniversary of the closing, a further
payment of at least $115 million but no more than $145 million will instead be
made, based on a price of $30 per mineable reserve ounce attributable to the
former Phelps Dodge ownership interest. If the aggregate payments have then not
totaled $150 million, a varying production payment will be made each quarter
based on 72.25% of the ounces produced on a sliding scale commensurate with the
then gold price as follows: (i) $0 per ounce if the gold price is up to or equal
to $350.00 per ounce; (ii) $3 per ounce if the gold price is greater than
$350.00 but less than or equal to $375.00 per ounce; (iii) $5 per ounce if the
gold price is greater than $375.00 but less than or equal to $400.00 per ounce;
(iv) $7 per ounce if the gold price is greater than $400.00 but less than or
equal to $425.00 per ounce; and (v) $10 per ounce if the gold price is greater
than $425.00 per ounce. Production payments will cease when the aggregate of all
payments reaches $150 million.
Due to the contingent nature of the transaction, the Company has recorded
only the initial payment of $5 million as additions to mining claims and leases
in their balance sheet at September 30, 1997.
The purchase payments are secured only by the 72.25% participating interest
and underlying assets in the Venture transferred from Phelps Dodge to the
Company and CR Montana in this transaction, and the 50% co-tenancy interest in
certain real property also transferred to the Company and CR Montana.
PERMITTING RISKS AT THE MCDONALD FACILITIES
The Company now anticipates that agency decisions on the granting of
numerous permits necessary under applicable federal and state statutes for the
initiation of gold production at the McDonald Project will be forthcoming by the
first quarter of 1999. No assurance, however, can be given that necessary
permits will be issued, or if issued, when such issuance will occur.
S-4
<PAGE> 5
In April of 1996, certain environmental groups brought an action against
the Montana Department of Environmental Quality (the "DEQ") challenging its
determination in March of 1996 that the Company's permit application for the
McDonald Project was complete. This action has been dismissed and is not
reviewable by the courts. See the Prospectus, "Principal Risk
Factors -- Specific Risks Related to the Company -- Permitting Risks at the
McDonald Facilities."
CAHUILLA PROPERTY
In March 1997, Canyon entered into an agreement to purchase the Cahuilla
gold project, a gold-mineralized exploration property located in Imperial
County, California, from Kennecott Exploration Company ("Kennecott"). Pursuant
to the Agreement, the Company agreed to issue 100,000 shares of Common Stock to
Kennecott upon execution of the purchase agreement and another 100,000 shares
within 18 months. In addition, upon mine development, $10 per recoverable ounce
of gold, not to exceed $20 million, as determined by a feasibility study, would
be payable in Common Stock at the then share price.
Effective September 10, 1997, the Company and Kennecott entered into a
Mutual Release whereby each party agreed to release all of their respective
rights under the purchase agreement. The Company agreed that (i) it would not
acquire any interest in the Cahuilla Property for two years; and (ii) it would
pay Kennecott $116,000 in cash and 50,000 shares of the Company's Common Stock
upon execution of the Mutual Release.
BRIGGS MINE
The Briggs Mine in southeastern California achieved commercial production
in March of 1997. For the period March 1997 through September 1997, 43,638
ounces of gold were produced at cash operating costs averaging $272 per ounce.
Gold was sold during the period at an average price of $397 per ounce. At
September 30, 1997, the Company's hedge position consisted of 215,503 ounces of
forward contracts, gold loans and put options which will be delivered at prices
averaging $414 per ounce.
In December 1995, CR Briggs Corporation, a wholly-owned subsidiary of
Canyon, entered into a loan agreement for financing the Briggs Mine. The project
construction was completed in early 1997, and formal completion testing was
initiated February 1, 1997. The testing covered a period of 120 days during
which certain production and economic parameters were measured against values
contained in the project's original feasibility study. Final completion tests
have not yet been achieved. Many individual items have been satisfied, however,
certain items, principally relating to the crushing plant, will require
additional time to complete. Gold ore at the Briggs Mine undergoes three stages
of crushing. The Company is testing cone crushers to replace the originally
installed tertiary Vertical Shaft Impact crushers and initial indications from
these tests are favorable. Because some of these tests involve leach
characterization of a crushed product, the results from testing can take more
than 60 days to be received. The lenders have granted an extension to June 1,
1998 to satisfy the completion test requirements and the Company anticipates it
will achieve project completion by that date.
In May 1997, the Company completed a drilling program which has increased
the mineable reserves at the Briggs Mine by 318,700 ounces, representing a 49%
increase of the initial 653,000-ounce Briggs reserve, yielding a total mineable
reserve at Briggs of 971,700 ounces of gold. The reserves were increased by
systematic drilling of the Goldtooth and North Briggs targets, immediately to
the south and north, respectively, of the Briggs Mine. At North Briggs, 151
drillholes (48,640 feet) defined 3.6 million tons of reserves, averaging 0.054
ounce of gold per ton and containing 193,000 ounces of gold, which can be mined
with a 7.8:1 strip ratio. The North Briggs reserves occur subparallel to the
topography, along a low-angle detachment fault, with increased thickness of
mineralization eastward approaching the high-angle regionally persistent
Goldtooth fault. The gold mineralized structure at North Briggs is still open to
the northeast and east.
At Goldtooth, 132 drillholes (38,668 feet) have defined 2.9 million tons of
reserves, which average 0.043 ounce of gold per ton and contain 125,700 ounces
of gold, which can be mined with a 5.4:1 strip ratio. The Goldtooth reserves
occur primarily in steeply dipping orientation within favorable rock units
adjacent to the Goldtooth fault.
S-5
<PAGE> 6
PANAMINT RANGE DRILLING
In May 1997, the Company completed reconnaissance drilling of a few other
gold targets in its 17,000-acre claim block in the Panamint Range, which
includes the Briggs Mine. The drilling program discovered, in four holes, two
mineralized horizons at the Pleasant Canyon target which appear to extend from
the surface to depths of at least 500 feet. The intercepts include 65 feet of
0.068 ounce of gold per ton in one hole and 50 feet of 0.048 ounce of gold per
ton in another hole. These early drill results at the Pleasant Canyon target
represent a new gold discovery that the Company will assess further with much
additional drilling.
ENVIRONMENTAL CONTROLS -- KENDALL MINE
During the fourth quarter of 1996, the Company recorded a charge of $1.4
million based on an update to the anticipated scope of reclamation work for
water quality compliance and long term monitoring requirements at its Kendall
Mine. The Company's current estimate of total costs to achieve mine closure is
$5.6 million; however, the Company is currently reviewing these costs and such
estimate may increase. Reclamation costs through September 30, 1997, total $3.8
million. See Prospectus, "Principal Risk Factors -- General Risks Related to the
Mining Industry -- Environmental Controls."
PROPOSED CHANGES IN MINING LAWS
During the last several Congressional sessions, bills have been repeatedly
introduced in the U.S. Congress that would supplant or radically alter the
provisions of the General Mining Law of 1872. As of December 18, 1997, no such
bills had been passed. If enacted, such legislation could substantially increase
the cost of holding unpatented mining claims and could impair the ability of the
Company to develop mineral resources on unpatented mining claims.
Recently, the Secretary of the Interior directed the Bureau of Land
Management to form a task force to prepare and publish for public comment
revisions to the hardrock mining surface management regulations implemented in
1981. The Secretary suggested that the revised regulations address, for example,
implementation of a technology based standard in hardrock mining, development of
performance standards for hardrock mining and reclamation, increased regulation
of operations of less than five acres, and increased coordination with state
regulators. As of December 18, 1997, no such regulations had been proposed or
promulgated. If promulgated, such regulations could impair the ability of the
Company to economically develop mineral resources on federal lands.
The extent of the changes, if any, which may be made by Congress to the
General Mining Law or by the Bureau of Land Management to the surface mining
regulations is not currently known and the potential impact on the Company as a
result of future Congressional action is not currently determinable.
LEGAL PROCEEDINGS
On November 13, 1995, an appellant group including the Timbisha Shoshone
Indian Tribe and Desert Citizens Against Pollution (collectively, the
"Appellants") filed a petition for Writ of Mandate and complaint for injunctive
relief in California Superior Court challenging the approval of the Mine
Reclamation Plan for the Briggs Mine. The Court denied Appellants' request for a
temporary restraining order and found in favor of the Company on the motion for
preliminary injunction and the Writ of Mandate. Appellants have appealed the
Superior Court ruling to the California Court of Appeals.
On December 23, 1996, Appellants filed an administrative appeal with the
U.S. Department of the Interior challenging the approval of a Plan of Operations
for exploration within the Briggs claim block. This appeal has been resolved in
the Company's favor. This decision concludes the proceeding before the Interior
Department.
On February 13, 1997, Appellants filed a petition for Writ of Mandate and
complaint for injunctive relief in California Superior Court challenging the
approval of the Mine Reclamation Plan for exploration within the Briggs claim
block. The Court denied Appellants' request for temporary restraining order and
issued a decision in favor of the Company on the motion for preliminary
injunction and the Writ of Mandate.
S-6
<PAGE> 7
GOLD PRICES OVER THE LAST FIVE YEARS
Gold prices tend to fluctuate significantly. The following table shows the
COMEX Gold month-end closing price for the last five years and eleven 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> <C> <C> <C> <C>
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 $387 $378 $378 $373 $368
1997 $345 $365 $351 $340 $345 $334 $324 $325 $334 $311 $297
</TABLE>
USE OF PROCEEDS
The Company intends to use the net proceeds of this offering ($4,350,000 in
the case of a Maximum Offering and $2,050,000 in the case of a Minimum Offering,
in each case after deducting Underwriter commissions and estimated offering
expenses) to fund expenditures for its Seven-Up/McDonald Project and for general
corporate purposes. The Company anticipates such proceeds will be used as
follows:
<TABLE>
<CAPTION>
PROJECT MAXIMUM OFFERING MINIMUM OFFERING
------- ---------------- ----------------
<S> <C> <C>
Seven-Up/McDonald Project........................... $3,000,000 $1,500,000
General Corporate................................... 1,350,000 550,000
---------- ----------
Total..................................... $4,350,000 $2,050,000
========== ==========
</TABLE>
The foregoing table is only an estimate of the manner in which funds will
be expended. Actual expenditures may vary substantially. In addition, if
management of the Company determines at any point in time that results for a
project do not merit further expenditure of additional funds, then management
will have the discretion to change the uses of such proceeds.
CAPITALIZATION
The following table sets forth as at September 30, 1997, (i) the actual
capitalization of the Company and (ii) the capitalization of the Company as
adjusted for each of the Maximum Offering and the Minimum Offering to give
effect to the sale of the Shares offered hereby.
<TABLE>
<CAPTION>
AS ADJUSTED
---------------------------------------
ACTUAL (MINIMUM OFFERING) (MAXIMUM OFFERING)
-------- ------------------ ------------------
(IN THOUSANDS)
---------------------------------------------------
<S> <C> <C> <C>
Debt:
Notes Payable........................ $ 32,570 $ 32,570 $ 32,570
Shareholders' Equity
Preferred stock, $0.01 par value,
10,000,000 shares authorized; none
outstanding Common stock, $0.01
par value, 100,000,000 shares
authorized; 41,082,100 shares
outstanding and 43,582,100
(Minimum Offering) and 46,082,100
(Maximum Offering) as
adjusted(1)....................... 411 436 461
Additional paid in capital............. 90,832 92,857 95,132
Deficit................................ (34,042) (34,042) (34,042)
-------- -------- --------
Total shareholders' equity... 57,201 59,251 61,551
-------- -------- --------
Total capitalization......... 89,771 91,821 94,121
======== ======== ========
</TABLE>
S-7
<PAGE> 8
- ---------------
(1) Excludes as of September 30, 1997: (i) 1,940,200 shares of Common Stock
reserved for issuance under the Company's Incentive Stock Option Plan; (ii)
320,000 shares of Common Stock reserved for issuance pursuant to the
Company's Non-Qualified Stock Option Plan; (iii) 2,317,167 shares of Common
Stock reserved for issuance upon the exercise of warrants issued in
connection with a private placement of shares of Common Stock made by the
Company in March 1996; and (iv) 278,182 shares of Common Stock reserved for
issuance upon exercise of Warrants issued to an underwriter in connection
with a public offering completed in June of 1997.
MARKET FOR THE COMPANY'S COMMON STOCK
The Company's Common Stock is traded on AMEX under the symbol "CAU." The
Common Stock was first included on the National Association of Securities
Dealers Automated Quotation System ("NASDAQ") on February 9, 1986, following the
completion of the Company's initial public offering and on the NASDAQ National
Market System on May 15, 1990. The Company subsequently moved trading of the
Common Stock to AMEX on August 19, 1996. For the periods indicated, the
following table reflects the high and low bid prices for the Common Stock while
it was included on NASDAQ and the high and low sales prices for the Common Stock
while it has been traded on AMEX.
<TABLE>
<CAPTION>
HIGH LOW
----- -----
<S> <C> <C>
Fiscal Year Ending December 31, 1997
Third Quarter............................................. $2.88 $1.75
Second Quarter............................................ $3.38 $2.31
First Quarter............................................. $3.50 $2.25
Fiscal Year Ended December 31, 1996
Fourth Quarter............................................ $3.13 $2.31
Third Quarter............................................. $3.00 $2.38
Second Quarter............................................ $3.88 $2.69
First Quarter............................................. $3.63 $2.38
Fiscal Year Ended December 31, 1995
Fourth Quarter............................................ $2.56 $1.81
Third Quarter............................................. $2.75 $2.13
Second Quarter............................................ $2.44 $1.88
First Quarter............................................. $2.13 $1.50
</TABLE>
On December 17, 1997, the high and low sales prices for the Common Stock
were $1.25 and $1.13, respectively. These prices do not include retail markups,
markdowns, or commissions and do not necessarily represent actual transactions.
Price quotations were provided by NASDAQ through August 16, 1996. From August
19, 1996 to the present, AMEX provided quotes.
As of November 5, 1997, there were approximately 1,343 holders of record of
the Company's Common Stock. The number of shareholders of the Company who
beneficially own shares in nominee or "street" name or through similar
arrangements is estimated by the Company to be approximately 3,000.
UNDERWRITING
The Company is offering up to 5,000,000 shares of Common Stock at a price
of $1.00 per share. The Minimum Offering will consist of shares with an
aggregate purchase price of $2,500,000.
The Company has executed an Underwriting Agreement with the Underwriter
pursuant to which the Company will offer the Shares through the Underwriter and
other broker-dealers selected by the Underwriter, subject to certain conditions,
on a "best efforts, all or none" basis with respect to the Minimum Offering, and
a "best efforts " basis with respect to the remaining Shares. Subject to sale of
the minimum number of Shares before termination of this Offering, the
Underwriter will receive a selling commission equal to 8.0% of the
S-8
<PAGE> 9
gross proceeds from the Shares ($.08 per Share) sold in this Offering, plus an
accountable expense allowance of $ . The Underwriter may reallot to the
Selected Dealers such part of the Underwriter's compensation as the Underwriter
determines in its discretion. The Underwriter has advised the Company that it
does not intend to sell the Shares to any account over which it has
discretionary authority.
The term of the Offering will be until the earlier of the sale of all of
the Shares or December 30, 1997, which the Company and the Underwriter have the
right to mutually extend for up to an additional 30 days (the "Expiration
Date"). The Company or the Underwriter may suspend or terminate this offering at
any time prior to expiration of the Offering or closing. The Company and the
Underwriter may conduct one or more closings during the course of the Offering.
All proceeds of the Offering will be held in escrow by , Toronto,
Canada, as escrow agent (the "Escrow Agent"), until the amount of the Minimum
Offering is received and accepted. All funds received by the Underwriter and/or
Selected Dealers will be transmitted to the Escrow Agent not later than noon of
the first business day after receipt, according to terms of an escrow agreement
with the Escrow Agent. All checks from investors must be made to
" -- Canyon Resources Corporation Escrow Account" until the
Minimum Offering has been closed. After closing of the Minimum Offering, all
checks from investors must be made payable to . If the Minimum
Offering is not received and accepted on or before the Expiration Date,
investors who have deposited funds into the escrow account will promptly receive
a full refund, without interest or deduction.
The Underwriting Agreement provides that the obligations of the
Underwriters are subject to certain conditions precedent and that they may be
terminated upon the occurrence of certain stated events.
Under the Underwriting Agreement, the U.S. Underwriters and any dealer to
whom they sell shares of Common Stock will not offer to sell or sell such shares
in Canada or to persons who are Canadian persons, and the Canadian Underwriters
and any dealer to whom they sell shares of Common Stock will not offer to sell
or sell such shares in the United States or to persons who are U.S. persons. The
foregoing limitations do not apply to stabilization transactions or to
transactions between the U.S. Underwriters and the Canadian Underwriters.
Subject to applicable law, the Underwriters may offer the Common Stock outside
Canada and the United States.
The Company has agreed that, without the prior written consent of the
Underwriters, for a period of days after the date of this Prospectus
Supplement, it will not otherwise dispose of any shares of Common Stock (or
securities convertible into or exercisable or exchangeable for shares of Common
Stock) or grant any options or warrants to purchase shares of Common Stock.
Nevertheless, the Company may grant options pursuant to its existing stock
option plans, may issue shares of Common Stock pursuant to the exercise of
options under its existing stock option plans, and may issue shares of Common
Stock issuable upon the exercise of outstanding warrants.
The Company has agreed to indemnify the Underwriters and their directors,
officers, employees and agents against certain liabilities, including civil
liabilities under the Canadian provincial securities legislation or the
Securities Act of 1933 (United States), as amended, or will contribute to
payments the Underwriters may be required to make in respect thereof.
In connection with the offering, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the
Common Stock in accordance with Regulation M of the Securities Exchange Act of
1934 (United States), as amended. Specifically, the Underwriters may over allot
the offering, creating a syndicate short position in the Common Stock for their
own account. The Underwriters may bid for and purchase shares of Common Stock in
the open market to cover syndicate short positions. In addition, the
Underwriters may bid for and purchase shares of Common Stock in the open market
to stabilize the price of the Common Stock. These activities may stabilize or
maintain the market price of the Common Stock above independent market levels.
The Underwriters are not required to engage in these activities and may end
these activities at any time.
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CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of the principal Canadian federal income tax
considerations generally applicable to a person who acquires shares of Common
Stock of the Company (the "Shares") pursuant to this offering (a "Holder") who,
for the purposes of the Income Tax Act (Canada) (the "Tax Act") and the
Canada -- United States Income Tax Convention, 1980 (the "Tax Treaty") and at
all relevant times, is resident in Canada and not resident in the United States,
deals at arm's length with the Company and holds the Shares as capital property.
The Shares will generally be considered to constitute capital property to a
Holder provided the Holder does not hold the Shares in the course of carrying on
a business and has not acquired the Shares in one or more transactions
considered to be an adventure in the nature of trade. Certain Holders who might
not otherwise be considered to hold their Shares as capital property may, in
certain circumstances, be entitled to have the Shares treated as capital
property by making the election permitted by subsection 39(4) of the Tax Act.
This summary does not apply to a Holder with respect to whom the Company is
a "foreign affiliate" within the meaning of the Tax Act, nor to a Holder who is
a "financial institution" as defined in the Tax Act for purposes of certain
rules applicable to income, gain or loss arising from "mark-to-market property".
This summary is based upon the current provisions of the Tax Act and the
regulations thereunder (the "Regulations"), all specific proposals to amend the
Tax Act and Regulations publicly announced by the Minister of Finance (Canada)
prior to the date hereof (the "Proposed Amendments"), the current provisions of
the Tax Treaty and counsel's understanding of the current published
administrative and assessing policies and practices of Revenue Canada. This
summary is not exhaustive of all possible Canadian federal income tax
considerations and, except for the Proposed Amendments, does not take into
account or anticipate any changes in law, whether by legislative, governmental
or judicial decision or action, nor does it take into account provincial,
territorial or foreign tax considerations which may differ significantly from
those discussed herein.
THIS SUMMARY IS OF A GENERAL NATURE ONLY AND IS NOT INTENDED TO BE, AND
SHOULD NOT BE CONSTRUED AS, LEGAL OR TAX ADVICE TO ANY PARTICULAR HOLDER. NO
REPRESENTATION WITH RESPECT TO THE CANADIAN FEDERAL INCOME TAX CONSEQUENCES TO
ANY PARTICULAR HOLDER IS MADE HEREIN. ACCORDINGLY, A PROSPECTIVE HOLDER SHOULD
CONSULT HIS OR HER OWN TAX ADVISOR WITH RESPECT TO THE PROSPECTIVE HOLDER'S
PARTICULAR CIRCUMSTANCES.
DIVIDENDS
The Canadian dollar equivalent of dividends computed at the currency
exchange rate prevailing at the time of receipt by the Holder (including the
Canadian dollar equivalent of any U.S. tax withheld therefrom) received by a
Holder on the Shares will be required to be included in computing the income of
such Holder under the Tax Act for the year in which such dividends are received.
The gross-up and dividend tax credit rules generally applicable to taxable
dividends received by an individual from taxable Canadian corporations will not
apply in respect of dividends received on the Shares. A Holder that is a
corporation will not be entitled to deduct an amount in respect of such
dividends in computing taxable income. Subject to the limitations in the Tax
Act, a foreign tax credit or a deduction in respect of U.S. withholding tax on
such dividends will generally be available in computing such Holder's Canadian
tax liability.
DISPOSITIONS
A Holder who disposes of or is deemed under the Tax Act to have disposed of
Shares will generally realize a capital gain (or capital loss) to the extent
that the proceeds of disposition, in Canadian dollars computed at the rate of
exchange prevailing on the date of disposition, net of any costs of disposition,
exceed (or are less than) the Holder's adjusted cost base of such Shares
immediately before the disposition. For the purposes of the Tax Act, the cost to
a Holder of Shares acquired hereunder will be the Canadian dollar equivalent of
the U.S. dollar price paid therefor computed at the exchange rate prevailing on
the date of
S-10
<PAGE> 11
purchase. The cost of Shares received pursuant to this Offering will be averaged
with the adjusted cost base of any other shares of the Common Stock of the
Company held by such Holder at that time.
Three-quarters of any capital gain so realized will be included in
computing the Holder's income as a taxable capital gain. Three-quarters of any
capital loss so realized may normally be deducted by the Holder from taxable
capital gains realized by the Holder in the year of disposition or in any of the
three preceding or any subsequent years, subject to and in accordance with the
rules contained in the Tax Act.
Capital gains realized by an individual may be subject to an alternative
minimum tax. Holders should consult their own tax advisors with respect to the
alternative minimum tax provisions.
Pursuant to the Tax Treaty, the amount of U.S. federal estate tax payable,
if any, as a consequence of the death of a Holder may be allowed as a deduction
from the amount of tax payable pursuant to the Tax Act by such Holder in the
year of death in accordance with the provisions of the Tax Treaty.
INFORMATION REPORTING
Certain Holders whose "cost amount" of "specified foreign property" (in
each case, as defined by the Tax Act), including the Shares, in a taxation year
exceeds $100,000 will be required to file an information return in respect of
the specified foreign property. This reporting requirement applies to taxation
years commencing after 1995; however, information returns are not required to be
filed for the 1997, 1998 and 1999 taxation years before the later of April 30,
1999 and the day on or before which the return for the taxation year is
otherwise required to be filed. Holders should consult their own advisors with
respect to the application of this reporting requirement.
FOREIGN PROPERTY
The Shares will be "foreign property" (as defined in the Tax Act) for
purposes of Part XI of the Tax Act. See "Eligibility for Investment".
CERTAIN UNITED STATES FEDERAL TAX
CONSEQUENCES TO CANADIAN HOLDERS
The following is a summary of certain United States federal income and
estate tax consequences of acquiring, holding and disposing of the Common Stock.
The summary is directed only to "Canadian Persons." For this purpose, "Canadian
Persons" are persons that are both (i) with respect to the United States,
nonresident aliens, foreign corporations, foreign partnerships and foreign
trusts and estates and (ii) "residents" of Canada under the Tax Treaty (as
defined above under "Certain Canadian Federal Income Tax Considerations"). A
"foreign partnership" includes not only traditional partnerships but also other
types of unincorporated organizations (such as limited liability companies) that
are treated as partnerships for United States federal income tax purposes.
Persons who are unsure of their status as "Canadian Persons" should consult with
their own tax advisors to determine their status. Persons who are not Canadian
Persons are cautioned that the following summary does not apply to them; they
should consult with their own tax advisors to determine the United States
federal income and estate tax consequences of an investment.
The following summary does not necessarily address all aspects of United
States federal income and estate tax that may be of significance to prospective
investors in light of their individual circumstances, nor does the summary
address foreign tax consequences or United States state and local tax
consequences. For these reasons, all prospective investors are urged to consult
their own tax advisors regarding the tax consequences of their investment.
The following summary does not apply to organizations that are exempt from
tax under Canadian law as governmental, religious or charitable organizations or
as pension or employee benefit plans. Organizations falling within these
categories should consult with their own tax advisors concerning their exempt
status for United States income tax purposes.
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ACQUISITION OF COMMON STOCK
The acquisition of Common Stock by purchase pursuant to the Offering is not
a taxable event for United States federal income and estate tax purposes. A
Canadian Person that purchases Common Stock pursuant to the Offering will
acquire a "basis" in the Common Stock equal to the amount paid for the Common
Stock. The resulting "basis" may be relevant in determining the Canadian
Person's gain (if any) from a disposition of the Common Stock (or from certain
Company distributions). However, as noted below (see "Disposition of Common
Stock"), the Company does not anticipate that Canadian Persons will ordinarily
be subject to United States tax on any gain derived from a disposition of the
Common Stock.
DIVIDENDS
Nonresident alien individuals and foreign corporations. A nonresident alien
individual or foreign corporation that receives a dividend paid on the Common
Stock will be liable for United States income tax on the dividend. For Canadian
Persons, the applicable tax will usually be 15% of the gross amount of the
dividend. If a Common Stock holder fails to qualify as a "resident" of Canada
under the Tax Treaty, the applicable tax will usually be 30% of the gross amount
of the dividend. The tax will usually be satisfied by withholding at either the
15% or 30% rate. Under current law, a person paying dividends to a nonresident
alien or foreign corporation at a Canadian address is entitled to withhold at
the lower treaty rate. Under recently-promulgated regulations scheduled to go
into effect in 1999 (the "1999 Regulations"), Canadian Persons will be required
to certify to the Company (or other payor) their qualification for the lower
treaty rate in order to have tax withheld at the lower rate. If withholding
exceeds liability, a refund may be claimed by filing appropriate forms with the
Internal Revenue Service (the "IRS").
The flat rate tax will not apply if a Canadian Holder is engaged in a trade
or business (including by the performance of independent personal services) in
the United States through a "permanent establishment" or "fixed base" (as those
terms are defined in the Tax Treaty) and the Common Stock is considered
effectively connected with the permanent establishment or fixed base. The United
States graduated tax rates and tax return filing requirements will usually apply
in such a case. In the case of foreign corporations engaged in a United States
trade or business to which Common Stock dividends are effectively connected, a
United States branch profits tax may also apply. In cases where the dividend
income is considered "effectively connected," the withholding regime will not
apply if the Canadian Holder certifies the "effectively connected" status of the
dividends to the Company (or other payor).
Foreign trusts and estates. Under the law currently in effect, dividends
paid to foreign trusts and estates are generally subject to the withholding
regime described above for nonresident alien individuals and foreign
corporations. The 1999 Regulations expressly reserve for future action the
application of the withholding regime to trusts and estates. Liability for the
underlying tax itself depends on the identity of the trust or estate
beneficiaries, the distributions made by the trust or estate and, in the case of
a trust, the nature of the trust. Due to the complexity of these rules and the
uncertainty introduced by the 1999 Regulations, prospective investors that are
foreign trusts and estates should consult with their own tax advisors concerning
the United States tax consequences of an investment.
Foreign partnerships. Foreign partnerships are not subject to United States
income tax on dividend income. Dividend income earned by a foreign partnership
is allocable to and taxable to its partners based on their status. However,
under recent amendments to the Code, the 15% tax rate under the Tax Treaty may
be denied to the partners in a foreign partnership if the partnership is treated
as a taxable entity by the jurisdiction in which the partnership is resident.
Under the law currently in effect, foreign partnerships are generally subject to
the withholding regime described above for nonresident aliens and foreign
corporations. Under the 1999 Regulations, application of the withholding regime
to foreign partnerships requires that a number of initial determinations be made
regarding the nature of the partnership and its partners. Due to the complexity
of the rules governing foreign partnerships, prospective investors that are
foreign partnerships are urged to consult with their own tax advisors concerning
the United States tax consequences of an investment.
S-12
<PAGE> 13
DISPOSITION OF COMMON STOCK
Nonresident aliens and foreign corporations. Nonresident aliens and foreign
corporations that are Canadian Persons will generally not be subject to tax on
any gain they realize from the disposition of Common Stock. Exceptions to this
rule may apply if (i) the gain is considered effectively connected with the
conduct of a trade or business through a permanent establishment or fixed base
in the United States, (ii) the nonresident alien or foreign corporation owned
(actually and constructively) more than 5% of the value of the Common Stock
during a "testing period" of as long as five years preceding the disposition or
(iii) the gain is realized by a nonresident alien who was previously a United
States resident for a substantial period, who held the Common Stock while he was
a United States resident and who is present in the United States for 183 days or
more during the year of disposition. The exception noted in (ii) is attributable
to the Company's belief that it currently is a "United States real property
holding corporation" the stock of which is "regularly traded on an established
securities market" within the meaning of the Code. If either of the exceptions
described in (i) or (ii) applies, the gain may be subject to United States tax
at the graduated rates generally applicable to United States individuals and
corporations (and, in the case of foreign corporations, may be subject to the
branch profits tax noted above). If (iii) applies, the gain may be subject to
United States tax at a flat rate of 30%. Nonresident aliens and foreign
corporations to whom (i), (ii) or (iii) may apply should consult their own tax
advisors concerning the consequences of an investment.
Foreign trusts and estates. Foreign trusts and estates that are Canadian
Persons will generally not be subject to tax on any gain they realize from the
disposition of Common Stock. The exceptions described above for nonresident
aliens and individuals are generally equally applicable to foreign trusts and
estates as well. However, due to the complexity of the rules governing foreign
trusts and estates, prospective investors that are foreign trusts and estates
should consult with their own tax advisors concerning the United States tax
consequences of an investment.
Foreign partnerships. Foreign partnerships are not subject to United States
income tax on realized gains. Any such gain is allocable to and taxable to the
partnership's partners based on their status. Due to the complexity of the rules
governing foreign partnerships, prospective investors that are foreign
partnerships are urged to consult with their own tax advisors concerning the
United States tax consequences of an investment.
INFORMATION REPORTING AND BACKUP WITHHOLDING
Dividends. The Company must report annually to the IRS the name and address
of each Canadian Person to whom it has paid dividends during the preceding year,
the amount of the dividends paid to each such person and the tax, if any,
withheld with respect to the dividends paid. Pursuant to the Tax Treaty, the IRS
will share the information contained in the Company's report with Revenue
Canada. Each dividend recipient will receive a copy of the information sent to
the IRS with respect to the recipient. Generally, any dividends paid to a
Canadian Person that are not subject to the 15% or 30% withholding tax described
above will be subject to "backup withholding" at a 31% rate. "Backup
withholding" is a collection mechanism and not a tax itself. If "backup
withholding" exceeds the tax actually due from a Canadian Holder, a refund may
be obtained by filing appropriate forms with the IRS.
Proceeds of disposition. If a Canadian Person other than a corporation
disposes of Common Stock through the United States office of a broker (or
through a foreign office, if the foreign office has certain United States
connections), the broker is required to report to the IRS the name, address and
United States taxpayer identification number of the person disposing of the
stock, the proceeds of disposition realized by such person and the tax, if any,
withheld on those proceeds. Reportable gross proceeds from a sale through a
United States office (but not a foreign office) are also potentially subject to
"backup withholding" at a 31% rate. However, the information reporting and
backup withholding rules do not apply if the Canadian Person certifies to the
broker its status as a Canadian Person and certain other matters intended to
demonstrate that the gain, if any, realized from the disposition is not subject
to United States income tax.
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<PAGE> 14
INCOME TAX RETURN FILING REQUIREMENTS
Nonresident alien individuals and foreign corporations. A Canadian Person
that is a nonresident individual or foreign corporation, whose liability for
United States income tax is satisfied entirely by withholding and who is not
engaged in a United States trade or business is not required to file a United
States income tax return.
Foreign trusts and estates. A Canadian Person that is a foreign trust or
estate is required to file a United States income tax return if its income from
United States sources (including dividends on the Common Stock) is $600 or more.
Foreign partnerships. A Canadian Person that is a foreign partnership is
required to file a United States income tax return if it has any income from
United States sources (including dividends on the Common Stock).
ESTATE TAX
The United States imposes an "estate tax" on the estates of nonresident
alien decedents to the extent the estate consists of property that is "situated
in the United States." Stock in United States corporations (which includes the
Common Stock) is treated as property "situated in the United States" for this
purpose. A credit available to nonresidents will generally eliminate the tax on
taxable estates of less than $60,000; a larger credit may be available depending
on the portion of the decedent's aggregate estate that is "situated in the
United States." For taxable estates larger than $60,000, the estate tax is
imposed at rates ranging from 26% to 55%, depending on the size of the estate.
Individuals who are contemplating large investments in Common Stock (or who
already hold large amounts of property "situated in the United States") should
consult with their own tax advisors concerning the United States estate tax
consequences of their investment.
ELIGIBILITY FOR INVESTMENT
In the opinion of Stikeman, Elliott and Cassels Brock & Blackwell, subject
to compliance with the prudent investment standards and general provisions and
restrictions of the statutes referred to below (and, where applicable, the
regulations thereunder) and, in certain cases, subject to the satisfaction of
additional requirements relating to investments or lending policies or goals
and, in certain cases, the filing of such policies or such goals, the Common
Stock would not, if the date hereof were the closing date, be precluded as
investments under the following statutes:
Insurance Companies Act (Canada)
Trust and Loan Companies Act (Canada)
Pension Benefits Standards Act, 1985 (Canada)
Financial Institutions Act (British Columbia)
Pension Benefits Standards Act (British Columbia)
Pension Benefits Act (Ontario)
Loan and Trust Corporations Act (Ontario)
In the opinion of such counsel, the shares of Common Stock will be
qualified investments for a trust governed by a registered retirement savings
plan, a deferred profit sharing plan or a registered retirement income fund
(collectively "Deferred Income Plans") under the Income Tax Act (Canada) (the
"Tax Act").
Shares of the Common Stock will constitute "foreign property" for purposes
of Part XI of the Tax Act. A Deferred Income Plan and certain other investors
generally exempt from tax will be subject to tax under Part XI of the Tax Act
if, at the end of any month, the cost amount (as defined in the Tax Act) of
foreign property then held by such plan exceeds, generally, the aggregate of (i)
20% of the cost amount to it of all property then held and, where applicable,
(ii) the allowable amount in respect of its investment in prescribed small
business properties.
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DESCRIPTION OF CAPITAL STOCK
The Company is authorized to issue up to 100,000,000 shares of Common
Stock, and 10,000,000 shares of preferred stock, par value $.01 per share (the
"Preferred Stock"), which Preferred Stock is issuable in series with rights and
preferences as designated by the Board of Directors. As of November 5, 1997,
there were 41,082,100 shares of Common Stock issued and outstanding and no
shares of Preferred Stock issued and outstanding.
American Securities Transfer & Trust, Inc., Denver, Colorado acts as
Transfer Agent for the Company.
COMMON STOCK
Holders of Common Stock are entitled to one vote for each share held of
record on all matters presented to shareholders. Shareholders are not entitled
to cumulative voting rights. Therefore, holders of a majority of the outstanding
shares have the power to elect all directors.
Holders of Common Stock are entitled to receive such dividends as may be
declared by the Board of Directors out of legally available funds and, in the
event of liquidation, to share pro rata in any distribution of the Company's
assets after payment of liabilities. Holders of Common Stock do not have
preemptive rights to subscribe to additional shares if issued by the Company.
All of the outstanding shares of Common Stock are, and the Shares being offered
through this Prospectus Supplement will be, fully paid and nonassessable.
PREFERRED STOCK
The Company's Board of Directors is vested with authority to divide the
authorized shares of Preferred Stock into one or more series of such shares and
to fix and determine the relative rights and preferences of any such series. A
series of such shares may, among other matters, establish (i) the number of
preferred shares to constitute such series and the distinctive designations
thereof; (ii) the rate and preference of dividends, if any, the time of payment
of dividends, whether dividends are cumulative and the date from which any
dividend shall accrue; (iii) whether shares of Preferred Stock may be redeemed
and, if so, the redemption price and the terms and conditions of redemption;
(iv) the liquidation preferences payable on preferred shares in the event of
involuntary or voluntary liquidation; (v) sinking fund or other provisions, if
any, for redemption or purchase of such preferred shares; (vi) the terms and
conditions by which preferred shares may be converted, if the preferred shares
of any series are issued with the privilege of conversion, and (vii) voting
rights, if any. The Board of Directors, without the approval of the Company's
shareholders, has the power to authorize the issuance of Preferred Stock with
voting and conversion rights which could adversely affect the voting power of
the Common Stock.
LEGAL MATTERS
Certain U.S. legal matters with respect to the Common Stock offered hereby
will be passed upon for the Company by Parcel, Mauro, Hultin & Spaanstra, P.C.,
and certain Canadian legal matters will be passed upon for the Company by
Stikeman, Elliott. Certain U.S. legal matters will be passed upon for the
Underwriters by Skadden, Arps, Slate, Meagher & Flom, and certain Canadian legal
matters will be passed upon for the Underwriters by Cassels Brock & Blackwell.
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NO PERSON HAS BEEN AUTHORIZED IN CONNECTION WITH THE OFFERING MADE HEREBY
TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE
CONTAINED HEREIN AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS.
THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL
OR THE SOLICITATION OF AN OFFER TO BUY ANY OF THESE SECURITIES IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION IN SUCH JURISDICTION. THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT
AND THE PROSPECTUS AT ANY TIME DOES NOT IMPLY THAT THE INFORMATION IN THE
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THIS DATE.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
PROSPECTUS SUPPLEMENT
Exchange Rate Information.............. S-2
Canyon Resources Corporation........... S-3
Forward-Looking Statements............. S-3
Recent Developments.................... S-4
Use of Proceeds........................ S-7
Capitalization......................... S-7
Market for the Company's Common
Stock................................ S-8
Underwriting........................... S-8
Certain Canadian Federal Income Tax
Considerations....................... S-10
Certain United States Federal Tax
Consequences To Canadian Holders..... S-11
Eligibility for Investment............. S-14
Description of Capital Stock........... S-15
Legal Matters.......................... S-15
PROSPECTUS DATED JANUARY 7, 1997
Available Information.................. 2
Incorporation of Certain Documents by
Reference............................ 2
Canyon Resources Corporation........... 3
Forward Looking Statements............. 3
Principal Risk Factors................. 4
Use of Proceeds........................ 10
Plan of Distribution................... 10
Legal Matters.......................... 11
Experts................................ 11
</TABLE>
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UP TO 5,000,000 SHARES
CANYON RESOURCES CORPORATION
COMMON STOCK
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PROSPECTUS SUPPLEMENT
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, 1997
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