<PAGE> 1
SCHEDULE 14a INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
</TABLE>
CANYON RESOURCES CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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<PAGE> 2
CANYON RESOURCES CORPORATION
14142 Denver West Parkway, Suite 250
Golden, Colorado 80401
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 10, 1999
To Our Shareholders:
The Annual Meeting of Shareholders ("Meeting") of Canyon Resources
Corporation (the "Company"), a Delaware corporation, will be held at 3:00 p.m.
(Mountain daylight time) on Thursday, June 10, 1999, at the Denver West Marriott
Hotel, 1717 Denver West Blvd., Golden, Colorado, for the following purposes:
1. To elect one director of the Company, for a three-year term.
2. To ratify the appointment of PricewaterhouseCoopers, LLP as the
Company's independent public accountants for 1999.
3. To consider and vote upon such other matters as may properly come
before the Meeting or any adjournment thereof.
Shareholders of record at the close of business on April 23, 1999, are
entitled to notice of and to vote at the Meeting. A list of the stockholders
entitled to vote at the Meeting shall be open to the examination of any
stockholder during ordinary business hours for a period of 10 days prior to the
Meeting at the Company's headquarters, 14142 Denver West Parkway, Suite 250,
Golden, Colorado.
The Board of Directors of the Company extends a cordial invitation to
all shareholders to attend the Meeting in person. Whether or not you plan to
attend the Meeting, please fill in, date, sign, and mail the enclosed proxy in
the return envelope as promptly as possible. Your proxy may be revoked by you at
any time prior to the Meeting. The prompt return of your completed proxy will
assist the Company in obtaining a quorum of shareholders for the Meeting, but
will not affect your ability to change your vote by subsequent proxy or by
attending the Meeting and voting in person. If you are unable to attend, your
written proxy will assure that your vote is counted.
By Order of the Board of Directors
Gary C. Huber
Corporate Secretary
Golden, Colorado
May 1, 1999
================================================================================
YOUR VOTE IS IMPORTANT NO MATTER HOW MANY SHARES YOU OWN
Please indicate your voting instructions on the enclosed proxy card,
date and sign it, and return it in the envelope provided, which is addressed for
your convenience. No postage is required if mailed in the United States.
PLEASE MAIL YOUR PROXY PROMPTLY
================================================================================
<PAGE> 3
CANYON RESOURCES CORPORATION
14142 Denver West Parkway, Suite 250
Golden, Colorado 80401
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
JUNE 10, 1999
This Proxy Statement is furnished to the shareholders of Canyon
Resources Corporation (the "Company"), a Delaware corporation, in connection
with the solicitation by and on behalf of the Company's Board of Directors (the
"Board") of proxies to be voted at the Annual Meeting of Shareholders
("Meeting") of the Company. The Meeting will be held on June 10, 1999, at 3:00
p.m. (Mountain daylight time) at the Denver West Marriott Hotel, 1717 Denver
West Blvd., Golden, Colorado, for the purposes set forth in the accompanying
Notice of Annual Meeting of Shareholders. Officers and regular employees of the
Company, without additional compensation, may solicit proxies personally or by
telephone if deemed necessary. Solicitation expenses will be paid by the
Company.
All proxies that are properly executed and received prior to the
Meeting will be voted at the Meeting. If a shareholder specifies how the proxy
is to be voted on any business to come before the Meeting, it will be voted in
accordance with such specification. If a shareholder does not specify how to
vote the proxy, it will be voted FOR the election of the nominee for director
named in this Proxy Statement, FOR the ratification of the appointment of
PricewaterhouseCoopers LLP as the Company's auditors for 1999, and in the proxy
holders' discretion on such other business as may properly come before the
Meeting. Any proxy may be revoked by a shareholder at any time before it is
actually voted at the Meeting by delivering written notification to the
Secretary of the Company, by delivering another valid proxy bearing a later
date, or by attending the Meeting and voting in person.
This Proxy Statement and the accompanying proxy are first being sent to
shareholders on or about May 1, 1999. The Company will bear the cost of
preparing, assembling, and mailing the notice, Proxy Statement, and form of
proxy for the Meeting.
VOTING SECURITIES
All voting rights are vested exclusively in the holders of the
Company's common stock, $.01 par value (the "Common Stock"), with each share
entitled to one vote. Only shareholders of record at the close of business on
April 23, 1999, are entitled to notice of and to vote at the Meeting or any
adjournment. At the close of business on April 23, 1999, there were 46,152,074
shares of Common Stock issued and outstanding. A minimum of one-third of the
shares of Common Stock issued and outstanding must be represented at the
Meeting, in person or by proxy, in order to constitute a quorum. Cumulative
voting is not allowed for any purpose. Assuming a quorum is present, the nominee
receiving the highest number of votes cast will be elected as director. The
affirmative vote of the holders of the majority of the shares of Common Stock
represented at the Meeting in person or by proxy and entitled to vote on the
subject matter will be necessary to ratify the appointment of the auditors.
1
<PAGE> 4
An abstention or withholding authority to vote will be counted as
present for determining whether the quorum requirement is satisfied. With
respect to the vote on any particular proposal, abstentions will be treated as
shares present and entitled to vote, and for purposes of determining the outcome
of the vote on any such proposal, shall have the same effect as a vote against
the proposal. A broker "non-vote" occurs when a nominee holding shares for a
beneficial holder does not have discretionary voting power and does not receive
voting instructions from the beneficial owner. Broker "non-votes" on a
particular proposal will not be treated as shares present and entitled to vote
on the proposal.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information, as of April 23, 1999, with
respect to beneficial ownership of the Common Stock by each person known by the
Company to be the beneficial owner of more than 5% of its outstanding Common
Stock, by each director and nominee for director of the Company, by each
executive officer named in the table titled "Summary Compensation Table," which
appears elsewhere in this Proxy Statement, and by all officers and directors of
the Company as a group. Unless otherwise noted, each shareholder has sole
investment and voting power over the shares owned.
<TABLE>
<CAPTION>
NAME OF TYPE OF NUMBER OF PERCENT OF
BENEFICIAL OWNER OWNERSHIP SHARES CLASS
- ------------------------------------------ ------------------ --------------- ---------------
<S> <C> <C> <C>
Richard H. De Voto Record and 860,698(1) 1.9%
Beneficial
Gary C. Huber Record and 412,561(2) *
Beneficial
Richard T. Phillips Record and 75,000(3) *
Beneficial
James E. Askew Record and 60,000(4) *
Beneficial
Leland O. Erdahl Record and 104,289(5) *
Beneficial
Richard F. Mauro Record and 50,000(6) *
Beneficial
All Officers & Directors as a Record and 1,562,148 3.4%
Group (6 persons) Beneficial
</TABLE>
* Less than 1%
(1) This number includes (i) 9,719 shares owned of record; (ii) 560,628 shares
held by the Richard H. De Voto Trust No. 1; (iii) 351 shares held as
Co-Trustee of Trust for his mother; (iv) an option to purchase 70,000 shares
at an exercise price of $3.00 per share; (v) options to purchase 100,000
shares at an exercise price of
2
<PAGE> 5
$1.63 per share; (vi) an option to purchase 25,000 shares at an exercise
price of $2.00 per share; (vii) an option to purchase 50,000 shares at an
exercise price of $2.19 per share; and (viii) an option to purchase 45,000
shares at an exercise price of $2.56 per share.
(2) This number includes (i) 207,561 shares owned of record; (ii) an option to
purchase 50,000 shares at an exercise price of $3.00 per share; (iii)
options to purchase 60,000 shares at an exercise price of $1.63 per share;
(iv) an option to purchase 20,000 shares at an exercise price of $2.00 per
share; (v) an option to purchase 35,000 shares at an exercise price of $2.19
per share; and (vi) an option to purchase 40,000 shares at an exercise price
of $2.56 per share.
(3) This number includes (i) an option to purchase 15,000 shares at an exercise
price of $3.00 per share; (ii) an option to purchase 15,000 shares at an
exercise price of $1.63 per share; (iii) an option to purchase 20,000 shares
at an exercise price of $2.19 per share; and (iv) an option to purchase
25,000 shares at an exercise price of $2.56 per share.
(4) This number includes (i) an option to purchase 50,000 shares at an exercise
price of $3.00 per share; and (ii) an option to purchase 10,000 shares at an
exercise price of $.81 per share.
(5) This number includes (i) 54,289 shares owned of record; (ii) an option to
purchase 10,000 shares at an exercise price of $2.19 per share; (iii) an
option to purchase 10,000 shares at an exercise price of $2.06 per share;
(iv) an option to purchase 10,000 shares at an exercise price of $3.31 per
share; (v) an option to purchase 10,000 shares at an exercise price of $3.00
per share; and (vi) an option to purchase 10,000 shares at an exercise price
of $0.81 per share.
(6) This number includes an option to purchase 50,000 shares at an exercise
price of $0.13 per share.
ELECTION OF DIRECTORS
The Company's Bylaws formerly provided that the number of members of
the Board would be six. On August 17, 1998, Robert L. Zerga resigned and the
Board amended the Bylaws to reduce the number of members to five. On March 23,
1999, William C. Parks resigned and on April 9, 1999, Richard F. Mauro was
appointed to fulfill Mr. Parks' remaining term.
The Company's Bylaws provide that the number of members of the Board
shall be five, divided into three classes. Cumulative voting in election of
directors is not permitted. Directors are elected by plurality vote of the
shares represented at the Meeting.
One Director, Richard F. Mauro, has been nominated for election at the
Meeting. UNLESS AUTHORITY IS WITHHELD, IT IS INTENDED THAT THE SHARES
REPRESENTED BY THE PROXIES WILL BE VOTED FOR THIS DIRECTOR, TO SERVE FOR A
THREE-YEAR TERM OR UNTIL HIS RESPECTIVE SUCCESSOR IS ELECTED AND QUALIFIED.
OFFICERS AND DIRECTORS
The following table lists the names, ages, and positions of the
executive officers and directors of the Company as of April 23, 1999. Directors
are divided into classes, each of which is elected to serve for three years,
with one class being elected each year. All officers have been appointed to
serve until their successors are elected and qualified. Additional information
regarding the business experience, length of time served in each capacity, and
other matters relevant to each individual is set forth below the table.
3
<PAGE> 6
<TABLE>
<CAPTION>
DIRECTORS' TERMS
NAME AGE POSITION EXPIRE
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Richard H. De Voto 64 President, Director and Chairman of 2001
the Board
Gary C. Huber 47 Vice President-Finance, Corporate 2000
Secretary and Director
James E. Askew 50 Director 2000
Leland O. Erdahl 70 Director 2000
Richard F. Mauro 54 Director 1999
Richard T. Phillips 44 Treasurer
</TABLE>
DR. RICHARD H. DE VOTO was a founder of the Company and has been a
Director of the Company since its formation in 1979. Dr. De Voto served as
President of the Company from September 1979 to April 1985, and became President
again in April 1987. He is President of CR Montana Corporation, CR Briggs
Corporation, and CR International Corporation, each wholly owned subsidiaries of
the Company. Dr. De Voto is Professor Emeritus of Geology at the Colorado School
of Mines, where he taught from 1966 to 1987. Dr. De Voto was a founder of the
private Australian mining firm, Canyon Resources Proprietary Ltd., which later
became Delta Gold N.L., a publicly listed company of which he was a Director
from 1983 to 1989.
GARY C. HUBER was a founder of the Company and served as Corporate
Secretary of the Company from inception in 1979 through June 1986, as Treasurer
from 1980 through December 1991, as Vice President from April 1985 to April
1987, and as Vice President-Finance since April 1987. He was elected as a
Director of the Company in June 1985 and served as President of CR Minerals
Corporation, a wholly owned subsidiary of the Company. Dr. Huber has been
responsible for the financial operations of the Company since its inception and
currently serves as Corporate Secretary.
JAMES E. ASKEW has been a Director of the Company since June 1997. He
is currently the President and CEO of Golden Star Resources Inc., and has just
finished his role of President and CEO of Rayrock Resources Inc. He is also
currently the President of International Mining & Finance Corporation, a venture
capital and private investment group targeting gold and base-metal opportunities
internationally. From 1987, until it was merged with Ashanti Goldfields Limited
in October 1996, Mr. Askew was President and Managing Director of Golden
Shamrock Mines, Ltd. He serves as Director to several mining companies
including, Ausdrill Ltd., Nelson Golden Corporation Ltd., Carpenter Pacific
Resources, Prospex Mining Corporation, Nord Resources Corporation and Silver
Standards Resources.
LELAND O. ERDAHL has been a Director of the Company since February
1986. He served as President and CEO of Stolar, Inc., a privately held service
and communication supply company for the mining industry, from July 1987 to
September 1991, and as President and CEO of Albuquerque Uranium Corporation, a
privately held company engaged in the production and sale of uranium from
November 1987 to January 1992. Mr. Erdahl also served as a Vice President and
Chief Financial Officer of Amax Gold Inc. from March, 1997 to June, 1998. Mr.
Erdahl serves as a Director of Hecla Mining Company, Uranium Resources, Inc.,
and Original Sixteen to
4
<PAGE> 7
One Mine, Inc., all publicly held mineral resources companies, and as a trustee
of a group of John Hancock Mutual Funds, all publicly held investment entities.
Mr. Erdahl also serves as a consultant to the mining industry.
RICHARD F. MAURO was appointed a Director of the Company on April 9,
1999 to fill the unexpired term of Mr. Parks. He was a co-founder and served as
Executive Vice President of Castle Group, Inc., an investment management firm,
from 1992 to 1997. In 1985 he co-founded the law firm Parcel Mauro and served as
President. He was former President of Sundance Oil Exploration Company in 1985.
He currently serves as a Director of Glencar Mining PLC and Argosy Mining Corp.
RICHARD T. PHILLIPS was appointed Treasurer of the Company in December
1991. Initially joining the Company as Controller in July 1991, he is
responsible for the Company's cash management, risk management, and financial
reporting functions. From 1988 to 1991, Mr. Phillips served as Controller for
Western Gold Exploration and Mining Company, a gold mining partnership between
Minorco and Inspiration Resources Corporation.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
(the "SEC"). Officers, directors and greater than ten percent shareholders are
required by SEC regulation to furnish the Company with copies of all Section
16(a) forms they file.
Based solely on its review of the copies of such forms received by it,
or written representations from certain reporting persons, the Company believes
that, during the fiscal year ended December 31, 1998, all filing requirements
applicable to its officers, directors and greater than ten percent beneficial
owners were met, with the exception that Messrs. De Voto, Huber and Phillips,
each filed one Form 4 one day late.
BOARD MEETINGS AND COMMITTEES
During the Company's 1998 fiscal year, the Board met ten times. All of
the Directors were present or attended by conference call for 75% or more of the
meetings of the Board and committees upon which they served that were held
during their individual incumbencies.
The Company's Audit Committee ("Audit Committee") is comprised of
Messrs. Erdahl and Mauro, all independent Directors of the Company. The Audit
Committee recommends the selection and reappointment of the Company's
independent certified public accountants to the Board and reviews the proposed
scope, content, and results of the audit performed by the accountants, and any
reports and recommendations made by them. The Audit Committee held two meetings
in 1998.
The Company's Compensation Committee ("Compensation Committee") is
currently comprised of Messrs. Askew and Erdahl, with Dr. De Voto as a
non-voting member. The Compensation Committee reviews and makes recommendations
to the Board concerning the salaries paid to the Company's officers.
The Compensation Committee held two meetings in 1998.
The Company has no nominating or executive committee.
5
<PAGE> 8
EXECUTIVE COMPENSATION
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. James E. Askew, Leland O. Erdahl, and Richard H. De Voto
currently serve as the Compensation Committee for the Board. Dr. De Voto, the
President of the Company, is a non-voting member of the Compensation Committee.
Other than Dr. De Voto, no committee member is an officer or employee of the
Company or any of its subsidiaries.
REPORT OF THE COMPENSATION COMMITTEE ON
EXECUTIVE COMPENSATION
OVERALL POLICY
Salary compensation of the Company's executive officers is determined
by the Board. The Compensation Committee is responsible for considering specific
information and making recommendations to the full Board. The Compensation
Committee is comprised of two outside directors appointed annually by the Board.
The Compensation Committee's consideration of and recommendations regarding
executive compensation are guided by a number of factors described below. The
objectives of the Company's total executive compensation package are to attract
and retain the best possible executive talent, to provide an economic framework
to motivate the Company's executives to achieve goals consistent with the
Company's business strategy, to provide an identity between executive and
shareholder interests through stock option plans, and to provide a compensation
package that recognizes an executive's individual results and contributions in
addition to the Company's overall business results.
In making recommendations concerning executive compensation, the
Committee reviews individual executive compensation, corporate performance,
stock price appreciation, and total return to shareholders for the Company as
well as a peer group of public North American gold-mining companies. The peer
group of companies used for compensation analysis includes many of the selected
peer group identified in the Performance Graph set forth below.
The Compensation Committee recommends to the Board compensation levels
for the President (Chief Executive Officer) and other officers of the Company.
In reviewing individual performance of executives whose compensation is detailed
in this Proxy Statement, the Compensation Committee takes into account the views
of Richard H. De Voto, the Company's Chief Executive Officer and non-voting
member of the Committee.
SALARIES
The key elements of the Company's executive compensation consist of
base salary, an incentive compensation plan, and stock options. The Board acts
on salary levels of officers and on the incentive compensation plan, and the
Compensation Committee makes recommendations on employee stock option awards.
Salaries for executive officers are determined by evaluating the
responsibilities of the position held and the experience of the individual, and
by reference to the competitive marketplace for executive talent, including a
comparison of salaries for comparable positions at other similar mining
companies.
6
<PAGE> 9
The salary levels of the Chief Executive Officer and other officers of
the Company for the following calendar year are generally established by the
Board at its December meeting. Specific individual performance and overall
corporate or business segment performance are reviewed in determining the
compensation level of each individual officer. In a particular business unit,
such unit's financial, operating, cost containment, and productivity results are
also considered. The Compensation Committee, where appropriate, also considers
other performance measures, such as increase in market share, safety,
environmental awareness, and improvements in relations with shareholders,
employees, the public, and government regulators.
Gold prices continued to fall during 1998 and specific events which
occurred in Montana created a difficult year for the Company. Gold prices fell
to the lowest levels observed in years and the Company's stock fell to a record
low. The Compensation Committee and the Board did consider that the Company was
successful in spite of the extremely depressed gold market in the following
areas: (i) the Briggs Mine produced 20% more gold from the prior year, (ii) the
cost per ounce of gold produced decreased, (iii) the Briggs project debt was
reduced substantially, (iv) the Company raised $2.5 million during the year in
equity sales, (v) the Company sold its industrial minerals division in a timely
manner, and (vi) the Company completed substantial cost reductions at both the
corporate and project levels. However, 1998 was still a very difficult year.
The Compensation Committee believes that the Chief Executive Officer,
as well as the other officers of the Company, are strongly motivated and
dedicated to the growth in shareholder value of the Company. The Compensation
Committee further believes that the Chief Executive Officer, as well as the
other officers of the Company, are receiving salary compensation in the
mid-range of peer-group levels and that their performance incentives are heavily
based on their personal shareholding and/or incentive stock options in the
Company. Because of the pricing problems facing the gold industry and the
Company, no increases in base annual cash compensation have been granted since
April 1, 1996 to Messrs. De Voto and Huber, and these executive officers have
deferred a portion of their base salary in 1998. Mr. Phillips' base salary was
increased to $100,000 per annum, effective April 1, 1998. Stock options were,
however, granted to officers with the view that such awards align their interest
directly with that of the shareholders.
INCENTIVE COMPENSATION PLAN
The Company's Board of Directors is committed to providing a strong
incentive compensation opportunity to encourage and reward superior performance.
Corporate objectives are to build a team-driven environment which will result in
increased mineral production, cash flow and profitability by means of
development of current reserves and discovery of new mineral deposits. On
January 1, 1997, a performance-driven, variable pay Incentive Compensation Plan
was implemented by the Board, designed to measure and reward executive officer's
performance based on several key performance indicators. The indicators used to
measure performance include (1) annual share price change compared to a peer
group of companies, (2) cash flow, (3) net income per share, (4) ounces of gold
produced, (5) total mineable (profitable) ounces of gold reserves, (6)
successful completion of merger and/or acquisition transactions, and (7)
discretionary critical behavior as determined by the President.
The Board of Directors feels that by moving from a "fixed" base pay
compensation structure to a structure with more emphasis on "variable" incentive
pay, a corporate environment will be created which is goal-oriented,
results-driven, profit-focused, time sensitive and entrepreneurial. No payments
have been made under this plan.
7
<PAGE> 10
STOCK OPTIONS
Under the Company's 1982 Incentive Stock Option Plan as amended ("ISO
Plan"), which was approved by shareholders, stock options are granted to the
Company's key employees, including the individuals whose compensation is
detailed in this Proxy Statement. The Compensation Committee sets the size of
the stock option grants based on factors, including competitive compensation
data, similar to those used to determine salaries.
Stock options are intended to align the interests of the executives
with those of the shareholders. All stock options granted from the ISO Plan are
granted with an exercise price equal to the market price of the Common Stock on
the date of grant and are generally exercisable over a 2-5 year period. This
approach is designed to provide executive incentive for creation of additional
shareholder value over the long term since the benefit of the option awards
cannot be realized unless stock price appreciation occurs.
CONCLUSION
The Company's executive compensation is linked to individual and
corporate performance and stock price appreciation. The Compensation Committee
intends to continue the policy of linking executive compensation to corporate
performance and returns to shareholders, recognizing that the ups and downs of
the business cycle, and in particular the depressed gold prices, from time to
time may result in an imbalance for a particular period.
This Report has been provided by the Compensation Committee.
James E. Askew(1)
Leland O. Erdahl(1)
Richard H. De Voto(2)
(1) Member of Compensation Committee
(2) Non-voting member of Compensation Committee
8
<PAGE> 11
COMPENSATION OF OFFICERS
The following tables show compensation during the fiscal years ended
December 31, 1998, 1997, and 1996, and option grants and option exercises during
the fiscal year ended December 31, 1998, of those persons who were, at December
31, 1998 (i) the Chief Executive Officer and (ii) the three other most highly
compensated executive officers of the Company whose total compensation exceeded
$100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Long-term
Compensation Compensation
------------ ---------------
Awards
---------------
Securities
Underlying All Other
Name and Salary(1) Options Compensation
Principal Position Year ($) (#) ($)(2)
- ----------------------- --------- ------------ --------------- --------------
<S> <C> <C> <C> <C>
Richard H. De Voto 1998 200,000 150,000 4,800
President, CEO 1997 200,000 155,000 4,800
1996 197,500 45,000 4,500
Gary C. Huber 1998 152,250 100,000 4,289
Vice President- 1997 152,250 75,000 4,567
Finance 1996 150,438 40,000 4,500
John R. Danio(3) 1998 83,796 -- 29,485
Vice President- 1997 127,500 15,000 3,825
Operations 1996 125,625 25,000 3,769
Richard T. Phillips 1998 97,500 50,000 2,925
Treasurer 1997 90,000 20,000 2,700
1996 90,000 25,000 2,700
</TABLE>
(1) 1998 Annual Compensation for Messrs. De Voto and Huber include deferred
amounts of $20,833 and $9,271, respectively.
(2) Except as noted below with respect to Mr. Danio, all amounts included in All
Other Compensation were paid pursuant to the Company's 401(k) plan.
(3) Mr. Danio's employment was terminated on August 15, 1998. All Other
Compensation includes a severance payment of $26,971 in connection with his
termination.
9
<PAGE> 12
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS Potential Realizable Value at
- --------------------------------------------------------------------------------------------- Assumed Annual Rates of
Number of Securities Percent of Total Stock Price Appreciation
Underlying Options Options Granted to Exercise or for Option Term
Granted Employees in Fiscal Base Price Expiration ------------------------------
Name (#) Year 1998 ($/Sh) Date 5% ($) 10% ($)
- ------------------- --------------------- ------------------ ------------ ----------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C>
Richard H. De Voto 150,000(1) 30.9% 0.25 12/09/03 10,361 22,894
Gary C. Huber 100,000(1) 20.6% 0.25 12/09/03 6,907 15,263
Richard T. Phillips 50,000(1) 10.3% 0.25 12/09/03 3,454 7,631
</TABLE>
(1) Options were granted on December 10, 1998, and first become exercisable
after the second anniversary of the date of grant. The options were granted
at an exercise price equal to the Common Stock closing price as quoted on
AMEX on the grant date.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities Underlying Value of Unexercised
Unexercised Options at FY-End In-The-Money Options at FY-
(#) End($)(1)
------------------------------- -----------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- --------------------- --------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Richard H. De Voto 290,000 335,000 0 0
Gary C. Huber 205,000 175,000 0 0
Richard T. Phillips 75,000 70,000 0 0
</TABLE>
(1) Based on the closing price of $0.25 of the Common Stock as quoted on AMEX
December 31, 1998.
10
<PAGE> 13
SHAREHOLDER RETURN PERFORMANCE GRAPH
The following graph shows the cumulative total shareholder return on
the Company's Common Stock for the period December 31, 1993, through December
31, 1998, compared to the cumulative total return of three other stock market
indices: 1) the AMEX Market Value Index, 2) an index comprised of a group of
peer companies engaged in precious metal mining, and 3) the Standard and Poor's
Gold Index.
The peer group of North American mining companies includes data from
nine companies, all of which are listed on NASDAQ, AMEX, or NYSE. The nine
companies are: Alta Gold Co., Bema Gold Corporation, Coeur d'Alene Mines
Corporation, Crown Resources Corporation, Dayton Mining Corporation, Glamis Gold
Ltd., Hecla Mining Company, Sunshine Mining and Refining Company, and Vista Gold
Corp. The Standard and Poor's Gold Index includes data from five large North
American gold mining companies: Barrick Gold Corporation, Battle Mountain Gold
Company, Homestake Mining Company, Newmont Gold Company, and Placer Dome Inc.
<TABLE>
<CAPTION>
TOTAL RETURN ANALYSIS 12/31/93 12/30/94 12/29/95 12/31/96 12/31/97 12/31/98
<S> <C> <C> <C> <C> <C> <C>
Canyon Resources $100 $38.45 $ 60.00 $ 64.62 $ 27.68 $ 6.15
S&P Gold $100 $80.79 $ 90.93 $ 90.25 $ 59.32 $ 52.01
Amex Market Value Index $100 $90.89 $114.89 $122.25 $148.27 $150.85
Peer Group $100 $78.76 $ 66.35 $ 60.05 $ 27.94 $ 16.62
</TABLE>
11
<PAGE> 14
COMPENSATION OF DIRECTORS
During 1998, the Company paid its Directors who are not officers,
employees, or otherwise retained by the Company an annual Director's fee of
$5,000, plus $1,000 for each attended meeting of the Board ($250 for each
telephonic meeting) and $500 for each Compensation and Audit Committee meeting.
The Chairman of the Audit Committee received an additional $2,000 of
compensation. The Company reimburses its Directors for expenses incurred in
attending meetings.
During 1998, Leland O. Erdahl, James E. Askew, and William C. Parks,
were each granted options to purchase 10,000 shares of common stock under the
Company's Non-Qualified Stock Option Plan. The options were granted at an
exercise price of $0.81 per share, the closing market price of the Company's
common stock on the date of the grant. The options are exercisable as of June
10, 1999, and expire on June 9, 2003. Mr. Parks resigned from the Board
effective March 23, 1999, and his 1998 grant will expire if not exercised on or
before June 21, 1999. Richard F. Mauro was appointed to fulfill the unexpired
term of Mr. Parks on April 9, 1999 and was granted an option to purchase common
stock under the Company's Non-Qualified Stock Option Plan. Mr. Mauro was granted
an option to purchase 50,000 shares at an exercise price of $0.13 per share, the
closing market price of the Company's common stock on the date of the grant. The
options are exercisable immediately, and expire on April 8, 2004.
CHANGE IN CONTROL ARRANGEMENT
The Company has entered into employment agreements with certain
executive employees, including Messrs. De Voto, Huber, and Phillips which are
only effective in the event of a "change in control" of the Company, as defined
in the employment agreements. Upon the occurrence of such a change in control,
the Company has agreed to continue the executives' employment and the executives
have agreed to remain in the Company's employ for a period ranging from six to
twenty-four months after such change in control (the "Employment Period").
During the Employment Period, the executive shall receive an annual base salary
at least equal to twelve times the highest monthly base salary paid to the
executive by the Company during the twelve-month period immediately preceding
the month in which the change of control occurs. Further, under the agreement,
the executive may terminate the employment agreement for "good reason." If
terminated for good reason, the executive is entitled to receive any accrued
obligations to such executive plus the executive's salary payable for the
remainder of the Employment Period. "Good reason" is defined in the agreement to
include: (i) a significant diminution of the executive's duties, (ii) a failure
of the Company to pay salary and other amounts due under the agreement, (iii)
requiring the executive to move beyond a 20 mile radius of the Company's
principal office, (iv) an unauthorized termination of the executive, or (v)
failure of the Company to require any successor company to honor the provisions
of the employment agreement.
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board has appointed PricewaterhouseCoopers LLP to audit the
Company's financial statements prepared in connection with the submittal of the
Company's Report on Form 10-K for the fiscal year ending December 31, 1999. The
Board recommends that the shareholders ratify that appointment.
PricewaterhouseCoopers LLP has audited the Company's financial statements since
inception.
The Company has requested representatives of PricewaterhouseCoopers LLP
to be present at the Meeting, will make available to such representatives an
opportunity to make a statement if they so desire, and expects them to be
available to respond to appropriate questions.
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<PAGE> 15
THE SHARES OF COMMON STOCK REPRESENTED BY THE PROXIES IN THE
ACCOMPANYING FORM WILL BE VOTED "FOR" THE RATIFICATION OF THE APPOINTMENT OF
INDEPENDENT PUBLIC ACCOUNTANTS UNLESS A CONTRARY DIRECTION IS INDICATED.
SHAREHOLDER PROPOSALS
Proposals by shareholders of the Company to be presented at the 2000
Annual Meeting of Shareholders must be received by the Company no later than
January 6, 2000, to be included in the Company's Proxy Statement and proxy for
that meeting. If a shareholder intends to submit a proposal at the meeting that
is not included in the Company's proxy statement, and the shareholder fails to
notify the Company prior to March 17, 2000 of such proposal, then the proxies
appointed by the Company's management would be allowed to use their
discretionary voting authority when the proposal is raised at the annual
meeting, without any discussion of the matter in the proxy statement. The
proponent must be a record or beneficial owner entitled to vote on his or her
proposal at the next Annual Meeting and must continue to own such security
entitling him or her to vote through that date on which such meeting is held.
The proponent must own 1% or more of the outstanding shares or $2,000.00 in
value of the Company's Common Stock and must have owned such shares for one year
in order to present a shareholder proposal to the Company.
ANNUAL REPORT
The Annual Report to Shareholders concerning the operation of the
Company during the fiscal year ended December 31, 1998, including certified
financial statements for the year then ended, has been enclosed with this Proxy
Statement. The Annual Report is not incorporated in this Proxy Statement and is
not to be considered a part of the soliciting material.
OTHER MATTERS
The Board knows of no other special business to be presented at the
Meeting. If other matters properly come before the Meeting, the persons named in
the accompanying form of proxy intend to vote on such other matters in
accordance with their best judgement.
AVAILABILITY OF ANNUAL REPORT ON FORM 10-K
UPON A WRITTEN REQUEST, THE COMPANY WILL PROVIDE, WITHOUT CHARGE, A
COPY OF ITS ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31,
1998, TO EACH SHAREHOLDER OF RECORD OR TO EACH SHAREHOLDER WHO OWNED COMMON
STOCK OF THE COMPANY LISTED IN THE NAME OF A BANK OR BROKER, AS NOMINEE, AT THE
CLOSE OF BUSINESS ON APRIL 23, 1999. ANY REQUEST BY A SHAREHOLDER FOR THE
COMPANY'S ANNUAL REPORT ON FORM 10-K SHOULD BE MAILED TO THE COMPANY'S
SECRETARY, C/O CANYON RESOURCES CORPORATION, 14142 DENVER WEST PARKWAY, SUITE
250, GOLDEN, COLORADO 80401.
By Order of the Board of Directors
Gary C. Huber
May 1, 1999 Corporate Secretary
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<PAGE> 16
PROXY CANYON RESOURCES CORPORATION PROXY
14142 Denver West Parkway, Suite 250
Golden, Colorado 80401
The undersigned holder of Common Stock acknowledges receipt of Notice of an
Annual Meeting of Shareholders of Canyon Resources Corporation, hereby appoints
Richard H. De Voto and Gary C. Huber, or either of them, as Proxies, each with
the power to appoint a substitute, and hereby authorizes them to represent and
to vote, as designated below, all shares of Common Stock of Canyon Resources
Corporation held of record by the undersigned on April 23, 1999, at the Annual
Meeting of Shareholders to be held on June 10, 1999, or at any adjournment
thereof, with respect to the following:
1. ELECTION OF DIRECTOR - Nominee: Richard F. Mauro
/ / FOR nominee / / WITHHOLD AUTHORITY to vote for nominee
IF AUTHORITY IS NOT EXPRESSLY WITHHELD, IT SHALL BE DEEMED GRANTED.
- -------------------------------------------------------------------------------
2. RATIFICATION OF THE APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
/ / FOR / / AGAINST / / ABSTAIN
This Proxy is solicited on behalf of the Board of Directors and may be revoked
prior to its exercise. This Proxy, when properly executed, will be voted as
directed above by the undersigned shareholders. If no direction is made, it will
be voted FOR the nominee named in Item 1, and FOR the Ratification of the
appointment of the independent public accountants in Item 2, and in the Proxies'
discretion on such other business as may properly come before the Meeting.
Date:
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Signature
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Signature if held jointly
(Please sign EXACTLY as your name appears on your stock certificate(s).
If more than one name appears because of joint ownership, all joint
owners should sign.)
