SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant
Filed by a Party other than the Registrant
Check the appropriate box:
Preliminary Proxy Statement
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
CROWN 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):
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:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction pursuant
to Exchange Act Rule 0-11:*
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
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:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
CROWN RESOURCES CORPORATION
Notice of Annual Meeting of Shareholders
To the Shareholders:
The Annual Meeting of the Shareholders of Crown Resources
Corporation will be held at the World Trade Center, 1625 Broadway,
Suite 820, Denver, Colorado, on Thursday, June 15, 2000, at 10:00
a.m., Mountain Daylight Time, for the following purposes:
1. Election of Directors. To elect seven Directors to
serve until the next Annual Meeting of Shareholders and until
their successors are elected and qualified.
2. Appointment of Auditors. To ratify the appointment
of Deloitte & Touche LLP as the Company's independent auditors
for fiscal year 2000.
3. Other Business. To transact such other business as
may properly come before the meeting and all adjournments
thereof.
The stock transfer books of the Company will not be closed.
The Board of Directors has fixed the close of business on May 3,
2000, as the record date for the determination of shareholders
entitled to notice of, and to vote at, the Annual Meeting. The
approximate date of the mailing of this Proxy Statement and the
enclosed form of proxy is May 5, 2000.
Your attention is directed to the accompanying Proxy
Statement. To constitute a quorum for the conduct of business at
the Annual Meeting, it is necessary that holders of a majority of
all outstanding shares entitled to vote at the meeting be present
in person or be represented by proxy. To assure representation at
the Annual Meeting, you are urged to date and sign the enclosed
proxy and return it promptly in the enclosed envelope.
By Order of the Board of
Directors
James R. Maronick
Secretary
May 1, 2000
Denver, Colorado
PROXY STATEMENT
Annual Meeting of Shareholders
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Crown Resources
Corporation, a Washington corporation (the "Company"), of proxies
in the accompanying form for use at the Annual Meeting of
Shareholders to be held on Thursday, June 15, 2000, and any
adjournment or postponement of such meeting. The Annual Meeting
will be held at 10:00 a.m., Mountain Daylight Time, at The World
Trade Center, 1625 Broadway, Suite 820, Denver, Colorado.
The principal office of the Company is located at 1675
Broadway, Suite 2400, Denver, Colorado, 80202.
Proxies are solicited so that each shareholder may have an
opportunity to vote. These proxies will enable shareholders to
vote on all matters that are scheduled to come before the meeting.
When proxies are returned properly executed, the shares represented
thereby will be voted in accordance with the shareholders'
directions. Shareholders are urged to specify their choices by
marking the appropriate boxes on the enclosed proxy card; if no
choice has been specified, the shares will be voted as recommended
by the Board of Directors of the Company (the "Board"). Means have
been provided whereby a shareholder may withhold his vote for any
Director. The proxy cards also confer discretionary authority to
vote the shares authorized to be voted thereby on any matter that
was not known on the date of the Proxy Statement but may properly
be presented for action at the meeting.
You are asked to sign, date, and return the accompanying proxy
card regardless of whether or not you plan to attend the meeting.
Any shareholder returning a proxy has the power to revoke it at any
time before shares represented by the proxy are voted at the
meeting. Any shares represented by an unrevoked proxy will be
voted unless the shareholder attends the meeting and votes in
person. A shareholder's right to revoke his or her proxy is not
limited by or subject to compliance with a specified formal
procedure, but written notice should be given to the Corporate
Secretary of the Company at or before the meeting.
The expense of printing and mailing proxy material will be
borne by the Company. In addition to the solicitation of proxies
by mail, solicitation may be made by certain Directors, officers,
and other employees of the Company in person or by telephone or
other means of electronic communication. No additional
compensation will be paid for such solicitation.
Arrangements will also be made with brokerage firms and other
custodians, nominees, and fiduciaries to forward proxy solicitation
material to certain beneficial owners of the Company's Common Stock
and the Company will reimburse such brokerage firms, custodians,
nominees , fiduciaries for reasonable out-of-pocket expenses
incurred by them in connection therewith.
Shares Outstanding
The holders of the Company's $.01 par value Common Stock (the
"Common Stock"), at the close of business on May 3, 2000, are
entitled to vote at the Annual Meeting. On the record date, May 3,
2000, there were outstanding 14,533,422 shares of Common Stock.
Each share of Common Stock entitles its holder to one vote. The
presence in person or by proxy of holders of record of a majority
of the outstanding shares of Common Stock is required to constitute
a quorum for the transaction of business at the meeting. Under
Washington law and the Company's Articles of Incorporation, if a
quorum is present at the meeting the seven nominees for election as
Directors who receive the greatest number of votes cast for
election of directors at the meeting by the shares present in
person or represented by proxy at the meeting and entitled to vote
shall be elected Directors. Shares held by persons who abstain
from voting on the election of Directors and broker non-votes will
not be counted in the election. Shares held by persons abstaining
will be counted in determining whether a quorum is present for the
purpose of voting on the proposal but broker non-votes will not be
counted for this purpose.
The Company also has issued 1,000,000 shares of its Series A
Nonconvertible Preferred Stock to a subsidiary of the Company.
Although the terms of the Preferred Stock entitle its holder to
vote as a shareholder of the Company, under Washington corporate
law this stock may not be voted while it is held by a subsidiary of
the Company.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information, as of April 17,
2000, with respect to the number of shares of Common Stock
beneficially owned by each shareholder known by the Company to be
the beneficial owner of more than five percent of the Common Stock,
by all Directors, nominees for director, executive officers named
in the Summary Compensation Table and all Directors, nominees for
director and executive officers as a group. Except as noted below,
each shareholder has sole voting and investment powers with respect
to the shares shown. Unless otherwise indicated below, the address
of each beneficial owner is 1675 Broadway, Suite 2400, Denver,
Colorado 80202.
Percent of
Name and Address of Amount and Nature of the Company's
Beneficial Owner Beneficial Ownership Common Stock
The Equitable Life Assurance Society (1). . . . 1,000,000 6.9
City Place House, 55, Basinghall Street
London EC2V 5DR
Mark E. Jones, III (2) . . . . . . . . . . . . 238,958 1.6
Christopher E. Herald (3) . . . . . . . . . . . 450,483 3.0
J. Michael Kenyon (4) . . . . . . . . . . . . . 77,800 0.5
Rodney D. Knutson (5) . . . . . . . . . . . . . 60,000 0.4
Linder G. Mundy (6) . . . . . . . . . . . . . . 60,150 0.4
Steven A. Webster (7) . . . . . . . . . . . . . 151,256 1.0
David R. Williamson (8) . . . . . . . . . . . . 100,000 0.7
James R. Maronick (9) . . . . . . . . . . . . . 133,886 0.9
All Directors, nominees for director,
and executive officers as a group
(10 persons) (3)(4)(10) . . . . . . . . . . . 1,633,696 10.4
(1) Based upon information supplied to the Company by the shareholder.
(2) Includes options to purchase 238,625 shares.
(3) Includes options to purchase 267,500 shares and 7,640 shares owned by
Mr. Herald's
spouse of which Mr. Herald disclaims beneficial ownership.
(4) Includes options to purchase 60,000 shares and
(5) Includes options to purchase 60,000 shares.
(6) Includes options to purchase 60,000 shares.
(7) Includes options to purchase 60,000 shares.
(8) Includes options to purchase 60,000 shares and 40,000 shares owned by
David Williamson
Associates Ltd.
(9) Includes options to purchase 125,000 shares.
(10) Includes, in the aggregate, options to purchase 1,233,125 shares.
ELECTION OF DIRECTORS
The Board currently consists of seven Directors. The
Directors elected at the Annual Meeting will serve until the next
Annual Meeting of Shareholders and until their successors are
elected and qualified. Unless the vote is withheld by the
shareholder, the proxies solicited by the Board will be voted for
the re-election of all the current Directors, who are:
Mark E. Jones, III. Mr. Jones, age 60, has been a Director
and the Chairman of the Board of the Company since it commenced
operations in February 1989. He was Chief Executive Officer of the
Company from February 1989 until July 1993. He was President of
the Company from September 1989 to November 1990. Mr. Jones is
also Chairman of Solitario Resources Corporation ("Solitario"), a
57.2 percent-owned subsidiary of the Company that is engaged in
exploration and development of properties in South America. Mr.
Jones also serves as Chairman of Star Resources Corporation, a
diamond exploration company.
Christopher E. Herald. Mr. Herald, age 46, has been a
Director of the Company since April 1989. He has served as Chief
Executive Officer of the Company since June of 1999 and President
of the Company since November 1990 and was Executive Vice President
of the Company from January 1990 to November 1990. Mr. Herald also
serves as Chief Executive Officer and a director of Solitario.
J. Michael Kenyon. Mr. Kenyon, age 50, has been a Director of
the Company since it commenced operations. Mr. Kenyon is President
of Hastings Resource Corp, a private mineral resource company and
is a private consultant to Barrick Gold Corporation.
Rodney D. Knutson. Mr. Knutson, age 58, has been a Director
of the Company since it commenced operations. He was a partner in
the law firm of Jones & Keller, P.C. from 1992 to 1998; and has
been of counsel to the law firm of Jones & Keller, P.C. since
January 1998.
Linder G. Mundy. Mr. Mundy, age 72, has been a Director of
Crown since its inception. Since 1985, Mr. Mundy has been a
private business consultant.
Steven A. Webster. Mr. Webster, age 48, has been a Director
of the Company since it commenced operations. Mr. Webster is a
director and Vice Chairman of R & B Falcon Corporation, an
international offshore drilling contractor; is managing director of
Global Energy Partners, an affiliate of Donaldson Lufkin and
Jenret's merchant banking group; is chairman of Carrizo Oil & Gas,
Inc., an oil exploration company; is a trust manager of Camden
Property Trust, a real estate investment trust; is a director of
Grey Wolf, Inc., a land rig contractor; and is a director of
Geokinetics, Inc., a geophysical company;.
David R. Williamson. Mr. Williamson, age 58, has been a
Director of the Company since September 1989. In 1989 he founded
David Williamson Associates Ltd., which undertakes research and
consulting for the mining industry. He also serves as a director
of Crew Development Corporation, Cornucopia Resources Ltd., and
Asia Pacific Resources, all mining and exploration companies.
It is intended that votes will be cast pursuant to the
enclosed proxy for the election of Directors from the foregoing
nominees. If any nominee shall not be a candidate for election as
a Director at the meeting, it is intended that votes will be cast
pursuant to the enclosed proxy for such substitute nominees as may
be nominated by the existing Directors. No circumstances are
presently known which would render any nominee named herein
unavailable.
Under the Company's Bylaws, shareholders seeking to nominate
other candidates for election to the Board at the Annual Meeting
must give written notice to the Corporate Secretary of the Company
no less than sixty (60) nor more than ninety (90) days before the
Annual Meeting. The notice must be accompanied by certain
information as to the shareholder giving the notice and each
proposed nominee, including information similar to that required
under the federal proxy rules. If less than seventy (70) days'
notice or prior public disclosure of the
date of the scheduled meeting is given, notice by the shareholder
must be given not later than the tenth day following the earlier of
mailing of notice of the meeting or the date public disclosure of
the meeting date was made. The Bylaws provide that no person shall
be elected a Director of the Company unless nominated in accordance
with the Bylaws. No Director nominations by shareholders for the
2000 Annual Meeting had been received by the Company prior to the
date of this Proxy Statement.
Directors' Compensation
Directors who are not employees of the Company are reimbursed
for their expenses incurred in attending Board meetings. Directors
are eligible to receive options to purchase Common Stock granted
under the Company's 1988 Stock Benefit Plan (the "1988 Plan") and
non-qualified stock options under the 1991 Stock Incentive Plan
(the "1991 Plan"). All options, under both plans, terminate after
five years from date of grant if not earlier exercised.
Under the 1991 Plan, the Board of Directors may (a) grant
incentive stock options, as defined in Section 422 of the Internal
Revenue Code of 1986, as amended, to any non-director employee of
the Company or to any non-director employee of any parent or
subsidiary of the Company; (b) grant options other than incentive
stock options (i.e. non-qualified stock options)except that members
of the Board of Directors are eligible only to receive formula
grants of non-qualified stock options. Each Director who is not an
employee automatically receives an award of a non-qualified stock
options covering 10,000 shares of Crown Common Stock on February 28
each year; (c) grant stock appreciation rights or cash bonus
rights; (d) award stock bonuses; and (e) grant stock purchase
rights and sell stock subject to restrictions. All options granted
to Directors under the 1991 Plan have an exercise price equal to
the fair market value of the Company's Common Stock on the date of
grant and they are exercisable from and after the date of grant.
The Board of Directors reserved 1,500,000 shares of Common Stock
for grants under the 1991 Plan. Currently, 1,129,856 shares remain
available for issue under the 1991 Plan; of these, options for
1,095,749 shares have been granted and options for 34,107 are
available for grant.
Generally, the terms and conditions of the 1988 Plan are
similar to those of the 1991 Plan described above, except that
members of the Board of Directors were not restricted to receive
formula grants of non-qualified stock options. The Board of
Directors reserved 1,500,000 shares of Common Stock for grants
under the 1988 Plan. The 1988 Plan had a ten-year term and no
additional grants of options may be made under the 1988 Plan.
Currently, 557,500 shares remain available for issue pursuant to
options previously granted under the 1988 Plan.
Meetings of Board of Directors and Committees
During the fiscal year ended December 31, 1999, there were
four meetings of the Board. Each of the incumbent Directors
attended at least 75 percent of the aggregate of the total number
of meetings of the Board held while they served as a Director and
the total number of meetings held by all committees of the Board on
which they served, except for David Williamson, who attended 25
percent of the meetings. All of the references to meetings exclude
actions taken by written consent.
The Board has an Audit Committee consisting exclusively of
non-employee Directors, Messrs. Kenyon Mundy and Webster. Mr.
Herald served on the audit committee through April of 2000 when he
was replaced by Mr. Kenyon. The Audit Committee reviews the
preparation and auditing of accounts of the Company; considers and
recommends to the Board the engagement of independent certified
public accountants for the ensuing year and the terms of such
engagement; reviews the scope of the audit proposed by such
accountants; implements and periodically reviews the performance of
the independent accountants; and reviews the annual financial
report to the Directors and shareholders of the Company. The Audit
Committee met once during the fiscal year ended December 31, 1999.
The Board also has a Compensation Committee consisting of non-
employee Directors, Messrs. Kenyon, Knutson, and Webster. The
Compensation Committee is responsible for reviewing and approving
executive compensation and administering the Company's stock option
programs. The Compensation Committee met once during 1999.
The Board does not have a nominating committee or other
committee performing similar functions.
Compliance with Section 16(a) of the Securities Exchange Act of
1934
Section 16(a) of the Securities Exchange Act of 1934 requires
the Company's Directors and executive officers, and persons who own
more than ten percent of a registered class of the Company's equity
securities, to file with the Securities and Exchange Commission
("SEC") initial reports of ownership and reports of changes in
ownership of Common Stock and other equity securities of the
Company. Officers, Directors, greater than ten percent
shareholders are required by SEC regulation to furnish the Company
with copies of all Section 16(a) forms they file. To the Company's
knowledge, based solely on review of the copies of such reports
furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31,
1999, all Section 16(a) filing requirements applicable to officers,
Directors, and greater than ten percent beneficial owners were
complied with.
EXECUTIVE COMPENSATION
Report of the Compensation Committee
Overview and Philosophy. The Compensation Committee of the
Board is composed entirely of three independent non-employee
directors. The Compensation Committee is responsible for reviewing
and approving executive compensation and administering the
Company's stock option programs. Following review and approval by
the Compensation Committee, all issues pertaining to executive
compensation are submitted to the full Board for approval.
The policy of the Compensation Committee in determining
executive compensation is that such compensation should (i) reflect
Company performance, (ii) reward individual performance, (iii)
align the interests of the executives with the long-term interests
of the shareholders and (iv) assist the Company in attracting and
retaining key executives critical to the long-term success of the
Company.
Executive Officer Compensation Program. The major elements of
the executive compensation program during 1999 consisted
principally of base salary, bonuses, and the Company's stock option
plans, which reward executives for delivering value to Crown
shareholders as measured by increases in the Common Stock price and
performance of the Company's share price relative to its industry
peer group.
Base Salary. Base salaries of executive officers are
established annually, at the beginning of each year. The
Compensation Committee reviews the responsibilities, experience,
performance of the executive officers, basing its approval of base
salary levels and changes thereupon on these and other factors,
including the competitive marketplace and the Company's budget
considerations. Due to budget considerations, there were no salary
increases granted to executive officers during 1999.
Bonuses. Bonuses are granted to executive officers at the
discretion of the Board. During 1999, bonuses were paid to certain
salaried employees in amounts equal to five percent of annual base
pay. Some of the bonuses were paid in the form of shares of the
Company's common stock.
Stock Option Plans. The shareholders have approved the
Company's stock option plans. The Board granted stock options in
fiscal 1998 to certain eligible employees including the Named
Executive Officers pursuant to the 1991 Plan. The objectives of
both the 1988 Plan and the 1991 Plan are to align executive and
shareholder long-term interests by creating a direct link between
executive pay and shareholder return, as well as provide long-term
incentives to the executive.
Non-qualified stock options are granted under the 1991 Plan to
non-director executive officers at an option price not less than
the average price for the five business days immediately preceding
the date of grant. Such non-qualified stock options are 25 percent
vested upon date of grant and vest an additional 25 percent each
year so that they are 100 percent vested after three years. The
Board grants such options annually.
Executive officers who are also members of the Board are
eligible only to receive formula grants of non-qualified stock
options under the 1991 Plan. Such executive officers are entitled
to receive automatically, on February 28 of each year, an award of
stock options calculated by dividing the executive officer's annual
base compensation rate on the grant date by three. All such
options are granted at a price equal to the fair market value of
the Company's Common Stock on the date of the grant.
All options granted to executive officers terminate after five
years from date of grant if not earlier exercised.
On June 5, 1999 and on June 19, 1998 the Board of Directors,
voted to reprice all existing stock options, held by current
officers, Directors and employees to $1.75, and to $4.06,
respectively, which was the then current market price of the
stock. The Board believed the worldwide declines in metals prices
over the prior two years and the ongoing difficulties faced in the
permitting of the Crown Jewel Project had a significant impact on
Crown's stock price and that the beneficial work of Crown's
management in a difficult environment, which included the positive
action taken by the President and Congress in getting the approval
of the Crown Jewel Plan of Operations, was not reflected in the
stock price. The use of Crown's stock options as both an incentive
and a form of compensation had further declined over the prior two
years. Crown's management and employees have not been given an
increase in salaries for the last six years. The directors of
Crown receive no compensation for their services, other than their
stock options. The Board recognized the efforts of the Company's
management and employees and believes that the retention of
existing personnel and recruitment of new personnel require the use
of stock options. Accordingly, the Board felt a repricing of
existing stock options in both years, to the then current market
level, was warranted for past service and as an incentive for
future performance. The total number of stock options repriced in
1999 was 1,559,775 which included 507,500 stock options from the
1988 Plan and 1,052,275 stock options from the 1991 Plan. The
total number of stock options repriced was 1,276,841 which included
523,250 stock options from the 1988 Plan and 753,591 stock options
from the 1991 Plan.
401(k) Plan. In 1990 the Company adopted the Crown Resources
Corporation 401(k) Plan ("401(k) Plan"), a defined-contribution
plan covering all full-time employees, including the Named
Executive Officers. The 401(k) Plan provides for Company matching,
at the rate of 75 percent, of employee savings contributions up to
nine percent of annual compensation, subject to ERISA limitations.
Company contributions are subject to vesting percentages of 25
percent after one year of vesting service, increasing annually by
25 percent, such that all amounts are fully vested after four years
of vesting service. Plan participants may direct the investment of
contributions in any of several different funds, including a
government securities fund and various debt and equity funds.
Compensation of the Chief Executive Officer. Mr. Herald's
compensation for 1999 was based upon the established compensation
policies described above. In establishing Mr. Herald's base
salary, the Board evaluated the competitive standing of the Company
as measured by criteria such as market capitalization, potential
ounces of annual gold production, proven gold reserves, and stock
performance. The Board also considered the duties,
responsibilities, and performance of Mr. Herald in his capacity as
Chief Executive Officer of Crown and executive pay rates of peer
group companies. Mr. Herald's 1999 salary and performance
incentives reflect his responsibilities in directing the day-to-
day activities of Crown and its subsidiaries. Mr. Herald's salary
arrangement and performance incentives will continue to be
evaluated by the Board periodically. During 1999, Mr. Herald
received a bonus of 3,080 shares of common stock of the Company,
valued at $8,666.
The stock options granted to Mr. Herald during fiscal 1999
were granted in accordance with the formula in the 1991 Plan.
COMPENSATION COMMITTEE
Rodney D. Knutson, Chairman
J. Michael Kenyon
Steven A. Webster
Summary Compensation Table
The following table sets forth the compensation paid by the Company during each of the
last three fiscal years to its Chairman and its President and each of the next most highly
paid executive officers whose cash compensation exceeded $100,000 during the fiscal year
ending December 31, 1999:
Long-Term
Annual Compensation Compensation All
Awards Other
Salary Bonuses Options Compensation
Name and Principal Position Year ($) ($) (#) ($)
Mark E. Jones, III, Chair. 1999 98,175 4,909 32,725(1) 11,168(2)
205,900(14)
135,000(5)
68,000(5)
80,000(17)
1998 98,175 4,909 32,725(1) 10,614(2)
235,508(15)
1997 98,175 20,618(3) 75,000(4) 12,937(2)
Christopher E. Herald, CEO 1999 144,375 8,663(6) 48,125(1) 9,931(8)
219,375(14)
145,000(5)
68,000(5)
70,000(17)
1998 144,375 7,810(7) 48,125(1) 9,993(8)
217,083(15)
1997 144,375 30,323(9) 75,000(4) 9,759(10)
70,000(5)
James R. Maronick, CFO 1999 100,000 6,000(11) 30,000(1) 6,933(13)
95,000(14)
70,000(5)
44,000(5)
50,000(17)
1998 100,000 5,410(12) 15,000(1) 7,005(13)
65,000(15)
1997 29,283(18) 0 50,000(1) 2,062(16)
50,000(5)
(1) Granted under the Company's 1991 Plan. See "Option Grants in Last
Fiscal Year."
(2) Includes $6,627 in fully-vested employer matching contributions to
401(k) Plan.
(3) Includes 2,732 shares of common stock, valued at a market price of
$5.75 per share, issued as a bonus.
(4) Granted under the Company's 1988 Plan. See "Option Grants in Last
Fiscal Year."
(5) Options to acquire Solitario common stock, granted under the Solitario
1994 Stock Option Plan.
(6) Includes 3,080 shares of common stock, valued at a market price of
$2.81 per share, issued as a bonus.
(7) Includes 2,118 shares of common stock, valued at a market price of
$3.69 per share, issued as a bonus.
(8) Amount includes $7,500 in fully-vested employer matching
contributions to 401(k) Plan.
(9) Includes 4,018 shares of common stock, valued at a market price of
$5.75 per share, issued as a bonus.
(10) Amount includes $7,125 in fully-vested employer matching contributions
to 401(k) Plan.
(11) Includes 2,133 shares of common stock valued at a market price of $2.81
per share, issued as a bonus.
(12) Includes 1,467 shares of common stock, valued at a market price of
$3.69 per share, issued as a bonus.
(13) Amount includes $6,750 in fully-vested employer matching contributions
to 401(k) Plan.
(14) Amount includes shares of the 1991 and 1988 Plans repriced by the Board
on June 5, 1999 to $1.75.
(15) Amount includes shares of the 1991 and 1988 Plans repriced by the Board
on June 19, 1998 to $4.06.
(16) Amount includes $1,977 in fully-vested employer matching contributions
to 401(k) Plan.
(17) Amount includes shares of the 1994 Solitario Plan repriced by Solitario
on March 16, 1999 to Cdn$1.16.
(18) Employment began September 15, 1997.
Options
The following tables set forth for the fiscal year ended December 31, ]
1999 contain certain information regarding options
granted to, exercised by, and held at year end by the Named Executive Officers.
OPTION GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
Percent of Potential Realizable
Total Value at Assumed
Options Annual Rates of
Granted Exercise Stock Price
Options to Employees or Base Appreciation for
Granted in Fiscal Price(2) Expiration Option Term (1)
Name (#) Year ($/sh) Date 5%($) 10%($)
Mark E. Jones, III 32,725(3) 11.8% $1.75 2/28/2004 14,726 32,398
135,000(5) 15.3% Cdn$1.16 3/16/2004 30,503(6) 67,680(6)
68,000(5) 8.8% Cdn$1.22 6/08/2004 16,805(6) 36,011(6)
Christopher E. Herald 48,125(3) 17.4% $1.75 2/28/2004 21,656 47,644
145,000(5) 16.5% Cdn$1.16 3/16/2004 32,763(6) 72,693(6)
68,000(5) 8.8% Cdn$1.22 6/08/2004 16,805(6) 36,011(6)
James R. Maronick 30,000(4) 10.8% $1.75 2/28/2004 13,500 29,700
70,000(5) 9.0% Cdn$1.16 3/16/2004 15,817(6) 35,093(6)
44,000(5) 5.0% Cdn$1.22 6/08/2004 10,874(6) 23,301(6)
(1) Potential realizable value is based on an assumption that the stock
price of the Common Stock appreciates at the annual
rate shown (compounded annually) from the date of grant, as repriced,
until the end of the five-year option term.
These numbers are calculated based on the requirements promulgated by
the SEC and do not reflect the Company's estimate
of future stock price growth.
(2) Options were repriced to $1.75 on June 5, 1999.
(3) The options granted are non-qualified stock options that vest and
become exercisable upon date of grant. Such options
are nonassignable and nontransferable except by will or by the laws
of descent and distribution. All options terminate
five years from date of grant.
(4) The options granted are non-qualified stock options that vest and
become exercisable over a four-year period, becoming
fully vested on February 28, 2002. Such options are nonassignable
and nontransferable except by will or by the laws
of descent and distribution. Options not already exercisable may
become exercisable upon mergers or changes in control
of the Company, pursuant to the 1991 Plan. All options terminate
five years from date of grant.
(5) Options granted pursuant to the Solitario 1994 Plan
(6) Value of increase in Cdn$ converted to US$ at the December 31, 1999
exchange rate.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
Number of Unexercised Value of Unexercised
Shares Value Options at Fiscal in-the Money Options
Acquired on Realized Year-End (#) at Fiscal Year-End ($)
Name Exercise(#) ($) Exercisable/Unexercisable Exercisable/Unexercisable
Mark E. Jones, III 0 0 205,900/ 0 51,475 / 0 (1)
0 0 283,000/ 0 0 / 0 (2)
Christopher E. Herald 0 0 219,375/ 0 54,844 / 0 (1)
0 0 283,000/ 0 0 / 0 (2)
James R. Maronick 0 0 52,500/42,500 13,125 /10,625(1)
0 0 66,000/98,000 0 / 0 (2)
(1) Value based on market price of $2.00 per share of Crown Common Stock
at December 31, 1999, less the exercise price.
(2) Value based on market price of Cdn$1.00 per share of Solitario
Common Stock at December 31, 1999, less the exercise price, converted
to US$.
TEN-YEAR OPTION/SAR REPRICINGS
Securities Years of
underlying Market price of Exercise price original option
number of stock at time of at time of New exercise term remaining
Name Date options/SARs repricing or repricing or price ($) at date of
repriced or amendment ($) amendment ($) repricing or
amended (#) amendment
Mark E. Jones, III 6/05/1999 32,725(1) $1.75 $2.56 $1.75 4.8
32,725(1) $1.75 $4.06 $1.75 3.8
65,450(1) $1.75 $4.06 $1.75 1.8
75,000(2) $1.75 $4.06 $1.75 2.6
3/16/1999 80,000(3) Cdn$1.16 Cdn$2.25 Cdn$1.16 2.8
6/19/1998 32,725(1) $4.06 $4.19 $4.06 4.7
65,450(1) $4.06 $5.63 $4.06 2.7
75,000(2) $4.06 $5.75 $4.06 3.5
62,333(1) $4.06 $6.56 $4.06 0.7
Christopher E. Herald 6/05/1999 48,125(1) $1.75 $2.56 $1.75 4.8
48,125(1) $1.75 $4.06 $1.75 3.8
48,125(1) $1.75 $4.06 $1.75 1.8
75,000(2) $1.75 $4.06 $1.75 2.6
3/16/1999 70,000(3) Cdn$1.16 Cdn$2.25 Cdn$1.16 2.8
6/19/1998 48,125(1) $4.06 $4.19 $4.06 4.7
48,125(1) $4.06 $5.63 $4.06 2.7
75,000(2) $4.06 $5.75 $4.06 3.5
45,833(1) $4.06 $6.56 $4.06 0.7
James R. Maronick 6/05/1999 30,000(1) $1.75 $2.63 $1.75 4.8
15,000(1) $1.75 $4.06 $1.75 3.8
30,000(1) $1.75 $4.06 $1.75 3.3
3/16/1999 50,000(3) Cdn$1.16 Cdn$4.40 Cdn$1.16 3.4
6/19/1998 15,000(1) $4.06 $4.30 $4.06 4.7
50,000(1) $4.06 $5.73 $4.06 4.2
(1) Options granted pursuant to the 1991 Plan.
(2) Options granted pursuant to the 1988 Plan.
(3) Options granted by Solitario pursuant to the 1994 Plan.
COMPARATIVE STOCK PERFORMANCE
The following performance graph compares the performance of the Company's
Common Stock to the NASDAQ Stock Market Total Return Index, the S & P Gold
Mining Index, and an seven-company peer group for the Company's last five
fiscal years. The graph assumes the value of the investment was $100 at
December 31, 1992 and measures that investment at December 31 of each of the
years shown. All dividends are assumed to be reinvested. The graph is
presented pursuant to requirements of the SEC. The information contained in
this graph is not necessarily indicative of future price performance.
CROWN RES CORP
Cumulative Total Return
12/94
12/95
12/96
12/97
12/98
12/99
CROWN RESOURCES CORPORATION
100.00
119.70
150.00
101.52
49.24
45.45
PEER GROUP
100.00
93.78
163.95
70.86
30.11
26.84
NASDAQ STOCK MARKET (U.S.)
100.00
141.34
173.90
213.07
300.43
555.99
S & P GOLD & PRECIOUS METALS MINING
100.00
112.55
111.71
73.36
64.32
61.96
(1) Consists of Barrick Gold, Battle Mountain Gold, Echo Bay Mines, Homestake
Mining, Newmont Mining, and Placer Dome, all of which are major gold
producers.
(2) Consists of Alta Gold, Bema Gold, Canyon Resources, Glamis Gold, Metallica
Resources, and Royal Gold.
INDEPENDENT PUBLIC ACCOUNTANTS
The Company's Shareholders are asked to ratify the selection
of Deloitte & Touche LLP, independent public accountants, to
continue as the Company's auditors for fiscal 2000.
Representatives from Deloitte & Touche LLP are expected to be
present at the Annual Meeting of Shareholders to make a statement
if they so desire and to respond to appropriate questions.
PROPOSALS OF SHAREHOLDERS
Under the Company's Bylaws, shareholders seeking to propose
business to be conducted at the 2000 Annual Meeting must give
written notice to the Corporate Secretary of the Company no later
than the time that shareholder Director nominations must be
received. The notice must contain certain information as to the
proposal and the shareholder, including the share ownership of
the shareholder and any financial interest in the proposal. Any
proposal not made in compliance with the Bylaws may be rejected
by the Board. No shareholder proposals for the 2000 Annual
Meeting had been received by the Company prior to the date of
this Proxy Statement.
Shareholder proposals intended to be presented at the 2001
Annual Meeting of Shareholders should be received by the Company
prior to January 1, 2001, for inclusion in the Company's Proxy
Statement for that meeting.
OTHER BUSINESS
The Company knows of no other business to be presented at the
meeting. If any other business properly comes before the
meeting, it is intended that the shares represented by proxies
will be voted with respect thereto in accordance with the best
judgment of the person named in the accompanying form of proxy.
Upon written request from any person solicited herein
addressed to the Corporate Secretary of the Company at its
principal offices, the Company will provide, at no cost, a copy
of the Annual Report on Form 10-K filed with the SEC for the
fiscal year ended December 31, 1999.
By Order of the
Board of
Directors
James R. Maronick
Secretary
May 1, 2000
Denver, Colorado
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CROWN RESOURCES CORPORATION
For Annual Meeting of Shareholders to be held on June 15, 2000
The undersigned hereby appoints Christopher E. Herald and James
R. Maronick, and each of them, with full power of substitution,
proxies of the undersigned at the Annual Meeting of Shareholders of
Crown Resources Corporation (the "Company"), to be held at the World
Trade Center, 1625 Broadway, Suite 820, Denver, Colorado, on
Thursday, June 15, 2000, at 10:00 a.m., Mountain Daylight Time, and
at all adjournments or postponements thereof, and hereby authorizes
them to represent and to vote all of the shares of Common Stock of
the Company held by the undersigned as fully as the undersigned
could do if personally present. Said proxies are herein
specifically authorized to vote the shares of Common Stock of the
Company which the undersigned is entitled to voate in the election
of Directors as proposed in the Proxy Statement, to ratify the
appointment of auditors as proposed in the Proxy Statement and to
vote said shares upon such other matters as may properly come before
the meeting or any adjournment or postponement thereof as the above-
named proxies shall determine.
The shares of Common Stock represented by this Proxy will be
voted or not voted on the matters set forth in accordance with the
specifications indicated herein.
(IMPORTANT - TO BE SIGNED AND DATED ON REVERSE SIDE;
PLEASE RETURN USING THE ENCLOSED ENVELOPE)
The Board of Directors recommends that shareholders vote in favor
of Proposals 1 and 2.
1. ELECTION OF DIRECTORS
Nominees: Mark E. Jones, III, Christopher E. Herald, J. Michael
Kenyon, Rodney D. Knutson, Linder G. Mundy, Steven A. Webster,
and David R. Williamson
FOR (All nominees) Except withhold authority to vote for any
individual nominee by lining through or otherwise striking
out the name of any nominee.
WITHHELD
2. APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE
COMPANY'S AUDITORS FOR AGAINST
ABSTA
IN
3. To transact such other business as may properly come
before the meeting and all adjournments or postponements
thereof.
If no specification is made with respect to the above
matters, the shares of Common Stock of the undersigned will be voted
FOR the election of these Directors, FOR the appointment of Deloitte
& Touche LLP, and either for or against such other matters as may
properly come before the meeting or any adjournment or postponement
thereof, as the above-named proxies may determine.
Please sign exactly as your name appears hereon. Where
shares are held by joint tenants, both should sign. When
signing as attorney, executor, admin-istrator, trustee or
guardian, please give full title as such. If a
corporation, please sign in full corporate name by
President or other authorized person.
DATED
,2000
(Signature)
(Signature if held jointly)
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