424(b)(3)
Commission File No. 333-152195
TARA MINERALS CORP.
Common Stock
This Prospectus relates to shares (the "Shares") of common stock (the
"Common Stock") of Tara Minerals Corp. ("Tara Minerals" or "the Company") which
may be issued pursuant to certain employee compensation plans adopted by the
Company. The employee compensation plans provide for the grant, to selected
employees of the Company and other persons, of either shares of the Company's
common stock or options to purchase shares of the Company's common stock.
Persons who received Shares pursuant to the Plans and who are offering such
shares to the public by means of this Prospectus are referred to as the "Selling
Shareholders".
The Company has an Incentive Stock Option Plan, a Non-Qualified Stock
Option Plan and a Stock Bonus Plan. In some cases these plans are collectively
referred to as the "Plans". The terms and conditions of any stock grants and the
terms and conditions of any options, including the price of the shares of Common
Stock issuable on the exercise of options, are governed by the provisions of the
respective Plans and any particular agreements between the Company and the Plan
participants.
The Selling Shareholders may offer the shares from time to time in
negotiated transactions in the over-the-counter market, at fixed prices which
may be changed from time to time, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at negotiated
prices. The Selling Shareholders may effect such transactions by selling the
Shares to or through securities broker/dealers, and such broker/dealers may
receive compensation in the form of discounts, concessions, or commissions from
the Selling Shareholders and/or the purchasers of the Shares for whom such
broker/dealers may act as agent or to whom they sell as principal, or both
(which compensation as to a particular broker/dealer might be in excess of
customary commissions). See "Selling Shareholders" and "Plan of Distribution".
None of the proceeds from the sale of the Shares by the Selling
Shareholders will be received by the Company. The Company has agreed to bear all
expenses (other than underwriting discounts, selling commissions and fees and
expenses of counsel and other advisers to the Selling Shareholders). The Company
has agreed to indemnify the Selling Shareholders against certain liabilities,
including liabilities under the Securities Act of 1933, as amended (the
"Securities Act").
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.
THESE SECURITIES ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK. FOR A
DESCRIPTION OF CERTAIN IMPORTANT FACTORS THAT SHOULD BE CONSIDERED BY
PROSPECTIVE INVESTORS, SEE "RISK FACTORS" BEGINNING ON PAGE 4 OF THIS
PROSPECTUS.
The date of this prospectus is April 28, 2009.
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AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and in accordance therewith, files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Proxy statements, reports and other information concerning the
Company can be inspected and copied at the Commission's office at 100 F Street,
NE, Washington, D.C. 20549. Certain information concerning the Company is also
available at the Internet Web Site maintained by the Securities and Exchange
Commission at www.sec.gov. This Prospectus does not contain all information set
forth in the Registration Statement of which this Prospectus forms a part and
exhibits thereto which the Company has filed with the Commission under the
Securities Act and to which reference is hereby made.
DOCUMENTS INCORPORATED BY REFERENCE
The Company will provide, without charge, to each person to whom a copy of
this Prospectus is delivered, including any beneficial owner, upon the written
or oral request of such person, a copy of any or all of the documents
incorporated by reference herein (other than exhibits to such documents, unless
such exhibits are specifically incorporated by reference into this Prospectus).
Requests should be directed to:
Tara Minerals Corp.
2162 Acorn Court
Wheaton, IL 60187
(630) 462-2079
Attention: Secretary
The following documents filed with the Commission by the Company are
hereby incorporated by reference into this Prospectus:
(1) the Company's Registration Statement on Form SB-2 (SEC file #
333-143512);
(2) the Company's report on Form 10-K for the year ended October 31, 2008.
(3) the Company's transition report on Form 10-Q for the transition period
ended December 31, 2008.
All documents filed with the Commission by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering registered hereby shall
be deemed to be incorporated by reference into this Prospectus from the date of
the filing of such documents. Any statement contained in a document incorporated
or deemed to be incorporated by reference shall be deemed to be modified or
superseded for the purposes of this Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Such statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
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TABLE OF CONTENTS
Page
PROSPECTUS SUMMARY ........................................
RISK FACTORS ..............................................
DILUTION AND COMPARATIVE SHARE DATA.......................
USE OF PROCEEDS ..........................................
SELLING SHAREHOLDERS......................................
PLAN OF DISTRIBUTION .....................................
DESCRIPTION OF COMMON STOCK ..............................
GENERAL ..................................................
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PROSPECTUS SUMMARY
Tara Minerals was incorporated in Nevada on May 12, 2006.
Tara Minerals is involved in the exploration and development of mining
properties which may be productive of metals such as copper, lead and zinc. As
of the date of this prospectus Tara Minerals had acquired four mining properties
in Mexico.
Tara Minerals' offices are located at 2162 Acorn Court, Wheaton, IL
60187. Tara Minerals' telephone number is 630-462-2079 and its fax number is
630-456-4135.
Tara Minerals' common stock trades on the OCT Bulletin Board under the
symbol "TARM".
Tara Minerals' website is www.taraminerals.com.
As of April 28, 2009 Tara Minerals had 40,942,667 outstanding shares of
common stock.
The Offering
By means of this prospectus a number of the shareholders of Tara Minerals
are offering to sell shares of its common stock. The shares owned by the selling
shareholders may be sold in the over-the-counter market, or otherwise, at prices
and terms then prevailing or at prices related to the then-current market price,
or in negotiated transactions.
The purchase of the securities offered by this prospectus involves a high
degree of risk. Risk factors include the lack of any relevant operating history,
losses since Tara Minerals was incorporated, and the need for Tara Minerals to
sell more of its common stock to raise additional capital. See "Risk Factors"
for additional risks.
RISK FACTORS
The securities offered by this prospectus involve a high degree of risk.
Prospective investors should consider the following risk factors which affect
Tara Minerals' business and this offering. If any of the risks discussed below
materialize, shares of Tara Minerals' common stock could decline in value or
become worthless.
Risk Factors Related to Tara Minerals' Business.
TARA MINERALS IS IN THE EXPLORATION STAGE, HAS CONDUCTED ONLY LIMITED
OPERATIONS, AND MAY NEVER BE PROFITABLE. As of the date of this prospectus Tara
Minerals:
o had not generated any revenue, and
o did not have any probable or proven reserves.
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Tara Minerals may not be able to implement its business plan, may never be
profitable, and the shares which may be sold in this offering may not have any
value.
THE FAILURE OF TARA MINERALS TO OBTAIN CAPITAL MAY SIGNIFICANTLY RESTRICT ITS
PROPOSED OPERATIONS. The capital required for exploration and development of
mining properties is substantial. Even if Tara Minerals finds a valuable deposit
of minerals, it may be several years before production is possible.
Tara Minerals does not know what the terms of any future capital raising
may be but any future sale of Tara Minerals' equity securities would dilute the
ownership of existing stockholders and could be at prices substantially below
the price of the shares of common stock sold in this offering. The failure of
Tara Minerals to obtain the capital which it requires will result in the slower
implementation of Tara Minerals' business plan or the inability of Tara Minerals
to implement its business plan. Tara Minerals may not be able to obtain the
capital which it will need.
TARA MINERALS' EARNINGS WILL BE AFFECTED BY THE PRICE OF COPPER, LEAD, ZINC AND
SILVER. Tara Minerals' revenues will primarily be derived from the sale of
metals such as copper, lead, zinc and silver. As a result, Tara Minerals'
earnings will be directly related to the prices of these metals which are
affected by numerous factors including:
o expectations for inflation;
o speculative activities;
o relative exchange rate of the U.S. dollar;
o global and regional demand and production;
o political and economic conditions; and
o production costs in major producing regions.
These factors are beyond Tara Minerals' control and are impossible to
predict. If the market prices for these metals fall below the costs to produce
them for a sustained period of time, Tara Minerals may have to discontinue its
exploration, development or mining operations.
THE EXPLORATION AND DEVELOPMENT OF NEW ORE BODIES MAY COST MORE AND PROVIDE LESS
RETURN THAN ESTIMATED. Tara Minerals' operations will be dependent to a large
extent on its ability to explore for and develop new ore bodies and/or expand
existing mining operations. Before it can begin a development project, Tara
Minerals must first determine whether it is economically feasible to do so. This
determination will be based on estimates of several factors, including:
o reserves;
o expected recovery rates of metals from the ore;
o facility and equipment costs;
o capital and operating costs of a development project;
o future metals prices;
o comparable facility and equipment costs; and
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o anticipated climate conditions.
Some mining prospects may have no operating history upon which to base any
estimates, in which case estimates will be based in large part on Tara Minerals'
interpretation of geological data, a limited number of drill holes, and other
sampling techniques. Actual operating costs and returns from a development
project may differ substantially from estimates, causing the project to be
uneconomical.
TARA MINERALS' EXPLORATION EFFORTS MAY NOT BE SUCCESSFUL. Tara Minerals must
continually replace ore reserves depleted by production. Tara Minerals' ability
to replace depleted ore reserves will depend on the success of its exploration
program. Mineral exploration is highly speculative, involves many risks and is
often nonproductive. Even if Tara Minerals finds a valuable deposit of minerals,
it may be several years before production is possible.
During that time, it may not be economically feasible to mine and process
mineral deposits. Establishing ore reserves requires substantial capital
expenditures and, in the case of new properties, to construct mining and
processing facilities. As a result of these costs and uncertainties, Tara
Minerals may never be profitable.
TARA MINERALS WILL FACE STRONG COMPETITION FROM OTHER MINING COMPANIES FOR THE
ACQUISITION OF PROPERTIES. Mines have limited lives and as a result, Tara
Minerals must continually seek to replace and expand reserves through the
acquisition of new properties. In addition, there is a limited supply of
desirable mineral lands available in the Mexico and other areas where Tara
Minerals would consider conducting exploration and/or production activities.
Tara Minerals will face strong competition for new properties from other mining
companies, many of which have greater financial resources than Tara Minerals. As
a result, Tara Minerals may be unable to acquire attractive new mining
properties on terms that considered acceptable.
THE UNAVAILABILITY OF PERSONNEL, MATERIAL OR EQUIPMENT WOULD PREVENT THE
EXPLORATION AND DEVELOPMENT OF TARA MINERALS' PROPERTIES. Tara Minerals does not
plan to hire any additional employees to implement its business plan but rather
plans to use independent contractors for its mining operations. In addition, all
material and equipment used in its mining operations will be obtained from
unrelated third parties. However, shortages of qualified personnel, material and
equipment needed for Tara Minerals' mining operations could interfere with Tara
Minerals' exploration and development plans and, consequently, Tara Minerals may
incur costs in excess of those anticipated as well as delays in its mining
operations. Additionally, because the contractors who will provide services to
Tara Minerals may be involved in mining activities for others, to the extent the
contractors can obtain only a limited supply of a necessary item, they may use
the item for mining operations unrelated to Tara Minerals' properties.
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THE TITLES TO SOME PROPERTIES MAY BE DEFECTIVE, IN WHICH CASE TARA MINERALS MAY
NOT BE ABLE TO PRODUCE ORE FROM THE PROPERTIES. Mining properties located in
foreign countries may constitute a significant portion of Tara Minerals'
property holdings. The validity of the title to mining properties in foreign
countries is often uncertain and may be contested. In accordance with mining
industry practice, Tara Minerals will not generally obtain title opinions until
it decides to develop a property. Therefore, while Tara Minerals will attempt to
acquire satisfactory title to undeveloped properties, some titles may be
defective.
TARA MINERALS' OPERATIONS MAY BE ADVERSELY AFFECTED BY RISKS AND HAZARDS
ASSOCIATED WITH THE MINING INDUSTRY. Tara Minerals' business will be subject to
a number of risks and hazards including:
o environmental hazards;
o political and country risks;
o industrial accidents;
o labor disputes;
o unusual or unexpected geologic formations;
o cave-ins;
o explosive rock failures; and
o flooding and periodic interruptions due to inclement or hazardous
weather conditions.
These risks could result in:
o damage to or destruction of mineral properties or producing
facilities;
o personal injury;
o environmental damage;
o delays in mining;
o monetary losses; and
o legal liability.
However, Tara Minerals may not be able to obtain insurance to protect
itself against future losses, particularly if there is a significant increase in
the cost of premiums. Insurance against environmental risks may generally be
either unavailable or too expensive, in which case Tara Minerals would not
maintain environmental insurance. To the extent Tara Minerals is subject to
environmental liabilities, it would have to pay for these liabilities. Moreover,
in the event that Tara Minerals is unable to fully pay for the cost of remedying
an environmental problem, Tara Minerals might be required to suspend operations
or enter into other interim compliance measures.
TARA MINERALS MAY BE UNABLE TO CONDUCT MINING OPERATIONS IF IT IS UNABLE TO
OBTAIN REQUIRED GOVERNMENT PERMITS. In the ordinary course of business, mining
companies are required to obtain government permits for mining operations.
Obtaining the necessary government permits is a complex and time-consuming
process involving numerous jurisdictions and often involving public hearings and
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costly undertakings. The duration and success of efforts to obtain permits will
be contingent upon many variables not within Tara Minerals' control. Obtaining
environmental protection permits, including the approval of reclamation plans,
may increase costs and cause delays depending on the nature of the activity to
be permitted and the interpretation of applicable requirements implemented by
the permitting authority. Tara Minerals may not be able to obtain all permits
necessary for its mining operations and, if obtained, the costs involved may
exceed those previously estimated. It is possible that the costs and delays
associated with the compliance with applicable standards and regulations could
become so significant that Tara Minerals would not proceed with the development
or operation of a mine or mines.
TARA MINERALS WILL FACE SUBSTANTIAL GOVERNMENTAL REGULATION AND ENVIRONMENTAL
RISKS, WHICH COULD CAUSE TARA MINERALS TO SPEND SUBSTANTIAL AMOUNTS OF MONEY.
Tara Minerals' business will be subject to extensive laws and regulations
governing development, production, labor standards, occupational health, waste
disposal, use of toxic substances, environmental regulations, mine safety and
other matters.
Tara Minerals may be required to maintain reserves for costs associated
with mine closure, reclamation of land and other environmental matters. Future
expenditures related to closure, reclamation and environmental expenditures are
difficult to estimate due to:
o the uncertainties relating to the costs and remediation methods that
will be required in specific situations;
o the possible participation of other potentially responsible parties;
and
o changing environmental laws, regulations and interpretations.
Various laws and permits require that financial assurances be in place for
certain environmental and reclamation obligations and other potential
liabilities. The amount of the financial assurances and the amount required to
be set aside as collateral for financial assurances are dependent upon a number
of factors, including reclamation cost estimates. Tara Minerals may be unable to
maintain the financial assurances which may be required.
TARA GOLD RESOURCES CORP. OWNS A CONTROLLING INTEREST IN TARA MINERALS' COMMON
STOCK. Tara Gold Resources Corp., by virtue of its controlling interest in Tara
Minerals, is able to control the election of directors, the appointment of
officers, and the outcome of other corporate actions requiring
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shareholder approval. As a result of this concentration of ownership, other
shareholders do no have the voting power to change management, even if a change
in management would be perceived by the investment community as being
beneficial.
Risk Factors Related to this Offering
- -------------------------------------
SINCE AS OF THE DATE OF THIS PROSPECTUS THERE WAS ONLY A LIMITED PUBLIC MARKET
FOR TARA MINERALS' COMMON STOCK, PURCHASERS OF THE SHARES OFFERED BY THIS
PROSPECTUS MAY BE UNABLE TO SELL THEIR SHARES. If purchasers are unable to sell
their shares, purchasers may never be able to recover any amounts which they
paid for Tara Minerals' common stock.
DISCLOSURE REQUIREMENTS PERTAINING TO PENNY STOCKS MAY REDUCE THE LEVEL OF
TRADING ACTIVITY IN THE MARKET FOR TARA MINERALS' COMMON STOCK AND INVESTORS MAY
FIND IT DIFFICULT TO SELL THEIR SHARES. Trading in Tara Minerals' common stock
is subject to Rule 15g-9 of the Securities and Exchange Commission, which rule
imposes certain requirements on broker/dealers who sell securities subject to
the rule to persons other than established customers and accredited investors.
For transactions covered by the rule, brokers/dealers must make a special
suitability determination for purchasers of the securities and receive the
purchaser's written agreement to the transaction prior to sale. The Securities
and Exchange Commission also has rules that regulate broker/dealer practices in
connection with transactions in "penny stocks". Penny stocks generally are
equity securities with a price of less than $5.00 (other than securities
registered on certain national securities exchanges or quoted on the NASDAQ
system, provided that current price and volume information with respect to
transactions in that security is provided by the exchange or system). The penny
stock rules require a broker/ dealer, prior to a transaction in a penny stock
not otherwise exempt from the rules, to deliver a standardized risk disclosure
document prepared by the Commission that provides information about penny stocks
and the nature and level of risks in the penny stock market. The broker/dealer
also must provide the customer with current bid and offer quotations for the
penny stock, the compensation of the broker/dealer and its salesperson in the
transaction, and monthly account statements showing the market value of each
penny stock held in the customer's account. The bid and offer quotations, and
the broker/dealer and salesperson compensation information, must be given to the
customer orally or in writing prior to effecting the transaction and must be
given to the customer in writing before or with the customer's confirmation.
SELLING SHAREHOLDERS
The Company has issued (or may in the future issue) shares of its common
stock to various persons pursuant to certain employee compensation plans adopted
by the Company. The employee compensation plans provide for the grant or
issuance to selected employees of the Company and other persons of shares of the
Company's common stock or options to purchase shares of the Company's common
stock. Persons who received shares pursuant to the Plans and who are offering
such shares to the public by means of this Prospectus are referred to as the
"Selling Shareholders".
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The Company has adopted stock option and stock bonus plans. A summary
description of these plans follows. In some cases these Plans are collectively
referred to as the "Plans".
Incentive Stock Option Plan. The Company's Incentive Stock Option Plan
authorizes the issuance of shares of the Company's Common Stock to persons that
exercise options granted pursuant to the Plan. Only Company employees may be
granted options pursuant to the Incentive Stock Option Plan.
Non-Qualified Stock Option Plan. The Company's Non-Qualified Stock Option
Plan authorizes the issuance of shares of the Company's Common Stock to persons
that exercise options granted pursuant to the Plans. The Company's employees,
directors, officers, consultants and advisors are eligible to be granted options
pursuant to the Plans, provided however that bona fide services must be rendered
by such consultants or advisors and such services must not be in connection with
the offer or sale of securities in a capital-raising transaction. The option
exercise price is determined by the Committee.
Stock Bonus Plan. The Company's Stock Bonus Plan allows for the issuance
of shares of Common Stock to it's employees, directors, officers, consultants
and advisors. However bona fide services must be rendered by the consultants or
advisors and such services must not be in connection with the offer or sale of
securities in a capital-raising transaction.
Summary. The following is a summary of the options granted pursuant to the
Plans as of April 28, 2009. Each option represents the right to purchase one
share of the Company's common stock.
Total Shares
Shares Reserved for Shares Remaining
Reserved Outstanding Issued as Options/Shares
Name of Plan Under Plans Options Stock Bonus Under Plans
- ------------ ----------- ------------ ----------- --------------
Incentive Stock
Option Plan 1,000,000 -- N/A 1,000,000
Non-Qualified Stock
Option Plan 3,000,000 1,000,000 N/A 2,000,000
Stock Bonus Plan 750,000 N/A 650,000 100,000
The following table shows the options granted as of April 28, 2009. All of
the options listed below were granted pursuant to the Company's Non-Qualified
Stock Option Plan.
Shares Issuable
Upon Exercise Exercise Expiration Options Exercised
Name of Options Price Date As of April 28,
- ---- --------------- -------- ---------- -----------------
2009
Francis R. Biscan, Jr. 750,000 $0.05 2/01/10 --
Clifford A. Brown 250,000 $0.05 2/01/10 --
Ramiro Trevizo Ledezma -- -- -- --
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Shares issued or issuable upon the exercise of options granted to the
Company's officers and directors pursuant to the Incentive Stock Option and
Non-Qualified Stock Option Plans, as well as shares issued pursuant to the Stock
Bonus Plan, are being offered by means of this Prospectus. The following table
lists the shareholdings of the Company's officers and directors and the shares
offered by means of this Prospectus as of April 28, 2009.
Number of Shares Number of
Being Offered Shares to be
Name of ------------------ Owned on Percent
Selling Number of Option Bonus Completion of of
Shareholder Shares Owned Shares (1) Shares the Offering Class
- ----------- ------------ ---------- ------ ------------- -------
Francis R. Biscan, Jr. 250,000 750,000 250,000 -- --
Clifford A. Brown 200,000 250,000 200,000 -- --
Ramiro Trevizo Ledezma 200,000 -- 200,000 -- --
(1) Represents shares issuable upon the exercise of Non-Qualified stock options.
The Company has filed with the Commission under the Securities Act of 1933
a Form S-8 registration statement, of which this Prospectus forms a part, with
respect to the resale of the Shares from time to time in the over-the-counter
market or in privately negotiated transactions.
PLAN OF DISTRIBUTION
The Selling Shareholders may sell the Shares offered by this Prospectus
from time to time in negotiated transactions in the over-the-counter market at
fixed prices which may be changed from time to time, at market prices prevailing
at the time of sale, at prices related to such prevailing market prices or at
negotiated prices. The Selling Shareholders may effect such transactions by
selling the Shares to or through broker/dealers, and such broker/dealers may
receive compensation in the form of discounts, concessions, or commissions from
the Selling Shareholders and/or the purchasers of the Shares for which such
broker/dealers may act as agent or to whom they may sell, as principal, or both
(which compensation as to a particular broker/dealer may be in excess of
customary compensation).
The Selling Shareholders and any broker/dealers who act in connection with
the sale of the Shares hereunder may be deemed to be "underwriters" within the
meaning of ss.2(11) of the Securities Acts of 1933, and any commissions received
by them and profit on any resale of the Shares as principal might be deemed to
be underwriting discounts and commissions under the Securities Act. The Company
has agreed to indemnify the Selling Shareholders and any securities
broker/dealers who may be deemed to be underwriters against certain liabilities,
including liabilities under the Securities Act as underwriters or otherwise.
The Company has advised the Selling Shareholders that they and any
securities broker/dealers or others who may be deemed to be statutory
underwriters will be subject to the Prospectus delivery requirements under the
Securities Act of 1933. The Company has also advised each Selling Shareholder
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that in the event of a "distribution" of the shares owned by the Selling
Shareholder, such Selling Shareholder, any "affiliated purchasers", and any
broker/ dealer or other person who participates in such distribution may be
subject to Rule 102 under the Securities Exchange Act of 1934 ("1934 Act") until
their participation in that distribution is completed. A "distribution" is
defined in Rule 102 as an offering of securities "that is distinguished from
ordinary trading transactions by the magnitude of the offering and the presence
of special selling efforts and selling methods". The Company has also advised
the Selling Shareholders that Rule 101 under the 1934 Act prohibits any
"stabilizing bid" or "stabilizing purchase" for the purpose of pegging, fixing
or stabilizing the price of the Common Stock in connection with this offering.
DESCRIPTION OF SECURITIES
Tara Minerals is authorized to issue 75,000,000 shares of common stock.
Holders of common stock are each entitled to cast one vote for each share held
of record on all matters presented to shareholders. Cumulative voting is not
allowed; hence, the holders of a majority of the outstanding common stock can
elect all directors.
Holders of common stock are entitled to receive such dividends as may be
declared by the Board of Directors out of funds legally available therefore and,
in the event of liquidation, to share pro rata in any distribution of Tara
Minerals' assets after payment of liabilities. The board is not obligated to
declare a dividend. It is not anticipated that dividends will be paid in the
foreseeable future.
Holders of common stock do not have preemptive rights to subscribe to
additional shares if issued by Tara Minerals. There are no conversion,
redemption, sinking fund or similar provisions regarding the common stock. All
outstanding shares of common stock are fully paid and nonassessable.
Transfer Agent
Corporate Stock Transfer, Inc., 3200 Cherry Creek Drive South, Suite 430,
Denver, Colorado 80209. Telephone 303-282-4800, Fax 303-282-5800.
GENERAL
The Company's Bylaws provide that the Company will indemnify its directors
and officers against expense and liabilities they incur to defend, settle or
satisfy any civil or criminal action brought against them as a result of their
being or having been the Company directors or officers unless, in any such
action, they have acted with gross negligence or willful misconduct. Officers
and Directors are not entitled to be indemnified for claims or losses resulting
from a breach of their duty of loyalty to the Company, for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law or a transaction from which the director derived an improper personal
benefit. Insofar as indemnification for liabilities arising under the Securities
Act of l933 may be permitted to the Company's directors and officers, the
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Company has been informed that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of l933, and is, therefore, unenforceable.
No dealer, salesman, or any other person has been authorized to give any
information or to make any representations other than those contained in this
prospectus in connection with this offering and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or the selling shareholders. This prospectus does not constitute
an offer to sell, or a solicitation of any offer to buy, the securities offered
in any jurisdiction to any person to whom it is unlawful to make an offer or
solicitation. Neither the delivery of this prospectus nor any sale made
hereunder shall, under any circumstances, create an implication that there has
not been any change in the affairs of the Company since the date hereof or that
any information contained herein is correct as to any time subsequent to its
date.
All dealers effecting transactions in the registered securities, whether
or not participating in this distribution, may be required to deliver a
prospectus. This is an addition to the obligation of dealers to deliver a
prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions.
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