SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities
Exchange Act of 1934
Check the appropriate box:
[_] Preliminary Information Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
[X] Definitive Information Statement
YAAK RIVER RESOURCES, INC.
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(Name of Registrant as Specified In Its Charter)
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Yaak River Resources, Inc.
423 Baybridge Drive
Sugarland, TX 77478
281-242-7656
NOTICE OF ACTION TAKEN BY THE SHAREHOLDERS
BY WRITTEN CONSENT OF A MAJORITY
MAY 19, 2004
To The Shareholders of Yaak River Resources, Inc.
Eric Sunsvold, Donald J. Smith, Robert Pike, and Darrell Benjamin
(collectively, the "Majority Shareholders") are the holders of a total of
43,361,582 shares or approximately 64% of the total issued and outstanding stock
of Yaak River Resources, Inc., a Colorado corporation (the "Company"). The
Majority Shareholders have adopted the following resolutions by written consent
in lieu of a meeting pursuant to the Business Corporation Act of the State of
Florida, and subject to the Notice requirements of Section 14 of the Securities
Exchange Act of 1934.
1. To change the Company's name to a name to be determined by the
Board of Directors.
2. To authorize a reverse split of the Company's common stock on a
one for sixty-eight basis.
Blaize N. Kaduru, President
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WE ARE NOT ASKING YOU FOR A CONSENT OR A PROXY AND YOU ARE
REQUESTED NOT TO SEND US A PROXY.
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Yaak River Resources, Inc.
423 Baybridge Drive
Sugarland, TX 77478
281-242-7656
May 19, 2004
NOTICE OF SHAREHOLDERS' ACTION
The Majority Shareholders have submitted their consents to the actions
described in this Information Statement on or about May 19, 2004, to be
effective on or before June 10, 2004. As of May 10, 2004, the Majority
Shareholders held of record 43,361,582 shares of the Company's common stock, or
approximately 64% of the total issued and outstanding common stock of the
Company. The remaining outstanding shares of common stock are held by
approximately fifty-five other shareholders.
The Majority Shareholders consenting consist of Eric Sunsvold, Donald J.
Smith, Robert Pike, and Darrell Benjamin. See "SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS."
Holders of the common stock of record as of May 10, 2004 are entitled to
submit their consent to the shareholder resolutions described in this
Information Statement, although no shareholder consents other than that of the
Majority Shareholders are required to be submitted in order for the resolution
to be adopted. The Company is NOT soliciting consents or proxies and
shareholders have no obligation to submit either of them. Whether or not
shareholders submit consents should not affect their rights as shareholders or
the prospects of the proposed shareholder resolutions being adopted. The
Majority Shareholders will consent to all of the shareholder resolutions
described in this Information Statement. The affirmative vote of the holders of
a majority of the outstanding common stock of the Company is required to adopt
the resolutions described in this Information Statement. Florida law does not
require that the proposed transaction be approved by a majority of the
disinterested shareholders. A total of 41,360,010 shares of common stock will be
entitled to vote on the Company's proposed transactions described in this
Information Statement.
THE COMPANY
The Company has its executive offices at 423 Baybridge Drive, Sugarland, TX
77478, and its telephone number is (281) 242-7656. As described in the
accompanying NOTICE OF ACTION TO BE TAKEN BY THE SHAREHOLDERS, the Company
proposes to adopt certain amendments to the Articles of Incorporation by
shareholder action as follows:
Proposal #1
AMENDMENT TO ARTICLES FOR
CORPORATION NAME CHANGE
The majority shareholders have authorized a change in the name of this
corporation to a name to be chosen by the Board in its discretion. This requires
an amendment to the Articles of Incorporation.
The Board believes the name change in our Articles of Incorporation is in
the best interest of the corporation to change from a mineral exploration image
of the Company.
PROPOSAL 2
REVERSE SPLIT OF COMMON STOCK ISSUED AND OUTSTANDING
To Authorize a reverse split of the common stock on a one for sixty-eight
basis, by which each sixty-eight shares shall become one share.
Our shareholders have approved a pro-rata reverse split of our common
stock, by which each sixty-eight shares would become one share. The effective
date of the reverse split will be within 45 days following the date of the
mailing of this Notice.
The shareholders entitled to fractional shares as a result of the
reverse split will have the fractional shares rounded up to the nearest whole
share, because the cost of administering fractional share to the Company and
the confusion, inconvenience, and administrative time at the transfer agent and
for "street name" shareholders. The Board has determined that it is more cost
effective and better business practice on a cost/benefit analysis to handle
fractional shares this way than to attempt to administer them as fractional
shares or to pay cash or scrip for them. At the most, the Company estimates,
this rounding up to the nearest whole share would result in the issuance of
fractional shares on a post-reverse split basis which at current price is $1.40
at $.014 per share.
There will be no change in the number of record holders as a result of
the reverse split.
We believe that reverse split will be advantageous to us and to all
shareholders, because it may provide the opportunity for higher share prices
based upon fewer shares. It is also a factor that most brokerage houses do not
permit or favor lower-priced stocks to be used as collateral for margin
accounts. Certain polices and practices of the securities industry may tend to
discourage individual brokers within those firms from dealing in lower-priced
stocks. Some of those polices and practices involve time-consuming procedures
that make the handling of lower priced stocks economically unattractive. The
brokerage commissions on the purchase or sale of lower priced stocks may also
represent a higher percentage of the price than the brokerage commission on
higher priced stocks.
As a general rule, potential investors who might consider making
investments in our company will refuse to do so when the company has a large
number of shares issued and outstanding with no equity. In other words, the
"dilution" which new investors would suffer would discourage them from
investing, as general rule of experience. A reduction in the total outstanding
shares may, without any assurance, make our capitalization structure more
attractive.
The Company does not now qualify for a listing on any exchange, AMEX,
NASDAQ, NYSE, or any smaller exchange. The Company does not meet any exchange
qualifications at this time except that it is an SEC registered company. There
is no assurance whatsoever that the Company will ever meet most of any exchange
listing criteria.
There is no assurance that any effect to the price of our stock will
result, or that the market price for our common stock, immediately or shortly
after the proposed changes will rise, or that any rise which may occur will be
sustained. Market conditions are not predictable and may be influenced by
changes in investor attitudes and external economic conditions. We are proposing
the steps we deem best calculated to meet the market attractively. We cannot
control the market's reaction.
Dissenting shareholders have no appraisal rights under Colorado law or
pursuant to our constituent documents of incorporation or bylaws, in connection
with the reverse split.
Additional information regarding the Company, its business, its stock,
and its financial condition are included in the Company's Form 10-KSB annual
reports and its Form 10-QSB quarterly reports. Copies of the Company's Form
10-KSB for its fiscal year ending December 31, 2002 and its quarterly report on
the Form 10-QSB for the quarter ending September 30, 2003 are available upon
request to: Blaize N. Kaduru, President, Yaak River Resources, Inc., 423
Baybridge Drive, Sugarland, TX 77478.
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS AND CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information known to the Company
with respect to the beneficial ownership of the Company's common stock as of
April 20, 2004 by (i) each person who is known by the Company to own
beneficially more than 5% of the Company's common stock, (ii) each of the
Company's directors and executive officers, and (iii) all officers and directors
of the Company as a group. Except as otherwise listed below, the address of each
person is c/o Yaak River Resources, Inc., 423 Baybridge Drive, Sugarland, TX
77478.
Name and Address of Number of Shares Percentage
Beneficial Owner Owned Beneficially of Class
Eric Sunsvold 6,694,605 9.9%
423 Baybridge Drive
Sugarland, TX 77478
Donald J. Smith 31,661,977(1) 47.0%
2501 E. Third St.
Casper, WY 82609
Robert Pike 680,000 1.0%
6396 E. Fair Avenue
Englewood, CO 80111
Blaize N. Kaduru 0 0%
423 Baybridge Drive
Sugarland, TX 77478
Darrell Benjamin 4,325,000 6.4%
6658 S. Starlight Rd.
Morrison, CO 80465
All officers and directors 32,341,977 48.0%
as a group (two persons)
(1) The figure shown includes 10,000 shares held in the name of Suvo
Corp. Mr. Smith is the owner of Suvo Corp.
The Company currently has 67,308,857 shares issued and outstanding.
Notes to the table:
Unless otherwise indicated, the persons named in the table have sole voting
and investment power with respect to all shares of common stock shown as
beneficially owned by them.
MANAGEMENT
The following table lists the names and ages of the executive officers and
directors of the Company. The directors were appointed in prior years and will
continue to serve until the next annual shareholders meeting or until their
successors are appointed and qualified. All officers serve at the discre- tion
of the Board of Directors.
NAME AGE POSITION WITH THE COMPANY
---- --- -------------------------
Blaize N. Kaduru 53 President, Secretary and
Treasurer and a Director
since December 18, 2002
Robert Pike 74 Vice President and a Director
since December 21, 1999
BLAIZE N. KADURU. Mr. Kaduru is an Adjunct Professor, teaching economics
and business related college courses at Wharton Junior College in Sugarland,
Texas, since January 2003. Previously, he was Executive Vice President of
Business Development for Wireless Communications Technology, Inc., a spin-off
of Prodigy Communications Inc. in Houston, Texas.
ROBERT PIKE. Mr. Pike has been Vice President and a Director of the
Company since December 21, 1999. Mr. Pike is a retired banker. For more than
the past five years, he has been an investor. Also for more than the past five
years, Mr. Pike has been President and sole owner of Bob Pike Associates, Inc.,
a real estate consulting and inspection firm, based in Englewood, Colorado, that
serves financial institutions.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, the Company has been informed that in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Act and is therefore unenforceable.
BOARD COMMITTEES
The Board of Directors currently serves as an Audit Committee and
Compensation Committee. During the fiscal year ended December 31, 2003, the
Board of Directors held occasional meetings.
COMPENSATION OF DIRECTORS
Directors receive no cash compensation for their services to the
Company as directors, but are reimbursed for expenses actually incurred in
connection with attending meetings of the Board of Directors.
SUMMARY COMPENSATION TABLE OF EXECUTIVES
Cash Compensation Security Grants
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Name and Year Salary Bonus Annual Restricted Securities Long Term LTIP All Other
Principal Compensation Stock Underlying Compensation/ Payments Other
Compensation /Other($) Awards Options/ Options
Position SARs(#)
(SHARES)
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Blaize N. 2001 0 0 0 0 0 0 0 0
Kaduru, 2002 0 0 0 0 0 0 0 0
President, 2003 0 0 0 0 0 0 0 0
Secretary,
Treasurer
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Robert Pike, 2001 0 0 0 0 0 0 0 0
Vice Pres- 2002 0 0 0 0 0 0 0 0
ident 2003 0 0 0 0 0 0 0 0
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Officers as 2001 0 0 0 0 0 0 0 0
A Group 2002 0 0 0 0 0 0 0 0
2003 0 0 0 0 0 0 0 0
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(b) Directors' Compensation
Directors who are also officers of Yaak River Resources, Inc. receive no
cash compensation for services as a director. However, the directors will be
reimbursed for out-of-pocket expenses incurred in connection with attendance at
board and committee meetings. The Company has granted options to directors under
its Stock Incentive Plan subsequently adopted.
SUMMARY COMPENSATION TABLE OF DIRECTORS
(To December 31, 2003)
Cash Compensation Security Grants
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Name and Year Annual Meeting Consulting Number Securities LTIP All Other
Principal retainer Fees ($) Fees/Other of Underlying Payments Compensation
Position Fees ($) Fees($) Shares (#) Options/SARs(#)
(SHARES)
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Blaize N. 2001 0 0 0 0 0 0 0
Kaduru, 2002 0 0 0 0 0 0 0
Director 2003 0 0 0 0 0 0 0
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Robert Pike, 2001 0 0 0 0 0 0 0
Director 2002 0 0 0 0 0 0 0
2003 0 0 0 0 0 0 0
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Directors as a 2001 0 0 0 0 0 0 0
group 2002 0 0 0 0 0 0 0
2003 0 0 0 0 0 0 0
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There have been no Option/SAR grants or exercises in the last fiscal
year reportable under Reg. S-B, 402(c) or (d).
(c) Termination of Employment and Change of Control Arrangements. None.
(d) Stock purchase options: None
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During the fiscal year ended December 31, 2003, the Company did not engage
in any related-party transactions.
There were no transactions, or series of transactions, for the fiscal year
ended December 31, 2003, nor are there any currently proposed transactions, or
series of the same, to which the Company is a party, in which the amount
involved exceeds $60,000 and in which to the knowledge of the Company any
director, executive officer, nominee, five-percent shareholder or any member of
the immediate family of the foregoing persons have or will have a direct or
indirect material interest.
INDEPENDENT AUDITORS
The Board of Directors has authorized the firm of Michael Johnson & Co.,
LLC, CPAs, independent certified public accountants, to serve as independent
auditors for the fiscal year ended December 31, 2004.
SHAREHOLDER PROPOSALS AND NOMINATING PROCEDURES
Any proposal that a shareholder intends to present at the Company's
2004 Annual Meeting should have been received at the Company's principal
executive office no later than August 31, 2004. Any such proposal must comply
with Rule 14a-8 of Regulation 14A of the proxy rules of the Securities and Ex-
change Commission. Shareholder proposals should be addressed to the Secretary of
the Company.
Nominations for directors to be elected at the 2004 Annual Meeting,
other than those made by the Board of Directors, should be submitted to the
Secretary of the Company no later than August 31, 2004. The nomination should
include the full name of the nominee and a description of the nominee's back-
ground in compliance with Regulation S-K of the reporting rules of the Securi-
ties and Exchange Commission.
OTHER MATTERS
The Board of Directors of the Company is not aware that any matter
other than those described in this Information Statement is to be presented for
the consent of the shareholders.
UPON WRITTEN REQUEST BY ANY SHAREHOLDER TO BLAIZE KADURU, PRESIDENT OF THE
COMPANY, AT YAAK RIVER RESOURCES, INC., 423 BAYBRIDGE DRIVE, SUGARLAND, TX 77478
TELEPHONE (281) 242-7656, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM
10-KSB AND INTERIM REPORTS ON FORM 10QSB WILL BE PROVIDED WITHOUT CHARGE.