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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM 10-K/A
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1995 Commission File No. 1-9666
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from __________ to __________
BATTLE MOUNTAIN GOLD COMPANY
(Exact name of registrant as specified in its charter)
Nevada 76-0151431
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
333 Clay Street, 42nd Floor, Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 650-6400
Securities registered pursuant to Section 12(b) of the Act:
Name of each Exchange
Title of each class on which registered
------------------- ---------------------
Common Stock New York Stock Exchange
$3.25 Convertible Preferred Stock New York Stock Exchange
Rights to Purchase Preferred Stock New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES [X] NO
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
The aggregate market value of the voting stock held by non-affiliates
of the registrant was approximately $709 million as of April 24, 1996, based on
the closing sales price of the registrant's common stock as reported on the New
York Stock Exchange Composite Tape on such date. For purposes of the foregoing
sentence only, all directors and officers of the registrant are assumed to be
affiliates.
The number of shares outstanding of the registrant's common
stock as of April 24, 1996 is 81,333,077.
DOCUMENTS INCORPORATED BY REFERENCE:
List hereunder the following documents if incorporated by reference
and the Part of the Form 10-K into which the document is incorporated: None.
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The information appearing in Part III of Battle Mountain Gold Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1995 is
amended to read in its entirety as set forth below.
PART III
Item 10. Directors and Executive Officers of the Registrant
Executive Officers
The information set forth under "Part I-Executive Officers of the
Registrant" is incorporated herein by reference.
Directors
The following sets forth information concerning the directors of Battle
Mountain Gold Company ("Battle Mountain"), including information as to each
director's age as of April 15, 1996, position with Battle Mountain and business
experience during the past five years.
Name, age and business experience
Douglas J. Bourne was Chairman of the Board and Chief Executive Officer
of Battle Mountain until his retirement in April 1990. Mr. Bourne serves as
Chairman of Battle Mountain's Executive Committee and is a member of Battle
Mountain's Environmental Affairs and Ethics Committee. Mr. Bourne has been a
director of Battle Mountain since its formation, and his present term expires in
1998. He is 73 years of age and is also a director of Potash Corporation of
Saskatchewan, Inc.
Delo H. Caspary has been engaged for more than five years in managing
his personal investments. He became a director of Battle Mountain in 1985, and
his present term expires in 1997. Mr. Caspary is also a director of Caspen,
plc., a British company, and Victoria Bank and Trust. Mr. Caspary serves on
Battle Mountain's Finance and Audit Committee. He is 70 years old.
Charles E. Childers has served as Chairman of the Board, President and
Chief Executive Officer of Potash Corporation of Saskatchewan, Inc. (mining and
processing of potash) since 1990. From 1987 through 1990, Mr. Childers served
as President and Chief Executive Officer of that corporation. Mr. Childers is
also a director of QUNO Corporation.
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He became a director of Battle Mountain in 1993 and his present term
expires in 1996. Mr. Childers serves on the Compensation and Stock Option
Committee. He is 63 years old.
Jack R. Crosby has been Chairman of the Board and Chief Executive
Officer of the Rust Group (investments, property development and
telecommunications) for more than five years. Mr. Crosby is Chairman of the
Board and Chief Executive Officer of Tescorp, Inc. and a director of National
Dentex Corporation. He became a director of Battle Mountain in 1985, and his
present term expires in 1998. Mr. Crosby is a member of Battle Mountain's
Compensation and Stock Option Committee. He is 69 years of age.
Rodney L. Gray has served as Managing Director of Enron Development
Corp. since August 1995. He served as President and CEO of Enron Global Power &
Pipelines LLC from October 1994 through November 1995, and now serves as
Chairman, President and CEO of that corporation. Mr. Gray served as Managing
Director of Enron Capital & Trade Resources, Inc. from October 1994 through
August 1995. From July 1993 through October 1994, he served as Chairman and
Chief Executive Officer for Enron International, Inc. From October 1992 through
July 1993, Mr. Gray served as Senior Vice President, Finance and Treasurer for
Enron, and was responsible for Enron's worldwide financing activities. From
April 1988 through October 1992, Mr. Gray served as Vice President and Treasurer
for Enron. Mr. Gray is also a director of Harmon Industries, Inc. and Enron
Global Power & Pipelines LLC. He became a director of Battle Mountain in 1993,
and his present term expires in 1997. Mr. Gray serves on the Finance and Audit
Committee. He is 43 years old.
Karl E. Elers is Chairman of the Board and Chief Executive Officer of
Battle Mountain. Mr. Elers is a member of Battle Mountain's Executive
Committee. From April 1988 until April 1990, he was President and Chief
Operating Officer of Battle Mountain. From May 1987 until April 1988, Mr. Elers
was Executive Vice President of Battle Mountain. Mr. Elers became a director in
1987 and his present term expires in 1996. He is 57 years old.
Ted H. Pate was President and Chief Operating Officer of Battle Mountain
until April 1988. Mr. Pate became a director of Battle Mountain in 1985, and
his present term expires in 1998. Mr. Pate serves as Chairman of Battle
Mountain's Finance and Audit Committee and is a member of the Environmental
Affairs and Ethics Committee. He is 69 years of age.
Kenneth R. Werneburg has been President and Chief Operating Officer of
Battle Mountain since April 1990, having previously served as Executive Vice
President of Battle Mountain since November 1989. Mr. Werneburg became a
director of Battle Mountain in 1990 and his present term expires in 1996. He is
a member of Battle Mountain's Executive Committee and is Chairman of Battle
Mountain's Environmental Affairs and Ethics Committee. He is 54 years old.
William A. Wise has served as Chairman of the Board, President and Chief
Executive Officer of El Paso Natural Gas Company, an integrated natural gas
company, since January 1994. From April 1989 through January 1990, Mr. Wise was
President and Chief Operating Officer of that corporation. He became Chief
Executive Officer in January 1990. Mr. Wise has been a director of Battle
Mountain since 1994, and his present term expires in 1998. Mr. Wise serves as
Chairman of Battle Mountain's Compensation and Stock Option Committee. He is 50
years old.
Compliance with Section 16(a) of the Securities Exchange Act
Based solely upon a review of Forms 3, 4 and 5 submitted to Battle
Mountain during and with respect to 1995 and written representations from
certain reporting persons that no Forms 5 were required from such persons, no
failures to file on a timely basis reports required by Section 16(a) of the
Exchange Act during 1995 or prior years by any person who was an officer or
director of Battle Mountain during 1995 were identified.
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Item 11. Executive Compensation
Executive Compensation
Summary Compensation Table--The table set forth below contains
information regarding compensation for services in all capacities to Battle
Mountain for 1995, 1994 and 1993 of those persons who (i) served as the chief
executive officer of Battle Mountain during 1995 and (ii) were the other four
mostly highly compensated executive officers of Battle Mountain at December 31,
1995. The format and the information presented are as prescribed in rules of
the SEC.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term Compensation
--------------------------------- ----------------------------------
Awards Payouts
---------------------- -------
Restricted Securities All Other
Name and Principal Other Annual Stock Underlying LTIP Compensation
Position Year Salary Bonus Compensation Awards Options Payouts(1) (2)
---------------------- ---- -------- -------- ------------ ---------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Karl E. Elers . . . . 1995 $351,575 $167,064 - - 57,200 $579,962 $85,133
Chairman of the 1994 332,858 180,030 - - 53,700 - 21,741
Board and Chief 1993 315,902 106,797 - - 138,400 338,865 15,590
Executive Officer
Kenneth R. Werneburg 1995 280,126 133,112 - - 45,600 462,268 57,142
President and 1994 256,212 143,443 - - 42,800 - 17,323
Chief Operating 1993 251,702 85,092 - - 108,400 265,772 13,137
Officer
R. Dennis O'Connell . 1995 175,111 66,583 - - 24,500 232,552 28,500
Vice President- 1994 165,401 72,012 - - 23,400 - 12,475
Finance and Chief 1993 157,951 42,719 - - 58,400 - 8,571
Financial Officer
Andre J. Douchane (3) 1995 172,459 65,577 - - 24,100 218,372 26,361
Vice President - 1994 160,846 69,314 - - 22,500 - 12,400
Operations 1993 150,324 40,772 - - 58,400 - 8,227
Joseph L. Mazur . . . 1995 164,366 62,484 - - 23,200 219,790 42,989
Vice President- 1994 156,863 68,295 - - 22,600 - 12,308
Administration and 1993 149,799 40,514 - - 58,400 128,043 8,204
Communications
</TABLE>
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(1) Amounts represent the cash and market value of Battle Mountain
Common Stock distributable in respect of performance units granted
under Battle Mountain's 1988 Long-Term Performance Unit Plan for the
three-year performance periods ended June 30, 1995 and June 30, 1993.
In 1992, the performance measures applicable to the performance period
ended June 30, 1993 were revised by dropping two of the four original
measures and establishing a new threshold condition to payout.
(2) Consists of (a) Battle Mountain's contributions (vested and
unvested) under Battle Mountain's Savings Plan and a related
contribution equalization plan of $9,240 and $19,193 in 1995, $12,708
and $9,033 in 1994, and $10,612 and $4,978 in 1993 for Mr. Elers;
$9,240 and $14,343 in 1995, $10,126 and $7,196 in 1994, and $10,612
and $2,525 in 1993 for Mr. Werneburg; $13,967 and $5,925 in 1995,
$9,240 and $3,234 in 1995, and
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$8,571 in 1993 for Mr. O'Connell; $9,240 and $6,662 in 1994, $9,240
and $3,160 in 1994, and $8,227 in 1993 for Mr. Douchane; and $9,240
and $5,318 in 1995, $5,662 and $3,068 in 1994, and $8,204 in 1993 for
Mr. Mazur and (b) as to the balance of such amounts, the benefit to
the executive officer of the premiums paid by Battle Mountain during
1995 under Battle Mountain's split-dollar life insurance program.
(3) Mr. Douchane resigned from Battle Mountain effective December 31,
1995.
Option Grants Table -- The following table shows, as to the executive
officers named in the Summary Compensation Table, information regarding stock
options granted pursuant to Battle Mountain's 1994 Long-Term Incentive Plan
during 1995. All of such options have an exercise price equal to the market
price on the date of grant.
<TABLE>
<CAPTION>
Individual Grants
--------------------------------------------------------------------------------
Number of Percent of
Securities total options
Underlying granted to Exercise Grant date
Options employees in Price Per Expiration present value
Granted (1) 1995 Share Date (2)
-------------- -------------- ------------- ---------- ---------------
<S> <C> <C> <C> <C> <C>
Karl E. Elers . . . . . 57,200 12.4 $11.375 4/27/05 $413,613
Kenneth R. Werneburg . 45,600 9.9 11.375 4/27/05 319,734
R. Dennis O'Connell . . 24,500 5.3 11.375 4/27/05 177,160
Andrew J. Douchane . . 24,100 5.2 11.375 4/27/05 174,267
Joseph L. Mazur . . . . 23,200 5.0 11.375 4/27/05 167,759
</TABLE>
-------------------------
(1) All options granted to the named executive officers were granted
on April 27, 1995 and have exercise prices equal to the closing price
of the Battle Mountain Common Stock on the NYSE Composite Tape on that
date. The options became exercisable on April 27, 1996 (except as to
Mr. Douchane, whose options lapsed as a result of the termination of
his employment) and also contain provisions for acceleration of
vesting in the event of a change of control and payment in cash of the
then appreciated value of the option. A change of control is deemed
to occur for this purpose if (i) a person or group becomes the
beneficial owner of 30 percent or more of Battle Mountain's
outstanding voting securities, (ii) a tender offer, merger or other
business combination or a contested election results in a change in
the composition of a majority of the Battle Mountain Board of
Directors, (iii) a merger or consolidation results in less than 70
percent of the outstanding voting securities of the surviving or
resulting corporation being owned by former shareholders of Battle
Mountain (other than parties to the merger or consolidation of their
affiliates), (iv) a tender offer is consummated for 30 percent or more
of Battle Mountain's outstanding voting securities or (v) Battle
Mountain transfers all or substantially all of its assets to another
corporation not a wholly owned subsidiary of Battle Mountain.
(2) Based on the Black-Scholes option pricing model adapted for use in
valuing executive stock options. The actual value, if any, an
executive may realize will depend on the excess of the stock price
over the exercise price on the date the option is exercised. There is
no assurance the value realized by an executive will be at or near the
value determined using the Black-Scholes model. The assumptions used
under that model include a volatility of 43.8 percent based on
one-year historical volatility of the Battle Mountain Common Stock
prior to the grant date, a risk-free rate of return of 7.1 percent
based on the ten-year zero coupon treasury bond yield at the time of
grant, a dividend yield of 0.4 percent based on the current dividend
rate and an option term equal to the full ten-year stated option term.
The estimated grant date value does not reflect any discount on
account of vesting or forfeiture provisions or prohibitions on
transfer.
Option Exercises and Year-End Values Table -- The table set forth
below contains information with respect to (i) the unexercised options to
purchase Battle Mountain Common Stock granted in 1995 and prior years under
Battle Mountain's 1994 Long-Term Incentive Plan, 1985 Stock Option Plan and
1988 Deferred Income Stock Option Plan to
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the executive officers named in the Summary Compensation Table and held by them
at December 31, 1995 and (ii) the aggregate number of shares acquired by
such executive officers upon the exercise during 1995 of options to purchase
Battle Mountain Common Stock.
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Options Value of Unexercised
Held at In-the-Money Options at
Shares December 31, 1995 December 31, 1995 (1)
Acquired ------------------------------ -----------------------
on Value
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- ------------ -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Karl E. Elers . . . . . 0 $ 0 284,777 103,334 $253,557 $74,968
Kenneth R. Werneburg . 0 0 196,566 81,734 258,745 58,718
R. Dennis O'Connell . . 0 0 62,333 43,967 63,266 31,634
Andre J. Douchane . . . 38,933 87,599 0 0 0 0
Joseph L. Mazur . . . . 0 0 135,455 42,667 98,645 31,634
</TABLE>
--------------------
(1) Based on the closing price of the Battle Mountain
Common Stock on the NYSE Composite Tape on December
29, 1995 ($8.50).
Retirement Plan and Supplemental Agreements -- Battle Mountain maintains a
non-contributory tax-qualified retirement plan generally available to U.S.
salaried employees (the "Retirement Plan"). The Retirement Plan is a defined
benefit plan under which employer contributions are actuarially determined each
year and is administered by an Administrative Committee appointed by the Board
of Directors. The amount of an employee's retirement benefit is based on final
average compensation (as defined below) and is computed as follows: 1.1 percent
of final average compensation for each year of service, plus 0.6 percent of
final average compensation in excess of $10,000 per year for each year of
service up to a maximum of 35 years.
The following table shows the estimated annual retirement benefits under
the Retirement Plan under the formula described above for eligible employees
(including officers) who retire at age 65 (normal retirement age) and have the
average compensation levels and years of service specified in the table. The
amounts listed in the table are payable for the life of the employee and are not
subject to any reduction for Social Security benefits or other offsetting
amounts. As is indicated in footnote 2 to the table, provisions of the Internal
Revenue Code limit the annual benefit which may be paid upon retirement to
$120,000 for 1996.
<TABLE>
<CAPTION>
Projected Retirement Plan Benefit
at Age 65 With Service of
Final Average ------------------------------------------------------------------------------------
Compensation(1) 15 Years 20 Years 25 Years 30 Years 35 Years
- --------------- ---------------- --------------- ------------- ---------------- ----------------
<S> <C> <C> <C> <C> <C>
$ 150,000 . . . . . $37,350 $49,800 $62,250 $74,700 $87,150
175,000 . . . . . 43,725 58,300 72,875 87,450 102,025
200,000 . . . . . 50,100 66,800 83,500 100,200 116,900
225,000 . . . . . 56,475 75,300 94,125 112,950 131,755(2)
250,000 . . . . . 62,850 83,800 104,750 125,700(2) 146,650(2)
300,000 . . . . . 75,600 100,800 126,000(2) 151,200(2) 176,400(2)
350,000 . . . . . 88,350 117,800 147,250(2) 176,700(2) 206,150(2)
400,000 . . . . . 101,100 134,800(2) 168,500(2) 202,200(2) 235,900(2)
450,000 . . . . . 113,850 151,800(2) 189,750(2) 227,700(2) 265,650(2)
500,000 . . . . . 126,600(2) 168,800(2) 211,000(2) 253,200(2) 295,400(2)
600,000 . . . . . 152,100(2) 202,800(2) 253,500(2) 304,200(2) 354,900(2)
700,000 . . . . . 177,600(2) 236,800(2) 296,000(2) 355,200(2) 414,400(2)
800,000 . . . . . 203,100(2) 270,800(2) 338,500(2) 406,200(2) 473,900(2)
900,000 . . . . . 228,600(2) 304,800(2) 381,000(2) 457,200(2) 533,400(2)
1,000,000 . . . . . 254,100(2) 338,800(2) 423,500(2) 508,200(2) 592,900(2)
</TABLE>
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(1) Final average compensation means the average of covered
remuneration for the five consecutive years, out of the ten years
immediately preceding retirement, in which the participant's
covered remuneration was the highest. Covered compensation
includes salary, bonus and most other compensation paid or
deferred in the year (including performance unit payments under
Battle Mountain's 1988 Long-Term Performance Unit Plan and 1994
Long-Term Incentive Plan but excluding amounts realized from
restricted stock and stock options). However, Section 401(a) (17)
of the Internal Revenue Code of 1986, as amended (the "Code")
limits the annual compensation taken into account for an employee
under the Retirement Plan. The compensation limit imposed by
Section 401(a)(17) is $150,000 for 1994, 1995 and 1996 and
$200,000 (indexed) for 1989-1993.
(2) Annual benefits under the Retirement Plan are limited to $120,000
for 1996 by Section 415 of the Code.
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At December 31, 1995, the individuals named in the Summary
Compensation Table had the following credited years of service under the
Retirement Plan: Mr. Elers, eight years; Mr. Werneburg, six years; Mr.
O'Connell, three years; and Mr. Mazur, 26 years. Mr. Douchane resigned from
Battle Mountain effective December 31, 1995, at which time he was not vested in
the Retirement Plan.
Battle Mountain has established a Supplemental Executive Retirement
Plan ("SERP") for certain executives, including Messrs. Elers, Werneburg,
O'Connell, Douchane and Mazur. The SERP provides that Battle Mountain will pay
each respective executive officer an additional retirement benefit equal to the
greater of two benefits: the prior benefit or the current benefit. The prior
benefit is the vested portion of 50 percent of such officer's considered
compensation. The prior benefit vests 10 percent each year beginning at the
executive's age 56 and is payable in level payments for 15 years beginning at
the executive's age 65. The current benefit is the benefit the executive would
have received under the Retirement Plan in the absence of Code limits, less the
amount of the participant's benefit under the Retirement Plan. The current
benefit begins on the later of the participant's age 55 or termination of
employment, and is paid as a joint and 50 percent surviving spouse annuity.
Where the current benefit would begin before the prior benefit, the present
value of the current benefit is compared with the present value of the prior
benefit to determine the better benefit.
The following table shows the estimated annual retirement benefits
under the SERP on the assumption the prior benefit is applicable for eligible
executives who retire at age 65 (normal retirement age) and have the average
compensation levels in the table:
<TABLE>
<CAPTION>
Considered
Compensation Estimated
at Age 65 Benefit
------------- ----------
<S> <C>
150,000 . . . . . . . . . . . . . . . . $ 75,000
200,000 . . . . . . . . . . . . . . . . 100,000
250,000 . . . . . . . . . . . . . . . . 125,000
300,000 . . . . . . . . . . . . . . . . 150,000
350,000 . . . . . . . . . . . . . . . . 175,000
400,000 . . . . . . . . . . . . . . . . 200,000
450,000 . . . . . . . . . . . . . . . . 225,000
500,000 . . . . . . . . . . . . . . . . 250,000
</TABLE>
For purposes of calculating the prior benefit, considered compensation is the
officer's annualized base monthly salary at the end of the last even-numbered
calendar year preceding retirement. If the current benefit is applicable, the
estimated annual retirement benefit for a participant under the SERP would be
in an amount that, when added to the benefit under the Retirement Plan,
equals the annual benefit shown in the above Projected Retirement Plan Benefit
table for benefits under the Retirement Plan determined without regard to Code
limits referred to in footnotes (1) and (2) to that table. In calculating the
current benefit, covered compensation is the same as that under the Retirement
Plan, except that deferrals of base compensation and bonus under nonqualified
deferred compensation plans are included.
In early 1995, Battle Mountain established a split-dollar life insurance program
covering certain executive officers including those named in the Summary
Compensation Table. This program provides for life insurance coverage with a
death benefit of $1,500,000 for Mr. Elers, $1,250,000 for Mr. Werneburg and
$750,000 each for Messrs. O'Connell and Mazur, with the executive to pay the
term insurance portion of the premium during a specified period of at least ten
years and Battle Mountain to pay the balance. Battle Mountain retains the right
to terminate premium payments under an executive officer's policy prior to the
end of the specified period in case of termination of employment, or otherwise
upon six months' notice. Upon death or other termination as to any executive
officer, Battle Mountain will be refunded the aggregate amount of the premium
payments made by it in respect of that officer's policy.
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Change-in-Control Arrangements -- Battle Mountain has severance
agreements with each of Messrs. Elers, Werneburg, O'Connell and Mazur, which
generally provide that, in the event employment terminates as a result of a
change of control of Battle Mountain, each executive officer would receive a
cash payment equal to two times his annual salary (plus bonus and other
incentive compensation). A covered officer, under the agreement, would receive
such payment only as a result of involuntary termination or specified changes in
duties, responsibilities or benefits within three years of the date of the
change of control or voluntary termination during a 120-day period commencing
120 days following the date of the change of control. The agreements also
provide for continuation of group life, medical and dental insurance benefits
for a period of 30 months after termination on the same contributory basis as
such benefits are provided to active employees of Battle Mountain. In the event
of a change of control, payments under the agreements of executive officers
using 1995 salaries and covered incentive compensation would be approximately
$1,626,238 for Mr. Elers, $1,295,916 for Mr. Werneburg, $719,548 for Mr.
O'Connell, and $676,900 for Mr. Mazur. The 1988 Long-Term Performance Unit Plan
and the performance unit awards made in 1994 under the 1994 Long-Term Incentive
Plan also contain provisions whereby outstanding performance units become
immediately payable at the credited value if the units have already been valued
or at the target value of $1.00 per unit if the units have not been valued in
the event of a change of control. In the event of a change of control, payments
under these plans in respect of the outstanding performance units would be
approximately as follows: $471,436 for Mr. Elers, $375,629 for Mr. Werneburg,
$188,574 for Mr. O'Connell, and $178,841 for Mr. Mazur. Options granted to these
officers under Battle Mountain's 1985 Stock Option Plan and 1994 Long-Term
Incentive Plan contain provisions for acceleration of vesting in the event of a
change of control and payment in cash of the then appreciated value of the
option. The above described severance agreements and awards also contain
provisions for a tax gross-up payment designed to make the officers whole
against any excise or other tax above the rate ordinarily applicable that is
occasioned by the change of control, pursuant to the provisions of Section 280G
of the U.S. Code or otherwise. In addition, after a change of control, Battle
Mountain will be required to continue making premium payments until the officer
reaches age 65 under the split-dollar life insurance program described above,
whether the officer remains employed by Battle Mountain or not. Such annual
premium amounts are approximately $104,000 in the case of Mr. Elers, $55,000 in
the case of Mr. Werneburg, $52,000 in the case of Mr. Mazur and $20,000 in the
case of Mr. O'Connell (the aggregate of such premium amounts to be refundable to
Battle Mountain at age 65 or upon death, if earlier). Further, benefits under
the SERP would be recalculated so that the prior benefit would be fully vested
and the current benefit would also be fully vested and credit given for four
additional years of benefit accrual. Based on current covered compensation
(and assuming the prior benefit is applicable), the annual retirement benefit
under the SERP after giving effect to such recalculation would be approximately
$173,000 for Mr. Elers, $137,000 for Mr. Werneburg, $81,000 for Mr. Mazur and
$85,000 for Mr. O'Connell. The definition of change of control in the
foregoing agreements is generally the same as that referred to in note (1) to
the Option Grants Table above.
On March 11, 1996, Battle Mountain entered into an agreement with Hemlo
Gold Mines Inc. that provides for a business combination of the two companies.
Consummation of the agreement, which is subject to the approval of the
stockholders of both companies and the satisfaction of other conditions, will
constitute a change of control under the foregoing agreements.
Director Compensation
Each director, other than those who are regularly employed officers of
Battle Mountain or its subsidiaries, receives a director's fee of $15,000 per
annum and an additional fee of $750 per day for attendance at meetings of the
Board or its committees. Directors are also reimbursed for their travel and
other expenses involved in attendance at Board and committee meetings. Pursuant
to the terms of Battle Mountain's Deferred Compensation Plan, a director may
elect to defer his director's fee and per diem fees for payment with interest
(at the six-month Treasury bill rate) at a later date. Pursuant to the terms of
Battle Mountain's 1988 Deferred Income Stock Option Plan (the "DISOP"), a
director may elect to receive a non-qualified stock option in lieu of up to 100
percent of his director's fee and per diem fees for attending Board or committee
meetings. To participate, the director selects an option strike price at a
discount from current market value of the Battle Mountain Common Stock and
receives options on a number of shares such that the aggregate discount is equal
to the amount of fees forgone. Messrs. Pate and Wise participated in the DISOP
in 1995,
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<PAGE> 9
acquiring an option to purchase 10,500 shares of Battle Mountain Common
Stock at an exercise price of $9.125 per share and 9,750 shares of Battle
Mountain Common Stock at an exercise price of $9.125 per share, respectively.
Under Battle Mountain's Nonqualified Stock Option Plan for Outside Directors,
individuals who become nonemployee directors of Battle Mountain are
automatically granted an initial option to purchase 5,000 shares of Battle
Mountain Common Stock on the date they become nonemployee directors. On the
date of the annual meeting of each year following the grant of the initial
option, each incumbent nonemployee director is granted an additional option to
purchase 1,500 shares of Battle Mountain Common Stock. Each option granted
pursuant to the Nonqualified Stock Option Plan for Outside Directors has an
exercise price per share equal to the market value of a share of Battle Mountain
Common Stock on the date the option is granted, and such options are not
exercisable until one year from the date of grant. Directors who are not also
executive officers are not eligible to participate in any other benefit plan of
Battle Mountain.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Security Ownership
Set forth in the table below is the number of shares of Battle
Mountain Common Stock beneficially owned (within the meaning of Rule 13d-3 under
the Securities Exchange Act) as of March 15, 1996, by each of Battle Mountain's
directors and nominees, each of the executive officers named in the Summary
Compensation Table under "Item 11. Executive Compensation" and all directors
and executive officers as a group. Except as otherwise indicated, all such
shares are owned directly, and the indicated owner has sole voting and
investment power with respect to such Battle Mountain Common Stock. As of April
15, 1996, there was no person known to Battle Mountain to be the beneficial
owner of more than 5 percent of the Battle Mountain Common Stock.
<TABLE>
<CAPTION>
Number of Percent
Name Shares of Class
---- ----------- --------
<S> <C> <C>
Douglas J. Bourne . . . . . . . . . . . . . . . . . . . . . . . 144,540(1) *
Delo H. Caspary . . . . . . . . . . . . . . . . . . . . . . . . 51,000(2) *
Charles E. Childers . . . . . . . . . . . . . . . . . . . . . . 12,000(3) *
Jack R. Crosby . . . . . . . . . . . . . . . . . . . . . . . . 61,375(4) *
Andre J. Douchane . . . . . . . . . . . . . . . . . . . . . . . 0 *
Karl E. Elers . . . . . . . . . . . . . . . . . . . . . . . . . 463,854(5) *
Rodney L. Gray . . . . . . . . . . . . . . . . . . . . . . . . 9,500(4) *
Joseph L. Mazur . . . . . . . . . . . . . . . . . . . . . . . . 197,490(6) *
R. Dennis O'Connell . . . . . . . . . . . . . . . . . . . . . . 115,196(7) *
Ted H. Pate . . . . . . . . . . . . . . . . . . . . . . . . . . 63,146(8) *
Kenneth R. Werneburg . . . . . . . . . . . . . . . . . . . . . 312,298(9) *
William A. Wise . . . . . . . . . . . . . . . . . . . . . . . . 26,000(4) *
All directors and executive officers as a group (14 persons) . 1,710,271(10) 2.1%
</TABLE>
--------------
(1) Includes 750 shares jointly owned by Mr. Bourne and
his wife, and 11,000 shares issuable upon the
exercise of stock options acquired under Battle
Mountain's option plans.
(2) Includes 11,000 shares issuable upon the exercise of
stock options acquired under Battle Mountain's option
plans.
(3) Includes 9,500 shares issuable upon the exercise of
stock options acquired under Battle Mountain's option
plans.
(4) Consists of shares issuable upon the exercise of
stock options acquired under Battle Mountain's option
plans.
(5) Includes 388,111 shares issuable upon the exercise of
stock options acquired under Battle Mountain's
option plans.
-9-
<PAGE> 10
(6) Includes 161,922 shares issuable upon the exercise of
stock options acquired under Battle Mountain's option plans.
(7) Includes 106,300 shares issuable upon the exercise of
stock options acquired under Battle Mountain's option
plans.
(8) Includes 57,000 shares issuable upon the exercise of
stock options acquired under Battle Mountain's option
plans.
(9) Includes 278,300 shares issuable upon the exercise of
stock options acquired under Battle Mountain's option
plans.
(10) Includes 1,362,874 shares issuable upon the exercise
of stock options acquired under Battle Mountain's
option plans.
* Less than 1%.
-10-
<PAGE> 11
SIGNATURES
Pursuant to the requirements of section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this amendment to be signed
on its behalf by the undersigned, thereunto duly authorized.
BATTLE MOUNTAIN GOLD COMPANY
By: /s/ R. DENNIS O'CONNELL
--------------------------------
R. Dennis O'Connell
Vice President, Finance and
Chief Financial Officer
Date: April 29, 1996
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