<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________
COMMISSION FILE NUMBER 1-9666
BATTLE MOUNTAIN GOLD COMPANY
(EXACT NAME OF THE 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, including Zip Code)
(713) 650-6400
(Registrant's telephone number, including area code)
NONE
(Former name, former address and former fiscal year if
changed since last report)
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
--- ---
Number of shares of Common Stock outstanding as of the latest
practicable date, April 30, 2000: 131,526,469. In addition, as of such date,
there were outstanding 98,359,948 Exchangeable Shares of Battle Mountain Canada
Ltd. which are exchangeable at any time into Common Stock on a one-for-one
basis, entitle their holders to dividend and other rights economically
equivalent to those of the Common Stock, and through a voting trust, vote at
meetings of stockholders of the Registrant.
================================================================================
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
INDEX
<TABLE>
<CAPTION>
Page
----
<S> <C>
Part I. Financial Information (Unaudited)
Condensed Consolidated Statement of Operations
for the three months ended March 31, 2000 and 1999 1
Condensed Consolidated Balance Sheet
at March 31, 2000 and December 31, 1999 2
Condensed Consolidated Statement of Cash Flows
for the three months ended March 31, 2000 and 1999 3
Notes to Condensed Consolidated Financial Statements 4
Supplemental Information 9
Management's Discussion and Analysis of Financial Condition
and Results of Operations 10
Quantitative and Qualitative Disclosures about Market Risk 14
Part II. Other Information 14
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BATTLE MOUNTAIN GOLD COMPANY
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended
March 31
------------------------
2000 1999
---------- ----------
MILLIONS, EXCEPT PER SHARE AMOUNTS (as restated)
<S> <C> <C>
Sales $ 62.5 $ 53.8
---------- ----------
Costs and expenses
Production costs 39.4 35.9
Depreciation, depletion and amortization 17.5 14.4
Exploration, evaluation & other lease costs, net 3.6 3.9
General and administrative expenses 3.3 3.4
---------- ----------
Total costs and expenses 63.8 57.6
---------- ----------
Operating Loss (1.3) (3.8)
Interest expense (3.8) (3.7)
Interest income 1.1 1.6
Equity in losses and impairment of Lihir (NOTE 2) -- (12.2)
Foreign currency exchange gain, net 0.5 3.1
Other income, net 0.3 0.5
---------- ----------
Loss Before Income Taxes (3.2) (14.5)
Income tax benefit 0.9 2.1
Mining tax benefit (expense) 0.7 (0.2)
---------- ----------
Net Loss (1.6) (12.6)
Preferred dividends 1.9 1.9
---------- ----------
Net Loss to Common Shares $ (3.5) $ (14.5)
========== ==========
Loss per Common Share - Basic and Diluted (NOTE 3) $ (.02) $ (.06)
========== ==========
Average Common Shares Outstanding for
Basic and Diluted Loss per Share Purposes 229.9 229.8
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
1
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
March 31, December 31,
MILLIONS 2000 1999
---------- -----------
(as restated)
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 21.5 $ 91.0
Accounts and notes receivable, net 11.8 13.2
Product inventories 10.7 8.7
Materials and supplies, net, at average cost 21.7 22.4
Marketable equity securities (NOTE 2) 43.9 --
Other current assets 9.8 7.9
---------- ----------
Total current assets 119.4 143.2
---------- ----------
Investments
Investment in Lihir (NOTE 2) -- 68.4
Other investments 12.1 10.6
---------- ----------
Total investments 12.1 79.0
---------- ----------
Restricted cash 40.7 40.0
Property, plant and equipment, net 288.7 299.6
Other assets 4.7 6.7
---------- ----------
Total Assets $ 465.6 $ 568.5
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt (NOTE 5) $ 7.5 $ 2.6
Debt due upon disposal of Lihir 30.0 30.0
Accounts payable 14.4 16.0
Income and mining taxes payable 14.6 16.7
Other current liabilities 17.3 23.6
---------- ----------
Total current liabilities 83.8 88.9
Long-term debt (NOTE 5) 161.9 176.8
Deferred income and mining taxes 63.0 64.5
Other liabilities 54.7 54.5
---------- ----------
Total Liabilities 363.4 384.7
Commitments and contingencies (NOTES 6 AND 8) -- --
Minority interest 5.7 65.1
Shareholders' equity (NOTE 4) 96.5 118.7
---------- ----------
Total Liabilities and Shareholders' Equity $ 465.6 $ 568.5
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended
March 31
------------------------
MILLIONS 2000 1999
---------- ----------
(as restated)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (1.6) $ (12.6)
Adjustments to reconcile net loss to net cash
flows from operating activities:
Depreciation, depletion and amortization 17.5 14.4
Deferred income and mining taxes (1.7) (2.9)
Equity in losses and impairment of Lihir -- 12.2
Foreign currency exchange gain, net (0.5) (3.1)
Change in working capital accounts, net (8.0) (4.4)
Other, net (0.2) (0.5)
---------- ----------
Net Cash Flows Provided by Operating Activities 5.5 3.1
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (9.5) (9.3)
Crown Butte liquidating dividend to minority shareholders -- (11.0)
Effects on cash of the Niugini Mining and Lihir merger (54.7) --
Other, net (0.5) 0.2
---------- ----------
Net Cash Flows Used in Investing Activities (64.7) (20.1)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Debt repayments (10.0) (11.6)
Decrease in short-term borrowings -- (14.9)
Cash dividend payments (1.9) (1.9)
Other, net (0.8) 0.1
---------- ----------
Net Cash Flows Used in Financing Activities (12.7) (28.3)
---------- ----------
Effect of Exchange Rate Changes on Cash 2.4 1.4
---------- ----------
Net Decrease in Cash and Cash Equivalents (69.5) (43.9)
Cash and cash equivalents at beginning of period 91.0 197.2
---------- ----------
Cash and Cash Equivalents at End of Period $ 21.5 $ 153.3
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1. General Information
The unaudited condensed consolidated financial statements included
herein have been prepared pursuant to the rules and regulations of the
Securities and Exchange Commission and include all normal recurring adjustments
which are, in the opinion of the management of Battle Mountain Gold Company,
necessary for a fair presentation. Certain information and footnote disclosures
required by generally accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations. These financial statements
include the accounts of Battle Mountain Gold Company and its wholly-owned and
majority-owned subsidiaries ("Battle Mountain") and should be read in
conjunction with the consolidated financial statements which are included in
Battle Mountain's Annual Report on Form 10-K for the year ended December 31,
1999.
Battle Mountain has restated its 1999 financial statement
presentation of its former interest in Niugini Mining Limited, which merged
with Lihir Gold Limited in February 2000, to reflect the full consolidation
of Battle Mountain's investment in its Niugini Mining subsidiary. The more
significant effects of this restatement on the 1999 information presented in
the accompanying financial statements compared to amounts previously reported
was a $0.7 million increase in net loss for the first quarter of 1999 (no
impact on loss per share), a $54.7 million increase in cash, a $61.7 million
decrease in assets held for sale, a $68.4 million increase in total
investments and a $59.1 million increase in minority interest. In addition,
cash flows from operations increased $1.0 million during the first quarter of
1999 compared with amounts previously reported. Certain other amounts for
prior periods may have been reclassified in order to conform to the current
reporting presentation.
The restatements had no impact on Battle Mountain's 1999 annual net
loss, loss per share or total net assets, and also had no impact on Battle
Mountain's March 31, 2000 cash balance.
Note 2. Niugini Mining and Lihir
Niugini Mining and Lihir merged on February 2, 2000. As a result,
Battle Mountain, which held a 50.45% interest in Niugini Mining prior to the
merger, received 111.3 million shares of Lihir, representing a 9.74% equity
interest in Lihir. Battle Mountain, through its investment in Niugini Mining,
held a 7.52% equity interest in Lihir at December 31, 1999.
Because of the merger, Battle Mountain no longer owns shares of
Niugini Mining. The post-merger investment in the Lihir shares has been
classified as marketable securities, available for sale, in the condensed
consolidated balance sheet. The market value of the Lihir shares decreased
$17.8 million in the first quarter of 2000 and this decrease was recorded as
a part of comprehensive loss in shareholders' equity in the condensed
consolidated balance sheet. Since in 1999 the investment in Lihir was an
equity-accounted investment, an $11.0 million impairment charge was recorded
in the first quarter of 1999 as a result of a decrease in the market value of
the Lihir shares then held by Niugini Mining because the decrease in value
was considered to be other than a temporary decrease.
Note 3. Loss per Common Share
Battle Mountain's outstanding common stock options, convertible
debentures and convertible preferred stock were anti-dilutive and therefore not
included in the calculations of basic and diluted loss per share amounts
presented in the condensed consolidated statement of operations.
4
<PAGE>
Note 4. Comprehensive Loss
Battle Mountain's comprehensive loss follows:
<TABLE>
<CAPTION>
Three months ended
March 31
------------------------
2000 1999
---------- ----------
MILLIONS (as restated)
<S> <C> <C>
Net loss $ (1.6) $ (12.6)
Foreign currency translation adjustments (0.9) (1.9)
Unrealized losses on marketable equity securities (17.8) --
---------- ----------
Comprehensive loss $ (20.3) $ (14.5)
========== ==========
</TABLE>
Note 5. Debt
In March 2000, $10.0 million of the Canadian Imperial Bank of Commerce
debt was repaid because the market value of the Lihir shares held by Battle
Mountain declined to less than the level required by the loan agreement. Further
declines in the market value of the shares of Lihir may result in additional
principal repayments.
Note 6. Derivative Financial Instruments
Gold contracts outstanding at March 31, 2000 were as follows:
<TABLE>
<CAPTION>
Total or
OUNCES IN THOUSANDS 2000 2001 2002 2003 2004 Average
------ ------ ------ ------ ------ -------
<S> <C> <C> <C> <C> <C> <C>
Written call options
Ounces 174 140 140 140 18 612
Average price per ounce $ 345 $ 359 $ 359 $ 359 $ 375 $ 355
Purchased put options
Ounces 105 140 140 140 18 543
Average price per ounce $ 298 $ 298 $ 298 $ 298 $ 305 $ 298
Forwards
Ounces 28 38 38 38 2 144
Average price per ounce $ 317 $ 317 $ 317 $ 317 $ 326 $ 317
</TABLE>
The put options are the minimum price Battle Mountain will receive,
while the call options, having a higher price, allow participation in a rising
gold market. All ounces sold through the forwards will be at the stated prices.
The above derivatives have no margin requirements nor do they subject Battle
Mountain to lease rate exposure. The above ounces represent between 3% and 36%
of estimated production for each period from March 31, 2000 through March 31,
2004, with a weighted average of approximately 19% of total estimated production
for those periods combined.
During the first quarter of 2000, Battle Mountain delivered or
financially settled put options for 18,750 ounces of gold at an average price of
$297 per ounce and forward sales contracts for 6,250 ounces of gold at an
average price of $311 per ounce. No such settlements were made during the first
quarter of 1999. In addition, options for 16,125 ounces of gold expired during
the first quarter of 2000. The estimated fair value of the written call options
and purchased put options outstanding at March 31, 2000, net, was $5.1 million.
The estimated fair value of the forwards outstanding at March 31, 2000 was $1.0
million.
5
<PAGE>
In addition to the aforementioned gold contracts outstanding, as part
of its overall financial planning, pursuant to pricing provisions as set forth
in certain customer forward sales contracts outstanding as of March 31, 2000,
Battle Mountain Canada had committed to deliver 23,570 ounces of gold valued at
approximately $6.8 million at an average price of $287 per ounce. This gold was
on deposit at a refinery or had been previously leased to third parties. All
such contracts mature May 31, 2000. From time to time, Battle Mountain Canada
also enters into gold leasing transactions prior to delivery of gold held in
inventory related to these commitments. Battle Mountain, at times, is a party to
these leasing transactions and will sell the leased gold into the spot market.
Whenever a spot sale is made, a forward purchase contract is entered into to
assure delivery of the gold at the end of the lease. Battle Mountain Canada had
lease contracts outstanding with Battle Mountain for 23,570 ounces of gold at
March 31, 2000. All such contracts mature May 31, 2000.
Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" was issued in June 1998. This
standard was amended by Accounting Standard No. 137, which deferred the
effective date of implementation to the first quarter of fiscal years beginning
after June 15, 2000. Accounting Standard No. 133 requires companies to record
derivative financial instruments on the balance sheet as assets or liabilities,
as appropriate, at fair value. Gains or losses resulting from changes in the
fair values of those derivatives are accounted for depending on the use of the
derivative and whether it qualifies for hedge accounting. Battle Mountain is
evaluating the impact that implementation of this standard may have on
consolidated results of operations, financial position and liquidity.
Note 7. Geographic and Segment Information
Financial information by segment for the applicable periods presented
in the condensed consolidated financial statements follows:
<TABLE>
<CAPTION>
MILLIONS
Three months Golden Kori Battle Vera / Corp &
ended March 31, 2000 Total Giant Kollo Holloway Mountain Nancy Other
- -------------------- ----- ----- ----- -------- -------- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Gross revenues $ 62.5 $ 25.3 $ 21.2 $ 8.4 $ - $ 6.8 $ 0.8
Production costs 39.4 13.9 16.0 6.6 (0.1) 3.0 -
Deprec., deplet. & amort. 17.5 6.0 6.1 3.9 1.3 0.2
Other expenses 6.9 - - - - - 6.9
------ ------ ------ ------ ------ ------ ------
Operating income (loss) (1.3) 5.4 (0.9) (2.1) 0.1 2.5 (6.3)
====== ====== ====== ====== ====== ======
Interest & other expenses (1.9)
------
Loss before income taxes (3.2)
======
Three months ended
March 31, 1999 (as restated)
- ----------------------------
Gross revenues 53.8 21.6 22.2 6.0 - 4.0 -
Production costs 35.9 13.3 16.9 4.7 0.1 1.7 (0.8)
Deprec., deplet. & amort. 14.4 4.9 6.1 2.7 - 0.4 0.3
Other expenses 7.3 - - - - - 7.3
------ ------ ------ ------ ------ ------ ------
Operating income (loss) (3.8) 3.4 (0.8) (1.4) (0.1) 1.9 (6.8)
====== ====== ====== ====== ====== ======
Lihir equity losses /
impairment (12.2)
Interest & other income 1.5
------
Loss before income taxes (14.5)
======
Total assets
- ------------
March 31, 2000 465.6 100.2 73.2 72.5 56.3 31.8 131.6
====== ====== ====== ====== ====== ====== ======
Dec. 31, 1999 (as restated) 568.5 118.1 78.4 76.1 54.3 36.0 205.6
====== ====== ====== ====== ====== ====== ======
</TABLE>
6
<PAGE>
Note 8. Other Matters
SAN LUIS. Battle Mountain's Annual Report on Form 10-K for the year
ended December 31, 1999 contained a description of closure and reclamation
efforts and technical long-term water quality issues at the San Luis mine in
Colorado, which ceased operations in November 1996.
In 1998, Battle Mountain provided notice to the requisite regulatory
agencies and undertook implementation of a response plan triggered by the
identification of elevated levels of naturally occurring constituents
detected in a monitoring well located downgradient from the West Pit. The
Colorado Mined Land Reclamation Board held a formal public hearing to
consider the matter on January 26, 1999 and determined that no violation had
occurred and ordered Battle Mountain to implement the response plan. Battle
Mountain has made all of the submittals required by the Board, has
implemented those measures which have been approved and is awaiting final
approval for permanent response measures set forth in a technical revision to
the facility's permit. In connection with its review of the pending technical
revision, the Colorado Division of Mineral and Geology has reassessed the
level of financial assurance required for the San Luis property and has
ordered Battle Mountain to increase the financial assurance for the property
to $7.4 million, reflecting an increase of $1.3 million. The additional
financial assurance has been put in place.
On August 20, 1999, the Colorado Department of Public Health and
Environment issued a Notice of Violation and Cease and Desist Order to Battle
Mountain, alleging discharges to waters not permitted under the Colorado Water
Quality Control Act. Battle Mountain filed an Answer to the Notice denying that
such a violation has occurred, has commenced treatment and discharge operations
as authorized by an October 1999 Amendment of the Notice and is awaiting final
approval of a Colorado Discharge Permit System permit for discharges from the
long-term operation of a water treatment facility at the site. Battle
Mountain has negotiated a settlement with the Colorado Department of Public
Health and Environment which, if approved, will resolve the violations
alleged in the Notice of Violation. The terms of the settlement are set forth
in a Settlement Agreement and Stipulated Order which was executed on May 9,
2000 by Battle Mountain and the Director of the Colorado Water Quality
Control Division. This Agreement requires the payment of a civil penalty in
the amount of $71,700 and a supplemental environmental project in the form of
a $30,000 contribution to a local water and sanitation district for capital
improvements to its wastewater treatment facility. Under applicable law, the
Settlement Agreement will not become final until the closure of a public
comment period and final imposition of the terms of the Agreement by the
Colorado Department of Public Health and Environment.
It is not possible to predict the nature or scope of any further
action that might be taken by regulatory authorities, which actions could
include seeking injunctive relief, mandating the posting of additional
financial assurances, requiring further on-site response actions and the
imposition of additional monetary penalties. Battle Mountain has in place
certain environmental and reclamation financial assurances related to the San
Luis property and additional financial assurances could be required over
time. There can be no guarantee that Battle Mountain will be able to maintain
and/or put in place the necessary assurances. An environmental remediation
charge of $9.5 million was recorded in the third quarter of 1999 based upon
Battle Mountain's current best estimate of costs to address technical
long-term water quality issues at the San Luis property. It is reasonably
possible that this estimate may change in future reporting periods as further
information becomes available.
OTHER. Battle Mountain is party to a number of other legal actions
arising in the ordinary course of business. While the final outcome of these
other actions cannot be predicted with certainty, it is the opinion of
management that none of these actions when resolved will have a material adverse
effect on results of operations, financial position or cash flows.
7
<PAGE>
Battle Mountain believes cash requirements over the next twelve months
will be funded through a combination of current cash, future cash flows from
operations, proceeds from potential asset sales, short-term lines of credit
and/or future debt or equity security issuances. Significant additional capital
will be required in the foreseeable future in order to continue the development
of current and future mining projects, including the Phoenix project. Battle
Mountain's ability to raise capital is highly dependent upon the commercial
viability of its projects, which in turn is dependent upon the price of gold.
Because of continued low gold prices and their effect on Battle Mountain's
financial condition, short-term liquidity and our ability to raise additional
capital for long-term development projects may be impaired. In the event that
cash balances decline to a level that cannot support planned activities,
management will defer planned capital and exploration expenditures as needed to
conserve cash.
Note 9. Summarized Financial Information
The following summarized information of Battle Mountain Canada is
presented in accordance with the Securities and Exchange Commission's reporting
requirements as they pertain to the Battle Mountain Canada Exchangeable Shares:
<TABLE>
<CAPTION>
Three months ended
March 31
---------------------
2000 1999
------- -------
MILLIONS (as restated)
<S> <C> <C>
Sales $ 34.2 $ 27.5
Costs and expenses 32.0 27.0
------- -------
Operating income $ 2.2 $ 0.5
======= =======
Net income (loss) $ 3.2 $ (9.5)
======= =======
</TABLE>
Summarized financial information of Lihir follows. Information for the
2000 period is not presented, as the investment in Lihir is classified as
marketable securities effective as of the date of the merger of Niugini Mining
and Lihir.
<TABLE>
<CAPTION>
Three months ended
MILLIONS March 31, 1999
--------------
<S> <C>
Sales $ 43.4
Costs and expenses 40.9
-------
Operating income $ 2.5
=======
Net loss $ (2.7)
=======
</TABLE>
8
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
SUPPLEMENTAL INFORMATION - (UNAUDITED) (1)
(Data reflects BMG attributable interests, except as noted)
(Ounces in thousands)
<TABLE>
<CAPTION>
Three months ended
March 31
-------------------
2000 1999
------ ------
<S> <C> <C>
GOLDEN GIANT
Gold ounces recovered 89 78
Silver ounces recovered 7 3
--------------------------------------------------------------------------------------------
Cost per Gold Ounce Produced
Cash production costs $ 149 $ 167
Depreciation, depletion and amortization 68 64
Reclamation and mine closure costs 6 4
------ ------
Total production costs $ 223 $ 235
--------------------------------------------------------------------------------------------
KORI KOLLO (88% Interest)
Gold ounces recovered 62 64
Silver ounces recovered 132 201
--------------------------------------------------------------------------------------------
Cost per Gold Ounce Produced (2)
Cash production costs $ 201 $ 189
Depreciation, depletion and amortization 89 85
Reclamation and mine closure costs 5 11
------ ------
Total production costs $ 295 $ 285
--------------------------------------------------------------------------------------------
HOLLOWAY (84.65% Interest)
Gold ounces recovered 23 20
--------------------------------------------------------------------------------------------
Cost per Gold Ounce Produced
Cash production costs $ 209 $ 206
Depreciation, depletion and amortization 135 126
Reclamation and mine closure costs 3 2
------ ------
Total production costs $ 347 $ 334
--------------------------------------------------------------------------------------------
VERA/NANCY (50% Interest)
Gold ounces recovered 25 14
Silver ounces recovered 19 12
--------------------------------------------------------------------------------------------
Cost per Gold Ounce Produced
Cash production costs $ 121 $ 116
Depreciation, depletion and amortization 51 31
Reclamation and mine closure costs 3 1
------ ------
Total production costs $ 175 $ 148
--------------------------------------------------------------------------------------------
============================================================================================
AGGREGATE DATA
Gold ounces recovered 199 176
Average price per gold ounce realized $ 290 $ 286
Silver ounces recovered 158 216
Average price per silver ounce realized $ 5.09 $ 5.26
--------------------------------------------------------------------------------------------
Weighted Average Cost per Gold Ounce Produced
Cash production costs $ 168 $ 175
Depreciation, depletion and amortization 80 76
Reclamation and mine closure costs 5 6
------ ------
Total production costs $ 253 $ 257
============================================================================================
</TABLE>
9
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
SUPPLEMENTAL INFORMATION - (UNAUDITED) (1)
(Data reflects BMG attributable interests, except as noted)
(Ounces in thousands)
<TABLE>
<CAPTION>
Three months ended
March 31
------------------
2000 1999
---- ----
<S> <C> <C>
AGGREGATE DATA (cont.)
Gold ounces recovered - 100% 207 185
Gold ounces sold - 100% 212 186
Gold ounces sold - BMG share 203 177
-------------------------------------------------------------------------------------------
Silver ounces recovered - 100% 176 244
Silver ounces sold - 100% 171 245
Silver ounces sold - BMG share 154 217
============================================================================================
</TABLE>
(1) Cash production costs are presented in accordance with guidelines
established by The Gold Institute. In addition to mining, milling and plant
level general and administrative expenses, cash production costs include
royalties, freight, smelting costs and allowances, and production taxes.
Credits for by-product silver and copper are offset against these cash
production costs.
(2) Royalties paid to the Bolivian government for the Kori Kollo mine are
treated as income tax for per ounce cost calculations and are therefore not
included in these cost calculations.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This discussion should be read in conjunction with Management's
Discussion and Analysis of Financial Condition and Results of Operations
included in Battle Mountain's Annual Report on Form 10-K for the year ended
December 31, 1999 and the unaudited condensed consolidated financial statements
and notes preceding this discussion.
OVERVIEW
Continued low gold prices, partially offset by higher production,
resulted in a net loss of $3.5 million for the three months ended March 31,
2000. Cash flows from operations increased to $5.5 million for the quarter,
compared with $3.1 million for the same period in 1999. Cash and cash
equivalents decreased $69.5 million during the first quarter of 2000, primarily
due to the merger of Niugini Mining and Lihir. Low gold prices, capital
expenditures and debt payments also contributed to this decrease.
LIQUIDITY AND CAPITAL RESOURCES
OPERATING ACTIVITIES. Battle Mountain generated cash flows of $5.5
million from operating activities during the three months ended March 31, 2000
compared with $3.1 million for the same period in 1999. The increase was
primarily the result of higher production and slightly improved gold prices.
INVESTING ACTIVITIES. Capital expenditures totaled $9.5 million in the
first quarter of 2000 compared with $9.3 million during the same period in 1999.
Battle Mountain currently expects to invest $40 million to $45 million on
capital expenditures in 2000.
10
<PAGE>
Niugini Mining and Lihir merged on February 2, 2000. As a result,
Battle Mountain, which held a 50.45% interest in Niugini Mining prior to the
merger, received 111.3 million shares of Lihir, representing a 9.74% equity
interest in Lihir. The effect of the merger on cash and cash equivalents was a
decrease of $54.7 million. See Note 2 of Notes to Condensed Consolidated
Financial Statements in Item 1 for further discussion. In March 1999, an $11.0
million liquidating dividend was paid to Crown Butte Resources Ltd. minority
shareholders.
FINANCING ACTIVITIES. Battle Mountain made $10.0 million of debt
repayments in the first three months of 2000 compared with $26.5 million of debt
and short-term borrowing repayments in the same period of 1999. In March 2000,
$10.0 million of the Canadian Imperial Bank of Commerce debt was repaid because
the market value of the Lihir shares held by Battle Mountain declined to less
than the level required by the loan agreement. Further declines in the market
value of the shares of Lihir may result in additional principal repayments.
Battle Mountain has an effective registration statement on file with
the Securities and Exchange Commission (the "SEC") for the issuance of up to
$150.0 million of debt and/or equity securities. As of the date of this report,
no securities have been issued nor are there any current plans to issue any
securities under this registration statement. Battle Mountain also has
registration statements on file with the SEC and regulatory authorities in
Canada which qualify for sale the 65.2 million shares of Battle Mountain common
stock effectively held by Noranda Inc. Battle Mountain will not receive proceeds
from the sales of any shares that may be sold under the registration statements
covering the shares held by Noranda.
CONCLUSION. Battle Mountain believes cash requirements over the next
twelve months will be funded through a combination of current cash, future cash
flows from operations, proceeds from potential asset sales, short-term lines of
credit and/or future debt or equity security issuances. Significant additional
capital will be required in the foreseeable future in order to continue the
development of current and future mining projects, including the Phoenix
project. Battle Mountain's ability to raise capital is highly dependent upon the
commercial viability of its projects, which in turn is dependent upon the price
of gold. Because of continued low gold prices and their effect on Battle
Mountain's financial condition, short-term liquidity and our ability to raise
additional capital for long-term development projects may be impaired. In the
event that cash balances decline to a level that cannot support planned
activities, management will defer planned capital and exploration expenditures
as needed to conserve cash.
RESULTS OF OPERATIONS
Battle Mountain recorded net losses to common shares of $3.5 million
($.02 per share) and $14.5 million ($.06 per share) for the three month periods
ended March 31, 2000 and 1999, respectively. Continued low gold prices were
partially offset by higher production and lower per ounce cash costs in the
first quarter of 2000. Results in the 1999 period included an $11.0 million
impairment in the investment in Lihir and foreign currency exchange gains of
$3.1 million.
<TABLE>
<CAPTION>
Three months ended
March 31
------------------
2000 1999
---- ----
<S> <C> <C>
Gold ounces sold - 100%, THOUSANDS 212 186
Average gold revenue realized per ounce $ 290 $ 286
Average London PM gold fix per ounce $ 290 $ 287
</TABLE>
Sales increased $8.7 million, or 16%, in the first three months of 2000
compared with the same period in 1999 as a result of higher production and
slightly higher gold prices. Increased production at Golden Giant was
attributable to decreased gold inventory in the mill circuit and higher
throughput, while increased production at Vera/Nancy was attributable to higher
throughput. The average realized price of gold increased slightly in 2000 as a
result of higher spot gold prices.
11
<PAGE>
<TABLE>
<CAPTION>
AGGREGATE ATTRIBUTABLE PRODUCTION COSTS Three months ended
PER OUNCE OF GOLD PRODUCED March 31
--------------------
2000 1999
------- -------
<S> <C> <C>
Direct mining costs $ 167 $ 175
Third party smelting, refining and transportation costs 1 2
By-product credits included in sales (4) (6)
------- -------
Cash operating costs 164 171
Royalties 4 4
------- -------
Total cash costs 168 175
Depreciation, depletion and amortization 80 76
Reclamation and mine closure costs 5 6
------- -------
Total production costs $ 253 $ 257
======= =======
</TABLE>
<TABLE>
<CAPTION>
RECONCILIATION OF AGGREGATE ATTRIBUTABLE CASH COSTS
PER OUNCE TO CONSOLIDATED FINANCIAL STATEMENTS Three months ended
March 31
--------------------
MILLIONS, EXCEPT OUNCES PRODUCED AND PER OUNCE AMOUNTS 2000 1999
------- -------
<S> <C> <C>
Production costs per financial statements $ 39.4 $ 35.9
Minority interest portion of production costs (1.8) (1.7)
By-product credits included in sales (0.7) (1.1)
Reclamation and mine closure costs (1.0) (1.2)
Inventory change and other (2.4) (1.1)
------- -------
Production costs for per ounce calculation purposes $ 33.5 $ 30.8
======= =======
Gold ounces produced, THOUSANDS 199 176
======= =======
Total cash costs per gold ounce produced $ 168 $ 175
======= =======
</TABLE>
Royalties paid to the Bolivian government for the Kori Kollo mine are
treated as income tax for per ounce cost calculations and are therefore
not included in these cost calculations.
Total production costs increased in the first quarter of 2000
compared with the first quarter of 1999, primarily at Holloway due to higher
gold sales and the sale of higher cost ounces produced in November and
December 1999. Niugini Mining's San Cristobal mine was placed on care and
maintenance effective January 1, 1999, therefore San Cristobal's revenues of
$1.4 million for the first quarter of 1999 were credited against the $0.7
million of its production costs during the period. As operations of San
Cristobal are not included in Battle Mountain's results in 2000 due to the
Niugini Mining and Lihir merger, this also contributed to the increase in
production costs in 2000. Consolidated per ounce cash costs decreased in
2000, primarily at Golden Giant due to higher production.
Depreciation, depletion and amortization increased during the three
month period ended March 31, 2000, primarily as a result of higher production.
Exploration, evaluation and other lease costs decreased in 2000 due
to planned decreased expenditures and the sale of exploration rights in 2000.
Effective January 1, 2000, expenditures at the Crown Jewel project are
classified as exploration, evaluation and other lease costs. Interest expense
remained fairly constant, while interest income decreased in the first three
months of 2000 due to lower levels of cash invested.
12
<PAGE>
Equity in losses and impairment of Lihir totaled $12.2 million for
the three months ended March 31, 1999. Since in 1999 the investment in Lihir
was an equity-accounted investment, an $11.0 million impairment charge to the
investment in Lihir was recorded in the first quarter of 1999 as a result of
a decrease in the market value of the Lihir shares then held by Niugini
Mining because the decrease in value was considered to be other than a
temporary decrease. See Note 2 of Notes to Condensed Consolidated Financial
Statements in Item 1 for discussion of the Niugini Mining and Lihir merger
and the subsequent accounting treatment of changes in the value of the
investment in Lihir.
Net foreign currency exchange gains totaled $0.5 million and $3.1
million during the first quarters of 2000 and 1999, respectively, primarily
on the U.S. dollar-denominated debt of foreign subsidiaries.
Battle Mountain's provision for income taxes for the three month
period ended March 31, 2000 included benefits of $0.9 million on losses
before income taxes of $3.2 million. Battle Mountain's effective income tax
rate for the first three months of 2000 was 19%. Mining taxes decreased in
2000 compared with the same period in 1999 due to a lower effective tax rate.
OTHER
See Note 8 of Notes to Condensed Consolidated Financial Statements
for a discussion of material contingencies.
Various laws require that financial assurances be in place for
certain environmental and reclamation obligations and potential liabilities.
Battle Mountain has certain environmental and reclamation financial
assurances in place and will be required to put additional financial
assurances in place in the near future. There can be no guarantee that Battle
Mountain will be able to maintain and/or put in place the necessary
assurances.
Accounting Standard No. 133, "Accounting for Derivative Instruments and
Hedging Activities" was issued in June 1998. This standard was amended by
Accounting Standard No. 137, which deferred the effective date of implementation
to the first quarter of fiscal years beginning after June 15, 2000. See Note 6
of Notes to Condensed Consolidated Financial Statements in Item 1 for further
discussion.
Unless otherwise discussed below, information for the three months
ended March 31, 2000 about market, foreign currency, interest rate and equity
risks does not differ materially from that discussed under Item 7A of Battle
Mountain's Annual Report on Form 10-K in Item 1 for the year ended December 31,
1999. See Note 6 of Notes to Condensed Consolidated Financial Statements for
discussion of derivative financial instruments.
Battle Mountain's profitability is significantly affected by changes in
the market price of gold. Gold prices can fluctuate widely and are affected by
numerous factors, such as demand, forward selling by producers, central bank
gold sales, purchases and lending, currency valuations, investor sentiment and
production levels. While Battle Mountain is a low-cost gold producer, a
sustained period of low gold prices would have a material adverse effect on
results of operations, financial position and cash flows.
All revenues generated during the first quarter of 2000 were from
mining operations outside the United States, while assets attributable to those
operations totaled approximately $277.7 million at March 31, 2000. As a result,
Battle Mountain is exposed to risks normally associated with operations located
outside the United States, including political, economic, social and labor
instabilities, as well as foreign exchange controls, currency fluctuations and
taxation changes.
13
<PAGE>
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
The U.S. securities laws provide a "safe harbor" for certain
forward-looking statements. This report contains forward-looking statements that
involve risks and uncertainties that could cause actual results to differ
materially from those projected in such forward-looking statements. Statements
regarding the expected commencement dates of mining operations, projected
quantities of future production, capital costs, production rates, costs and
expenditures, and other operating and financial data are based on expectations
that the Company believes are reasonable, but can give no assurance that such
expectations will prove to have been correct. Factors that could cause actual
results to differ materially include, among others: risks and uncertainties
relating to general domestic and international economic and political
conditions, the cyclical and volatile prices of gold and silver, political and
economic risks associated with foreign operations, unanticipated ground and
water conditions, unanticipated grade and geological problems, metallurgical and
other processing problems, availability of materials and equipment, the delays
in the receipt of or failure to receive necessary governmental permits, the
inability to maintain or put in place necessary environmental or reclamation
financial assurances, appeals of agency decisions or other litigation, changes
in laws or regulations or the interpretation and enforcement thereof, the
occurrence of unusual weather or operating conditions, force majeure events, the
failure of equipment or processes to operate in accordance with specifications
or expectations, labor relations, accidents, delays in anticipated start-up
dates, environmental risks and the results of financing efforts and financial
market conditions. These and other risk factors are discussed in more detail
herein. Many of such factors are beyond Battle Mountain's ability to control or
predict. Readers are cautioned not to put undue reliance on forward-looking
statements. Battle Mountain disclaims any intent or obligations to update these
forward-looking statements, whether as a result of new information, future
events or otherwise.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
See Management's Discussion and Analysis of Financial Condition and
Results of Operations - "Other" in Item 1 for a discussion.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
On August 20, 1999, the Colorado Department of Public Health and the
Environment issued a Notice of Violation and Cease and Desist Order to Battle
Mountain, alleging discharges at the San Luis mine to waters not permitted
under the Colorado Water Quality Control Act. Battle Mountain filed an Answer
to the Notice denying that such a violation had occurred. Battle Mountain has
negotiated a settlement with the Colorado Department of Public Health and
Environment which, if approved, will resolve the violations alleged in the
Notice of Violation. The terms of the settlement are set forth in a
Settlement Agreement and Stipulated Order which has been executed by Battle
Mountain and the Director of the Colorado Water Quality Control Division.
Under applicable law, the Settlement Agreement will not become final until
the closure of a public comment period and final imposition of the terms of
the Agreement by the Colorado Department of Public Health and Environment.
See Note 8 of Notes to Condensed Consolidated Financial Statements under Part
I for further discussion. Battle Mountain is also party to a number of other
legal actions arising in the ordinary course of business. While the final
outcome of these other actions cannot be predicted with certainty, it is the
opinion of management that none of these actions when resolved will have a
material adverse effect on results of operations, financial position or cash
flows.
14
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
10.1 Battle Mountain Gold Company March 2000 Severance
Plan and Summary Plan Description
10.2 Form of Agreement relating to bonus for certain key
employees
11 Computations of Earnings (Loss) per Common Share
27 Financial Data Schedule
(b) Reports on Form 8-K
A Current Report on Form 8-K, dated January 28, 2000, was
filed containing a January 19, 2000 press release issued by
Battle Mountain concerning certain information regarding an
adverse water rights / water quality ruling on the Crown Jewel
mine.
A Current Report on Form 8-K, dated January 28, 2000, was
filed containing a January 27, 2000 press release issued by
Battle Mountain concerning Noranda Inc.'s intent to nominate
four individuals for positions on the Battle Mountain Board of
Directors.
A Current Report on Form 8-K, dated February 16, 2000, was
filed containing a fourth quarter 1999 earnings release issued
by Battle Mountain on February 4, 2000.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
BATTLE MOUNTAIN GOLD COMPANY
Date: May 15, 2000. /s/ Jeffrey L. Powers
----------------------------------------
Jeffrey L. Powers
Vice President and Controller
(Chief Accounting Officer)
15
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
MARCH 2000 SEVERANCE PLAN
AND
SUMMARY PLAN DESCRIPTION
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
MARCH 2000 SEVERANCE PLAN AND SUMMARY PLAN DESCRIPTION
TABLE OF CONTENTS
<TABLE>
<S> <C> <C>
I. INTRODUCTION 1
II. DEFINITIONS 1
Base Pay 2
Company 4
Effective Date 4
Eligible Employee 1
ERISA 5
Involuntary Termination 3
Participating Company(ies) 4
Plan Administrator 4
Regular, Full-Time Employee 1
Severance Pay 3
Termination 3
Termination Date 3
Termination for Cause 3
Voluntary Termination 4
Years of Service 2
III. SEVERANCE PAY AND PLAN BENEFITS 5
A. Eligibility for Severance Pay and Plan Benefits 5
B. Severance Pay 5
C. Other Severance Benefits 7
D. Payment and Taxation of Severance Pay 8
IV. THE CLAIMS PROCESS 8
A. Claims for Benefits 8
B. Appeal and Review 9
V. MISCELLANEOUS PROVISIONS 9
A. Termination and Changes to the Plan 9
B. Successors 10
C. Interpretation of the Plan 10
D. Construction 11
E. Summary Plan Description 11
VI. ERISA REQUIRED INFORMATION/
ADMINISTRATIVE INFORMATION REQUIRED BY ERISA 11
VII. STATEMENT OF ERISA RIGHTS 12
Schedule A 14
</TABLE>
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
MARCH 2000 SEVERANCE PLAN
AND SUMMARY PLAN DESCRIPTION
I. INTRODUCTION
Battle Mountain Gold Company (as hereinafter defined, the
"Company") establishes the Battle Mountain Gold Company March 2000 Severance
Plan (as hereinafter defined, the "Plan") to assist Eligible Employees (as
hereinafter defined) whose employment is terminated under certain
circumstances. With respect to such actions, this Plan does not supersede any
formal, written agreement between an employee of a Participating Company and
the Participating Company with regard to payments to be made upon termination
of employment. This Plan is an employee welfare benefit plan as defined in
Section 3(1) of the ERISA. It is not a funded plan; any benefits under the
Plan will be paid from the general assets of the Participating Companies.
Employees have no right to or interest in any specific assets or accounts of
the Participating Companies, even if amounts are credited to the accounts
designated to be used for the payment of severance benefits.
II. DEFINITIONS
A. ELIGIBLE EMPLOYEE
A Regular, Full-Time Employee of a Participating Company.
B. REGULAR, FULL-TIME EMPLOYEE
An active salaried employee of the Participating Companies
whose normal work week is at least thirty-seven and one-half (37 1/2)
hours. Regular, Full-Time Employees do not
1
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
include 1) individuals who are on-call agency or contract employees, 2)
individuals who are on leave of absence or other inactive status as of the
time of their Termination Date with the Participating Company (other than a
legally mandated leave such as including, but not limited to, leaves regulated
under the Family and Medical Leave Act or the Uniformed Services Employment
and Reemployment Rights Act, or a leave of absence for an Eligible Employee
who is receiving payments under the Battle Mountain Gold Company Long Term
Disability Insurance Plan during the first two (2) years of such payments), 3)
individuals who are classified on the payroll or personnel records of the
Participating Company as hourly paid employees, or whose employment is
governed under the terms of a collective bargaining agreement between a
Participating Company and a labor organization, or 4) officers of the
Participating Company.
C. BASE PAY
The regular base salary or wages in effect for the Eligible
Employee on his Termination Date. The Eligible Employee's Base Pay shall be
determined by annualizing his base salary or wages in effect on his
Termination Date.
D. YEARS OF SERVICE
Twelve (12) months of uninterrupted, continuous employment
with a Participating Company, based on his original date of hire on the
payroll or personnel records of the Participating Company. This may include
service with a predecessor of the Participating Company, a company acquired by
the Participating Company, or the Noranda Group of Companies, as an hourly or
salaried employee. For this purpose, credit will be given for partial years of
service up to and including the Termination Date. Transfers between
Participating Companies and any other subsidiaries of the Company shall not
result in a break in continuous employment for this purpose.
2
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
E. SEVERANCE PAY
The cash payment made to an Eligible Employee, as further
defined under Section III.B. hereunder, based on his Involuntary Termination
as defined under Section II.H. hereunder.
F. TERMINATION
Termination means that an Eligible Employee is no longer
employed by a Participating Company or successor of a Participating Company,
or the Noranda Group of Companies.
G. TERMINATION DATE
The final date of an Eligible Employee's employment, as is
determined by the Participating Company by which the Eligible Employee is
employed.
H. INVOLUNTARY TERMINATION
Termination of an Eligible Employee's employment with a
Participating Company which is not a Termination for Cause or a Voluntary
Termination. Further, where an Eligible Employee's Termination is an
Involuntary Termination, if the Eligible Employee quits prior to his
designated Termination Date, it shall no longer be deemed an Involuntary
Termination.
I. TERMINATION FOR CAUSE
Termination of an Eligible Employee's employment with a
Participating Company which is based on the fact that the Eligible Employee
willfully and continually failed to substantially perform his duties with the
Participating Company, or willfully engaged in conduct which is demonstrably
and substantially injurious to any Participating Company, monetarily or
otherwise, or is due to gross and continuous violation of policies of any
Participating Company. However, if failure to substantially perform the duties
of the position
3
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
held by the Eligible Employee on his Termination Date is due solely to his
incapacity based on disability, which in the sole discretion of the
Participating Company qualifies as a justifiable disability hereunder, his
termination shall not be deemed a Termination for Cause.
J. VOLUNTARY TERMINATION
Termination of an Eligible Employee's employment with a
Participating Company which is initiated by the Eligible Employee, or is a
result of the Eligible Employee's death, disability, or retirement. A
Termination is not a Voluntary Termination (or a Termination for Cause) if the
Eligible Employee's rejection of an offer of continued or alternative
employment is based on a substantial change in the terms and conditions of
such employment, relating to position, duties, wages or benefits, or based on
a requirement that the Eligible Employee (without his consent) be based at any
place outside a fifty (50)-mile radius of his prior place of employment,
except for reasonably required travel on the Company's business.
K. COMPANY
Battle Mountain Gold Company, a Nevada corporation, and its
successor or successors.
L. PARTICIPATING COMPANY(IES)
The Company and, to the extent they adopt the Plan, Battle
Mountain Resources, Inc., Battle Mountain Exploration Company, and Battle
Mountain Services Company.
M. PLAN ADMINISTRATOR
The Company. The Company shall also be the Named Fiduciary
under the Plan.
N. EFFECTIVE DATE
March 1, 2000.
4
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
O. ERISA
The Employee Retirement Income Security Act of 1974, as
subsequently amended.
III. SEVERANCE PAY AND PLAN BENEFITS
A. ELIGIBILITY FOR SEVERANCE PAY AND PLAN BENEFITS
Severance Pay and Plan benefits shall be payable under the
Plan to an Eligible Employee whose Termination is as a result of Involuntary
Termination. An Eligible Employee will only receive Severance Pay and other
benefits under the Plan if he:
1. returns and delivers, by his designated Termination Date,
all Company property and materials, and
2. executes and delivers his consent to payment under an
agreement and release in conformance with the form
provided in Schedule A (the "Agreement"), no later than
forty-five (45) days after his Termination Date, which consent
shall not be revoked within the seven (7) day period following
such execution and delivery.
B. SEVERANCE PAY
An Eligible Employee who has met the requirements for a
benefit pursuant to Section III.A hereof, shall receive Severance Pay in an
amount as follows:
1. two (2) weeks of Base Pay for an Eligible Employee
classified as non-exempt on the personnel records of the
Participating Company and whose target incentive award under
the Battle Mountain Gold Incentive Bonus Plan is six percent
(6%), multiplied by the Eligible Employee's Years of Service,
to a
5
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
maximum of fifty-two (52) weeks of Base Pay or, if greater,
four (4) weeks of Base Pay; or
2. three (3) weeks of Base Pay for an Eligible Employee
classified as exempt on the personnel records of the
Participating Company and whose target percentage award under
the Battle Mountain Gold Incentive Bonus Plan is from seven
percent (7%) to fifteen percent (15%), multiplied by the
Eligible Employee's Years of Service, to a maximum of
fifty-two (52) weeks of Base Pay or, if greater, eight (8)
weeks of Base Pay; or
3. four (4) weeks of Base Pay for an Eligible Employee
classified as exempt on the personnel records of the
Participating Company and whose target percentage award under
the Battle Mountain Gold Incentive Bonus Plan is from sixteen
percent (16%) to thirty-five percent (35%), multiplied by the
Eligible Employee's Years of Service, to a maximum of
fifty-two (52) weeks of Base Pay or, if greater, twelve (12)
weeks of Base Pay.
The amount resulting under this Section III.B. will be
reduced by the amount of any outstanding debt owed to the Participating
Company as of the Eligible Employee's Termination Date and, as to an Eligible
Employee who is, on his Termination Date, receiving payments under the Battle
Mountain Gold Company Long Term Disability Insurance Plan during the first two
(2) years of such payments, an offset shall be made to the Severance Pay
otherwise determined in the amount of the payments expected to be made to him
under the Battle Mountain Gold Company Long Term Disability Insurance Plan
during the remainder of such first two (2) year period.
6
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
C. SEVERANCE BENEFITS
In addition to Severance Pay, benefits under the Plan will
be as follows:
1. HEALTH COVERAGE. Each Eligible Employee who makes a timely
COBRA election to continue group health coverage and is
otherwise eligible for such coverage, will receive health
(medical and dental) coverage for himself and those dependents
covered under the Participating Company's group health plan as
of his Termination Date, based on the same premium schedule as
is applicable to active employees, until the later of:
a. the number of weeks of Severance Pay determined as
payable under Section III.B. above, or
b. the date the Eligible Employee becomes eligible to be
covered by another employer's group health plan.
Such coverage is intended to satisfy the requirements
for continuation of coverage under the Consolidated Omnibus
Budget Reconciliation Act of 1986 ("COBRA"), as amended, for
the period of time such coverage is provided hereunder, and
shall be in lieu of any other continued or extended coverage
provided by the Participating Company during such same period.
2. LIFE INSURANCE COVERAGE. For as long as Eligible Employee
is entitled to receive group health coverage under Section
III.C.1. above, group term life insurance, in the amount
maintained as of his Termination Date, shall be provided by
the Participating Company, under the same requirements for
premium payment as was applicable for such coverage during the
Eligible Employee's active employment.
7
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
3. OUTPLACEMENT SERVICES. Each Eligible Employee shall receive
outplacement services of a type and amount as determined by
the Company.
D. PAYMENT AND TAXATION OF SEVERANCE PAY
Severance Pay will be paid as a lump sum, and will be mailed
to the Eligible Employee or, if applicable, deposited directly into an account
that has been authorized by the Eligible Employee. The payment will be made as
soon as administratively feasible following the expiration of the revocation
period for the executed Agreement. All Severance Pay under this Plan will be
treated as "wages" for the purposes of state and federal employment taxes and,
as such, will be subject to withholding and other payroll taxes, as well as
previously authorized deductions and such other deductions as may be required
by law.
IV. THE CLAIMS PROCESS
A. CLAIMS FOR BENEFITS
Any claims concerning eligibility, participation, benefits
or other aspects of this Plan must be submitted in writing and directed to the
Plan Administrator. If the Plan Administrator determines that any claimant is
not entitled to receive all or any part of the benefits claimed, it will mail
or deliver written notice to such claimant of its determination, the reasons
therefor, appropriate references to pertinent Plan provisions, and the
procedure for review of this determination. Any such notice shall be provided
within sixty (60) days of submission of a denied claim, unless the Plan
Administrator provides the claimant with notice in writing before the end of
such period that an extension of time (of no more than a single additional
sixty (60) days) is required for processing such claim. This notice shall also
provide the reasons for such extension, an indication of the date on which a
decision is expected to be
8
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
made, and the decision of the Plan Administrator shall be made no later than
the end of such extended period.
B. APPEAL AND REVIEW
An applicant for benefits whose claim has been denied in
whole or in part, or the duly authorized representative of such person may,
within sixty (60) days after receipt of written notice of such denial, request
a review thereof. Such request must be in writing, submitted to the Plan
Administrator, and must provide such information as will establish the
claimant's right to the benefits in question. If, upon receipt of this further
information, the Plan Administrator determines that the claimant is not
entitled to the benefits claimed, it will afford the claimant, or his duly
authorized representative, a reasonable opportunity to submit issues and
comments in writing and to review pertinent documents. The Plan Administrator
shall then render its final decision in writing, including the reasons for
such decision with references to pertinent Plan provisions, within sixty (60)
days after the submission of such request for review. One single additional
sixty (60) day extension may be allowed the Plan Administrator if it notifies
the claimant within the original sixty (60) day period that special
circumstances require such extension. In such case, the Plan Administrator
shall transmit its final response to the claimant no later than the end of
such extended period.
V. MISCELLANEOUS PROVISIONS
A. TERMINATION AND CHANGES TO THE PLAN
The Company reserves the right to amend or otherwise change
all or part of this Plan at any time, except the Company will not reduce any
benefits for employees who have satisfied all conditions for eligibility prior
to such amendment. Any such amendment will be adopted by formal action of the
Company's President or executed by another officer authorized
9
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
to act by the President. The Company has the right to act at its sole
discretion without prior notice or consideration to any employee with regard
to such changes.
B. SUCCESSORS
This Plan shall bind any successor to all or substantially
all of the business and/or assets of the Participating Company (whether direct
or indirect, by purchase, merger, combination, consolidation or otherwise), in
the same manner and to the same extent that the Participating Company would be
obligated under this Plan if no succession had taken place. In the case of a
transaction in which such successor would not, by the foregoing provision or
by operation of law, be bound by this Plan, the Participating Company shall
require such successor expressly and unconditionally to assume and agree to
perform the Participating Company's obligations hereunder, in the same manner
and to the same extent that the Participating Company would be required to
perform if no succession had taken place.
C. INTERPRETATION OF THE PLAN
The Plan will be interpreted by the Plan Administrator and
all Plan fiduciaries in accordance with the terms of the Plan and their
intended meanings. The Plan Administrator shall have such powers as may be
necessary to discharge its duties hereunder, which it shall execute in its
sole discretion, including, but not by way of limitation, the following powers
and duties:
1. to construe and interpret the Plan, decide all questions of
eligibility and determine the amount, manner and time of
payment of any benefits hereunder;
2. to determine all questions arising in the administration of
the Plan; and
3. to set down uniform and nondiscriminatory rules of
interpretation and administration which may be modified from
time to time in light of the Company's experience.
10
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
D. CONSTRUCTION
The masculine gender, where appearing in the Plan, shall be
deemed to include the feminine gender, and the singular may include the
plural, unless the context clearly indicates the contrary. The words "hereof,"
"herein," "hereunder" and other similar compounds of the word "here" shall,
unless otherwise specifically stated, mean and refer to the entire Plan, and
not to any particular provision or section. Article and section headings are
included for convenience of reference and are not intended to add to, or
subtract from, the terms of the Plan.
E. SUMMARY PLAN DESCRIPTION
The Plan and the Summary Plan Description are a combined
document.
VI. ERISA REQUIRED INFORMATION
Plan Sponsor and Plan Battle Mountain Gold Company
Administrator, including 333 Clay Street, 42nd Floor
address and telephone number: Houston, Texas 77002
(713) 650-6400
Name, address and telephone Mr. Ivan Thompson
number of person designated as Manager of Human Resources
agent for service of process: Battle Mountain Gold Company
333 Clay Street, 42nd Floor
Houston, Texas 77002
(713) 653-7216
Basis on which Plan January 1 - December 31, except the
records are kept: first plan year will begin March 1,
2000
Type of Plan: Unfunded welfare benefit severance
plan
Plan Number: 546
EIN: 76-0151431
11
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
VII. STATEMENT OF ERISA RIGHTS
As a participant in this Plan, an employee is entitled to
certain rights and protections under ERISA. ERISA provides that all
participants will be entitled to:
- examine, without charge, at the Plan Administrator's
office and other specified locations, all Plan documents and
copies of all documents filed by the Plan with the U.S.
Department of Labor;
- obtain copies of all Plan documents and other Plan
information upon written request to the Plan Administrator.
The Plan Administrator may make a reasonable charge for the
copies.
In addition to creating rights for Plan participants, ERISA
imposes duties upon the people who are responsible for the operation of the
employee benefit plan. The people who operate the Plan, called "fiduciaries"
of the Plan, have a duty to do so prudently and in the interest of Plan
participants. No one, including the Company or any other person, may fire an
employee or otherwise discriminate against an employee in any way in order to
prevent an employee from obtaining a Plan benefit or exercising an employee's
rights under ERISA.
If an employee's claim for a benefit is denied in whole or
in part, the employee must receive a written explanation for the reason for
the denial. The employee has the right to have the Plan Administrator review
and reconsider the employee's claim. See Section IV for details.
Under ERISA, there are steps an employee can take to enforce
the above rights. For instance, if an employee requests certain materials from
the Plan and does not receive them within 30 days, the employee may file suit
in a federal court. In such a case, the court may
12
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
require the Plan Administrator to provide the materials and pay the employee
up to $100 a day until the employee receives them, unless the materials were
not sent because of reasons beyond the control of the Plan Administrator. If
an employee has a claim for benefits which is denied or ignored, in whole or
in part, the employee may file a suit in a state or federal court. If an
employee is discriminated against for asserting his rights, the employee may
seek assistance from the U.S. Department of Labor, or the employee may file
suit in a federal court. The court will decide who should pay court costs and
legal fees. If the employee is successful, the court may order the person the
employee has sued to pay these costs and fees. If the employee loses, the
court may order the employee to pay these fees and costs; for example, if it
finds the employee's claim is frivolous. If an employee has any questions
about the Plan, the employee should contact the Plan Administrator. If an
employee has any questions about this statement or about the employee's rights
under ERISA, the employee should contact the nearest Area Office of the U.S.
Labor-Management Services Administrator, Department of Labor.
13
<PAGE>
Battle Mountain Gold Company
March 2000 Severance Plan and
Summary Plan Description
Schedule A
AGREEMENT AND RELEASE OF ALL CLAIMS
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
AGREEMENT
This Agreement made this ____ day of ________, 2000, by and between
Battle Mountain Gold Company, a Nevada corporation with its principal office at
333 Clay Street, 42nd Floor, Houston, Texas 77002 (hereinafter, together with
its successors, called the "Company") and < < FirstName > > < < LastName > >
("Key Employee").
WITNESSETH:
WHEREAS, the Company recognizes the value of the experience, abilities
and services of the Key Employee; and
WHEREAS, all of the terms, conditions and undertaking of this Agreement
and the execution of this Agreement have been duly approved, authorized and
directed by the Compensation and Stock Option Committee of the Board of
Directors ("Committee") for and on behalf of the Company;
NOW, THEREFORE, for good and valuable consideration, it is mutually
agreed by and between the parties hereto as follows:
1. RETENTION BONUS PAYMENT. (a) 2000 BONUS. Subject to clause 3 of
this Agreement, the Company shall pay Key Employee US$< < M_2000bonus > > on
October 2, 2000 ("2000 Bonus") provided that Key Employee is actively
employed by the Company on October 2, 2000; (b) 2001 BONUS. Subject to clause
3 of this Agreement, the Company shall pay Key Employee US$< < M_2001bonus > >
on October 1, 2001 ("2001 Bonus") provided that Key Employee is actively
employed by the Company on October 1, 2001.
2. FORM OF PAYMENT. The 2000 Bonus and the 2001 Bonus will each be
payable to the Key Employee in the form of cash on the attainment of the
respective employment time goal set forth above.
3. FORFEITURE. If the Key Employee is not actively employed by the
Company on October 2, 2000 or October 1, 2001, the Key Employee shall
respectively forfeit his right to the payment of the 2000 Bonus and 2001 Bonus
pursuant to clause 1.
4. CHANGE IN EMPLOYMENT STATUS. If prior to October 1, 2001, Key
Employee resigns for Good Reason or the Company terminates Key Employee's
employment for any reason except for Termination for Cause, then the Company
will pay Key Employee, in one lump sum cash payment, (i) an amount equal to the
aggregate total amount of the 2000 Bonus and the 2001 Bonus if the termination
of employment of the Key Employee, as set forth above, occurs prior
<PAGE>
to October 2, 2000, or (ii) an amount equal to the 2001 Bonus if the
termination of employment of Key Employee, as set forth above, occurs on or
after October 2, 2000 but on or prior to October 1, 2001. In such case, the
lump sum cash payment shall be paid to the Key Employee by the Company no
later than thirty (30) days following the termination date of employment of
the Key Employee.
For the purposes of this Section 4, "Good Reason" and "Termination for
Cause" shall have the following definitions:
"GOOD REASON" means any of the following Company acts or failures to act:
a. change in the Key Employee's status, title, position, duties or
responsibilities which, in the Key Employee's reasonable judgment,
represents a substantial reduction of his immediately prior
status, title, position, duties or responsibilities;
b. failure to either (i) continue in effect any material salary,
compensation or benefit plan, program or practice in which the Key
Employee was participating immediately prior to such failure, or
(ii) provide the Key Employee with salary, compensation and
benefits at least equal (in terms of benefit levels and/or reward
opportunities) to those provided under each such plan, program and
practice as in effect immediately prior to such
failure;
c. requirement that the Key Employee (without his consent) be based
at any place outside a 35 mile radius of his prior place of
employment, except for reasonably required travel on the Company's
business or, in the event the Key Employee consents to any such
relocation, the Company's failure to pay (or reimburse the Key
Employee for) all reasonable moving expenses incurred by him
relating to a change of principal residence in connection with
such relocation and to indemnify Key Employee against any loss
realized in the sale of Key Employee's principal residence in
connection with any such change of residence;
d. material breach of any provision of this Agreement; or
e. purported termination of the Key Employee's employment for cause
by the Company which does not meet the definition of "Termination
for Cause" in this Agreement.
2
<PAGE>
"TERMINATION FOR CAUSE" means a termination of the Key Employee's
employment which is based on the fact that the Key Employee (a) willfully
and continually failed to substantially perform his duties with the
Company (other than a failure resulting from the Key Employee's
incapacity due to Disability), or (b) willfully engaged in conduct which
is demonstrably and substantially injurious to the Company, monetarily or
otherwise.
5. NO RIGHT TO EMPLOYMENT. This Agreement is not an employment
agreement. Nothing contained in this Agreement shall be construed to limit in
any way the rights of the Company or any of its affiliates to terminate the Key
Employee's employment with Company or any such affiliate at any time. Nothing
contained in this Agreement shall be evidence of any agreement or understanding,
expressed or implied, that the Company or any affiliate will employ the Key
Employee in any particular position or at any particular rate of remuneration.
The Key Employee's employment, in the absence of any other written agreement to
the contrary, shall be on an at will basis, terminable by either the Company or
the Key Employee on notice to the other.
6. CONFIDENTIALITY.The Key Employee acknowledges his or her
continuing obligation of confidentiality regarding proprietary or confidential
information of the Company. During and after the term of this Agreement, the Key
Employee agrees to maintain the strictest confidence with respect to information
concerning the business or affairs of the Company which was acquired by the Key
Employee during the course of employment including the terms of this Agreement.
Such information includes, but is not limited to, inventions, ideas, technical
data, products, services, processes, procedures, prices, litigation, discounts,
computer and information systems (including software), future plans, policies,
and all other knowledge in whatever form used in management, engineering,
marketing, finance, litigation, operations, or otherwise concerning the business
of the Company which is of a proprietary or confidential nature. Following
termination of employment with the Company, the Key Employee hereby covenants
not to use or disclose, and not to allow others to use or disclose, any such
information at any time without the express written consent of the President of
the Company, unless the Key Employee is legally compelled to do so by proper
legal process. Should the Key Employee be served with legal process seeking the
Key Employee to disclose any such information, the Key Employee agrees to notify
the President of the Company immediately in order that the Company may resist
such process if it so chooses. It is understood and agreed that if at any time
the Key Employee violates this obligation of confidentiality regarding
proprietary or confidential information of the Company, then the Company may, in
its sole discretion, discontinue and/or recover any or all payments made
hereunder to the Key Employee and seek to recover damages.
3
<PAGE>
7. WITHHOLDING OF TAXES. The Company may withhold from any payment
made hereunder all federal, state, city or other taxes as may be required
pursuant to any law or governmental regulation or ruling.
8. ADMINISTRATION. The Committee shall administer this Agreement.
Bonus awards granted hereunder have been determined by the Committee. All
questions of interpretation of this Agreement shall be determined by the
Committee.
9. NO FUNDING. The Key Employee has the status of a general unsecured
creditor of the Company. This Agreement constitutes a mere promise by the
Company to make payments in the future as set forth herein. This Agreement is
intended to be unfunded for tax purposes and for purposes of Title I of the
Employee Retirement Income Security Act of 1974, as amended.
10. NO ASSIGNMENT. The Key Employee's right to payment hereunder are
not subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment, or garnishment by creditors of the
Key Employee or the Key Employee's beneficiary, other than by transfer by will
or by the laws of descent and distribution. In the event of any attempt at such
prohibited assignment or transfer, the Company shall have no liability to pay
any amount so assigned or transferred.
11. SUCCESSORS. This Agreement shall bind any successor (whether
direct or indirect, by purchase, merger, combination, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Company, in the same manner and to the same extent that the Company would be
obligated under this Agreement if no succession had taken plan. In the case of a
transaction in which such successor would not by the foregoing provision or by
operation of law be bound by this Agreement, the Company shall require such
successor expressly and unconditionally to assume and agree to perform the
Company's obligations under this Agreement, in the same manner and to the same
extent that the Company would be required to perform if no succession had taken
place.
12. PROTECTIVE PROVISIONS; WAIVER. Any payment payable to the Key
Employee hereunder is conditioned upon the Key Employee's cooperation with the
Company by furnishing any and all information requested by the Company in order
to facilitate the payments set forth above. Receipt of any payment hereunder may
be contingent, at the Company's sole discretion, upon the Key Employee's signing
a waiver and release with respect to form, substance and timeliness of the Key
Employee's rights to such payment(s).
4
<PAGE>
13. ENTIRETY; AMENDMENT OF AGREEMENT. This Agreement shall constitute
the entire understanding between the parties hereto with respect to the subject
matter hereof and may be modified only by writing executed by the parties
hereto.
14. NOTICE. Any notice required or permitted to be given to the
Company hereunder shall be sufficient if in writing and hand delivered, or sent
by registered or certified mail, to the Company at its principal office to the
attention of the Vice President of Human Resources. Any notice required or
permitted to be given to the Key Employee hereunder shall be sufficient if in
writing and hand delivered, or sent by registered or certified mail, to the last
known address of the Key Employee. Such notice shall be deemed given as of the
date of delivery, or if delivery is made by mail, as of the date shown on the
postmark on the receipt of the registration or certification.
15. VALIDITY. In case any provision hereunder shall be held illegal or
invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Agreement shall be construed and enforced as if
such illegal and invalid provision had never been inserted in the Agreement.
16. CONSTRUCTION. No payments made hereunder shall be considered
"Annual Compensation" under any of the Company's Severance Plans, programs, or
Agreements. This Agreement is supplemental to the existing Plans, programs, and
Agreements of the Company and to the March 2000 Severance Plan and does not
supercede or replace any such Plans, programs, and Agreements. This Agreement
shall be subject to and construed under the laws of the State of Nevada, without
regard to the conflict of law provisions thereof.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer and the Key Employee has hereunto set
his hand, all as of the day and year first above written.
BATTLE MOUNTAIN GOLD COMPANY
By:
------------------------------
----------------------------------
< < FirstName > > < < LastName > >
5
<PAGE>
BATTLE MOUNTAIN GOLD COMPANY
COMPUTATIONS OF INCOME (LOSS) PER COMMON SHARE
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31
MILLIONS, EXCEPT PER SHARE AMOUNTS 2000 1999
---- ----
(AS RESTATED)
<S> <C> <C>
BASIC INCOME LOSS PER SHARE
Net loss
Net loss $ (1.6) $ (12.6)
Deduct dividends on preferred shares (1.9) (1.9)
--------- ---------
Net loss applicable to common stock $ (3.5) $ (14.5)
========= =========
Shares
Weighted average number of common shares outstanding 229.9 229.8
========= =========
Basic loss per common share $(0.015) $(0.063)
========= =========
DILUTED LOSS PER SHARE
Net loss applicable to common stock $ (3.5) $ (14.5)
========= =========
Shares
Weighted average number of common shares outstanding 229.9 229.8
Assuming exercise of stock options reduced by the number of shares
which could have been purchased with the proceeds from exercise
of such options - -
--------- ---------
Weighted average number of common shares outstanding, as adjusted 229.9 229.8
========= =========
Diluted loss per share, assuming conversion $(0.015) $(0.063)
========= =========
CALCULATIONS OF CONVERSIONS OF SECURITIES PRODUCING ANTI-DILUTIVE RESULTS
CONVERSION OF PREFERRED SHARES
Net loss
Net loss applicable to common stock $ (3.5) $ (14.5)
Effect on net loss if preferred shares were converted 1.9 1.9
--------- ---------
Net loss $ (1.6) $ (12.6)
========= =========
Shares
Weighted average number of common shares outstanding 229.9 229.8
Effect on average shares outstanding if preferred shares were converted 11.0 11.0
--------- ---------
Weighted average number of common shares outstanding, as adjusted 240.9 240.8
========= =========
Diluted loss per share, assuming conversion $(0.007) $(0.052)
========= =========
CONVERSION OF DEBENTURES
Net loss
Net loss applicable to common stock $ (3.5) $ (14.5)
Effect on net loss if debentures were converted 1.0 1.0
--------- ---------
Net loss, as adjusted $ (2.5) $ (13.5)
========= =========
Shares
Weighted average number of common shares outstanding 229.9 229.8
Effect on average shares outstanding if debentures were converted 4.8 4.8
--------- ---------
Weighted average number of common shares outstanding, as adjusted 234.7 234.6
========= =========
Diluted loss per share, assuming conversion $(0.011) $(0.058)
========= =========
CONVERSION OF OPTIONS
Net loss
Net loss applicable to common stock $ (3.5) $ (14.5)
========= =========
Shares
Weighted average number of common shares outstanding 229.9 229.8
Effect on average shares outstanding if options were converted - -
--------- ---------
Weighted average number of common shares outstanding, as adjusted 229.9 229.8
========= =========
Diluted loss per share, assuming conversion $(0.015) $(0.063)
========= =========
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Battle Mountain Gold Company Quarterly Report on Form 10-Q for the quarter
ended March 31, 2000, and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> DEC-31-2000 DEC-31-1999
<PERIOD-END> MAR-31-2000 MAR-31-1999<F1>
<CASH> 21,500 0
<SECURITIES> 0 0
<RECEIVABLES> 11,800 0
<ALLOWANCES> 0 0
<INVENTORY> 32,400 0
<CURRENT-ASSETS> 119,400 0
<PP&E> 829,900 0
<DEPRECIATION> 541,200 0
<TOTAL-ASSETS> 465,600 0
<CURRENT-LIABILITIES> 83,800 0
<BONDS> 161,900 0
0 0
110,600 0
<COMMON> 13,300 0
<OTHER-SE> (27,400) 0
<TOTAL-LIABILITY-AND-EQUITY> 465,600 0
<SALES> 62,500 53,800
<TOTAL-REVENUES> 62,500 53,800
<CGS> 56,900 50,300
<TOTAL-COSTS> 56,900 50,300
<OTHER-EXPENSES> 3,600 3,900
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 3,800 3,700
<INCOME-PRETAX> (3,200) (14,500)
<INCOME-TAX> (1,600) (1,900)
<INCOME-CONTINUING> (1,600) (12,600)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (3,500) (14,500)
<EPS-BASIC> (0.02) (0.06)
<EPS-DILUTED> (0.02) (0.06)
<FN>
<F1>AS RESTATED
</FN>
</TABLE>
