As filed with the Securities and Exchange Commission on October 21, 1996
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
BATTLE MOUNTAIN CANADA LTD.
(Exact name of registrant as specified in its charter)
ONTARIO NOT APPLICABLE
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
SUITE 2902
1 ADELAIDE STREET EAST
TORONTO, ONTARIO M5C 2Z9
(Address of Principal Executive Offices) (Zip Code)
OPTIONS GRANTED PURSUANT TO THE COMBINATION AGREEMENT
BETWEEN BATTLE MOUNTAIN GOLD COMPANY AND
HEMLO GOLD MINES INC.
(Full title of the plan)
ROBERT J. QUINN
VICE PRESIDENT AND GENERAL COUNSEL
BATTLE MOUNTAIN GOLD COMPANY
HOUSTON, TEXAS 77002
(Name and address of agent for service)
(713) 650-6400
(Telephone number, including area code, of agent for service)
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed maximum Proposed
Title of securities to Amount to be offering price per maximum aggregate Amount of registration
be registered registered share(2) offering price fee
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Exchangeable
Shares(1) 519,480 -- $3,416,492(3) $1,036
- ---------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes the Exchangeable Share purchase rights associated with the
Exchangeable Shares.
(2) In accordance with Rule 457(o) under the Securities Act of 1933, as
amended, the proposed maximum offering price per share is not included in
this table.
(3) In accordance with Rule 457(h)(1) under the Securities Act of 1933, as
amended, computed based on the aggregate price at which the options granted
pursuant to the Combination Agreement between Battle Mountain Gold Company
and Hemlo Gold Mines Inc. may be exercised, and expressed in U.S. dollars
based upon the noon buying rate on October 15, 1996, in New York City for
cable transfers in Canadian dollars, as certified for customs purposes by
the Federal Reserve Bank of New York.
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<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Note: The document(s) containing the information concerning the option
grants pursuant to the Combination Agreement effective as of March 11, 1996
between Battle Mountain Gold Company, a Nevada corporation ("Battle Mountain"),
and Hemlo Gold Mines Inc. ("Hemlo Gold"), an Ontario corporation which is
currently named Battle Mountain Canada Ltd. ("Battle Mountain Canada"), required
by Item 1 of Form S-8 under the Securities Act of 1933, as amended (the
"Securities Act"), and the statement of availability of registrant information
and other information required by Item 2 of Form S-8 will be sent or given to
participants as specified by Rule 428. In accordance with Rule 428 and the
requirements of Part I of Form S-8, such documents are not being filed with the
Securities and Exchange Commission (the "Commission") either as part of this
registration statement on Form S-8 (this "Registration Statement") or as
prospectuses or prospectus supplements pursuant to Rule 424. Battle Mountain
Canada maintains a file of such documents in accordance with the provisions of
Rule 428. Upon request, Battle Mountain Canada shall furnish to the Commission
or its staff a copy or copies of all of the documents included in such file.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, which the Battle Mountain Canada has filed with
the Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (File No. 1-10943), are incorporated in this Registration
Statement by reference and shall be deemed to be a part hereof:
(i) Battle Mountain Canada's Annual Report on Form 40-F for the year
ended December 31, 1995;
(ii) Battle Mountain Canada's Reports on Form 6-K for the quarters
ended March 31, 1996 and June 30, 1996; and
(iii) The description of the exchangeable shares of Battle Mountain
Canada (the "Exchangeable Shares") contained in Battle Mountain
Canada's Registration Statement on Form 8-A dated August 23,
1996;
The following documents, which Battle Mountain has filed with the
Commission pursuant to the Exchange Act, are incorporated in this Registration
Statement by reference and shall be deemed to be a part hereof:
(i) Battle Mountain's Annual Report on Form 10-K for the year ended
December 31, 1995, as amended by Form 10-K/A (Amendment No. 1)
dated April 29, 1996, Form 10-K/A (Amendment No. 2) dated July
12, 1996, and Form 10-K/A (Amendment No. 3) dated October 18,
1996;
(ii) Battle Mountain's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1996 and June 30, 1996;
(iii) Battle Mountain's Current Reports on Form 8-K dated March 11,
1996, June 11, 1996, June 27, 1996, and July 19, 1996;
(iv) The description of the common stock, par value $0.10 per share,
of Battle Mountain (the "Battle Mountain Common Stock") contained
in Battle Mountain's Registration Statement on Form 8-A dated
August 12, 1987 (as amended by a Form 8 dated April 24, 1991 and
Form 8-A/A dated August 26, 1996); and
(v) The description of the preferred stock purchase rights
associated with the Battle Mountain Common Stock contained in
Battle Mountain's Registration Statement on Form 8-A dated
November 15, 1988 (as amended by a Form 8 dated November 29, 1988
and a Form 8-A/A dated August 26, 1996).
All documents filed by Battle Mountain Canada or Battle Mountain with the
Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
subsequent to the date of this Registration Statement and prior to the filing of
a post-effective amendment to this Registration Statement which indicates that
all securities offered hereby have been sold or which deregisters all securities
then remaining unsold shall be deemed to be incorporated in this Registration
Statement by reference and to be a part hereof from the date of filing of such
documents. In lieu of separate reports filed by Battle Mountain Canada pursuant
to Section 13(a) of the Exchange Act, Battle Mountain's Annual Reports on Form
10-K will contain information describing the Exchangeable Shares of Battle
Mountain Canada and summarized financial information regarding Battle Mountain
Canada. Any statement contained in this Registration Statement, in a supplement
to this Registration Statement or in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any subsequently
filed supplement to this Registration Statement or in any document that is
subsequently incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Registration
Statement.
EXPERTS
The consolidated financial statements of Hemlo Gold, incorporated by
reference herein as of December 31, 1994 and 1995, and for each of the three
years in the period ended December 31, 1995, have been audited by Ernst & Young,
Chartered Accountants, as set forth in their report thereon incorporated by
reference herein, and are incorporated by reference herein in reliance upon such
report given upon the authority of such firm as experts in accounting and
auditing.
The consolidated financial statements of Battle Mountain as of December 31,
1995 and 1994 and for each of the three years in the period ended December 31,
1995, incorporated in this Registration Statement by reference to the Annual
Report on Form 10-K/A (Amendment No. 3) for the year ended December 31, 1995,
have been so incorporated in reliance on the report of Price Waterhouse LLP,
independent accountants, as set forth in their report. The consolidated
financial statements referred to above have been incorporated herein in reliance
upon the authority of such firm as experts in accounting and auditing.
The financial statements of Lihir Gold Limited incorporated by reference
herein as of December 31, 1995 and for the year then ended have been audited by
Coopers & Lybrand, Port Moresby, Papua New Guinea, as set forth in their report
thereon dated June 27, 1996 incorporated by reference herein. Such financial
statements referred to above are incorporated herein by reference in reliance
upon such report given upon the authority of such firm as experts in accounting
and auditing.
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<PAGE>
ITEM 4. DESCRIPTION OF SECURITIES.
DESCRIPTION OF BATTLE MOUNTAIN CANADA
SHARE CAPITAL
GENERAL
On July 19, 1996, pursuant to the terms of a plan of arrangement (the "Plan
of Arrangement") under section 182 of the Business Corporations Act (Ontario)
(the "OBCA") contemplated by the Combination Agreement dated as of March 11,
1996 by and between Battle Mountain and Hemlo Gold, as amended and restated (the
"Combination Agreement"), (i) Hemlo Gold changed its name to Battle Mountain
Canada Ltd., (ii) Battle Mountain Canada issued 100 common shares of Battle
Mountain Canada ("Battle Mountain Canada Common Shares") to Battle Mountain in
exchange for 148 shares of Battle Mountain Common Stock and (iii) Battle
Mountain Canada issued 1.48 Exchangeable Shares in exchange for each existing
common share of Hemlo Gold (the "Hemlo Gold Common Shares") (other than Hemlo
Gold Common Shares held by Battle Mountain and by holders who properly exercised
their rights of dissent and are ultimately entitled to be paid fair value for
their shares).
Battle Mountain Canada is authorized to issue an unlimited number of Battle
Mountain Canada Common Shares, an unlimited number of its subordinate shares
("Subordinate Shares"), an unlimited number of its preferred shares ("Preferred
Shares") and an unlimited number of Exchangeable Shares.
The R-M Trust Company at its offices in Montreal, Toronto and Vancouver is
the transfer agent and registrar for Battle Mountain Canada.
The following description of certain rights, privileges, restrictions and
conditions attaching to the Battle Mountain Canada Common Shares, the Battle
Mountain Canada Preferred Shares, the Battle Mountain Canada Subordinate Shares
and the Exchangeable Shares is qualified in its entirety by reference to the
full text of the Articles of Amalgamation of Hemlo Gold dated January 1, 1995,
the Exchangeable Share provisions attached to the Plan of Arrangement (the
"Exchangeable Share Provisions"), the Voting, Support and Exchange Trust
Agreement (the "Voting, Support and Exchange Trust Agreement") entered into
among Battle Mountain, Battle Mountain Canada and the trustee thereunder, The
R-M Trust Company, or any successor thereto (the "Trustee") and the Rights
Agreement dated as of July 19, 1996 between Battle Mountain Canada and The R-M
Trust Company, which are included as exhibits to this Registration Statement and
are incorporated herein by reference.
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<PAGE>
BATTLE MOUNTAIN CANADA COMMON SHARES
The holders of Battle Mountain Canada Common Shares are entitled to receive
notice of and to attend all meetings of the shareholders of Battle Mountain
Canada and are entitled to one vote for each share held of record on all matters
submitted to a vote of holders of Battle Mountain Canada Common Shares. Subject
to the prior rights of the holders of Exchangeable Shares and any other shares
ranking senior to the Common Shares with respect to priority in the payment of
dividends, the holders of Battle Mountain Canada Common Shares are entitled to
receive such dividends as may be declared by the Battle Mountain Canada Board of
Directors out of funds legally available therefor. Holders of Battle Mountain
Canada Common Shares are entitled upon any liquidation, dissolution or winding
up of Battle Mountain Canada, subject to the prior rights of the holders of the
Exchangeable Shares and to any other shares ranking senior to the Battle
Mountain Canada Common Shares, to receive the remaining property and assets of
Battle Mountain Canada.
BATTLE MOUNTAIN CANADA PREFERRED SHARES
The Preferred Shares of Battle Mountain Canada are issuable in series. The
directors are empowered to fix the number of shares in and the designation and
attributes of each series.
BATTLE MOUNTAIN CANADA SUBORDINATE SHARES
The Subordinate Shares of Battle Mountain Canada are issuable in series.
The directors are empowered to fix the number of shares in and the designation
and attributes of each series. The Subordinate Shares of Battle Mountain Canada
rank junior to the Exchangeable Shares to the same extent as the Battle Mountain
Canada Common Shares.
BATTLE MOUNTAIN CANADA EXCHANGEABLE SHARES
DIVIDENDS. Holders of Exchangeable Shares are entitled to receive dividends
equivalent to dividends paid from time to time by Battle Mountain on shares of
Battle Mountain Common Stock, and are not otherwise entitled to receive
dividends. The declaration date, record date and payment date for dividends on
the Exchangeable Shares will be the same as that for the corresponding dividends
on the Battle Mountain Common Stock.
CERTAIN RESTRICTIONS. Except as provided in the next sentence, Battle
Mountain Canada will not without the approval of the holders of the Exchangeable
Shares as set forth below under "-- Amendment and Approval":
(a) pay any dividend on the Battle Mountain Canada Common Shares,
Subordinate Shares or any other shares ranking junior to the Exchangeable
Shares, other than stock dividends payable in Battle Mountain Canada Common
Shares, Subordinate Shares or any such other shares ranking junior to the
Exchangeable Shares, as the case may be;
II-3
<PAGE>
(b) redeem, purchase or make any capital distribution in respect of
Battle Mountain Canada Common Shares, Subordinate Shares or any other
shares ranking junior to the Exchangeable Shares;
(c) redeem or purchase any other shares of Battle Mountain Canada
ranking equally with the Exchangeable Shares with respect to the payment of
dividends or on any liquidation distribution; or
(d) issue any shares other than (i) Exchangeable Shares, (ii) Battle
Mountain Canada Common Shares, (iii) Subordinate Shares, (iv) Preferred
Shares issuable in connection with the exercise of rights associated with
Exchangeable Shares having terms substantially the same as the BMG Rights
issued under the BMG Rights Agreement (as those terms are defined below
under "-Exchangeable Share Rights") and (v) any other shares not ranking
superior to the Exchangeable Shares.
The restrictions in clauses (a), (b) and (c) above will not apply at any
time when the dividends on the outstanding Exchangeable Shares corresponding to
dividends declared on the Battle Mountain Common Stock have been declared and
paid in full.
LIQUIDATION OF BATTLE MOUNTAIN CANADA. In the event of the liquidation,
dissolution or winding up of Battle Mountain Canada or any other proposed
distribution of the assets of Battle Mountain Canada among its shareholders for
the purpose of winding up its affairs, a holder of Exchangeable Shares is
entitled to receive from Battle Mountain Canada for each Exchangeable Share on
the effective date of such liquidation, dissolution or winding up (the
"Liquidation Date") an amount to be satisfied by issuance of one share of Battle
Mountain Common Stock, plus an additional amount equivalent to the full amount
of all declared and unpaid dividends on such Exchangeable Share (the
"Liquidation Amount") .
On or after the Liquidation Date, a holder of Exchangeable Shares may
surrender certificates representing such Exchangeable Shares, together with such
other documents as may be required, to Battle Mountain Canada's registered
office or the office of the transfer agent. Upon receipt of the certificates and
other documents and subject to the exercise by Battle Mountain and Battle
Mountain Canada Holdco, Inc., an indirect wholly owned subsidiary of Battle
Mountain ("Battle Mountain Sub"), of its Liquidation Call Right described below,
Battle Mountain Canada will deliver the Liquidation Amount to such holder at the
address recorded in the securities register or by holding the Liquidation Amount
for pick up by the holder at Battle Mountain Canada's registered office or the
office of the transfer agent, as specified by Battle Mountain Canada in a notice
to such holders.
Upon the occurrence of a liquidation, dissolution or winding up of Battle
Mountain Canada, Battle Mountain and Battle Mountain Sub have the right (the
"Liquidation Call Right") to purchase all but not less than all of the
Exchangeable Shares then outstanding (other than Exchangeable Shares held by
Battle Mountain, Battle Mountain Sub or a single wholly owned subsidiary of
Battle Mountain incorporated under the federal laws of Canada or a province
thereof
II-4
<PAGE>
("Canada Holdco")) at a purchase price per share equal to the Liquidation Amount
and, upon the exercise of the Liquidation Call Right, the holders thereof will
be obligated to sell such shares to Battle Mountain or Battle Mountain Sub, as
applicable. The purchase by Battle Mountain or Battle Mountain Sub of all of the
outstanding Exchangeable Shares upon the exercise of the Liquidation Call Right
will occur on the Liquidation Date.
The Liquidation Call Right may, in general, be exercised, at the election
of Battle Mountain, by either Battle Mountain or Battle Mountain Sub, but with
respect to a holder who acquires in the arrangement referred to in the
Combination Agreement (the "Arrangement") Exchangeable Shares that are
exchangeable into more than 5 percent of the number of shares of Battle Mountain
Common Stock outstanding at 12:01 a.m. (Toronto time) (the "Effective Time") on
the effective date of the Arrangement (the "Effective Date") and who have
properly requested that Battle Mountain enter into a tax cooperation agreement
pursuant to the Combination Agreement (an "Initial 5 Percent Holder"), may be
exercised only by Battle Mountain Sub unless certain conditions have occurred.
Upon the occurrence of a Battle Mountain Canada Insolvency Event, the
trustee under the Voting, Support and Exchange Trust Agreement on behalf of the
holders of Exchangeable Shares has the right to require Battle Mountain to
purchase any or all of the Exchangeable Shares then outstanding (other than
Exchangeable Shares held by Battle Mountain and certain of its subsidiaries) for
the Liquidation Amount as described under "-- Voting, Support and Exchange Trust
Agreement -- Optional Exchange Right in case of a Battle Mountain Canada
Insolvency Event." A "Battle Mountain Canada Insolvency Event" is the
institution by Battle Mountain Canada of any proceeding to be adjudicated a
bankrupt or insolvent or to be dissolved or wound up, or the consent of Battle
Mountain Canada to the institution of bankruptcy, insolvency, dissolution or
winding-up proceedings against it, or the filing of a petition, answer or
consent seeking dissolution or winding up under any bankruptcy, insolvency or
analogous laws, including without limitation the Companies Creditors'
Arrangement Act (Canada) and the Bankruptcy and Insolvency Act (Canada), and the
failure by Battle Mountain Canada to contest in good faith any such proceedings
commenced in respect of Battle Mountain Canada within 15 days of becoming aware
thereof, or the consent by Battle Mountain Canada to the filing of any such
petition or to the appointment of a receiver, or the making by Battle Mountain
Canada of a general assignment for the benefit of creditors, or the admission in
writing by Battle Mountain Canada of its inability to pay its debts generally as
they become due, or Battle Mountain Canada not being permitted, pursuant to
solvency requirements of applicable law, to redeem any Exchangeable Shares
pursuant to the Exchangeable Share Provisions.
AUTOMATIC EXCHANGE ON LIQUIDATION OF BATTLE MOUNTAIN. Upon the occurrence
of a Battle Mountain Liquidation Event, Battle Mountain is required to purchase
each outstanding Exchangeable Share (other than Exchangeable Shares held by
Battle Mountain, Battle Mountain Sub or Canada Holdco) and holders of
Exchangeable Shares are required to sell the Exchangeable Shares held by them at
that time, in exchange for one share of Battle Mountain Common Stock for each
such Exchangeable Share, plus an additional amount equivalent to the full amount
of all declared and unpaid dividends on the Exchangeable Share, on the fifth
business day prior to the
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<PAGE>
effective date of the liquidation, dissolution or winding up contemplated by a
Battle Mountain Liquidation Event. A "Battle Mountain Liquidation Event" means
(i) any determination by Battle Mountain's Board of Directors to institute
voluntary liquidation, dissolution or winding-up proceedings with respect to
Battle Mountain or to effect any other distribution of assets of Battle Mountain
among its stockholders for the purpose of winding up its affairs or (ii) receipt
by Battle Mountain of notice of, or Battle Mountain otherwise becoming aware of,
any threatened or instituted claim, suit, petition or other proceeding with
respect to the involuntary liquidation, dissolution or winding up of Battle
Mountain or to effect any other distribution of assets of Battle Mountain among
its stockholders for the purpose of winding up its affairs.
Upon a holder's request and surrender of Exchangeable Share certificates,
duly endorsed in blank and accompanied by such instruments of transfer as Battle
Mountain may reasonably require, Battle Mountain will deliver to such holder
certificates representing an equivalent number of shares of Battle Mountain
Common Stock plus a check in the amount equivalent to the full amount of all
declared and unpaid dividends on the Exchangeable Shares.
RETRACTION OF EXCHANGEABLE SHARES BY HOLDERS. A holder of Exchangeable
Shares is entitled at any time to require Battle Mountain Canada to redeem any
or all of the Exchangeable Shares held by such holder for a retraction price per
share to be satisfied by issuance of one share of Battle Mountain Common Stock,
plus an additional amount equivalent to the full amount of all declared and
unpaid dividends on the Exchangeable Shares, subject to the Retraction Call
Rights of Battle Mountain and Battle Mountain Sub described below. Holders of
the Exchangeable Shares may effect such retraction by presenting a certificate
or certificates to Battle Mountain Canada or its transfer agent representing the
number of Exchangeable Shares the holder desires to retract, together with a
duly executed statement (the "Retraction Request") specifying the number of
Exchangeable Shares the holder wishes to retract and such other documents as may
be required to effect the retraction of the Exchangeable Shares. The retraction
will become effective five business days after the date on which Battle Mountain
Canada receives the Retraction Request from the holder (the "Retraction Date").
When a holder requests Battle Mountain Canada to redeem the Exchangeable
Shares, Battle Mountain or Battle Mountain Sub has an overriding right (the
"Retraction Call Right") to purchase all but not less than all of the
Exchangeable Shares that the holder has requested Battle Mountain Canada to
redeem at a purchase price per share equal to one share of Battle Mountain
Common Stock, plus an additional amount equivalent to the full amount of all
declared and unpaid dividends on the Exchangeable Share (the "Retraction
Price").
At the time of a Retraction Request by a holder of Exchangeable Shares,
Battle Mountain Canada will immediately notify Battle Mountain and Battle
Mountain Sub. Battle Mountain or Battle Mountain Sub must then advise Battle
Mountain Canada within two business days as to whether the Retraction Call Right
will be exercised. If either Battle Mountain or Battle Mountain Sub so advises
Battle Mountain Canada within such two business day period, Battle Mountain
Canada will notify the holder as soon as possible thereafter that the Retraction
Call Right will be exercised. A holder may revoke his or her Retraction Request
at any time prior to the close
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of business on the business day preceding the Retraction Date, in which case the
holder's Exchangeable Shares will neither be purchased by Battle Mountain or
Battle Mountain Sub nor be redeemed by Battle Mountain Canada. If the holder
does not revoke his or her Retraction Request, on the Retraction Date the
Exchangeable Shares that the holder has requested Battle Mountain Canada to
redeem will be purchased by Battle Mountain or Battle Mountain Sub or redeemed
by Battle Mountain Canada, as the case may be, in each case at a purchase price
per share equal to one share of Battle Mountain Common Stock, plus an additional
amount equivalent to the full amount of all declared and unpaid dividends on the
Exchangeable Share.
The Retraction Call Right may, in general, be exercised, at the election of
Battle Mountain, by either Battle Mountain or Battle Mountain Sub, but with
respect to an Initial 5 Percent Holder, may be exercised only by Battle Mountain
Sub unless certain conditions have occurred.
If, as a result of solvency provisions of applicable law, Battle Mountain
Canada is not permitted to redeem all Exchangeable Shares tendered by a
retracting holder, Battle Mountain Canada will redeem only those Exchangeable
Shares tendered by the holder (rounded down to a whole number of shares) as
would not be contrary to such provisions of applicable law. The holder of any
Exchangeable Shares not redeemed by Battle Mountain Canada will be deemed to
have required Battle Mountain to purchase such unretracted shares in exchange
for Battle Mountain Common Stock on the retraction date pursuant to the optional
exchange right (the "Exchange Right") granted to the Trustee for the use and
benefit of the holders of the Exchangeable Shares pursuant to the Voting,
Support and Exchange Trust Agreement to require Battle Mountain to exchange
Exchangeable Shares for shares of Battle Mountain Common Stock, plus an
additional amount equivalent to any declared and unpaid dividends on such
Exchangeable Shares, upon the occurrence of a Battle Mountain Canada Insolvency
Event. See "-- Voting, Support and Exchange Trust Agreement -- Optional Exchange
Right in case of a Battle Mountain Canada Insolvency Event."
REDEMPTION OF EXCHANGEABLE SHARES. Subject to applicable law and the
Redemption Call Right of Battle Mountain or Battle Mountain Sub described below,
on any date on or after July 31, 2003 established by the Battle Mountain Canada
Board of Directors for the redemption of the Exchangeable Shares pursuant to the
Exchangeable Share Provisions or such earlier date as established for such
purpose by the Battle Mountain Canada Board of Directors if there are fewer than
5,000,000 Exchangeable Shares outstanding (other than Exchangeable Shares held
by Battle Mountain and its direct and indirect subsidiaries and subject to
adjustment to such number of shares to reflect permitted changes to Exchangeable
Shares) (the "Optional Redemption Date"), Battle Mountain Canada will redeem all
but not less than all of the then outstanding Exchangeable Shares for a
redemption price per share equal to one share of Battle Mountain Common Stock,
plus an additional amount equivalent to the full amount of all declared and
unpaid dividends on the Exchangeable Shares (the "Redemption Price"). Battle
Mountain Canada will, at least 120 days prior to the relevant Optional
Redemption Date, provide the registered holders of the Exchangeable Shares with
written notice of the proposed redemption of the Exchangeable Shares by Battle
Mountain Canada. On or after the Optional Redemption Date,
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upon the holder's presentation and surrender of the certificates representing
the Exchangeable Shares and such other documents as may be required at the
office of the transfer agent or the registered office of Battle Mountain Canada,
Battle Mountain Canada will deliver the Redemption Price to the holder at the
address of the holder recorded in the securities register or by holding the
Redemption Price for pick up by the holder at the registered office of Battle
Mountain Canada or the office of the transfer agent as specified in the written
notice.
Notwithstanding a proposed redemption of the Exchangeable Shares by Battle
Mountain Canada on an Optional Redemption Date pursuant to the Exchangeable
Share Provisions, Battle Mountain and Battle Mountain Sub have an overriding
right (the "Redemption Call Right"), to purchase on such Optional Redemption
Date all but not less than all of the Exchangeable Shares then outstanding
(other than Exchangeable Shares held by Battle Mountain, Battle Mountain Sub or
Canada Holdco) in exchange for the Redemption Price and, upon the exercise of
the Redemption Call Right, the holders thereof will be obligated to sell such
shares to Battle Mountain or Battle Mountain Sub, as applicable. If either
Battle Mountain or Battle Mountain Sub exercises the Redemption Call Right,
Battle Mountain Canada's right to redeem the Exchangeable Shares on such
Optional Redemption Date will terminate.
The Redemption Call Right may, in general, be exercised, at the election of
Battle Mountain, by either Battle Mountain or Battle Mountain Sub, but with
respect to an Initial 5 Percent Holder, may be exercised only by Battle Mountain
Sub unless certain conditions have occurred. If the Redemption Call Right is
exercised, Battle Mountain Canada may elect to redeem all then outstanding
Exchangeable Shares on a subsequent Optional Redemption Date.
VOTING RIGHTS. Except as required by applicable law, the holders of the
Exchangeable Shares are not entitled as such to receive notice of or attend any
meeting of the shareholders of Battle Mountain Canada or to vote at any such
meeting.
AMENDMENT AND APPROVAL. The rights, privileges, restrictions and conditions
attaching to the Exchangeable Shares may be changed only with the approval of
the holders thereof. Any such approval or any other approval or consent to be
given by the holders of the Exchangeable Shares will be sufficiently given if
given in accordance with applicable law and subject to a minimum requirement
that such approval or consent be evidenced by a resolution passed by not less
than two-thirds of the votes cast thereon (other than shares beneficially owned
by Battle Mountain, Battle Mountain Sub or any of their direct or indirect
subsidiaries) at a meeting of the holders of Exchangeable Shares duly called and
held at which holders of at least 50 percent of the then outstanding
Exchangeable Shares are present or represented by proxy. In the event that no
such quorum is present at such meeting within one-half hour after the time
appointed therefor, then the meeting will be adjourned to such place and time
(not less than 10 days later) as may be determined at the original meeting and
the holders of Exchangeable Shares present or represented by proxy at the
adjourned meeting will constitute a quorum thereat and may transact the business
for which the meeting was originally called. At the adjourned meeting, a
resolution passed by the affirmative vote of not less than two-thirds of the
votes cast thereon will constitute the approval or consent of the holders of the
Exchangeable Shares.
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ACTIONS BY BATTLE MOUNTAIN CANADA UNDER VOTING, SUPPORT AND EXCHANGE TRUST
AGREEMENT. Under the Exchangeable Share Provisions, Battle Mountain Canada has
agreed to take all such actions and do all such things as are necessary or
advisable to perform and comply with its obligations under, and to ensure the
performance and compliance by Battle Mountain with its obligations under, the
Voting, Support and Exchange Trust Agreement.
VOTING, SUPPORT AND EXCHANGE TRUST AGREEMENT
The following is a summary description of the material provisions of the
Voting, Support and Exchange Trust Agreement and is qualified in its entirety by
reference to the full text of the Voting, Support and Exchange Trust Agreement,
which is included as an exhibit to this Registration Statement and is
incorporated herein by reference.
VOTING RIGHTS. Pursuant to the Voting, Support and Exchange Trust
Agreement, Battle Mountain has issued one share (the "Special Voting Share") of
its Special Voting Stock, par value $0.10 per share (the "Special Voting
Stock"), to the Trustee for the benefit of the holders (other than Battle
Mountain and certain subsidiaries of Battle Mountain) of the Exchangeable
Shares. The Special Voting Share has a number of votes, which may be cast at any
meeting at which Battle Mountain stockholders are entitled to vote, equal to the
number of outstanding Exchangeable Shares (other than shares held by Battle
Mountain and certain subsidiaries of Battle Mountain). With respect to any
written consent sought from the Battle Mountain stockholders, the Special Voting
Share will have a like number of votes.
Each holder of an Exchangeable Share on the record date for any meeting at
which Battle Mountain stockholders are entitled to vote is entitled to instruct
the Trustee to exercise one of the votes attached to the Special Voting Share
for such Exchangeable Share. The Trustee will exercise each vote attached to the
Special Voting Share only as directed by the relevant holder and, in the absence
of instructions from a holder as to voting, will not exercise such votes. A
holder may, upon instructing the Trustee, obtain a proxy from the Trustee
entitling the holder to vote directly at the relevant meeting the votes attached
to the Special Voting Share to which the holder is entitled.
The Trustee will send to the holders of the Exchangeable Shares the notice
of each meeting at which the Battle Mountain stockholders are entitled to vote,
together with the related meeting materials and a statement as to the manner in
which the holder may instruct the Trustee to exercise the votes attaching to the
Special Voting Share, at the same time as Battle Mountain sends such notice and
materials to the Battle Mountain stockholders. The Trustee will also send to the
holders copies of all information statements, interim and annual financial
statements, reports and other materials sent by Battle Mountain to the Battle
Mountain stockholders at the same time as such materials are sent to the Battle
Mountain stockholders. To the extent such materials are provided to the Trustee
by Battle Mountain, the Trustee will also send to the holders all materials sent
by third parties to Battle Mountain stockholders, including dissident proxy
circulars and tender and exchange offer circulars, as soon as possible after
such materials are first sent to Battle Mountain stockholders.
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All rights of a holder of Exchangeable Shares to exercise votes attached to
the Special Voting Share will cease upon the exchange of all of such holder's
Exchangeable Shares for shares of Battle Mountain Common Stock.
OPTIONAL EXCHANGE RIGHT IN CASE OF A BATTLE MOUNTAIN CANADA INSOLVENCY
EVENT. Upon the occurrence and during the continuance of a Battle Mountain
Canada Insolvency Event, a holder of Exchangeable Shares is entitled to instruct
the Trustee to exercise the optional Exchange Right with respect to any or all
of the Exchangeable Shares held by such holder, thereby requiring Battle
Mountain to purchase such Exchangeable Shares from the holder. Immediately upon
the occurrence of a Battle Mountain Canada Insolvency Event or any event which
may, with the passage of time or the giving of notice, become a Battle Mountain
Canada Insolvency Event, Battle Mountain Canada and Battle Mountain will give
written notice thereof to the Trustee. As soon as practicable thereafter, the
Trustee will then notify each holder of Exchangeable Shares of such event or
potential event and will advise the holder of its rights with respect to the
optional Exchange Right.
The purchase price payable by Battle Mountain for each Exchangeable Share
to be purchased under the optional Exchange Right will be satisfied by issuance
of one share of Battle Mountain Common Stock plus an additional amount
equivalent to the full amount of all declared and unpaid dividends on the
Exchangeable Share.
If, as a result of solvency provisions of applicable law, Battle Mountain
Canada is unable to redeem all of the Exchangeable Shares tendered for
retraction by a holder in accordance with the Exchangeable Share Provisions, the
holder will be deemed to have exercised the optional Exchange Right with respect
to the unredeemed Exchangeable Shares and Battle Mountain will be required to
purchase such shares from the holder in the manner set forth above.
BATTLE MOUNTAIN SUPPORT OBLIGATION. Under the Voting, Support and Exchange
Trust Agreement, Battle Mountain has agreed that: (i) it will not declare or pay
dividends on the Battle Mountain Common Stock unless Battle Mountain Canada is
able to and simultaneously pays an equivalent dividend on the Exchangeable
Shares; (ii) it will advise Battle Mountain Canada in advance of the declaration
of any dividend on the Battle Mountain Common Stock and ensure that the
declaration date, record date and payment date for dividends on the Exchangeable
Shares are the same as those for the Battle Mountain Common Stock and that such
dates will correspond with any requirement of the stock exchange on which the
Exchangeable Shares are then listed; (iii) it will ensure that the record date
for any dividend declared on the Battle Mountain Common Stock is not less than
10 business days after the declaration date for such dividend or such shorter
period within which applicable law may be complied with; (iv) it will take all
actions and do all things necessary to ensure that Battle Mountain Canada is
able to pay to the holders of the Exchangeable Shares the equivalent number of
shares of Battle Mountain Common Stock plus any additional amount equivalent to
the full amount of all unpaid dividends on the Exchangeable Shares in the event
of a liquidation, dissolution or winding up of Battle Mountain Canada, a
retraction request by a holder of Exchangeable Shares or a redemption of
Exchangeable Shares by Battle Mountain Canada; (v) it will not vote or otherwise
take any action or omit to take any
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action causing the liquidation, dissolution or winding up of Battle Mountain
Canada; and (vi) it will enable Battle Mountain Canada to maintain a listing for
the Exchangeable Shares on a Canadian stock exchange.
The Voting, Support and Exchange Trust Agreement also provides that,
without the prior approval of Battle Mountain Canada and the holders of the
Exchangeable Shares as set forth under " -- Battle Mountain Canada Exchangeable
Shares -- Amendment and Approval," Battle Mountain will not distribute
additional shares of Battle Mountain Common Stock or rights to subscribe
therefor or other property or assets to all or substantially all holders of
shares of Battle Mountain Common Stock, nor change the Battle Mountain Common
Stock, unless the same or an economically equivalent distribution on, change to
or offer for the Exchangeable Shares (or in the rights of the holders thereof)
is made simultaneously. The Battle Mountain Canada Board of Directors is
conclusively empowered to determine in good faith and in its sole discretion
whether any corresponding distribution on or change to the Exchangeable Shares
is the same as or economically equivalent to any proposed distribution on or
change to the Battle Mountain Common Stock. In the event of any proposed tender
offer, share exchange offer, issuer bid, take-over bid or similar transaction
affecting the Battle Mountain Common Stock, Battle Mountain will use reasonable
efforts to take all actions necessary or desirable to enable holders of
Exchangeable Shares to participate in such transaction to the same extent and on
an economically equivalent basis as the holders of Battle Mountain Common Stock.
The Voting, Support and Exchange Trust Agreement also provides that, as
long as any outstanding Exchangeable Shares are owned by any person or entity
other than Battle Mountain, Battle Mountain Sub or any of their subsidiaries,
Battle Mountain will, unless approval to do otherwise is obtained from the
holders of the Exchangeable Shares, remain the direct or indirect beneficial
owner of at least 50.1% of all issued and outstanding securities of Battle
Mountain Canada having voting rights (excluding the Exchangeable Shares).
With the exception of administrative changes for the purpose of adding
covenants for the protection of the holders of the Exchangeable Shares, making
certain necessary amendments or curing ambiguities or clerical errors (in each
case provided that the board of directors of each of Battle Mountain, Battle
Mountain Canada and the Trustee and its counsel are of the opinion that such
amendments are not prejudicial to the interests of the holders of the
Exchangeable Shares), the Voting, Support and Exchange Trust Agreement may not
be amended without the approval of the holders of the Exchangeable Shares as set
forth under " -- Battle Mountain Canada Exchangeable Shares -- Amendment and
Approval."
Under the Voting, Support and Exchange Trust Agreement, Battle Mountain has
agreed not to exercise any voting rights attached to the Exchangeable Shares
owned by it or any of its direct or indirect subsidiaries on any matter
considered at meetings of holders of Exchangeable Shares (including any approval
sought from such holders in respect of matters arising under the Voting, Support
and Exchange Trust Agreement).
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DELIVERY OF BATTLE MOUNTAIN COMMON STOCK. Battle Mountain will ensure that
all shares of Battle Mountain Common Stock to be delivered by it or Battle
Mountain Sub under the Voting, Support and Exchange Trust Agreement or the Plan
of Arrangement are duly registered, qualified or approved under applicable
Canadian and United States securities laws, if required, so that such shares may
be freely traded by the holders thereof (other than any restriction on transfer
by reason of a holder being a "control person" of Battle Mountain Canada for
purposes of Canadian law or an "affiliate" of Battle Mountain or, prior to the
Effective Date, of Hemlo Gold for purposes of United States law). In addition,
Battle Mountain will take all actions necessary to cause all such shares of
Battle Mountain Common Stock to be listed or quoted for trading on all stock
exchanges or quotation systems on which outstanding shares of Battle Mountain
Common Stock are then listed or quoted for trading.
EXCHANGEABLE SHARE RIGHTS
Each Exchangeable Share issued upon consummation of the Plan of Arrangement
has associated with it one Right (a "Right"). Rights are also issuable in
respect of all Exchangeable Shares issuable after such consummation but prior to
the earliest of (i) the Distribution Date referred to in the next paragraph,
(ii) the date on which the Rights are redeemed as provided below and (iii)
November 10, 1998. Each Right entitles the registered holder to purchase from
Battle Mountain Canada one Exchangeable Share at a purchase price of U.S.$60,
subject to adjustment (the "Purchase Price"). As provided in the Combination
Agreement, the Rights are intended to provide rights to acquire additional
Exchangeable Shares (or in certain circumstances other securities) on terms
substantially the same as the rights (the "BMG Rights") attached to each
outstanding share of Battle Mountain Common Stock confer the right to acquire
shares of Series A Junior Participating Preferred Stock of Battle Mountain (or
in certain circumstances Battle Mountain Common Stock or other securities), in
accordance with the Rights Agreement dated as of November 10, 1988, as amended
and restated as of July 19, 1996, between Battle Mountain and the Bank of New
York, as rights agent (the "BMG Rights Agreement").
Rights are now attached to all certificates representing outstanding
Exchangeable Shares. The Rights will separate from the Exchangeable Shares and a
"Distribution Date" will occur upon the occurrence of a "Distribution Date"
under the corresponding provisions of the BMG Rights Agreement. See "Description
of Battle Mountain Capital Stock -- Battle Mountain Preferred Stock -- Series A
Preferred Stock." The Rights are not exercisable until the Distribution Date and
will expire at the close of business on November 10, 1998, unless earlier
redeemed by Battle Mountain Canada as described below.
In the event an adjustment is made under the BMG Rights Agreement as a
result of (i) Battle Mountain being the surviving corporation in a merger with
an "Acquiring Person" (as that term is used below under "Description of Battle
Mountain Capital Stock -- Battle Mountain Preferred Stock -- Series A Preferred
Stock") under circumstances in which the Battle Mountain Common Stock is not
changed or exchanged, (ii) a person becoming the beneficial owner of 30 percent
or more of the then outstanding shares of Battle Mountain Common Stock (except
pursuant to a tender or exchange offer for all outstanding shares of Battle
Mountain Common
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Stock at a price and on terms that a majority of the independent directors of
Battle Mountain determines to be fair to and otherwise in the best interests of
Battle Mountain and its shareholders), (iii) an Acquiring Person engaging in one
or more "self-dealing" transactions as set forth in the BMG Rights Agreement or
(iv) during such time as there is an Acquiring Person, an event involving Battle
Mountain or a subsidiary of Battle Mountain occurring that results in such
Acquiring Person's ownership interest being increased by more than one percent
(E.G., a reverse stock split), at any time following the Distribution Date, a
corresponding and economically equivalent adjustment will at the same time be
made to the Rights such that each holder of a Right will thereafter have the
right to receive, upon exercise, such number of Exchangeable Shares (or, in
certain circumstances, cash, property or other securities) having a value equal
to two times the exercise price of a Right. Notwithstanding any of the
foregoing, following the occurrence of any of the events set forth in this
paragraph, all Rights that are, or (under certain circumstances specified in the
Rights Agreement dated as of July 19, 1996 between Battle Mountain Canada and
The R-M Trust Company) were, beneficially owned by any Acquiring Person (or by
certain related parties) will be null and void. However, Rights are not
exercisable following the occurrence of any of the events set forth above until
such time as the BMG Rights are no longer redeemable as described below under
"Description of Battle Mountain Capital Stock -- Battle Mountain Preferred Stock
- -- Series A Preferred Stock."
In the event that, on or after the Stock Acquisition Date as that term is
defined below under "Descriptions of Battle Mountain Capital Stock -- Battle
Mountain Preferred Stock -- Series A Preferred Stock" an adjustment is made
under the BMG Rights Agreement as a result of (i) Battle Mountain being acquired
in a merger or other business combination transaction (other than a merger
described in the preceding paragraph or a merger which follows an offer
described in the preceding paragraph) or (ii) 50 percent or more of Battle
Mountain's assets or earning power being sold or transferred, each holder of a
Right (except Rights which previously have been voided as set forth above) will
thereafter have the right to receive, upon exercise, common shares of the
acquiring company having a value equal to two times the exercise price of the
Right.
At such time as the BMG Rights are redeemed pursuant to the BMG Rights
Agreement, Battle Mountain Canada is required to redeem all the then outstanding
Rights at a price of U.S.$0.01 per Right, payable, at the option of Battle
Mountain Canada, in cash, Exchangeable Shares or such other consideration as the
Battle Mountain Canada Board of Directors may determine. The Rights may have
certain anti-takeover effects, including deterring someone from acquiring
control of Battle Mountain in a manner or on terms not approved by the Battle
Mountain Board of Directors. The Rights should not interfere with any merger or
other business combination approved by the Battle Mountain Board of Directors.
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DESCRIPTION OF BATTLE MOUNTAIN CAPITAL STOCK
GENERAL
As of August 21, 1996, Battle Mountain is authorized by its Restated
Articles of Incorporation, as amended (the "Battle Mountain Articles"), to issue
500,000,000 shares of Battle Mountain Common Stock, 50,000,000 shares of
preferred stock, par value $1.00 per share (the "Battle Mountain Preferred
Stock"), and one share of Special Voting Stock. As of August 21, 1996, there are
2,300,000 shares of Battle Mountain Preferred Stock designated by the Board of
Directors of Battle Mountain as $3.25 Convertible Preferred Stock (the
"Convertible Preferred Stock") and an additional 5,000,000 shares of Battle
Mountain Preferred Stock designated by the Board of Directors of Battle Mountain
as Series A Junior Participating Preferred Stock (the "Series A Preferred
Stock"). Shares of Series A Preferred Stock have been initially reserved for
issuance upon exercise of the BMG Rights hereinafter described. See "--Battle
Mountain Preferred Stock--Series A Preferred Stock."
Battle Mountain's ability to pay dividends is subject to certain
restrictions contained in loan or credit agreements.
The Bank of New York at its office in New York, New York is the transfer
agent and registrar for Battle Mountain.
The following description of certain terms of the Battle Mountain Common
Stock, the Battle Mountain Preferred Stock, the Special Voting Stock, the
Convertible Preferred Stock and the Series A Preferred Stock and of certain
provisions of the Battle Mountain Articles and the bylaws, as amended, of Battle
Mountain (the "Battle Mountain Bylaws") is qualified in its entirety by
reference to the full text of the Battle Mountain Articles (including the
Certificates of Resolution with respect to the Convertible Preferred Stock and
the Series A Preferred Stock), the Battle Mountain Bylaws and the BMG Rights
Agreement, which are included as exhibits to this Registration Statement and are
incorporated herein by reference.
BATTLE MOUNTAIN COMMON STOCK
Subject to the prior rights of any shares of Battle Mountain Preferred
Stock that may from time to time be outstanding, holders of Battle Mountain
Common Stock are entitled to share ratably in such dividends as may be lawfully
declared by the Board of Directors and paid by Battle Mountain and, in the event
of liquidation, dissolution or winding up of Battle Mountain, are entitled to
share ratably in all assets available for distribution. Battle Mountain is
prohibited from declaring or paying dividends on the Battle Mountain Common
Stock unless Battle Mountain Canada is able to, and simultaneously does, declare
or pay an equivalent dividend on the Exchangeable Shares. See "Description of
Battle Mountain Canada Share Capital -- Voting, Support and Exchange Trust
Agreement."
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The Battle Mountain Common Stock is entitled to one vote per share held of
record on each matter submitted to a vote of stockholders. Except as otherwise
provided by law or the Battle Mountain Articles, the Battle Mountain Common
Stock and the Special Voting Stock will vote together as a single class in the
election of directors and on all matters submitted to a vote of stockholders of
Battle Mountain. The holders of Battle Mountain Common Stock have no preemptive
rights to purchase any securities of Battle Mountain or cumulative voting
rights. Preferred stock purchase rights are issuable in respect of all shares of
Battle Mountain Common Stock issued prior to certain events. See " -- Battle
Mountain Preferred Stock -- Series A Preferred Stock." All outstanding shares of
Battle Mountain Common Stock are validly issued, fully paid and nonassessable.
Battle Mountain is not prohibited by the Battle Mountain Articles from
repurchasing shares of Battle Mountain Common Stock. Any such repurchases would
be subject to any limitations on the amount available for such purpose under
applicable corporate law, any applicable restrictions under the terms of any
outstanding Battle Mountain Preferred Stock or indebtedness and, in the case of
market purchases, such restrictions on the timing, manner and amount of such
purchases as might apply in the circumstances under applicable securities laws.
The outstanding Battle Mountain Common Stock is listed on the New York
Stock Exchange, the Australian Stock Exchange Limited, the Swiss Stock Exchange
and the Frankfurt Stock Exchange under the symbol "BMG."
BATTLE MOUNTAIN SPECIAL VOTING STOCK
Except as otherwise required by law or the Battle Mountain Articles, the
Special Voting Share will possess a number of votes equal to the number of
outstanding Exchangeable Shares from time to time not owned by Battle Mountain
or certain subsidiaries of Battle Mountain, and may be voted in the election of
directors and on all other matters submitted to a vote of stockholders of Battle
Mountain. The holders of Battle Mountain Common Stock and the holder of the
Special Voting Share will vote together as a single class on all matters, except
to the extent voting as a separate class is required by applicable law or the
Battle Mountain Articles. In the event of any liquidation, dissolution or
winding up of Battle Mountain, the holder of the Special Voting Share will not
be entitled to receive any assets of Battle Mountain available for distribution
to its stockholders. The holder of the Special Voting Share is not entitled to
receive dividends. Pursuant to the Combination Agreement, the Special Voting
Share was issued to the trustee appointed under the Voting, Support and Exchange
Trust Agreement. At such time as the Special Voting Share has no votes attached
to it because there are no Exchangeable Shares outstanding not owned by Battle
Mountain or certain subsidiaries of Battle Mountain, and there are no shares of
stock, debt, options or other agreements of Battle Mountain Canada that could
give rise to the issuance of any Exchangeable Shares to any person (other than
Battle Mountain or certain subsidiaries of Battle Mountain), the Special Voting
Share will be canceled.
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BATTLE MOUNTAIN PREFERRED STOCK
Battle Mountain's Board of Directors is authorized, without any further
vote or action by Battle Mountain's stockholders, to divide the Battle Mountain
Preferred Stock into series and, with respect to each series, to determine the
dividend rights, dividend rates, conversion rights, voting rights (which may be
greater or lesser than the voting rights of the Battle Mountain Common Stock),
redemption rights and terms, liquidation preferences, sinking fund rights and
terms, the number of shares constituting the series and the designation of each
series.
CONVERTIBLE PREFERRED STOCK. Holders of shares of Battle Mountain's
Convertible Preferred Stock are entitled to receive, when, as and if declared by
the Board of Directors of Battle Mountain, an annual cash dividend of U.S.$3.25
per share, payable in equal quarterly installments. Except as required by law or
as described in the next sentence, holders of shares of Convertible Preferred
Stock have no voting rights. Whenever dividends on the Convertible Preferred
Stock are in arrears for at least six full quarterly dividends, holders of the
Convertible Preferred Stock will be entitled (voting separately as a class
together with holders of shares of any one or more other series of capital stock
of Battle Mountain ranking on a parity with the Convertible Preferred Stock as
to dividends and having like voting rights) to elect two additional directors
until such dividend arrearage is eliminated. Each share of Convertible Preferred
Stock is convertible at any time, at the option of the holder, into shares of
Battle Mountain Common Stock at a conversion rate of 4.762 shares of Battle
Mountain Common Stock for each share of Convertible Preferred Stock, subject to
adjustment under certain circumstances. The Convertible Preferred Stock is
redeemable at any time on and after May 15, 1996, at the option of Battle
Mountain, in whole or in part, in exchange for shares of Battle Mountain Common
Stock at a redemption price of U.S.$52.275 per share of Convertible Preferred
Stock, and thereafter at prices decreasing ratably annually to U.S.$50.00 per
share on or after May 15, 2003, plus accrued and unpaid dividends. The number of
shares of Battle Mountain Common Stock to be issued upon the redemption of any
share of Convertible Preferred Stock will be equal to the then-current
redemption price divided by the lower of (i) the average of the daily closing
prices of the Battle Mountain Common Stock for the 20 consecutive trading days
immediately preceding the first business day immediately preceding the date of
any applicable redemption notice or (ii) the closing price of the Battle
Mountain Common Stock on the trading day immediately preceding the first
business day immediately preceding the date of any applicable redemption notice.
At no time is the Convertible Preferred Stock redeemable for cash.
In the event of any liquidation, dissolution or winding up of Battle
Mountain, the holders of shares of Convertible Preferred Stock are entitled to
receive a liquidation preference of U.S.$50.00 per share, plus an amount equal
to any accrued and unpaid dividends to the date of payment, before any
distribution of assets is made to holders of Battle Mountain Common Stock or any
other stock that ranks junior to the Convertible Preferred Stock as to
liquidation rights. The holders of Convertible Preferred Stock and all series or
classes of Battle Mountain's stock that rank on a parity as to liquidation
rights with the Convertible Preferred Stock are entitled to share ratably, in
accordance with the respective preferential amounts payable on such stock, in
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any distribution which is not sufficient to pay in full the aggregate of the
amounts payable thereon.
The Convertible Preferred Stock is listed for trading on the NYSE. The
registrar, transfer agent, conversion agent and dividend disbursing agent for
the Convertible Preferred Stock is The Bank of New York.
SERIES A PREFERRED STOCK. On November 10, 1988, the Board of Directors of
Battle Mountain declared a dividend of one BMG Right for each outstanding share
of Battle Mountain Common Stock to stockholders of record at the close of
business on November 21, 1988. BMG Rights are issuable in respect of all shares
of Battle Mountain Common Stock issued after such record date but prior to the
earliest of (i) the Distribution Date (as defined below), (ii) the date on which
the BMG Rights are redeemed as provided below and (iii) November 10, 1998. Each
BMG Right entitles the registered holder to purchase from Battle Mountain a unit
consisting of one one-hundredth of a share (a "Unit") of Battle Mountain's
Series A Preferred Stock, at a purchase price of U.S.$60 per Unit, subject to
adjustment (the "Unit Purchase Price").
The BMG Rights are now attached to all Battle Mountain Common Stock
certificates representing outstanding shares, and no separate BMG Rights
Certificates have been distributed. The BMG Rights will separate from the Battle
Mountain Common Stock and a "Distribution Date" will occur upon the earlier of
(i) 10 days following a public announcement that a person or group of affiliated
or associated persons (an "Acquiring Person") has acquired, or obtained the
right to acquire, beneficial ownership of 20 percent or more of the outstanding
shares of Battle Mountain Common Stock (the date of the announcement being the
"Stock Acquisition Date") or (ii) 10 business days (or such later date as may be
determined by Battle Mountain's Board of Directors before the Distribution Date
occurs) following the commencement of a tender offer or exchange offer that
would result in a person or group beneficially owning 30 percent or more of such
outstanding shares of Battle Mountain Common Stock. The BMG Rights Agreement
provides that Noranda Inc., an Ontario corporation ("Noranda"), will not be an
Acquiring Person solely as a result of becoming the beneficial owner of
Exchangeable Shares upon consummation of the Arrangement or Battle Mountain
Common Stock acquired in exchange therefor unless and until it or any of its
affiliates or associates purchase or otherwise become the beneficial owner of
any additional shares of Battle Mountain Common Stock or any other person or
persons who is (or collectively are) the beneficial owners of any shares of
Battle Mountain Common Stock become an affiliate or associate of Noranda unless
(x) in either such case, Noranda, together with all of its affiliates or
associates, is not then the beneficial owner of 20 percent or more of the shares
of Battle Mountain Common Stock then outstanding or (y) in case Noranda becomes
the beneficial owner of such additional shares as a result of the acquisition by
it of another person or of another person who is such a beneficial owner
becoming an affiliate or associate of Noranda as a result of a bona fide
transaction undertaken primarily for another purpose not related to the
acquisition of beneficial ownership of shares of Battle Mountain Common Stock
and not for any purpose with any effect of changing or influencing control of
Battle Mountain, Noranda (or such affiliate or associate) promptly divests or
causes to be divested such additional shares. The BMG Rights Agreement further
provides certain exceptions from the definition of Acquiring Person,
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conditional on prompt divestiture. For purposes of the BMG Rights, beneficial
ownership of Exchangeable Shares is treated as beneficial ownership of Battle
Mountain Common Stock and calculations of percentage ownership, the number of
shares outstanding and related provisions are made on a basis that treats the
Battle Mountain Common Stock and Exchangeable Shares as though they are the same
security. The BMG Rights are not exercisable until the Distribution Date and
will expire at the close of business on November 10, 1998, unless earlier
redeemed by Battle Mountain as described below. As described above under
"Description of Battle Mountain Canada Share Capital -- Exchangeable Share
Rights," each Exchangeable Share has an associated right to acquire additional
Exchangeable Shares on terms substantially the same as those on which the BMG
Rights confer the right to acquire Series A Preferred Stock (or in certain
circumstances Battle Mountain Common Stock or other securities).
In the event that (i) Battle Mountain is the surviving corporation in a
merger with an Acquiring Person and the Battle Mountain Common Stock is not
changed or exchanged, (ii) a person becomes the beneficial owner of 30 percent
or more of the then outstanding shares of Battle Mountain Common Stock (except
pursuant to a tender or exchange offer for all outstanding shares of Battle
Mountain Common Stock at a price and on terms that a majority of the independent
directors of Battle Mountain determines to be fair to and otherwise in the best
interests of Battle Mountain and its stockholders), (iii) an Acquiring Person
engages in one or more "self-dealing" transactions as set forth in the BMG
Rights Agreement or (iv) during such time as there is an Acquiring Person, an
event involving Battle Mountain or a subsidiary of Battle Mountain occurs that
results in such Acquiring Person's ownership interest being increased by more
than one percent (E.G., a reverse stock split), at any time following the
Distribution Date, each holder of a BMG Right will thereafter have the right to
receive, upon exercise, Battle Mountain Common Stock (or, in certain
circumstances, cash, property or other securities of Battle Mountain) having a
value equal to two times the exercise price of the BMG Right. The exercise price
is the Unit Purchase Price multiplied by the number of Units issuable upon
exercise of the BMG Right prior to the event described in this paragraph
(initially, one). Notwithstanding any of the foregoing, following the occurrence
of any of the events set forth in this paragraph, all BMG Rights that are, or
(under certain circumstances specified in the BMG Rights Agreement) were,
beneficially owned by any Acquiring Person (or by certain related parties) will
be null and void. However, BMG Rights are not exercisable following the
occurrence of any of the events set forth above until such time as the BMG
Rights are no longer redeemable by Battle Mountain as set forth below.
In the event that, on or after the Stock Acquisition Date, (i) Battle
Mountain is acquired in a merger or other business combination transaction
(other than a merger described in the preceding paragraph or a merger which
follows an offer described in the preceding paragraph) or (ii) 50 percent or
more of Battle Mountain's assets or earning power is sold or transferred, each
holder of a BMG Right (except BMG Rights which previously have been voided as
set forth above) will thereafter have the right to receive, upon exercise,
common stock of the acquiring company having a value equal to two times the
exercise price of the BMG Right.
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At any time until 10 days following the Stock Acquisition Date, Battle
Mountain may redeem the BMG Rights in whole, but not in part, at a price of
U.S.$0.01 per BMG Right, payable, at the option of Battle Mountain, in cash,
shares of Battle Mountain Common Stock or such other consideration as the Board
of Directors may determine. The BMG Rights may have certain antitakeover
effects, including deterring someone from acquiring control of Battle Mountain
in a manner or on terms not approved by the Board of Directors of Battle
Mountain. The BMG Rights should not interfere with any merger or other business
combination approved by the Board of Directors of Battle Mountain.
Any shares of Series A Preferred Stock that may be issued upon exercise of
the BMG Rights will be nonredeemable. The holders of shares of Series A
Preferred Stock will be entitled to receive, when, as and if declared, a
preferential quarterly dividend in an amount per share effectively equal to the
greater of U.S.$2.00 per share or 100 times any cash or noncash dividend or
other distribution declared on the Battle Mountain Common Stock (other than
dividends payable in shares of Battle Mountain Common Stock), in like kind. In
the event of liquidation, the holders of the Series A Preferred Stock will be
entitled to receive a liquidation payment per share in an amount effectively
equal to the greater of U.S.$100 per share or 100 times the per share amount
distributed to holders of Battle Mountain Common Stock. In the event of any
merger, consolidation or other transaction in which shares of Battle Mountain
Common Stock are exchanged, the holder of the shares of Series A Preferred Stock
will be entitled to receive per share 100 times the amount received per share of
Battle Mountain Common Stock. Holders of Series A Preferred Stock will have 100
votes per share of Series A Preferred Stock and, except as otherwise provided in
the Battle Mountain Articles or required by law, will vote together with holders
of Battle Mountain Common Stock as a single class. The rights of the Series A
Preferred Stock as to dividends, liquidation and voting are protected by
antidilution provisions. Whenever dividend payments on the Series A Preferred
Stock are in arrears, Battle Mountain will not (i) purchase or redeem any shares
of Series A Preferred Stock or shares ranking on a parity with respect to the
Series A Preferred Stock except in accordance with a purchase offer to all
holders, (ii) declare or pay dividends on or purchase or redeem any shares of
stock ranking junior to the Series A Preferred Stock or (iii) declare or pay
dividends on or purchase or redeem any shares of stock ranking on a parity with
the Series A Preferred Stock except dividends paid ratably on the Series A
Preferred Stock and all such parity stock and except purchases or redemptions of
such parity stock in exchange for junior stock. If dividend payments on the
Series A Preferred Stock are in arrears for six quarters, the holders of the
Series A Preferred Stock (altogether with holders of any other Preferred Stock
with similar rights) will have the right to elect two additional directors of
Battle Mountain.
OTHER MATTERS
ANTITAKEOVER PROVISIONS. The Battle Mountain Articles and the Battle
Mountain Bylaws contain certain provisions that might be characterized as
antitakeover provisions. Such provisions may render more difficult certain
possible takeover proposals to acquire control of Battle Mountain and make
removal of management of Battle Mountain more difficult.
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PROVISIONS OF THE BATTLE MOUNTAIN ARTICLES AND BATTLE MOUNTAIN BYLAWS. The
Battle Mountain Articles and the Battle Mountain Bylaws set the number of
directors at a minimum of three and a maximum of 12, as may be fixed from time
to time by resolution of the entire Board of Directors, and provide that the
membership of the classified Board of Directors shall be divided into three
classes, as nearly equal in number as possible, each of which serves for three
years, with the term of each class ending in a successive year. Under the Nevada
General Corporation Law (the "NGCL"), any director may be removed from office
upon the vote of stockholders representing not less than two-thirds of the
issued and outstanding capital stock entitled to voting power, unless a
corporation's articles require the concurrence of a larger percentage of the
stock entitled to voting power. As permitted by the NGCL, the Battle Mountain
Articles provide that a director may be removed from office without cause only
by the affirmative vote of the holders of not less than 80 percent of the number
of shares of Battle Mountain Common Stock then outstanding.
Pursuant to the Battle Mountain Articles, the vote of holders of 80 percent
of the voting power of all stock of Battle Mountain entitled to vote in
elections of directors (excluding stock entitled so to be voted only upon the
happening of some contingency unless such contingency shall have occurred and is
continuing) is required for approval of, with certain exceptions, a merger or
consolidation of Battle Mountain with or into another corporation, a sale or
lease of all or substantially all the assets of Battle Mountain to another
corporation, person or entity and, under certain conditions, a sale or lease to
Battle Mountain of assets in exchange for voting securities (or securities
convertible into or exchangeable for voting securities) of Battle Mountain or
any of its subsidiaries, in each case where the other party to the transaction
is the beneficial owner, directly or indirectly, of 5 percent or more of the
outstanding shares of any class or series of voting stock of Battle Mountain. In
addition, for any transaction to be effected for which the foregoing 80 percent
vote is required, it is also required that such transaction be approved by a
majority of the outstanding voting power of the voting stock of Battle Mountain,
exclusive of the voting stock beneficially owned, directly or indirectly, by the
party whose interest in the transaction and stock ownership in Battle Mountain
gives rise to the requirement of the 80 percent vote. The foregoing requirements
described in this paragraph do not apply to a transaction if (i) the Board of
Directors of Battle Mountain has approved a memorandum of understanding with
respect to such transaction with the other party to the transaction prior to the
time the 5 percent beneficial ownership position is acquired or (ii) the
transaction is made with a corporation of which 50 percent or more of its
outstanding voting stock is beneficially owned, directly or indirectly, by
Battle Mountain.
As permitted by the NGCL, the Battle Mountain Articles provide that no
action may be taken by stockholders without a meeting except by the unanimous
written consent of all stockholders entitled to vote on such action. Special
meetings of stockholders may be called only by a majority of the Board of
Directors, the Chairman of the Board or the President of Battle Mountain.
The Battle Mountain Articles require approval of at least 80 percent of the
total voting power of the voting stock of Battle Mountain and approval of the
holders of at least a majority
II-20
<PAGE>
of the voting power of the voting stock of Battle Mountain exclusive of all
voting stock of Battle Mountain owned by beneficial owners of 5 percent or more
of the outstanding shares of any class or series of voting stock of Battle
Mountain to effect an amendment or repeal of, or the adoption of any provision
inconsistent with, the provisions of such articles relating to (i) the
alteration, amendment or repeal of the Battle Mountain Bylaws by stockholders,
(ii) the organization and powers of the Board of Directors and the nomination,
election and removal of directors, (iii) stockholder action without meetings and
the calling of special stockholder meetings or (iv) the affirmative vote
required for approval of the transactions described in the preceding paragraph
between Battle Mountain and beneficial owners of 5 percent or more of the
outstanding shares of any class or series of voting stock of Battle Mountain.
The Battle Mountain Articles also require the same affirmative vote for the
amendment or repeal of the foregoing provision.
The Battle Mountain Articles and the Battle Mountain Bylaws provide that
the Bylaws may be altered, amended or repealed by the stockholders only by the
affirmative vote of at least 80 percent of the voting power of all shares of
Battle Mountain represented at any regular meeting of stockholders (or at any
special meeting thereof duly called for that purpose) and entitled to vote
generally in the election of directors, voting together as a class.
The ability of the Board of Directors to determine the preferences,
relative rights, qualifications and restrictions of the Preferred Stock and to
issue Preferred Stock without stockholder approval could have an antitakeover
effect.
The Board of Directors has adopted a preferred stock purchase rights plan
which has an antitakeover effect. See "--Battle Mountain Preferred Stock
- --Series A Preferred Stock" for a description of the plan.
Battle Mountain's committed revolving credit facility provides that it is
an event of default thereunder if (a) any person or group acquires beneficial
ownership of 20 percent or more of the voting stock of Battle Mountain or (b)
during any period of up to 24 consecutive months, individuals who at the
beginning of such 24-month period were directors of Battle Mountain cease for
any reason to constitute a majority of the Board of Directors of Battle
Mountain. (This provision does not apply to the acquisition by Noranda of
Exchangeable Shares as provided in the Combination Agreement or the change in
composition of Battle Mountain's Board of Directors that occurred upon
consummation of the Combination Agreement.)
NEVADA CORPORATION LAW. Sections 78.378 ET SEQ. of the NGCL generally
disallow the exercise of voting rights with respect to "control shares" of an
"issuing corporation" held by an "acquiring person," unless such voting rights
are conferred by a majority vote of the disinterested stockholders. "Control
shares" are the voting shares of an issuing corporation acquired in connection
with the acquisition of a "controlling interest." "Controlling interest" is
defined in terms of threshold levels of voting share ownership, which
thresholds, whenever each may be crossed, trigger application of the voting bar
with respect to the shares newly acquired. The issue of voting rights is
presented at the next annual or special meeting of stockholders after the
acquisition in question, unless a special meeting of stockholders is requested
sooner by the
II-21
<PAGE>
acquiring person. At such meeting, the votes of an "interested stockholder" are
not counted towards the majority approval requirement under this statute. In the
event that the control shares are accorded full voting rights (but only if the
acquiring person has acquired a majority voting interest in the issuing
corporation), any stockholder, other than the acquiring person, who has not
voted in favor of authorizing voting rights for the control shares is entitled
to demand payment for the fair value of his shares. Such right of payment may,
however, be expressly withdrawn by the corporate charter or bylaws. Any charter
or bylaw amendment withdrawing such right must be adopted prior to the 10th day
following the acquisition of a controlling interest. In the event that the
control shares are not accorded full voting rights, the issuing corporation may
call for redemption of all, but not less than all, of the control shares at the
average price paid for such shares, but only if the corporate charter or bylaws
expressly permit such redemption. Any charter or bylaw amendment providing for
such right of redemption must be adopted prior to the 10th day following the
acquisition of a controlling interest. Battle Mountain's bylaws were amended in
connection with the consummation of the Combination Agreement to provide that
provisions of the NGCL described in this paragraph do not apply to the
acquisition by Noranda of up to 65,242,526 Exchangeable Shares or shares of
Battle Mountain Common Stock in the Arrangement (including shares of Battle
Mountain Common Stock issuable upon exchange for or redemption of such
Exchangeable Shares).
Battle Mountain is subject to Sections 78.411, ET SEQ. of the NGCL, which
generally prohibit a publicly held Nevada corporation from engaging in any
"combination" with an "interested stockholder" for three years after the date
the interested stockholder became an interested stockholder unless, prior to
that date, either the combination or the purchase of shares that resulted in the
interested stockholder becoming such is approved by the board of directors of
the corporation. An "interested stockholder" is a person who, together with
affiliates and associates, is the beneficial owner (or within the previous three
years was the beneficial owner) of 10 percent or more of the voting power of the
corporation's outstanding voting shares. A "business combination" generally
includes mergers, asset sales and share issuances above threshold sizes, and
certain other transactions resulting in financial benefit to the interested
stockholder. Even after the expiration of the three-year period in which such
business combinations with an interested stockholder are prohibited, a
corporation may not engage in a business combination with an interested
stockholder unless, in addition to meeting applicable requirements of the
corporation's articles of incorporation, either (1) the combination is approved
by the affirmative vote of a majority of the outstanding voting power of the
corporation not beneficially owned by the interested stockholder (or affiliates
or associates) at a meeting called for that purpose not earlier than the end of
such three-year period or (2) certain requirements for the minimum consideration
payable to holders other than the disinterested holder are met (based on the
higher of (a) the highest price per share paid by the interested stockholder
within prescribed periods and (b) the market value per share on the date of
announcement of the transaction or the date the interested stockholder became
such (in each case plus an amount based on an interest factor net of certain
dividends) and (c) in the case of a class other than common stock, the highest
preferential amount payable upon liquidation).
II-22
<PAGE>
DIRECTOR AND OFFICER LIABILITY PROVISIONS. The Battle Mountain Articles
eliminate the personal liability of each director and officer of Battle Mountain
to Battle Mountain or any of its stockholders for damages resulting from
breaches of fiduciary duty as a director or officer involving any act or
omission of any such director or officer occurring on or after April 28, 1987.
The Battle Mountain Articles do not limit or eliminate the liability of a
director or officer for actions or omissions involving intentional misconduct,
fraud, a knowing violation of law or payment of an unlawful dividend.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Paragraphs 7 through 10 of the Bylaws of Battle Mountain Canada provides
for the indemnification of officers and directors of Battle Mountain Canada to
the extent permitted by the OBCA. Under the OBCA, a corporation may indemnify a
director or officer, a former director or officer or a person who acts or acted
at the corporation's request as a director or officer of a body corporate of
which the corporation is or was a shareholder or creditor, and his or her heirs
and legal representatives (an "Indemnifiable Person"), against all costs,
charges and expenses, including an amount paid to settle an action or satisfy a
judgment, reasonably incurred by him or her in respect of any civil, criminal or
administrative action or proceeding to which he or she is made a party by reason
of being or having been a director or officer of such corporation or such body
corporate, if: (a) he or she acted honestly and in good faith with a view to the
best interests of such corporation; and (b) in the case of a criminal or
administrative action or proceeding that is enforced by a monetary penalty, he
or she had reasonable grounds for believing that his or her conduct was lawful.
An Indemnifiable Person is entitled to such indemnity from the corporation if he
or she was substantially successful on the merits in his or her defense of the
action or proceeding and fulfilled the conditions set out in (a) and (b), above.
A corporation may, with the approval of a court, also indemnify an Indemnifiable
Person in respect of an action by or on behalf of the corporation or body
corporate to procure a judgment in its favor, to which such person is made a
party by reason of being or having been a director or an officer of the
corporation or body corporate, if he or she fulfills the conditions set out in
(a) and (b), above.
The above discussion of the Bylaws of Battle Mountain Canada and of
relevant provisions of the OBCA is not intended to be exhaustive and is
respectively qualified in its entirety by such Bylaws and statute.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
II-23
<PAGE>
ITEM 8. EXHIBITS.
Exhibit
NUMBER DESCRIPTION
*4(a)(1) Restated Articles of Incorporation of Battle Mountain, as amended
and restated through May 11, 1988 (Exhibit 4(a)(1) to Battle
Mountain's Current Report on Form 8-K dated July 19, 1996; File
No. 1-9666).
*4(a)(2) Certificate of Amendment to Restated Articles of Incorporation of
Battle Mountain filed with the Secretary of State of the State of
Nevada on July 19, 1996 (Exhibit 4(a)(2) to Battle Mountain's
Current Report on Form 8-K dated July 19, 1996; File No. 1-9666).
*4(b) Certificate of Resolution Establishing Designation, Preferences
and Rights of $3.25 Convertible Preferred Stock (Exhibit (4)(b)to
Battle Mountain's Current Report on Form 8-K dated July 19, 1996;
File No. 1-9666).
*4(c) Certificate of Amendment of Certificate of Resolution
Establishing Designation, Preferences and Rights of Series A
Junior Participating Preferred Stock (Exhibit 4(c) to Battle
Mountain's Current Report on Form 8-K dated July 19, 1996; File
No. 1-9666).
*4(d) Bylaws of Battle Mountain as amended through July 19, 1996
(Exhibit 4(d) to Battle Mountain's Current Report on Form 8-K
dated July 19, 1996; File No. 1- 9666).
*4(e) Rights Agreement, dated November 10, 1988, as amended and
restated as of July 19, 1996, between Battle Mountain and The
Bank of New York, as Rights Agent (Exhibit 4(e) to Battle
Mountain's Current Report on Form 8-K dated July 19, 1996; File
No. 1-9666).
*4(f) Articles of Amalgamation of Hemlo Gold dated January 1, 1995
(Exhibit 4(f) to Battle Mountain Canada's Registration Statement
on Form 8-A dated August 23, 1996; File No. 1-10943).
*4(g) Plan of Arrangement of Hemlo Gold under Section 182 of the
Business Corporations Act (Ontario) (Annex D to Exhibit 20(a),
Joint Management Information Circular and Proxy Statement, to
Battle Mountain's Current Report on Form 8-K dated June 11, 1996,
File No. 1-9666).
*4(h) Bylaws of Battle Mountain Canada dated December 16, 1986 (Exhibit
4(h) to Battle Mountain Canada's Registration Statement on Form
8-A dated August 23, 1996; File No. 1-10943).
II-24
<PAGE>
*4(i) Rights Agreement, dated July 19, 1996, between Battle Mountain
Canada and The R-M Trust Company, as Rights Agent (Exhibit 4(f)
to Battle Mountain's Current Report on Form 8-K dated July 19,
1996; File No. 1-9666).
*4(j) Voting, Support and Exchange Trust Agreement dated as of July 19,
1996 between Battle Mountain, Hemlo Gold and The R-M Trust
Company (Annex E to Exhibit 20(a), Joint Management Information
Circular and Proxy Statement, to Battle Mountain's Current Report
on Form 8-K dated June 11, 1996, File No.
1-9666).
*4(k) Specimen Stock Certificate for the Common Stock of Battle
Mountain (Exhibit 4(b) to Battle Mountain's Annual Report on Form
10-K for the fiscal year ended December 31, 1988; File No.
1-9666).
*4(l) Specimen Stock Certificate for the Exchangeable Shares of Battle
Mountain Canada (Exhibit 4(l) to Battle Mountain Canada's
Registration Statement on Form 8-A dated August 23, 1996; File
No. 1-10943).
*4(m) Specimen Voting Stock Certificate for the Special Voting Stock of
Battle Mountain (Exhibit 4(m) to Battle Mountain Canada's
Registration Statement on Form 8-A dated August 23, 1996; File
No. 1-10943).
*4(n) Combination Agreement effective as of March 11, 1996 by and
between Battle Mountain and Hemlo Gold (Annex C to Exhibit 20(a),
Joint Management Information Circular and Proxy Statement, to
Battle Mountain's Current Report on Form 8-K dated June 11, 1996,
File No. 1-9666).
5 Opinion of McCarthy Tetrault.
23(a) Consent of Ernst & Young, Chartered Accountants.
23(b) Consent of Price Waterhouse LLP, independent accountants.
23(c) Consent of Coopers & Lybrand, Port Moresby, Papua New Guinea,
independent auditors, Lihir Gold Limited.
23(d) Consent of McCarthy Tetrault (included in Exhibit 5).
24 Power of Attorney.
- -------------------------------
* Incorporated by reference as indicated.
II-25
<PAGE>
ITEM 9. UNDERTAKINGS.
(a) Battle Mountain Canada hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this Registration
Statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in
the effective Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in
this Registration Statement or any material change to such
information in this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by them pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) Battle Mountain Canada hereby undertakes that, for purposes
of determining any liability under the Securities Act, each filing of its annual
report pursuant to
II-26
<PAGE>
Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Exchange Act) that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of Battle Mountain Canada pursuant to the foregoing provisions, or otherwise,
Battle Mountain Canada has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by Battle Mountain Canada of
expenses incurred or paid by a director, officer or controlling person of Battle
Mountain Canada in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, Battle Mountain Canada will, unless in the opinion
of its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
II-27
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE
REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL
OF THE REQUIREMENTS FOR FILING ON FORM S-8 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF TORONTO, PROVINCE OF ONTARIO, ON OCTOBER 18, 1996.
BATTLE MOUNTAIN CANADA LTD.
BY /S/ IAN D. BAYER
(IAN D. BAYER
PRESIDENT AND CHIEF EXECUTIVE
OFFICER)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATE INDICATED.
SIGNATURE TITLE DATE
/S/ IAN D. BAYER President and Chief October 18, 1996
(IAN D. BAYER) Executive Officer
(Principal Executive
Officer)
/S/ MICHAEL C. PROCTOR Vice President - Finance and October 18, 1996
(MICHAEL C. PROCTOR) Corporate Secretary
(Principal Financial and
Accounting Officer)
IAN D. BAYER*
JAMES W. MCCUTCHEON, Q.C.* Directors of the Registrant October 18, 1996
MARY MOGFORD*
*By /S/ KARL E. ELERS
(KARL E. ELERS,
ATTORNEY-IN-FACT)
II-28
EXHIBIT 5
[Letterhead of McCarthy Tetrault]
Battle Mountain Canada Ltd. October 16, 1996
Suite 2902
1 Adelaide Street East
Toronto, Ontario
M5C 2Z9
Gentlemen:
As set forth in the Registration Statement on Form S-8 (the
"Registration Statement") to be filed by Battle Mountain Canada Ltd., an Ontario
corporation ("Battle Mountain Canada"), with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the offering by Battle Mountain Canada of a maximum aggregate of
519,480 exchangeable shares of Battle Mountain Canada (the "Exchangeable
Shares") to holders of options (the "BMG Options") to purchase shares of common
stock, par value $0.10 per share, of Battle Mountain Gold Company, a Nevada
corporation ("Battle Mountain") or, at the option of the holder, Exchangeable
Shares issued in accordance with the Combination Agreement effective as of March
11, 1996 (the "Combination Agreement") between Battle Mountain and Hemlo Gold
Mines Inc. (the former name of Battle Mountain Canada) in exchange for
previously outstanding options to purchase common shares of Hemlo Gold Mines
Inc., certain legal matters in connection with the 519,480 Exchangelable Shares
subject to issuance pursuant to the BMG Options (the "Shares") are being passed
upon for Battle Mountain Canada by us. At your request, this opinion is being
furnished to you for filing as Exhibit 5 to the Registration Statement.
In our capacity as counsel to Battle Mountain Canada, we have examined
Battle Mountain Canada's articles and bylaws, each as amended to date, and have
examined the originals, or copies certified or otherwise identified, of
corporate records of Battle Mountain Canada, statutes and other instruments and
documents as a basis for the opinions hereinafter expressed.
On the basis of the foregoing, we are of the opinion that, upon the
issuance of and payment for the Shares in accordance with the terms and
provisions of the BMG Options, the Shares will be duly authorized, validly
issued, fully paid and non-assessable.
<PAGE>
[Letterhead of McCarthy Tetrault]
-2-
October 16, 1996
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement. In giving this consent, we do not hereby admit
that we are in the category of persons whose consent is required under Section 7
of the Securities Act.
Yours truly,
/s/ MCCARTHY TETRAULT
EXHIBIT 23(a)
CONSENT OF INDEPENDENT CHARTERED ACCOUNTANTS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-8) of Battle Mountain Canada Ltd. and the
prospectus relating to this Registration Statement pertaining to the options
granted pursuant to the Combination Agreement between Battle Mountain Gold
Company and Hemlo Gold Mines Inc. and to the incorporation by reference therein
of our report dated February 8, 1996, with respect to the consolidated financial
statements of Hemlo Gold Mines Inc. included in its Annual Report for the year
ended December 31, 1995, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG
Chartered Accountants
Toronto, Canada
October 18, 1996
EXHIBIT 23(b)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement
on Form S-8 and in the Prospectus relating to this Registration Statement of our
report dated October 10, 1996 on the consolidated financial statements of Battle
Mountain Gold Company as of December 31, 1995 and 1994 and for each of the three
years in the period ended December 31, 1995, appearing on page 2 of Battle
Mountain Gold Company's Annual Report of Form 10-K/A (Amendment No. 3) for the
year ended December 31, 1995. We also consent to the references to us under the
heading "Experts" in this Registration Statement and in the Prospectus relating
to this Registration Statement.
/s/ PRICE WATERHOUSE LLP
Price Waterhouse LLP
October 18, 1996
EXHIBIT 23(c)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement
of Battle Mountain Canada Ltd. on Form S-8 and the related prospectus of our
report dated June 27, 1996 on our audit of the financial statements of Lihir
Gold Limited as of December 31, 1995, and for the year then ended, which report
is included in Form 10-K/A for the year ended December 31, 1995. We also consent
to the reference to our firm under the caption "Experts".
/s/ COOPERS & LYBRAND
Coopers & Lybrand
Port Moresby, Papua New Guinea
October 18, 1996
EXHIBIT 24
BATTLE MOUNTAIN CANADA LTD.
POWER OF ATTORNEY
WHEREAS, BATTLE MOUNTAIN CANADA LTD., a Ontario corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), a
Registration Statement of Form S-8, with any amendment or amendments and any
supplement or supplements thereto, as prescribed by the Commission pursuant to
the Act and the rules and regulations of the Commission promulgated thereunder,
together with any and all exhibits and other documents relating to such
Registration Statement in connection with the offering by the Company of 519,480
exchangeable shares of the Company and associated exchangeable share purchase
rights, pursuant to options granted pursuant to the Combination Agreement
effective as of March 11, 1996, between Battle Mountain Gold Company and Hemlo
Gold Mines Inc.
NOW, THEREFORE, the undersigned, in his capacity as a director of the
Company, does hereby appoint Karl E. Elers, R. Dennis O'Connell and Robert J.
Quinn, and each of them severally, his true and lawful attorneys-in-fact and
agents with power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto (including, without limitation,
post-effective amendments and any additional registration statements filed
pursuant to Rule 462 under the Act increasing the amount of securities for which
registration is being sought) and all instruments necessary or incidental in
connection therewith and to file the same with the Commission. Each of such
attorneys-in-fact and agents shall have full power and authority to do and
perform in the name and on behalf of the undersigned, in any and all capacities,
every act whatsoever necessary or desirable to be done in the premises, as fully
and to all intents and purposes as the undersigned might or could do in person,
the undersigned hereby ratifying and approving the acts of such
attorneys-in-fact and agents and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument as of the
21st day of August, 1996.
/s/ IAN D. BAYER
Ian D. Bayer
<PAGE>
BATTLE MOUNTAIN CANADA LTD.
POWER OF ATTORNEY
WHEREAS, BATTLE MOUNTAIN CANADA LTD., a Ontario corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), a
Registration Statement of Form S-8, with any amendment or amendments and any
supplement or supplements thereto, as prescribed by the Commission pursuant to
the Act and the rules and regulations of the Commission promulgated thereunder,
together with any and all exhibits and other documents relating to such
Registration Statement in connection with the offering by the Company of 519,480
exchangeable shares of the Company and associated exchangeable share purchase
rights, pursuant to options granted pursuant to the Combination Agreement
effective as of March 11, 1996, between Battle Mountain Gold Company and Hemlo
Gold Mines Inc.
NOW, THEREFORE, the undersigned, in his capacity as a director of the
Company, does hereby appoint Karl E. Elers, R. Dennis O'Connell and Robert J.
Quinn, and each of them severally, his true and lawful attorneys-in-fact and
agents with power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto (including, without limitation,
post-effective amendments and any additional registration statements filed
pursuant to Rule 462 under the Act increasing the amount of securities for which
registration is being sought) and all instruments necessary or incidental in
connection therewith and to file the same with the Commission. Each of such
attorneys-in-fact and agents shall have full power and authority to do and
perform in the name and on behalf of the undersigned, in any and all capacities,
every act whatsoever necessary or desirable to be done in the premises, as fully
and to all intents and purposes as the undersigned might or could do in person,
the undersigned hereby ratifying and approving the acts of such
attorneys-in-fact and agents and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument as of the
26th day of August, 1996.
/s/ JAMES W. MCCUTCHEON, Q.C.
James W. McCutcheon, Q.C.
<PAGE>
BATTLE MOUNTAIN CANADA LTD.
POWER OF ATTORNEY
WHEREAS, BATTLE MOUNTAIN CANADA LTD., a Ontario corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), a
Registration Statement of Form S-8, with any amendment or amendments and any
supplement or supplements thereto, as prescribed by the Commission pursuant to
the Act and the rules and regulations of the Commission promulgated thereunder,
together with any and all exhibits and other documents relating to such
Registration Statement in connection with the offering by the Company of 519,480
exchangeable shares of the Company and associated exchangeable share purchase
rights, pursuant to options granted pursuant to the Combination Agreement
effective as of March 11, 1996, between Battle Mountain Gold Company and Hemlo
Gold Mines Inc.
NOW, THEREFORE, the undersigned, in his capacity as a director of the
Company, does hereby appoint Karl E. Elers, R. Dennis O'Connell and Robert J.
Quinn, and each of them severally, his true and lawful attorneys-in-fact and
agents with power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign such Registration Statement
and any and all amendments thereto (including, without limitation,
post-effective amendments and any additional registration statements filed
pursuant to Rule 462 under the Act increasing the amount of securities for which
registration is being sought) and all instruments necessary or incidental in
connection therewith and to file the same with the Commission. Each of such
attorneys-in-fact and agents shall have full power and authority to do and
perform in the name and on behalf of the undersigned, in any and all capacities,
every act whatsoever necessary or desirable to be done in the premises, as fully
and to all intents and purposes as the undersigned might or could do in person,
the undersigned hereby ratifying and approving the acts of such
attorneys-in-fact and agents and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument as of the
22nd day of August, 1996.
/s/ MARY MOGFORD
Mary Mogford
