Battle Mountain Gold Co.
Feb. 13, 1992

[INQUIRY LETTER 1]

BAKER & BOTTS
ONE SHELL PLAZA, 910 LOUISIANA
HOUSTON, TEXAS 77002-4995

December 20, 1991

Rule 14a-8(d)

Office of Chief Counsel
Division of Corporate Finance
Securities and Exchange Commission
450 Fifth Avenue, N.W.
Washington, D.C. 20549

Ladies and Gentlemen:

We are writing on behalf of our client Battle Mountain Gold Company, a Nevada corporation (the "Company"). The Company has received from Peter Kurilecz, Jr., M.D., correspondence requesting that a proposal be submitted to the Companys 1992 annual meeting of shareholders. We are advised that the 1992 annual meeting is scheduled to be held on April 21, 1991 and that the Company intends to mail its definitive proxy material relating to the meeting on or about March 13, 1991. The Company does not intend to include Dr. Kurilecz proposal in its proxy statement and form of proxy.

Dr. Kurilecz request that a proposal be submitted is contained in letters dated April 8, 1991 and May 2, 1991, copies of which are included with this letter. The proposal submitted by Dr. Kurilecz (the "Proposal") is to the effect that "a management cut in salary of 30% be instituted and the stock options be discontinued until the profit picture improves." The correspondence from Dr. Kurilecz does not include a supporting statement as such for the Proposal. Although Dr. Kurilecz does not state his own intention to present the Proposal as required by the first paragraph of Rule 14a-8(a) and although his correspondence does not contain all the information required by Rule 14a-8(a)(2), this submission is being made pursuant to Rule 14a-8(d) on the basis that its requirements may be deemed applicable. (Reference herein to Rules are to the Commissions rules contained in Regulation 14A under the Securities Exchange Act of 1934.)

The Company believes the Proposal may properly be omitted from its proxy soliciting material pursuant to Rule 14a-8(c)(7) (as relating to the conduct of the ordinary business operations of the Company), Rule 14a-8(c)(1) (as not a proper subject for action by security holders under the laws of the state of Nevada), and Rule 14a-8(c)(3) (as being vague and indefinite so as to contravene Rule 14a-9). The basis for these conclusions is set forth in more detail below.

Rule 14a-8(c)(7).

There is a sound basis for excluding the Proposal under Rule 14a-8(c)(7) in that it "deals with a matter relating to the conduct of the ordinary business operations" of the Company. The Staff has consistently taken the position in no-action letters that shareholder proposals relating to compensation levels may be properly excluded under Rule 14a-8(c)(7). See, e.g., Comtech Telecommunications Corp. (September 8, 1991) (proposal to escrow incentive compensation for a fixed period until common stock reaches target price); Shop Television Network, Inc. (May 20, 1991) (proposal to limit management compensation and impose price/earnings ratios or dividend conditions for certain payments); MCI Communications Corporation (March 7, 1991) (proposal to prohibit company from "issuing any new stock option plans" for five years and canceling all old stock options not already granted); The Chase Manhattan Corporation (March 5, 1991) (proposal to reduce compensation and to suspend pension contributions, deferred compensation arrangements and stock options of management); Fibreboard Corporation (February 12, 1991) (proposal to limit the number of stock options, stock appreciation rights and other similar rights granted to officers and to limit downward adjustments of the exercise price of outstanding rights); Salomon Inc (February 12, 1991) (proposal to cap executive salaries until common stock reaches a target price); and Rohr Industries, Inc. (August 20, 1990) (proposal to prohibit stock bonuses, options and salary increases until company becomes profitable).

Insofar as Rule 14a-8(c)(7) is concerned, there is no basis for distinguishing the Proposal from the numerous other situations in which the Staff has taken the position that proposals seeking to regulate compensation levels are properly excludable. The Company believes that decisions as to executive compensation matters require the detailed knowledge of the contributions made by the respective individuals, their past performance and compensation history, the relationship of salary to other forms of compensation under various benefit and compensation plans, and compensation levels of individuals in similar positions with other companies. The level of specific knowledge required in order to make informed judgments as to such matters is consistent with a determination that such matters relate to ordinary business operations.

Rule 14a-8(c)(1).

Under Rule 14a-8(c)(1) a proposal may be omitted if it is, under the laws of the issuers domicile, not a proper subject for action by security holders.

The Company is incorporated under the laws of the State of Nevada. Section 78.120(1) of the Nevada Revised Statutes provides:

Subject only to such limitations as may be provided by this chapter Chapter 78 of the Nevada Revised Statutes, or the articles of incorporation of the corporation, the board of directors has full control over the affairs of the corporation.

There is no other provision of Chapter 78 of the Nevada Revised Statutes that reserves or grants to the shareholders of a Nevada corporation authority with respect to matters concerning executive compensation. Nor is there any such provision in the Companys Articles of Incorporation or By-laws. Therefore, decisions as to matters concerning executive compensation are, under the laws of the State of Nevada, within the authority and responsibility of the Board of Directors of the Company. Copies of a separate supporting opinion of Vargas & Bartlett, special Nevada counsel for the Company, to the effect that the Proposal is not a proper subject for action by the Companys shareholders are enclosed with this letter.

Rule 14a-8(c)(3).

Rule 14a-8(c)(3) states that a registrant is permitted to omit a proposal from its proxy materials "if the proposal or the supporting statement is contrary to any of the Commissions proxy rules and regulations, including Rule 14a-9, which prohibits false or misleading statements in proxy soliciting materials." Pursuant to Rule 14a-8(c)(3), the Company may omit from its proxy soliciting materials a proposal that is so vague and indefinite as to be misleading to shareholders.

The meaning and application of the terms in the Proposal, as contained in the correspondence from Dr. Kurilecz, including such terms as "management," "discontinued," "profit picture" and "improves," are not clear from Dr. Kurilecz correspondence and would be subject to differing opinions. It would be uncertain which employees would be subject to the limitations of the Proposal, whether discontinuation of stock options means simply a cessation of new option grants or also includes an attempted abrogation of contractual obligations under outstanding options, and what financial results would result in the restrictions no longer being applicable. See, e.g., PHLCORP, Inc. (September 10, 1991) (proposal to require shareholders approval prior to any buy back of shares); and Fuqua Industries, Inc. (March 12, 1991) (proposal to prohibit major shareholders from engaging in certain transactions).

Pursuant to Rule 14a-8(d), six copies of this letter and the enclosed correspondence from Dr. Kurilecz are included herewith. Pursuant to the requirements of Rule 14a-8 a copy of this letter (and the separate supporting opinion) is being sent to Dr. Kurilecz with a letter from the Company notifying him of the Companys intention to omit the Proposal from its proxy materials. Copies of that letter from the Company are also enclosed.

If the Staff has any questions regarding this matter, a call to Gareth Bahlmann (at 713 229-1970) or C. Michael Watson (at 713 229-1542) of this firm would be appreciated.

Very truly yours,

BAKER & BOTTS

By

C. Michael Watson

Enclosures

cc: Peter Kurilecz, Jr., M.D.
1851 Prairie View, Suite D
Dallas, Texas 75235

Mr. Robert J. Quinn
Battle Mountain Gold Company

[INQUIRY LETTER 2]

VARGAS & BARTLETT
THIRD FLOOR, 201 WEST LIBERTY STREET, POST OFFICE BOX 281
RENO, NEVADA 89504
TELEPHONE(702) 786-5000

Battle Mountain Gold Company
333 Clay Street
42nd Floor
Houston, Texas 77002

Gentlemen:

We understand that Dr. Peter Kurilecz, a shareholder of Battle Mountain Gold Company, a Nevada corporation (the "Company"), has submitted to the Company correspondence requesting that a proposal be submitted to the Companys 1991 annual meeting of shareholders. The proposal (the "Proposal") is to the effect that "a management cut in salary be instituted and the stock options be discontinued until the profit picture improves." We understand that the Company desires to omit the Proposal from its proxy soliciting materials (the "Proxy Materials") for its 1992 annual meeting.

As special Nevada counsel for the Company, we have examined such questions of law as we have considered necessary or appropriate for the purposes of this opinion. Upon the basis of such examination, it is our opinion that the Proposal is not a proper subject for action by the Companys shareholders and may therefore properly be omitted from the Proxy Materials pursuant to Rule 14a-8(c)(1) under the Securities Exchange Act of 1934.

Section 78.120(1) of the Nevada Revised Statutes provides:

Subject only to such limitations as may be provided by this chapter Chapter 78 of the Nevada Revised Statutes, or the articles of incorporation of the corporation, the board of directors has full control over the affairs of the corporation.

See also, Berman v. Riverside Casino Corp., 247 F.Supp. 243 (D. Nev. 1964), affd, Berman v. Riverside Casino Corp., 354 F.2d 43 (9th cir. 1965) ("Under Nevada law, the management and control of the affairs of a private corporation are vested in the board of directors, and a stockholder, as such, exercises his powers in the election of directors.")

There is no other provision of Chapter 78 of the Nevada Revised Statutes that reserves or grants to the shareholders of a Nevada corporation authority with respect to matters concerning executive compensation. Nor is there any such provision in the Companys Articles of Incorporation or Bylaws. Nevadas applicable corporate statutes support the conclusion that matters of executive compensation are within the authority and responsibility of the Board of Directors of the Company. See NRS 78.130 (officers are chosen by the board of directors, and in the manner and for such terms as prescribed by the bylaws or determined by the Board of directors); NRS 78.140(3) (the board of directors may fix the compensation of directors in any capacity, unless otherwise provided in the articles of incorporation or the bylaws).

In addition, Nevadas applicable statutes provide that the issuance of stock or stock options are within the authority and responsibility of the Board of Directors of the Company. See NRS 78.200 (the issuance of stock options are to be evidenced by instruments approved by the board of directors, and the terms of such must be fixed and stated in the articles of incorporation or in a resolution adopted by the board of directors); NRS 78.211 (the board of directors may authorize shares to be issued, and before issuance, the board of directors must determine that the consideration to be received for the shares is adequate, which determination is conclusive in the absence of actual fraud in the transaction).

Thus, in the absence of some other provision in Chapter 78 of the Nevada Revised Statutes or in the Companys Articles of Incorporation or Bylaws authorizing the shareholders to direct the Board of Directors to take the action contemplated by the Proposal, it is our opinion that the Proposal would encroach upon the authority and responsibility of the Board of Directors to control the affairs of the Company and, consequently, is not a proper subject for a proposal to be submitted for action at a meeting of the Companys shareholders.

The foregoing opinion is limited to the Federal laws of the United States and the corporation law of the State of Nevada (Chapter 78 of the Nevada Revised Statutes), and we express no opinion as to the effect of the laws of any other jurisdiction.

Very truly yours,

Vargas & Bartlett

DSM:dm

A:/DSM.LET/280

[INQUIRY LETTER 3]

PETER KURILECZ
1851 PRAIRIE VIEW, SUITE D
DALLAS, TEXAS 75235
TELEPHONE(214) 688-0550

Mr. Karl Elers, Chairman of Board
Battle Mountain Gold Co.
333 Clay St. 42nd Fl.
Houston, Texas 77002

Dear Mr. Elers:

I am an irate and discouraged stock holder of the Battle Mountain Gold Co. I note the company is doing very poorly but there have been no salary cuts for Management.

I propose to the Board of Directors that a remedy of this situation be instituted and that the Board cut the salaries of top management 38% until they show a more profitable picture and also cut out all stock options until the company is more profitable.

If the Board does not act on this, please write me so that I may submit a stockholders proposal for the next yearly meeting.

Sincerely yours,

Peter Kurilecz, Jr., M.D.

PK:hb

[INQUIRY LETTER 4]

PETER KURILECZ
1851 PRAIRIE VIEW, SUITE D
DALLAS, TEXAS 75235
TELEPHONE(214) 688-0550

Mr. Karl E. Elers, CEO
Battle Mountain Gold Company
333 Clay St., 42nd Floor
Houston, Texas 77002

Dear Mr. Elers:

I received your letter dated 4-24-91.

This does not agree with my thinking of what the company should be done and the exorbitant salaries and stock options which have been taken. Pretty soon, the officers will own the company and not the stockholders.

I am requesting that a stockholders proposal be submitted to the meeting next year regarding the poor showing of the company, a management cut in salary of 30% be instituted and the stock options be discontinued until the profit picture improves. I want this included in the stockholders proposal and I am sending a copy of this letter to the Securities and Exchange Commission so that they would have a record I have requested that this proposal be included in next years annual meeting.

Sincerely yours,

Peter Kurilecz, Jr., M.D.

PK:hb

[INQUIRY LETTER 5]

BATTLE MOUNTAIN GOLD COMPANY
333 CLAY STREET, 42ND FLOOR
HOUSTON, TEXAS 77002-4103
TELEPHONE(713) 650-6400

Peter Kurilecz, M.D.
1851 Prairie View, Suite D
Dallas, Texas 75235

Dear Dr. Kurilecz:

We have reviewed your correspondence requesting that a proposal relating to management compensation be submitted for consideration at the Companys 1992 annual meeting.

Pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, certain categories of shareholder proposals may properly be omitted from an issuers proxy materials. This letter is to notify you that Battle Mountain Gold Company does not intend to include your proposal in its proxy statement and form of proxy relating to its 1992 annual meeting because we believe it is excludable under Rule 14a-8.

Enclosed are copies of correspondence from counsel which is being submitted to the Securities and Exchange Commission stating the reasons the Company believes your proposal may properly be omitted from the proxy materials.

If you have any questions about this procedure, you are welcome to call.

Sincerely,

James A. Brooks

JAB:dmc

C3/911220A

[STAFF REPLY LETTER]

FEB 13, 1992

RESPONSE OF THE OFFICE OF CHIEF COUNSEL

DIVISION OF CORPORATION FINANCE

RE: Battle Mountain Gold Company (the "Company")

Incoming letter dated December 23, 1991

The proposal calls for a cut in management salaries and stock options until the Company becomes more profitable.

You have expressed your view that the proposal may be omitted under Rule 14a-8(c)(7) because it relates to the Companys ordinary business operations. In the Divisions view, it is not clear whether the proposal is directed at salaries and options for the Companys executive officers or relates to general compensation policy. If the proposal is intended to limit executive compensation and if the proponent provides the Company with an amended proposal making such limitation clear within 7 calendar days of the receipt of this letter, the Division is unable to conclude that the proposal may be omitted under Rule 14a-8(c)(7). In view of the widespread public debate concerning executive and director compensation policies and practices, and the increasing recognition that these issues raise significant policy issues, it is the Divisions view that proposals relating to senior executive compensation no longer can be considered matters relating to a registrants ordinary business.

There appears to be some basis for your view that the proposal may be excluded pursuant to Rule 14a-8(c)(1) as an improper subject for shareholder action under applicable state law. It appears that this defect could be cured, however, if the proposal is cast as a recommendation or request that the Board of Directors take the steps necessary to implement the proposal. Assuming the proponent provides the Company with a proposal revised in this manner, within seven calendar days upon receipt of this response, the staff does not believe that Rule 14a-8(c)(1) can be relied upon as a basis to omit the proposal from the Companys proxy materials.

Finally, the Division is unable to concur in your view that the proposal is misleading under Rule 14a-9 and therefore may be excludable under 14a-8(c)(3). Accordingly, the Company may not rely on Rule 14a-8(c)(3) as a basis for omitting the proposal from its proxy materials.

Sincerely,

William H. Carter
Special Counsel