Employment Agreement
This
Agreement is made effective on the 15th day of October, 2005,
between Coeur d’ Alene Mines Corporation
(“Company”), and James Duff
(“Employee”).
WITNESSETH:
In
consideration of the mutual promises and covenants herein contained
to be kept and performed by the parties hereto, the parties agree
as follows:
1.
Employment . The Company agrees to, and hereby does, employ
Employee as the President, South America Operations, and Employee
accepts such employment, on the terms and conditions of this
Agreement.
2.
Term Of Employment . The initial term of this Agreement
shall be from October 15, 2005 through June 30, 2007, unless sooner
terminated as herein provided. It is further agreed that this
Agreement may be considered for a one year extension during the
month of June, 2006, to the end that the parties will then be bound
to a new two year term of this Agreement, ending June 30, 2008. It
is understood, however, that termination can occur in accordance
with the provisions of paragraph 7 below, notwithstanding anything
to the contrary in this paragraph 2.
3.
Compensation . The Company shall pay to Employee during the
duration of the term of this Agreement as follows:
(a)
A base salary of $200,000 and a foreign service premium of 30% to
result in total base salary of $260,000 annually, payable in equal
monthly installments, which may be reviewed annually during any
Agreement year, but which may not be decreased, and any higher
salary to become the base salary for the purposes of this
provision, it being understood, however, that failure to increase
the salary shall not be grounds for termination of this
Agreement;
(b)
A stock grant by October 30, 2005 in the amount of 41,666 shares
pursuant to the Coeur d’ Alene Mines Corporation’s 2003
Long Term Incentive Plan, with vesting to occur in full on March
11, 2006. Shares granted shall be priced as of the date of Grant,
using the closing price on the preceding trading day.
(c)
Such other compensation and benefits that may be made available by
the Company in the discretion of the Board of Directors, consisting
of bonuses, short-term and long-term incentive plans, pension plan,
retirement plan, profit sharing plan, stock purchase plan and any
other kind or type of incentive programs approved by the Board. It
is understood that Employee shall be a participant in all
compensation and benefit programs, both pension and welfare benefit
plans, which exist for the executive staff of the Company;
and
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(d)
Employee shall be entitled to earn an annual incentive bonus during
each calendar or partial year of this Agreement payable in cash
pursuant to the Company’s Annual Incentive Plan (AIP) equal
to no less than 40% of Employee’s then current annual salary,
plus an additional 30% of annual salary for foreign premium, which,
at the date of this Agreement, is the potential sum of $104,000 and
a maximum of $208,000. In addition, Employee shall be entitled to
earn a long-term incentive bonus, payable in cash and/or stock,
stock options or other compensation under the Company’s Long
Term Incentive Plan (LTIP) with a target level of 75%, plus 30% for
foreign premium, or a potential $195,000. Such bonuses are at the
discretion of the board of directors; and
(e)
Employee will be eligible for a company paid vehicle in Bolivia;
and
(f)
Employee will be eligible for an expatriate housing allowance to be
paid by the Company, consistent with current Company policies as
modified from time to time, commencing upon reporting to the
foreign location; and
(g)
Payments will be made to Employee to assure that he will not pay
more as a foreign company employee in income taxes than he would
have paid as a U.S. employee; and
(h)
Upon termination of this Agreement for any reason, Company will pay
for repatriation.
4.
Duties . Employee, during the term of this Agreement, shall
perform the duties usually and customarily associated with the
office specified in paragraph (1) above and as assigned to Employee
from time-to-time by the Coeur d’Alene Mines Corporation
Chairman, President and Chief Executive Officer and as further
specified in Employee’s job description as may be modified
from time-to-time. As a part of Employee’s duties it is
agreed that Employee will become familiar with and comply with
Employee’s duties under the Sarbanes-Oxley laws and under the
Company’s corporate governance policies, and Employee will
promptly execute the necessary public filings and certify the
contents of such documents on the date of their filing.
Employee
shall devote Employee’s best efforts and substantially all of
Employee’s time during business hours to advance the
interests of the Company. Employee shall not engage in business
activity in competition with the Company. Notwithstanding the
above, Company recognizes that Employee may remain associated, in a
non-managerial role, with two publicly traded, junior mining
company’s, specifically Little Squaw Gold Mining Company and
American International Ventures. Employee’s continued
affiliation shall not be a violation of this Agreement, however,
should Employee’s role change with regard to his affiliation
with the above named entities, Employee shall notify Company of the
change in status.
5.
Vacation . Employee shall be entitled to four (4) weeks of
vacation during each contract year of this Agreement commencing
with the year 2005-2006, during which the compensation provided in
this Agreement shall be paid in full. Employee shall be entitled to
take accrued vacation time as it accrues during the course of any
given year. Employee must normally use all vacation accrued in one
employment year during the following employment year. Employee may
not carry forward more than two weeks of vacation from any given
employment year to the following employment year.
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6.
Disability . In the event Employee becomes disabled
(inability or incapacity due to physical or mental illness or
injury to perform Employee’s duties) during the term of this
Agreement, which renders Employee unable to perform
Employee’s duties, Employee shall be entitled to participate
in the Company’s disability payment plan in effect at the
time of the disability.
7.
Termination Of Employment . This Agreement shall be
terminated as follows:
(a)
In accordance with paragraph 2 above upon the expiration of the
term of this Agreement or any extension thereof;
(b)
Upon the death of Employee;
(c)
By mutual agreement of the parties;
(d)
Upon disability of Employee, when such disability renders Employee
unable to perform Employee’s duties for more than 90
continuous days;
(e)
By the Company without giving any reason for termination, but with
the understanding that the compensation provided herein, except for
participation in the 401K & Defined Contribution Plan; and the
life insurance, accidental death and dismemberment and disability
insurance benefits (the “Excluded Benefits”), but
including the base compensation, vehicle allowance, target annual
incentive bonus and the long term incentive bonus if Employee is so
entitled (it being understood, however, as to the incentive plans
the Plan documents control the Employee’s rights)
(“Included Benefits”), shall be paid or provided in
full to Employee in accordance with this Agreement, for the period
of the remaining duration of this Agreement. It is agreed that the
Company may set-off against the compensation and Included Benefits
due to Employee under this subparagraph any items of like
compensation which Employee receives from other employment after
the date of termination, there being no affirmative obligation for
Employee to obtain other employment following
termination;
(f)
By the Company “ For Cause ”. For purposes of
this Agreement, any of the following constitutes For Cause
termination:
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(i)
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failure to
perform Employee’s duties, as defined below, after having
received from the Company written documentation that
Employee’s duties are not being performed, which written
documentation shall specify how performance is deficient, and
Employee then fails to resume satisfactory performance promptly
after receipt of such documentation and failure of performance is
not satisfactorily rectified, or
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(ii)
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a serious and
substantial failure to perform Employee’s duties, which
failure is so obvious and so harmful to Company that written
documentation and an opportunity to rectify conduct need not be
afforded by Company to Employee, or
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(iii)
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a conviction
of, or plea of nolo contendere to, a felony, or engagement
in illegal conduct which may not constitute a felony but which is
injurious to the Company, in either such case Company need not
allow Employee to rectify nonperformance, or
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(iv)
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a material
breach of Employee’s obligations under the
“Confidentiality Agreement’ as described in section 8
herein.
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For
purposes of this provision, Failure To Perform duties in section
(f)(i) above includes, but is not limited to; misfeasance or
nonfeasance of duty which was intended to, or does in fact, injure
the Company’s reputation or its business or relationships;
willful and continued failure of Employee to substantially perform
his duties under this Agreement (except by reason of physical or
mental disability, which is dealt with in paragraph 7(d) above);
personal dishonesty in the performance of Employee’s duties;
and/or material breach by Employee of the covenants contained in
paragraph 4 above;
(g)
Upon change in control of Company, as “ Change in
Control ” is defined in the so-called Change in Control
Agreement between Company and Employee, a copy of which is attached
hereto as Attachment A, and which will be executed by the parties
hereto when this Agreement is executed by them. In the event of
termination for this reason, Employee’s and Company’s
rights with respect to compensation and all other matters related
to employment shall be as specified in the Change in Control
agreement, and not this Agreement; and
(h)
Upon the insolvency or dissolution of the Company; and
(i)
By Employee for “ Good Reason” . For purposes of
this Agreement, Good Reason is defined to mean any of the
following;
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(i)
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a material
reduction in Employee’s responsibilities, authorities or
duties compared to those in existence on the effective date of this
Agreement which is evidence of the duties contemplated by paragraph
4; or
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(ii)
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failure of the
Company to pay to Employee any amount otherwise vested and due
under this Agreement or under any plan or policy of the
Company,
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which failure
in either (i) or (ii) above is not cured within five days from
receipt by the Company of written notice from Employee which
specifies the details of the failure.
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In the event of termination of
this Agreement for any of the reasons specified above other than
item (e) regarding termination by the Company without giving any
reason, Employee shall be entitled to be paid his base salary
prorated for the calendar year to the date of termination. All
other benefits, if any, following such termination shall be paid in
accordance with the plans, policies and practices of the Company
which are in effect on the date of termination. As to termination
in accordance with item (e) above, Employee shall be paid in
accordance with that subparagraph.
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8.
Confidentiality . Employee agrees to keep information
acquired in connection with Employee’s employment
confidential, in accordance with the Confidentiality Agreement
which is attached to this Agreement, marked Attachment B, to be
executed by Employee when this Agreement is executed. With respect
to confidentiality, Attachment B controls the rights, duties and
obligations of the parties, rather than this paragraph
8.
9.
Specific Performance . Employee understands that the
obligations undertaken by Employee as set forth in this Agreement
are unique, and that Company will likely have no adequate remedy at
law in the event such obligations are breached. Employee therefore
confirms that Company has the right to seek specific performance if
Company feels such remedy is essential to protect the rights of
Company. Accordingly, in addition to any other remedies which
Company might have in law or equity, it shall have the right to
have all obligations specifically performed, and to obtain
in
