HECLA MINING COMPANY KEY EMPLOYEE DEFERRED COMPENSATION PLAN

Page

ARTICLE I.

PURPOSE AND INTENT

1

Section 1.1.

Purpose of Plan

Section 1.2.

Intent and Construction

ARTICLE II.

DEFINITIONS

2

Section 2.1.

Definitions

Section 2.2.

Rules of Interpretation

ARTICLE III.

PARTICIPATING EMPLOYERS

8

Section 3.1.

Eligibility

Section 3.2.

Participation Requirements

Section 3.3.

Recordkeeping and Reporting

Section 3.4.

Termination of Participation

Section 3.5.

Separate Accounting

ARTICLE IV.

ELIGIBILITY AND PARTICIPATION

10

Section 4.1.

Eligibility

Section 4.2.

Participation

Section 4.3.

Suspension of Eligibility

ARTICLE V.

BENEFITS

10

Section 5.1.

Deferred Compensation

Section 5.2.

Deferral Elections

Section 5.3.

Matching Amounts

Section 5.4.

Discretionary Amounts

Section 5.5.

Stock Options

ARTICLE VI.

VALUATION OF BENEFITS

16

Section 6.1.

Investment Account

Section 6.2.

Company Stock Account

Section 6.3.

Discounted Stock Option

Page

ARTICLE VII.

VESTING OF ACCOUNTS

19

Section 7.1.

Vested Benefit

Section 7.2.

Nature of Accounts

ARTICLE VIII.

DISTRIBUTION AND EXERCISE OF OPTIONS

20

Section 8.1.

Distributable Events

Section 8.2.

Distribution of Benefits

Section 8.3.

Designation of Beneficiaries

Section 8.4.

Death Prior to Full Distribution

Section 8.5.

Facility of Payment

Section 8.6.

Form of Distribution

Section 8.7.

Lump Sum Distribution of Benefits

Section 8.8.

Application for Distribution

Section 8.9.

Limitation on Payment

Section 8.10.

Tax Withholding

ARTICLE IX.

NONTRANSFERABILITY AND VOTING RIGHTS

27

Section 9.1.

Anti-Alienation of Benefits

Section 9.2.

Voting of Company Stock With Respect to Accounts

Section 9.3.

Voting With Respect to Options

ARTICLE X.

ADMINISTRATION OF THE PLAN

28

Section 10.1.

Administrator

Section 10.2.

Authority of Administrator

Section 10.3.

Operation of Plan and Claims Procedures

Section 10.4.

Participant’s Address

Section 10.5.

Conflict of Interest

Section 10.6.

Service of Process

Section 10.7.

Errors in Computations

ARTICLE XI.

MISCELLANEOUS PROVISIONS

32

Section 11.1.

No Employment Rights

Section 11.2.

Participants Should Consult Advisors

Section 11.3.

Unfunded and Unsecured

Section 11.4.

Plan Provisions

Section 11.5.

Severability

Section 11.6.

Applicable Law

Section 11.7.

Stock Subject to Plan

ARTICLE XII.

AMENDMENT OF THE PLAN

33

Section 12.1.

Amendment of the Plan

33

Section 12.2.

Procedure for Amendment

33

Page

ARTICLE XIII.

TERMINATION OF PLAN

33

Section 13.1.

Termination of the Plan

33

Section 13.2.

Procedure for Amendment to Terminate the Plan

34

EXHIBIT A —

HECLA MINING COMPANY KEY EMPLOYEE DEFERRED COMPENSATION PLAN PARTICIPANTS

A-1

EXHIBIT B —

HECLA MINING COMPANY KEY EMPLOYEE DEFERRED COMPENSATION PLAN PARTICIPATING EMPLOYERS

B-1

(a)

Pursuant to the authority and power of Hecla Mining Company reserved to it in Section 14.1 of the plan document, Hecla Mining Company has amended the plan document, in the form of a restatement of the plan document, effective January 1, 2005, to: (i) freeze the plan in effect as of December 31, 2004, so that participation in that plan would be limited to existing participants, and any employees who are not participants in that plan as of December 31, 2004, would not be eligible to become participants in the plan, (ii) maintain accounts to which amounts of compensation were deferred and credited and the right to which was earned and vested (as defined in paragraph (a)(2) of section 1.409A-6 of the Treasury Regulations) as of December 31, 2004, (iii) permit no additional amounts to be credited to those accounts, other than to adjust such accounts based upon earnings and losses and (iv) require those amounts which are earned and vested as of December 31, 2004, and any earnings thereon to be governed by the terms and conditions of the plan document in effect as of December 31, 2004, and not to be subject to or governed by section 409A of the Code.

(b)

On April 10, 2007, the Department of the Treasury and the Internal Revenue Service issued final regulations with respect to the application of section 409A of the Internal Revenue Code, sections 1.409A-1 through 1.409A-6 of the Treasury Regulations. Consequently, Hecla Mining Company has adopted an amendment of the Hecla Mining Company Key Employee Deferred Compensation Plan to conform the plan document to those final regulations which are effective as of January 1, 2009.

(a)

Account or Accounts. “Account” or “Accounts” means the separate bookkeeping account or accounts established and maintained for a Participant representing separate unfunded and unsecured general obligations of the Company with respect to a Participant under the Plan and to which amounts shall be credited pursuant to the Plan. The Account or Accounts of a Participant shall consist of the Company Stock Account and the Investment Account.

(b)

Beneficiary. “Beneficiary” means the person, persons or trust designated by a Participant, or automatically by operation of the Plan, to receive any benefits which may become payable under the Plan by reason of the death of the Participant.

(c)

Board of Directors. “Board of Directors” means the Board of Directors of Hecla Mining Company.

(d)

Business Day. “Business Day” means a day on which the New York Stock Exchange is open for trading.

(e)

Change in Control. “Change in Control” means, for purposes of the interpretation of this Plan in conformance with section 409A of the Code and the applicable guidance issued by the Department of the Treasury and the Internal Revenue Service with respect to the application of section 409A, with respect to a Plan Participant, a Change in Control event must relate to: (i) the corporation for which the Participant is performing services at the time of the Change in Control event, (ii) the corporation that is liable for the payment of the deferred compensation (or all corporations liable for the payment if more than one corporation is liable), or (iii) a corporation that is a majority shareholder of a

corporation identified in part (i) or part (ii) above, or any corporation in a chain of corporations in which each corporation is a majority shareholder of another corporation in the chain, ending in a corporation identified in part (i) or part (ii) above. For purposes of this provision, a majority shareholder is a shareholder owning more than fifty percent (50%) of the total fair market value and total voting power of such corporation. Also, for purposes of this provision, section 318(a) of the Code applies to determine stock ownership. Additionally, for purposes of this provision and in conformance with section 409A and the applicable guidance issued by the Department of the Treasury and the Internal Revenue Service with respect to the application of section 409A, a change in the ownership of a corporation or a change in the effective control of a corporation shall be determined in accordance with the provisions described below in this definition.

(i)

A change in the ownership of a corporation shall occur on the date that any one person, or more than one person acting as a group, in one transaction or a series of transactions, directly or indirectly, acquires ownership of stock of the corporation that, together with stock held by such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock of the corporation. However, if any one person or more than one person acting as a group, is considered to own more than fifty percent (50%) of the total fair market value or total voting power of the stock of the corporation, the acquisition of additional stock by the same person or persons shall not be considered to cause a change in the ownership of the corporation (or to cause a change in the effective control of the corporation). An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction, in one transaction or a series of transactions, directly or indirectly, in which the corporation acquires its stock in exchange for property shall be treated as an acquisition of stock for purposes of this provision.

(ii)

For purposes of paragraph (i) above, persons will not be considered to be acting as a group solely because they purchase or own stock of the same corporation at the same time, or as a result of the same public offering. However, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the corporation. If a person, including an entity, owns stock in both corporations that enter into a merger, consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is considered to be acting as a group with other shareholders in a corporation prior to the transaction giving rise to the change and not with respect to the ownership interest in the other corporation.

(iii)

A change in the effective control of a corporation shall occur on the date that either:

(A)

any one person, or more than one person acting as a group, in one transaction or a series of transactions, directly or indirectly, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the corporation possessing thirty-five percent (35%) or more of the total voting power of the stock of the corporation; or

(B)

a majority of members of the board of directors of the corporation is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the board of directors of the corporation prior to the date of the appointment or election, provided that for purposes of this subparagraph (B) the term “corporation” shall be determined in accordance with the requirements of section 409A of the Code and the applicable guidance issued by the Department of the Treasury with respect to the application of section.

(iv)

A change in the ownership of a substantial portion of the assets of a corporation shall occur on the date that any one person, or more than one person acting as a group acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the corporation that have a total gross fair market value equal to or more than forty percent (40%) of the total gross fair market value of all of the assets of the corporation immediately prior to such acquisition or acquisitions. For this purpose, gross fair market value means the value of the assets of the corporation, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

(v)

The provisions of this subsection (e) regarding the definition of the term “Change in Control,” shall be determined and administered in accordance with section 409A and section 1.409A-3(i)(5) of the Treasury Regulations.

(f)

Code. “Code” means the Internal Revenue Code of 1986, any amendments thereto, and any regulations or rulings issued thereunder.

(g)

Common Stock. “Common Stock” means the common stock, par value $0.25 per share, of Hecla Mining Company as such stock may be classified, reclassified, converted or exchanged by reorganization, merger or otherwise.

(h)

Company. “Company” means the Hecla Mining Company, a Delaware corporation.

(i)

Company Stock Account. “Company Stock Account” means the Account established and maintained for a Participant as a record of deferred amounts of Eligible Compensation and Performance-Based Compensation credited to the Account pursuant to Sections 5.1 and 5.2, matching amounts credited to the Account pursuant to Section 5.3, discretionary amounts credited to the Account

pursuant to Section 5.4, and the positive value of exercise proceeds credited to the Account pursuant to Section 5.5, which shall be denominated in units and measured by the value of Company Common Stock; the Account shall be maintained for bookkeeping purposes only.

(j)

Compensation Committee. “Compensation Committee” means the Compensation Committee of the Board of Directors or such other committee of directors as may be designated by the Board of Directors to administer the Plan. The committee administering the Plan shall be composed solely of two or more non-employee directors, as defined in Rule 16b-3 under the Securities Exchange Act of 1934, as amended. Notwithstanding anything to the contrary contained herein, the Board of Directors may, at any time and from time to time, without any further action of the Compensation Committee, exercise the powers and duties of the Compensation Committee under the Plan.

(k)

Deferral Election Form. “Deferral Election Form” means the form approved by the Compensation Committee from time to time for use by a Participant to elect to defer compensation under the Plan.

(l)

Disability . “Disability” means, with respect to a Participant, the Participant is: (i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company; or (iii) determined to be totally disabled by the Social Security Administration. This definition shall be interpreted and construed in a manner consistent with section 1.409A-3(i)(4) of the Treasury Regulations.

(m)

Discretionary Amount. “Discretionary Amount” means an amount denominated in units that are measured by the value of Company Common Stock credited to the Account of a Participant pursuant to the Plan.

(n)

Distributable Event. “Distributable Event” means an event identified as such in Section 8.1 of the Plan.

(o)

Eligible Compensation. “Eligible Compensation” means, with respect to a Participant, remuneration for services performed during a taxable year as defined herein and as determined for purposes of the interpretation of the Plan:

(i)

except as provided herein and in the succeeding paragraphs of this subsection, Eligible Compensation means wages within the meaning of section 3401(a) of the Code (for purposes of income tax withholding) but determined without regard to any rules that limit the remuneration

included in wages based on the nature or location of the employment or the services performed or the limitations imposed on tax-qualified plans described in section 401(a) of the Code, and shall include any elective deferral as defined in section 402(g)(3) of the Code and any amount which is contributed or deferred by a Participating Employer at the election of the Participant by reason of section 125 of the Code, section 134(f) of the Code, section 403(b) of the Code, or section 457 of the Code;

(ii)

Eligible Compensation shall be further determined in accordance with the following rules and requirements:

(A)

Eligible Compensation shall be determined by including bonuses (other than vacation bonuses), sick pay and short-term disability benefits;

(B)

Eligible Compensation shall not include: any remuneration not paid in cash; the value of life insurance coverage included in the Participant’s wages under section 79 of the Code; any car allowance or moving expense or mileage reimbursement; severance pay; amounts deferred under any plan of deferred compensation except this Plan; any benefit under any qualified or nonqualified stock option or stock purchase plan or deferred compensation plan; expatriate premiums; amounts realized upon the exercise of a nonqualified stock option, the lapse of restrictions applicable to restricted stock, or any disposition of stock acquired under a qualified or incentive stock option; or any compensation in the form of Performance-Based Compensation.

(p)

ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, any amendments thereto, and any regulations or rulings issued thereunder.

(q)

Investment Account. “Investment Account” means the Account established and maintained for a Participant as a record of any deferred amounts that may be credited to the account of the Participant pursuant to the Plan and measured in dollars pursuant to the provisions of the Plan. The Account shall be maintained for bookkeeping purposes only.

(r)

Participant. “Participant” means an individual who has satisfied the eligibility and participation requirements of Article IV of the Plan and is determined to be a Participant pursuant to and in accordance with Article IV of the Plan, which individual shall be identified as a Participant on Exhibit A attached hereto and made a part hereof by reference.

(s)

Participating Employer. “Participating Employer” means an employer that has satisfied the eligibility and participation requirements of Article III of the Plan and is determined to be a Participating Employer pursuant to and in accordance with Article III of the Plan, which Participating Employer shall be identified as a

Participating Employer on Exhibit B attached hereto and made a part hereof by reference.

(t)

Performance-Based Compensation. “Performance-Based Compensation” means compensation where the amount of, or entitlement to, the compensation is contingent on the satisfaction of preestablished organizational or individual performance criteria relating to a performance period of at least twelve (12) consecutive months in which the Participant performs services. Organizational or individual performance criteria are considered preestablished if established in writing by not later than ninety (90) days after the commencement of the period of service to which the criteria relates, provided that the outcome is substantially uncertain at the time the criteria are established (Performance-Based Compensation may include payments based on performance criteria that are not approved by the Compensation Committee of the Board of Directors or by stockholders of the Company). This definition shall be interpreted and construed in a manner consistent with section 1.409A-1(e) of the Treasury Regulations.

(u)

Plan. “Plan” means the “HECLA MINING COMPANY KEY EMPLOYEE DEFERRED COMPENSATION PLAN,” as amended and restated effective as of January 1, 2005, and as approved and adopted by the Board of Directors and the stockholders of the Company, which is unfunded and maintained by Hecla Mining Company and certain of its affiliated companies primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees of Hecla Mining Company or another Participating Employer.

(v)

Unforeseeable Emergency. “Unforeseeable Emergency” means a severe financial hardship to the service provider resulting from an illness or accident of the service provider, the spouse of the service provider, or of a dependent (as defined in section 152 of the Code without regard to section 152(b)(1), (b)(2), and (d)(1)(B)) of the service provider; loss of the service provider’s property due to casualty; or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the service provider; whether a service provider is faced with an Unforeseeable Emergency permitting a distribution under the Plan shall be determined based on the relevant facts and circumstances of each case, but, in any case, a distribution shall not be allowed to the extent that such emergency is or may be relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the service provider’s assets, to the extent the liquidation of such assets would not cause a severe financial hardship or by cessation of deferrals under the Plan. The amount of a distribution on account of an Unforeseeable Emergency shall be limited to the amount reasonably necessary to satisfy the emergency need, plus amounts necessary to pay any federal, state or local income taxes or penalties reasonably anticipated to result from the distribution. This definition shall be interpreted and construed in a manner consistent with section 1.409A-3(i)(3) of the Treasury Regulations.

(w)

Vested. “Vested” means, for purposes of determining the benefit that may be payable to or on behalf of a Participant under the Plan, an interest in the benefit described under the Plan which may be payable to or on behalf of the Participant in accordance with and subject to the terms of the Plan.

(a)

The General Rule. Except as otherwise provided in this Section 5.2, Eligible Compensation for services performed by a Participant during a calendar year may be deferred at the election of the Participant only if the election to defer such Eligible Compensation is made and becomes irrevocable not later than the last day of the calendar year immediately preceding the calendar year during which services are to be performed.

(b)

Performance-Based Compensation. In the case of Performance-Based Compensation based upon a performance period of at least twelve (12) months, provided that the Participant performs services continuously from a date no later than the date upon which the performance criteria are established through a date no earlier than the date upon which the Participant makes an initial deferral election, an initial deferral election may be made with respect to the Performance-Based Compensation no later than the date that is six (6) months before the end of the performance period, provided that in no event may an election to defer Performance-Based Compensation be made after such compensation has become both substantially certain to be paid and readily ascertainable. For purposes of this provision, the performance criteria shall be established in writing no later than ninety (90) days after the commencement of the performance period.

(c)

First Year of Eligibility. The rule to apply with respect to the first year of eligibility: in the case of the first Plan Year in which an employee becomes eligible to participate in the Plan, with the determination of eligibility made under Article IV of the Plan based upon the date on which the information relevant to the employee is properly recorded on the administrative records or files of the recordkeeper, the employee may make an initial deferral election regarding

Eligible Compensation within thirty (30) days after the date the employee becomes eligible to participate in the Plan, with respect to Eligible Compensation payable for services to be performed subsequent to the election. In the case of Performance-Based Compensation, in accordance with section 1.409A-2(a)(8) of the Treasury Regulations, an initial deferral election may be made with respect to such Performance-Based Compensation on or before the date that is six (6) months before the end of the performance period, provided that the employee performs services continuously from the later of the beginning of the performance period or the date the performance criteria are established through the date an election is made under the Plan and section 1.409A-2(a)(8) of the Treasury Regulations, and provided further that in no event may an election to defer Performance-Based Compensation be made after such compensation has become readily ascertainable.

(a)

The liability of a benefit payable under this Section 5.4 of the Plan with respect to the whole units credited to the Company Stock Account shall be satisfied in shares of Company Common Stock and partial units shall be satisfied in cash.

(b)

A Participant may elect to defer the value of a discretionary amount credited to the Company Stock Account of the Participant under this Section 5.4; however, an election by a Participant to defer the value of any such amount, treated as restricted stock units credited under this Section 5.4, must be made within thirty (30) days after any restricted stock units have been made available to the Participant in the calendar year immediately preceding the calendar year in which such restricted stock units vest and become payable under the stated terms of such restricted stock units. If an election to defer the value of a restricted stock units is made by a Participant and the employment of a Participant terminates prior to the date on which such restricted stock units vest and the stated restrictions lapse, the restricted stock units made available with respect to the Participant and deferred under the Plan are forfeited.

(c)

An election to defer the value of any restricted stock units must state a specified date in the future for the distribution of the value of such restricted stock units, which shall be the distribution date that shall apply unless an earlier distribution event occurs under Section 8.1 of the Plan and such earlier distribution event shall supersede the stated distribution date selected by the Participant under this Section 5.4.