<PAGE> 1
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Coeur D'Alene Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------------------------------------------
(2) Form, schedule or registration statement no.:
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(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
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<PAGE> 2
COEUR D'ALENE CORPORATION
400 COEUR D'ALENE MINES BUILDING
POST OFFICE BOX I
505 FRONT AVENUE
COEUR D'ALENE, IDAHO 83814
April 1, 1998
Dear Shareholder:
We are pleased to invite you to attend our Annual Meeting. This year it
will be held the morning of Tuesday, May 12, 1998, at 9:30 A.M., local time, at
The Coeur d'Alene Resort and Conference Center, Second Street and Front Avenue,
Coeur d'Alene, Idaho. The primary business of the meeting will be to elect
directors and ratify the selection of independent accountants.
A Notice of the Annual Meeting and the Proxy Statement follow. You will
also find enclosed a proxy card. We invite you to attend the meeting in person,
but if this is not feasible, we think it wise for you to be represented by
proxy. Therefore, if you cannot attend the meeting, we urge you to sign the
enclosed proxy card and mail it promptly in the return-addressed, permit-stamped
envelope which we have provided for your convenience.
Sincerely,
/s/ DENNIS E. WHEELER
Dennis E. Wheeler
Chairman of the Board,
President and Chief Executive
Officer
<PAGE> 3
COEUR D'ALENE MINES CORPORATION
400 COEUR D'ALENE MINES BUILDING
505 FRONT AVENUE
POST OFFICE BOX I
COEUR D'ALENE, IDAHO 83814
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
Dear Shareholder:
Notice is hereby given that the Annual Meeting of Shareholders of Coeur
d'Alene Mines Corporation (the "Company"), an Idaho corporation, will be held at
The Coeur d'Alene Resort and Conference Center, Second Street and Front Avenue,
Coeur d'Alene, Idaho, on Tuesday, May 12, 1998, at 9:30 A.M., local time, for
the following purposes:
1. To elect a Board of Directors of the Company consisting of seven
persons to serve for the ensuing year or until their respective successors
are duly elected and qualified;
2. To ratify the selection of Ernst & Young LLP as public accountants
for the Company for the current fiscal year; and
3. To transact such other business as properly may come before the
meeting.
Nominees for directors are set forth in the enclosed Proxy Statement.
Only shareholders of record at the close of business on March 24, 1998, the
record date fixed by the Board of Directors, are entitled to notice of, and to
vote at, the Annual Meeting.
By order of the Board of Directors,
/s/ DENNIS E. WHEELER
Coeur d'Alene, Idaho Dennis E. Wheeler
April 1, 1998 Chairman of the Board
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT
Please date, sign and promptly return the enclosed proxy so that your
shares may be voted in accordance with your wishes.
Mail the proxy in the enclosed envelope, which requires no postage if
mailed in the United States.
The giving of the proxy does not affect your right to vote in person should
you attend the meeting.
- --------------------------------------------------------------------------------
<PAGE> 4
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the solicitation, by
the Board of Directors of Coeur d'Alene Mines Corporation (the "Company"), of
proxies of shareholders to be voted at the Annual Meeting of Shareholders to be
held on May 12, 1998, and any and all adjournments thereof.
Any shareholder executing a proxy retains the right to revoke it at any
time prior to its being exercised by giving notice to the Secretary of the
Company.
This Proxy Statement and the accompanying proxy are being mailed or given
on or about April 1, 1998, to shareholders of the Company.
VOTING SECURITIES
All shareholders of record as of the close of business on March 24, 1998,
are entitled to vote at the Annual Meeting or any adjournment thereof upon the
matters listed in the Notice of Annual Meeting. Each shareholder is entitled to
one vote for each share held of record on that date, except that shareholders
have cumulative voting rights in the election of directors. As of the close of
business on March 24, 1998, a total of 21,898,624 shares of common stock, $1 par
value per share (the "Common Stock"), and 7,077,833 shares of Mandatory
Adjustable Redeemable Convertible Securities, $1 par value per share (the
"MARCS"), were issued and outstanding.
Under cumulative voting for directors, the number of votes a shareholder
may cast is the number of shares held, multiplied by the number of directors
being elected. Those votes may be cast however desired. For example, if you own
100 shares and seven directors are being elected, you have 700 votes which you
may either cast for one candidate or distribute among the candidates, as you
desire.
Shares represented by a proxy will be voted according to the instructions,
if any, given in the proxy. Unless otherwise instructed, the person or persons
named in the proxy will vote (1) FOR the election of the seven nominees for
directors listed herein (or their substitutes in the event any of the nominees
is unavailable for election) or, in their discretion, they may vote cumulatively
for all or a lesser number of such nominees in order to elect the maximum number
of Management's nominees; (2) FOR the ratification of the selection of Ernst &
Young as the Company's independent public accountants; and (3) in their
discretion with respect to such other business as properly may come before the
meeting.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the inspectors of election appointed by the Company for the meeting. The number
of shares represented at the meeting in person or by proxy will determine
whether or not a quorum is present. The inspectors of election will treat
abstentions as shares that are present and entitled to vote for purposes of
determining the presence of a quorum but as unvoted for purposes of determining
the approval of any matter submitted to the shareholders for a vote. If a broker
indicates on the proxy that it does not have discretionary authority as to
certain shares to vote on a particular matter, those shares will not be
considered as present and entitled to vote by the inspectors of election with
respect to that matter.
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<PAGE> 5
The cost of soliciting proxies will be borne by the Company. Proxies may be
solicited by directors, officers or regular employees of the Company in person
or by telephone or telegram. The Company has retained Morrow & Company, Inc.,
New York, New York, to assist it in the solicitation of proxies. That firm's
charge to the Company will be $7,500 plus out-of-pocket expenses.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Seven directors are to be elected at the Annual Meeting, each to serve for
one year or until his successor is elected and qualified. All of the following
seven nominees currently are members of the Board except John H. Robinson, who
is being nominated to fill the vacancy created by the withdrawal of Jeffery T.
Grade, who chose not to stand for reelection to the Board. James A. Sabala, who
resigned as Senior Vice President and Chief Financial Officer of the Company
effective March 31, 1998, will not stand for reelection to the Board. Proxies
will be voted at the Annual Meeting, unless authority is withheld, FOR the
election of the seven persons named below, or in the sole discretion of the
persons named in the accompanying proxy, for a lesser number of such nominees in
order to elect the maximum number of Management's nominees. The Company does not
contemplate that any of the persons named below will be unable, or will decline,
to serve; however, if any such nominee is unable or declines to serve, the
persons named in the accompanying proxy will vote for a substitute, or
substitutes, in their discretion.
<TABLE>
<CAPTION>
DIRECTOR
NOMINEE AGE SINCE
------- --- --------
<S> <C> <C>
Dennis E. Wheeler........................................... 55 1978
Chairman of the Board of the Company since May 1992;
President since December 1980; Chief Executive Officer
since December 1986; Chief Administrative Officer from
December 1980 to December 1986; Secretary from January
1980 to December 1980; Senior Vice President and General
Counsel from 1978 to 1980. Chairman of the Board and a
director of Sierra Pacific Resources (a public utility
holding company).
Joseph C. Bennett........................................... 65 1981
Mining Consultant. Director of Equity Oil Company.
Duane B. Hagadone........................................... 65 1987
Chairman of the Board of The Hagadone Corporation, a
company engaged in the newspaper and communications
businesses, since 1966; Chairman of the Board of Hagadone
Hospitality Co., which is engaged in the hotel and
restaurant businesses, since 1983. Director of Washington
Water Power Company.
James J. Curran............................................. 58 1989
Former Chairman of the Board and Chief Executive Officer,
First Interstate Bank, Northwest Region (Alaska, Idaho,
Montana, Oregon and Washington) from October 1991 to April
30, 1996; Chairman of the Board and Chief Executive
Officer, First Interstate Bank of Oregon, N.A. from
February 1991 to October 1991; Chairman, President and
Chief Executive Officer of First Interstate Bank of
Denver, N.A., from April 1990 to January 1991; Chairman,
President and Chief Executive Officer of First Interstate
Bank of Idaho, N.A., from July 1984 to March 1990.
Director of Fred Meyer, Inc. (regional general merchandise
retailer).
</TABLE>
2
<PAGE> 6
<TABLE>
<CAPTION>
DIRECTOR
NOMINEE AGE SINCE
------- --- --------
<S> <C> <C>
James A. McClure............................................ 73 1991
Attorney with the Boise, Idaho law firm of Givens, Pursley
& Huntley; Consultant to the Washington, D.C. firm of
McClure, Gerard & Neuenschwander, Inc.; United States
Senator from Idaho from 1972 to 1990; former Chairman of
the Senate Energy and Natural Resources Committee.
Director of Boise Cascade Corporation (natural resources
company) and The Williams Companies (petroleum and
telecommunications company).
Cecil D. Andrus............................................. 66 1995
Governor of Idaho (1971-1977); Secretary of the Department
of the Interior (1977-1981); Governor of Idaho
(1987-1995). Director of Albertson's Inc. (a nation-wide
grocery retail chain) and Key Corp. (commercial banking).
Chairman of the Andrus Center for Public Policy at Boise
State University; "of counsel" member of the Gallatin
Group (a policy consulting firm).
John H. Robinson............................................ 48 --
Managing Partner and Chief Development Officer of Black &
Veatch, an international engineering and construction firm
since 1996; Chairman of Black and Veatch U.K., Ltd and
President of Black & Veatch International since 1994;
employed by Black & Veatch since 1972; director of The
Pritchard Corporation
</TABLE>
MANAGEMENT RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF THE ABOVE NOMINEES AS
DIRECTORS OF THE COMPANY.
The Board of Directors of the Company met eight times during 1997. The
Company has an Audit Committee, consisting of Messrs. Curran, Grade and McClure,
which met three times during 1997. The Board also has a Compensation Committee,
comprised solely of outside directors and consisting of Messrs. Andrus, Bennett,
Grade and Hagadone, which met two times during 1997. Each director attended all
of the meetings of the Board of Directors and committees on which he served
except Messrs. Andrus, Bennett, Curran and McClure, who were each absent from
one meeting of the Board of Directors, and Mr. Hagadone, who was absent from two
meetings. The Company also has an Executive Committee of its Board on which
Messrs. Bennett, Curran, Hagadone and Wheeler currently serve and which is
authorized to act in the place of the Board of Directors on limited matters
which require action between Board meetings. The Board of Directors does not
have a nominating committee.
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<PAGE> 7
SHARE OWNERSHIP
The following table sets forth information, as of March 24, 1998,
concerning the beneficial ownership of the Company's Common Stock by
shareholders known by the Company to be the beneficial owner of more than 5% of
the Company's outstanding shares of Common Stock or MARCS, by each of the
nominees for election as directors, and by all directors/nominees and executive
officers of the Company as a group:
<TABLE>
<CAPTION>
COMMON STOCK MARCS
--------------------------------- -------------------------- PERCENT OF
SHARES SHARES TOTAL
BENEFICIALLY PERCENT OF BENEFICIALLY PERCENT OF VOTING
OWNED OUTSTANDING OWNED OUTSTANDING POWER
------------ ----------- ------------ ----------- ----------
<S> <C> <C> <C> <C> <C>
Franklin Resources, Inc.(1)....... 1,655,010 7.56% -- -- 5.71%
Federated Investors(2)............ 3,500 * 1,085,000 15.33 3.76
Mackenzie Financial
Corporation(3).................. 1,130,000 5.16 -- -- 3.90
Brookhaven Capital Management Co.
Ltd. ........................... 1,152,100 5.26 -- -- 3.98
Dennis E. Wheeler................. 157,573(5)(6) .72 -- -- .54
Joseph C. Bennett................. 4,795(5)(6) .02 -- -- *
Duane B. Hagadone................. 18,041(5)(6) * -- -- *
James J. Curran................... 15,073(5)(6) * -- -- *
James A. McClure.................. 2,145(5)(6) * -- -- *
Jeffrey T. Grade.................. 1,895(6) * -- -- *
Cecil D. Andrus................... 1,898(6) * -- -- *
John H. Robinson.................. 100 -- -- -- --
All officers and nominees for
director as a group (16
persons)........................ 300,241(4)(5) 1.37 -- -- 1.04
</TABLE>
- ---------------
(*) Holding constitutes less than .10% of the outstanding shares.
(1) Franklin Resources, Inc. is an investment advisory firm that serves as
investment advisor to several investment companies that own the
above-reported shares. Its address is 777 Mariners Island Blvd., P.O. Box
7777, San Mateo, CA 94403-7777. Of the above shares of Common Stock, 735,000
shares may be acquired upon the conversion of the MARCS and 1,047,900 shares
may be acquired upon the conversion of the Company's 6% Convertible
Subordinated Debentures Due 2002 and 6 3/8% Convertible Subordinated
Debentures Due 2004.
(2) Federated Investors is an investment advisory firm that serves as investment
advisor to several investment companies that own the above-reported shares.
Its address is 1001 Lebery Avenue, Pittsburgh, PA 15222-3779.
(3) Mackenzie Financial Corporation is an investment advisory firm. Its address
is 150 Bloor Street West, Suite M111, Toronto, Canada M55 385.
(4) Brookhaven Capital Management Co. Ltd. is an investment advisory firm. Its
address is 3000 Sandhill Road, Menlo Park, California 94025.
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<PAGE> 8
(5) Individual shares investment and voting powers over certain of his shares
with his wife. The other directors have sole investment and voting power
over their shares.
(6) Holding includes the following shares which may be acquired upon the
exercise of exercisable options outstanding under the Company's 1989
Long-Term Incentive Plan or its 1995 Non-Employee Directors' Stock Option
Plan: Dennis E. Wheeler -- 108,702 shares; Joseph C. Bennett -- 1,795
shares; Duane B. Hagadone -- 17,941 shares; James J. Curran -- 14,973
shares; James A. McClure -- 1,795 shares; Jeffery T. Grade -- 1,795 shares;
Cecil D. Andrus -- 1,798 shares; and all officers and directors as a
group -- 222,422 shares.
COMPENSATION AND RELATED MATTERS
HISTORY AND OBJECTIVES OF THE COMPANY'S EXECUTIVE COMPENSATION PROGRAM
The Company's Executive Compensation Program (the "Program") was approved
by the shareholders in 1989. Hewitt Associates, a leading, independent executive
compensation consulting firm has rendered advice since the original plan was
approved by shareholders on the structure of an executive compensation program
which provides incentives to executive officers to meet short-term and long-term
objectives and attract, retain and motivate key executives that significantly
affect Company performance. During 1995, the Program was reviewed by Towers
Perrins, an independent executive compensation firm, and Hewitt Associates. As a
result, the Compensation Committee revised the Program to remain competitive
with mining industry peer companies and to align even further the financial
incentives of management with the shareholders' interests, the Program was
revised. The Company believes the Program is structured to motivate the key
executives to best serve the shareholders by conducting business in a manner
that enhances shareholder value.
COMPENSATION COMMITTEE
The Company has a Compensation Committee composed entirely of outside
directors. The Committee works with the independent consultants and with the
Chief Executive Officer to assure that the Program meets the objectives set
forth above, and is consistent with other plans in the mining industry. In
addition, the Compensation Committee meets annually to set executive
compensation for the year, to review recommendations of the independent
consultant and to recommend compensation to the Board of Directors. The
selection of officers receiving grants of stock options and awards of stock
under the Program, and decisions concerning the timing, pricing and amount of
such grants and awards, are made by the Compensation Committee. The Board makes
the final decision regarding all other elements of executive compensation,
including executives salaries.
ELEMENTS OF THE PROGRAM
The Program consists of three basic elements: 1) base salary, 2) annual
incentive compensation, and 3) long-term incentive compensation. The Program is
performance based. For the year 1997, 75% of each executive's annual incentive
compensation was determined by the Company's overall performance relative to
predetermined goals established by the Board of Directors, and the remaining 25%
was determined by the executive's performance relative to his predetermined
goals. Goals of the Chief Executive Officer are set and
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<PAGE> 9
reviewed by the Compensation Committee which makes recommendations to the Board
of Directors. Goals of other executives are set by the Chief Executive Officer,
reviewed by the Compensation Committee and approved by the Board of Directors.
Fifty percent of each executive's long-term incentive compensation is based upon
the Company's total return to shareholders compared to a mining industry peer
group and the remaining 50% consists of stock options which align the
executive's compensation with shareholder interests.
COMPENSATION PROGRAM SUMMARY
Under the Program, base salary and annual incentives are targeted at
approximately the 50th percentile of that reported for other companies in the
industry on a size-adjusted basis. The total compensation opportunity (including
long-term incentives) is targeted at the 75th percentile, based on stated
performance objectives. During 1997, Hewitt Associates reviewed executive
compensation and the target levels. The compensation of the Company's executive
officers is also linked to the Company's financial performance as well as the
individual officer's performance. As more fully discussed below under
"Compensation Committee Report," annual incentive compensation awards under the
Annual Incentive Plan (the "AIP") are based upon target award levels expressed
as a percentage of base salaries, established at the beginning of each year for
participating executives, and vary depending upon the individual's level of
responsibility and impact on overall Company performance. In 1997, 75% of the
AIP target award value was based on financial performance of the Company and 25%
was based on the individual officer's performance. The Program's Long-Term
Incentive Plan (the "LTIP") is based upon a four-year performance period. The
Program's long-term incentives include options granted under the LTIP and
performance shares (payable in shares of Common Stock and cash after a four-year
performance period) granted under the Company's Long-Term Performance Share Plan
(the "LTPSP"). The long-term compensation opportunities associated with options
that vest at a rate of 25% a year and shares of Common Stock that are issued
after a four-year period are directly related to the market value of the
Company's Common Stock. Long-term incentive awards paid under the LTPSP reward
long-term shareholder value enhancement relative to industry competitors over a
four-year performance period. In 1997, all long-term incentive awards under the
LTIP and LTPSP directly related to Company performance.
As of March 24, 1998, a balance of 243,244 shares of the 857,000 shares of
Common Stock authorized under the program since 1989 remained available to
underlie awards that may be granted in the future under the Program. Options for
a total of 336,571 shares were granted to all participants in the Program in
1997.
---------------------------------------------------
The total annual incentive awards paid to the Company's Chief Executive
Officer and the other four highest paid executive officers of the Company
employed at the end of the year were $329,769 in 1996 compared to $676,938 in
1997 and their total annual compensation was $999,483 in 1996 compared to
$1,072,353 in 1997.
The following Summary Compensation Table sets forth the annual salary,
annual bonus (including cash and stock) and long-term compensation (including
stock awards, options granted and long-term incentive cash payments) earned by
the Company's Chief Executive Officer and the other four highest paid executive
officers of the Company employed at the end of the year for services rendered
during each of the last three years.
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<PAGE> 10
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
------------------------------------
AWARDS
ANNUAL COMPENSATION ------------------------- PAYOUTS
------------------------------------------- SHARES --------
OTHER ANNUAL COMMON STOCK UNDERLYING LTIP ALL OTHER
NAME AND PRINCIPAL SALARY BONUS COMPENSATION AWARD(S) OPTIONS PAYOUTS COMPENSATION
POSITION YEAR ($) ($)(1)(2) ($) ($)(3) (#)(4) ($)(5) ($)(6)
------------------ ---- ------ --------- ------------ ------------ ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis E. Wheeler...... 1997 $ 394,417 $330,472 -- $ 3,852 100,000 $ 22,952 $ 38,005
Chairman, President 1996 378,710 145,304 -- -- 32,068 64,391 39,739
& Chief Executive
Officer 1995 356,824 244,969 -- -- 43,880 83,016 35,670
James A. Sabala(7)..... 1997 183,780 120,431 -- 1,517 29,194 9,041 17,853
Senior Vice 1996 166,488 46,778 -- -- 9,362 25,360 19,132
President -- 1995 165,238 94,545 -- -- 11,069 33,086 18,087
Finance & Chief
Financial Officer
Robert Martinez(8)..... 1997 155,433 85,913 -- 474 8,120 2,825 14,024
Vice-President -- 1996 132,823 23,730 -- -- 2,604 9,510 13,955
Operations 1995 122,948 43,421 -- -- 3,269 13,283 8,501
Michael C. Tippett(9).. 1997 170,258 45,000 -- 925 28,963 5,509 13,595
Senior Vice 1996 169,658 42,316 -- -- 9,288 15,454 12,749
President -- 1995 140,020 65,179 -- -- 16,718 22,641 10,062
Business Development
& Exploration
William F. Boyd(10).... 1997 168,465 95,122 -- 1,031 19,905 6,144 16,037
Vice President 1996 152,163 37,209 -- -- 6,383 17,237 17,067
Secretary and 1995 150,913 76,519 -- -- 9,142 24,814 15,651
Corporate Counsel
</TABLE>
- ---------------
(1) Annual incentive payments under the AIP are based upon target award levels
established by the Compensation Committee of the Company's Board of
Directors (the "Committee") at the beginning of each annual performance
period and vary depending upon each participant's responsibilities and base
salary. Awards under the AIP are paid after the annual performance period
and vary from 0% to 200% of the targets based on actual performance.
Commencing in 1996, 75% of the award value is based on overall Company
financial performance and 25% is based on the participant's individual
performance. Prior to 1996, 50% of the annual award was based on Company
performance and 50% was based on individual performance. Company financial
objectives underlying the measurement of Company performance include both
total asset growth and cash flow return on total assets. The amounts
reported above for 1995, 1996 and 1997 were paid in March 1996, March 1997
and March 1998, respectively.
(2) Does not report perquisites amounting to less than the lesser of $50,000 or
10% of total salary and bonus.
(3) Shares of Common Stock awarded under the LTPSP are issued upon completion
of a four-year performance period after the date of grant. Prior to 1993,
the Program provided for annual awards of restricted stock that vested over
a four-year period. Commencing in 1993, awards are paid in shares of Common
Stock and cash in amounts that are not determinable until completion of a
four-year award cycle. The aggregate number and market value (based on the
$8.9375 per share closing price of the shares on the New York Stock
Exchange on December 31, 1997) of the restricted shares of Common Stock
granted pursuant to the LTPSP prior to 1993 and held by the above executive
officers at December 31, 1997, were as follows: Dennis E. Wheeler -- 15,445
shares ($138,040), James A. Sabala -- 6,435 shares ($57,513), Robert
Martinez -- 2,011 shares ($17,973), Michael L. Tippett --
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<PAGE> 11
2,875 shares ($25,695) and William F. Boyd -- 2,076 shares ($18,554).
Dividends on restricted shares are remitted to each executive as paid by
the Company.
(4) Reports the number of shares underlying nonqualified options and incentive
stock options granted under the LTIP with respect to each of the respective
years. The options granted with respect to 1997 include (i) a special grant
of options in July 1997 in recognition of the fact that historical cash
compensation had fallen below industry norms and (ii) the customary grant
of options in March 1998.
(5) Reports cash payouts (not awards) under the LTIP. Payments are made under
the LTIP after the end of the four-year performance period after award. The
above reported payments relate to awards made in 1994 and are based on the
performance period ending December 31, 1997. See note 2 to the Long-Term
Incentive Plan Awards Table below for additional information regarding the
LTIP.
(6) Includes the Company's contributions to its Defined Contribution and 401K
Retirement Plan (the "Retirement Plan") and amounts credited to the
Company's Supplemental Retirement Plan (the "Supplemental Retirement
Plan"). All full-time employees who have been employed for over one year
and are at least 21 years old participate in the Retirement Plan. The
amount of the Company's annual contribution is determined annually by the
Board of Directors and may not exceed 15% of the participants' aggregate
compensation; however for the years 1995, 1996 and 1997 the contribution
was 5%. In addition, the Retirement Plan provides for an Employee Savings
Plan which allows each employee to contribute up to 10% of compensation,
subject to a maximum contribution of $9,500. The Company contributes an
amount equal to 50% of the first 6% of any such contributed amount. Accrued
benefits under the Retirement Plan begin vesting after one year of
employment and are fully vested after five years of employment. Retirement
benefits under the Retirement Plan are based on a participant's investment
fund account upon retirement, the participant's age and the form of benefit
payment elected by the participant. The Company maintains the Supplemental
Retirement Plan for its executive officers. Under the Supplemental
Retirement Plan, an amount is accrued that equals the portion of the
contribution to the Company's Retirement Plan that is restricted due to
restrictions under ERISA. In 1997, Messrs. Wheeler, Sabala, Tippett, Boyd
and Martinez were credited with Company contributions of $12,750, $12,750,
$8,000, $12,750 and $12,750, respectively, under the Retirement Plan. In
1997, Messrs. Wheeler, Martinez, Sabala, Tippett and Boyd were credited
with $22,080, $1,215, $4,764, $5,459 and $3,117, respectively, pursuant to
the Supplemental Retirement Plan. The amounts of all other compensation
reported in the above table also include "above-market" interest earnings
on deferred compensation that is accrued under the Company's Supplemental
Retirement Plan. "Above-market" interest earnings on deferred compensation
is the excess of such interest over 120% of the applicable federal
long-term rate, with compounding, as prescribed under the Internal Revenue
Code. In 1997, the amounts of above-market interest earnings accrued for
the benefit of Messrs. Wheeler, Martinez, Sabala, Tippett and Boyd amounted
to $3,175, $59, $339, $136 and $170, respectively.
(7) Mr. Sabala resigned as Senior Vice President -- Finance and Chief Financial
Officer of the Company effective March 31, 1998.
(8) Prior to his appointment as Vice President -- Operations on April 1 1997,
Mr. Martinez served as Vice President -- Engineering, Operational Services
and South American Operations of the Company from January 1, 1997, to March
30, 1997, and as Vice President and General Manager of the Company's
subsidiary, Rochester Coeur, Inc., from August 13, 1988, to December 31,
1996.
(9) Mr. Tippett ceased to be employed by the Company at the close of business
on December 31, 1997.
(10) Mr. Boyd retired from the Company effective March 31, 1998.
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<PAGE> 12
The following Option Grants Table sets forth, for each of the named
executive officers, information regarding individual grants of options granted
in July 1997 under the LTIP for services rendered in 1997, and their potential
realizable values. Information regarding individual option grants includes the
number of options granted, the percentage of total grants to employees
represented by each grant, the per-share exercise price and the expiration date.
The potential realizable value of the options are based on assumed annual 0%, 5%
and 10% rates of stock price appreciation over the term of the option. Also set
forth is the amount of the increases in the value of all of the Company's
outstanding shares of Common Stock that would be realized in the event of such
annual rates of stock price appreciation.
OPTION GRANTS TABLE
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- -----------------------------------------------------------------------------------------------
NUMBER OF % OF TOTAL
SHARES OPTIONS GRANTED
UNDERLYING TO EMPLOYEES
OPTIONS GRANTED IN FISCAL EXERCISE EXPIRATION
NAME (#)(1) YEAR(2) PRICE ($/SH)(3) DATE
---- --------------- --------------- --------------- ----------
<S> <C> <C> <C> <C>
Dennis E. Wheeler....... 100,000 41.47% $13.125 7/14/07
Robert Martinez......... 8,120 3.37 13.125 7/14/07
James A. Sabala......... 29,194 12.11 13.125 7/14/07
Michael C. Tippett...... 28,963 12.01 13.125 7/14/07
William F. Boyd......... 19,905 8.25 13.125 7/14/07
All Shareholders (5)....
Named Executive
Officers' Gains as a %
of All Shareholder
Gains.................
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION
FOR OPTION TERM(4)
- ------------------------ --------------------------------------
NAME 0% 5% ($) 10% ($)
---- -- ------ -------
<S> <C> <C> <C>
Dennis E. Wheeler....... $0 $ 825,400 $ 2,091,500
Robert Martinez......... 0 67,022 169,854
James A. Sabala......... 0 240,967 610,680
Michael C. Tippett...... 0 239,061 605,848
William F. Boyd......... 0 164,296 416,373
All Shareholders (5).... 0 180,751,242 456,075,417
Named Executive
Officers' Gains as a %
of All Shareholder
Gains................. .85% .85%
</TABLE>
- ---------------
(1) The options include nonqualified and incentive stock options that become
exercisable cumulatively as to 25%, 50%, 75% and 100% after the first,
second, third and fourth anniversaries, respectively, after the date of
grant.
(2) Based on options for a total of 241,127 shares granted to all employees.
(3) The exercise price is equal to the fair market value on the date of grant
of the option.
(4) The potential realizable values shown in the columns are net of the option
exercise price. These amounts assume annual compounded rates of stock price
appreciation of 0%, 5%, and 10% from the date of grant to the option
expiration date, a term of ten years. These rates have been set by the U.S.
Securities and Exchange Commission and are not intended to forecast future
appreciation, if any, of the Company's Common Stock. Actual gains, if any,
on stock option exercises are dependent on several factors including the
future performance of the Company's Common Stock, overall stock market
conditions, and the optionee's continued employment through the vesting
period. The amounts reflected in this table may not actually be realized.
(5) Total dollar gains based on assumed annual rates of appreciation shown and
the 21,898,624 shares of Common Stock outstanding on March 24, 1998.
9
<PAGE> 13
The following aggregate Option Exercises and Year-End Option Value Table
sets forth, for each of the named executive officers, information regarding the
number and value of unexercised options at December 31,1997. No options were
exercised during 1997 by such persons.
AGGREGATE OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF SHARES IN-THE-MONEY
SHARES ACQUIRED UNDERLYING UNEXERCISED OPTIONS AT FY-END
ON EXERCISE VALUE OPTIONS AT FY-END (#) ($)(1)
NAME (#) REALIZED ($) EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- --------------- ------------ ------------------------- -------------------------
<S> <C> <C> <C> <C>
Dennis E. Wheeler.......... -- -- 88,767/169,823 $0/0
Robert Martinez............ -- -- 10,739/14,090 0/0
James A. Sabala............ -- -- 26,009/49,856 0/0
Michael C. Tippett......... -- -- 21,421/50,690 0/0
William F. Boyd............ -- -- 15,421/34,785 0/0
</TABLE>
- ---------------
(1) Market value of underlying securities at exercise or year-end, minus the
exercise price.
The following Long-Term Incentive Plan Awards Table sets forth, for each of
the named executive officers, long-term incentive plan awards (not payouts) for
services rendered in 1997 under the LTPSP. (Payouts for the completed four-year
performance periods ending in 1995, 1996 and 1997 are reported above under the
Long-Term Compensation Payouts column of the Summary Compensation Table.) No
awards under the LTPSP have yet been made in 1998.
LONG-TERM INCENTIVE PLAN AWARDS TABLE
<TABLE>
<CAPTION>
ESTIMATED FUTURE-PAYOUTS UNDER
PERFORMANCE OR NON-STOCK PRICE BASED PLANS(2)
NUMBER OF OTHER PERIOD -------------------------------
SHARES, UNITS OR UNTIL MATURATION THRESHOLD TARGET MAXIMUM
NAME OTHER RIGHTS(#)(1) OR PAYOUT (#) (#) (#)
---- ------------------ ---------------- ---------- ------- --------
<S> <C> <C> <C> <C> <C>
Dennis E. Wheeler.................. -- -- -- -- --
Robert Martinez.................... -- -- -- -- --
James A. Sabala.................... -- -- -- -- --
Michael C. Tippett................. -- -- -- -- --
William F. Boyd.................... -- -- -- -- --
</TABLE>
- ---------------
(1) Performance share awards under the LTPSP are based upon target award levels
established by the Committee at the beginning of each four-year performance
period and vary depending upon the participant's responsibilities and base
salary. Awards under the LTPSP are paid after the end of a four-year
performance period and may vary from 0% to 150% of the targets based on
actual Company financial performance. Commencing with LTPSP awards made in
1993, 60% is paid in shares of Common Stock and 40% is paid in cash upon
completion of the four-year performance period.
10
<PAGE> 14
(2) Company financial performance for LTPSP award determination purposes is
based on the Company's total shareholder return ("TSR") relative to a group
of other companies in the precious metals mining industry (the "Comparable
Group"). TSR equals the market price of the Company's Common Stock at the
end of the four-year period plus dividends paid during the period, divided
by the market price of the Common Stock at the beginning of the period.
Actual award levels are based on the relative performance of the Company's
TSR relative to the TSRs of the Comparable Group companies. The threshold
performance level (i.e., the minimum amount payable) is reached if the
Company's TSR is at the 30th percentile, in which case the percent of the
target award is 50%. The target performance level is reached if the
Company's TSR is at the 50th percentile, in which case the percent of the
target award is 100%. The maximum performance level is achieved if the
Company's TSR is at or above the 75th percentile, in which case the percent
of the target award is 150%.
COMPENSATION COMMITTEE REPORT
The following description of the Company's executive compensation practices
and policies is presented on behalf of the Compensation Committee of the
Company's Board of Directors (the "Committee"). The present members of the
Committee are Cecil D. Andrus, Joseph C. Bennett, Jeffery T. Grade and Duane B.
Hagadone. The fundamental philosophy of the Company's Executive Compensation
Program is to offer competitive compensation opportunities based on the
Company's performance and to a lesser extent individual performance. The Company
and the Committee at least annually receive the services of Hewitt Associates, a
leading, independent executive compensation consulting firm, in connection with
the implementation of the Company's Executive Compensation Program. In addition,
the Committee also receives information from other mining company compensation
studies. Compensation of the Company's executive officers is reviewed annually
by the Committee, which is comprised entirely of outside directors, and is
directly linked to the Company's financial performance comparisons with other
companies in the industry and shareholder interests. Total compensation
opportunities are competitive with those offered by other employers in the
precious metals mining industry on a size-adjusted basis. Annual base salaries
are targeted at approximately the 50th percentile of such companies on a
size-adjusted basis.
Annual incentive compensation awards under the AIP are based on target
award levels, expressed as a percentage of base salaries, established at the
beginning of each annual performance period for participating executives and
vary (from 50% for the Company's Chairman/President/CEO to lower amounts for
other executives) depending upon the individual's level of responsibility and
impact on overall Company performance. Specific individual and group objectives,
reflecting the executive's responsibilities, are developed for each
participating executive prior to the beginning of the year. Objectives for
participants other than the Chairman/President/CEO are established for each
participant by the CEO, and reviewed by the Compensation Committee. Individual
objectives for the Chairman/President/CEO are established by the Committee and
for 1997 included objectives relating to the operation, management and growth of
the Company. Accordingly, the Compensation Committee reviews the executive's
performance relative to the predetermined goals and reports to the Board of
Directors. In addition, financial objectives are established for the Company
based on growth of total assets and cash flow return on total assets. Actual
awards paid after the end of each annual performance period vary from the target
awards based on the actual versus targeted performance objectives. In 1997, 75%
of the target award value was based on financial performance of the Company and
25% was based on the individual performance of the participant. Awards vary from
zero percent to 200 percent
11
<PAGE> 15
of the target awards. The total annual incentive awards paid to the Company's
Chief Executive Officer and the other four highest paid executive officers
employed at the end of 1997 were $329,769 in 1996 compared to $676,938 in 1997.
Long-term incentive awards under the Plan consist of stock options granted
under the LTIP and performance shares awarded under the LTPSP. Of each long-term
incentive awarded, 50% is allocated to stock options granted under the LTIP and
50% is allocated to performance shares awarded under the LTPSP.
Awards of stock options are based on established percentages of base salary
and vest cumulatively at a rate of 25% per year. The options expire ten years
after the date of grant. Option exercise prices are equal to the fair market
value of the Common Stock on the date of grant. Stock options granted with
respect to 1997 included (i) a special grant of options in July 1997 in
recognition of the fact that historical cash compensation had fallen below
industry norms and (ii) the customary grant of options in March 1998. As of
March 24, 1998, nonqualified stock options and incentive stock options to
purchase a total of 500,239 shares of Common Stock at an average exercise price
of $16.02 per share were outstanding.
Performance shares awarded under the LTPSP are designed to award key
executives for overall Company performance over a four-year time period and to
align the interests of such executives with those of shareholders by rewarding
increases in shareholder value. Before each four-year performance period begins,
target awards, expressed as a percentage of base salaries, are established for
each executive, with a target award level (varying from 60% for the Company's
Chairman/President/CEO to lower amounts for other executives) for each
participant depending upon the individual's level of responsibility and impact
on overall total return to shareholders. Actual awards paid at the end of the
four-year performance period vary from the initial award target based on the
actual total shareholder return ("TSR") of the Company relative to the TSRs of a
group of other companies in the precious metals mining industry (the "Comparable
Group"). The companies in the Comparable Group are AMAX Gold, Inc., ASARCO,
Inc., Barrick Gold Corp., Battle Mountain Gold Co., Echo Bay Mines, Ltd.,
Meridian Gold, Inc., Hecla Mining Co., Homestake Mining Co., Newmont Gold
Company and Placer Dome, Inc. TSR is the price of the Common Stock at the end of
the year plus dividends during the year, divided by the market value of the
Common Stock at the beginning of the year. Actual award payments may vary from
zero percent to 150% of the target awards. Final awards under the LTPSP, which
are not determinable until completion of the four-year performance period, are
paid 60% in shares of Common Stock and 40% in cash.
Effective June 1, 1997, following a review by Hewitt Associates of the
annual base salaries paid by companies in the Comparable Group of other precious
metals mining companies, the Committee recommended and the Board of Directors
approved an increase in the annual salary of Dennis E. Wheeler, the Company's
Chairman/President/CEO, from $376,800 to $407,000 in order for his salary to be
approximately equal to the 50th percentile of the salaries paid to persons
occupying comparable positions in the Comparable Group companies on a
size-adjusted basis. Mr. Wheeler's salary was not increased in 1996 and has not
been increased to date in 1998. Other factors considered by the Board of
Directors in setting executive salaries are length of service and level of
responsibility.
Payments made in March 1998 under the AIP are based on 1997 performance. As
stated above, 75% of an AIP award is based on the prior year's growth of the
Company's total assets and cash flow return on investment and 25% is based on
individual performance measured against predetermined individual or group
12
<PAGE> 16
objectives. With respect to the individual performance portion of the March 1998
AIP award to the Company's Chairman/President/CEO, the award was based on 1997
performance and reflected the following Company performance accomplishments in
1997: (i) the increase in the Company's total revenues from $105.9 million in
1996 to $160.0 million in 1997; (ii) the increase in the Company's total gold
and silver production from approximately 214,000 and 9.5 million ounces,
respectively, in 1996 to record levels of approximately 291,000 and 11.0 million
ounces, respectively, in 1997 with production increasing at all of its existing
mines; (iii) the underwritten sale in October 1997 of $143,750,000 principal
amount of 7 1/4% Convertible Subordinated Debentures due 2005, which contributed
to the Company's ability to have approximately $213 million of cash and
equivalents at the end of 1997 available for use in connection with the
Company's growth; (iv) the increase during 1997 from 35% to 50% of the Company's
ownership of the outstanding capital stock of Gasgoyne Gold Mines NL, an
Australian gold mining company that has a 50% interest in the operating Yilgarn
Star Mine in Western Australia; (v) the effectiveness of cost-reduction efforts
at the Fachinal Mine in Chile that resulted in cash costs of production of $305
per ounce of gold in the fourth quarter of 1997 compared to average cash assets
of production of $350 per ounce during the first nine months of the year; (vi)
significant progress was made during the year at the Kensington Project in
Alaska in acquiring most of the major permits and governmental approvals
required for the project to move forward and significant progress toward
completing an optimization study to reduce capital and operating costs; and
(vii) significant improvement at the Company's Golden Cross Mine in New Zealand
which resulted in record annual production of 83,110 ounces of gold at a cash
cost of $245.34 per ounce; and (viii) success of the non-executive employee
gain-sharing program which significantly reduced employment levels and costs
during 1997.
Compensation Committee of the Board of Directors
Joseph C. Bennett, Chairman
Cecil D. Andrus
Jeffery T. Grade
Duane B. Hagadone
13
<PAGE> 17
SUPPLEMENTAL RETIREMENT DEFERRED COMPENSATION PLAN
Pursuant to the Company's Supplemental Retirement Deferred Compensation
Plan, officers may defer up to 50% of their salary as well as 100% of the cash
portion of awards under the AIP and LTPSP. Amounts deferred accrue interest at a
prime lending rate not to exceed 10% and payout may be effected by a lump sum or
an annuity.
DIRECTORS' FEES
Pursuant to the Coeur d'Alene Mines Corporation Non-Employee Directors'
Stock Option Plan, outside directors of the Company must receive at least $5,000
of their director fees in the form of stock options in lieu of $5,000 of cash
compensation and are able to elect to receive stock options in lieu of cash fees
for up to the $45,000 balance of their annual director fees. The Company was the
first company in the precious metals mining industry that required the directors
to receive a portion of their directors' fees in stock options in lieu of cash
compensation. Information relating to options granted to outside directors on
January 2, 1997, was set forth in last year's proxy statement relating to the
1997 Annual Meeting of Shareholders. The following table sets forth information
regarding options that were granted under the Plan to non-employee directors on
January 2, 1998:
<TABLE>
<CAPTION>
AMOUNT OF FOREGONE NUMBER OF SHARES OPTION EXERCISE
NAME OF OUTSIDE DIRECTOR DIRECTOR'S FEES SUBJECT TO OPTION(1) PRICE PER SHARE(2)
------------------------ ------------------ --------------------- ------------------
<S> <C> <C> <C>
Cecil D. Andrus........................ $ 5,000 1,056 $ 8.9375
Joseph C. Bennett...................... 5,000 1,056 8.9375
James J. Curran........................ 25,000 5,277 8.9375
Jeffrey T. Grade....................... 5,000 1,056 8.9375
Duane B. Hagadone...................... 50,000 10,555 8.9375
James A. McClure....................... 5,000 1,056 8.9375
------- ------
Total............................. $95,000 20,056
======= ======
</TABLE>
- ---------------
(1) The number of shares is determined by dividing each outside director's
foregone directors' fees by the per-share value of an option using the
Black-Scholes option valuation method.
(2) The option exercise price is equal to the average of the high and low prices
of the Common Stock reported by the New York Stock Exchange on January 2,
1998, which was the date of grant.
Committee members receive no compensation for their services.
DIRECTORS' RETIREMENT PLAN
Pursuant to the Company's Directors' Retirement Plan, outside directors who
have a minimum of five years of service are entitled to one year of retirement
benefit for each year of service up to a maximum of ten years of retirement
benefits. Each year's retirement benefit is equal to 40% of the outside
director's annual compensation as a director of the Company at the time of
retirement.
14
<PAGE> 18
CHANGE IN CONTROL PROVISIONS
In the event of a change in control of the Company, as defined below (a
"Change in Control"), all awards under the Program fully vest as follows: (i)
all unvested stock options become fully exercisable; (ii) any unvested shares of
restricted stock become fully vested so that the restrictions on the sale of
such stock lapse on the Change in Control date; and (iii) cash or Common Stock
payments of performance awards made under the Program must be fully paid within
30 days following the date of the Change in Control. A Change in Control of the
Company for purposes of the Program is deemed to occur in the event of (i) an
organization, group or person acquires beneficial ownership of securities of the
Company representing 35% or more of the combined voting power of the Company's
then outstanding securities; (ii) a majority of the members of the Company's
Board of Directors during any two-year period is replaced by directors who are
not nominated and approved by the Board; (iii) a majority of the Board members
is represented by, appointed by or affiliated with any organization, group or
person whom the Board has determined is seeking to affect a Change in Control of
the Company; or (iv) the Company is combined with or acquired by another company
and the Board determines, either before or after such event, that a Change in
Control will or has occurred.
EMPLOYMENT AGREEMENTS
The Company has an employment agreement with Dennis E. Wheeler, Chairman of
the Board, President and Chief Executive Officer, which provides for a
three-year term of employment through June 1, 2000, and which is automatically
extended for one year on June 1 of each year unless terminated or modified by
the Company by written notice. Mr. Wheeler's employment agreement includes the
same Change in Control provisions as those included in the Executive Severance
Agreements described below, and in the event of his death, his employment
agreement provides for the lump sum payment to his estate of an amount equal to
his annual base salary at the time of such death.
During 1997, and continuing from year-to-year thereafter unless terminated
by the Company by written notice, the Executive Severance Agreements with ten
executive officers of the Company (the "Executives") provide that certain
benefits will be payable to the Executives in the event of a Change in Control
of the Company and the termination of the Executive's employment within two
years after such Change in Control for any reason other than for cause,
disability, death, normal retirement or early retirement. (The term "Change in
Control" for purposes of the Executive Severance Agreements has the same meaning
as that discussed above under "Change in Control Provisions.")
The benefits payable to an Executive in the event of a Change in Control
and such termination of employment are (i) the continued payment of the
Executive's full base salary at the rate in effect immediately prior to his or
her termination of employment, as well as the short-term and long-term bonuses
at 100% of the target levels provided under the AIP and LTPSP for the two years
following such termination of employment; (ii) the continued payment by the
Company during that period of all medical, dental and long-term disability
benefits under programs in which the Executive was entitled to participate
immediately prior to termination of employment; (iii) acceleration of the
exercisability and vesting of all outstanding stock options, restricted stock,
performance plan awards and performance shares granted by the Company to the
Executive under the Program; and (iv) the granting to the Executive of continued
credit through the two-year period following termination of employment for
purposes of determining the Executive's retirement benefits under the Company's
Retirement Plan. Each Executive Severance Agreement provides that if the
severance payments
15
<PAGE> 19
provided thereunder would constitute a "parachute payment," as defined in
Section 280G of the Internal Revenue Code, the payment will be reduced to the
largest amount that would result in no portion being subject to the excise tax
imposed by, or the disallowance of a deduction under, certain provisions of the
Code. Accordingly, the present value of such payment will generally be required
to be less than three times the Executive's average annual taxable compensation
during the five-year period preceding the Change in Control.
PROPOSAL NO. 2
INDEPENDENT ACCOUNTANTS
The Company's Board of Directors has appointed Ernst & Young LLP to serve
as the Company's independent public accountants for the current fiscal year.
Ernst & Young LLP has served since 1981 in that capacity. A resolution will be
presented at the Annual Meeting to ratify the appointment by the Company's Board
of Directors of Ernst & Young LLP to serve as the Company's independent public
accountants for the current fiscal year. A majority vote is required for
ratification. A representative of Ernst & Young LLP will be present at the
Annual Meeting to answer any questions concerning the Company's financial
statements and to make a statement if he desires to do so.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE IN FAVOR OF THE
PROPOSED APPOINTMENT OF ERNST & YOUNG LLP AS THE COMPANY'S INDEPENDENT
ACCOUNTANTS FOR 1998.
16
<PAGE> 20
STOCK PERFORMANCE CHART
The following chart compares the Company's cumulative total shareholder
return with the S&P 500 Index, which is a performance indicator of the overall
stock market, and a Company-determined peer group.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG COEUR D'ALENE MINES CORPORATION, S&P 500 INDEX
& PEER GROUP INDEX**
[GRAPH]
Assumes $100 invested on January 1, 1992, in the Company's Common Stock, S&P 500
Index and a peer group index.
- ---------------
* Total return assumes reinvestment of dividends.
** The issuers of common stock included in the peer group index are Amax Gold,
Inc., ASARCO Incorporated, Barrick Gold Corp., Battle Mountain Gold Co.,
Echo Bay Mines, Ltd., Meridian Gold, Inc., Hecla Mining Company, Homestake
Mining Company, Newmont Gold Company, Pegasus Gold, Inc. and Placer Dome,
Inc.
*** Fiscal year ending December 31.
17
<PAGE> 21
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 as amended, requires
the Company's officers and directors, and persons who own more than 10% of a
registered class of the Company's equity securities, to file reports of
securities ownership and changes in such ownership with the Securities and
Exchange Commission. Initial Statements of Beneficial Ownership of Securities on
Form 3 are required to be filed within ten days after the date on which the
person became a reporting person. Statements of Changes of Beneficial Ownership
of Securities are required to be filed by the tenth day of the month following
the month during which the change in beneficial ownership of securities
occurred. The Company believes that all reports of securities ownership and
changes in such ownership required to be filed during 1997 were timely filed.
1999 SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 1999 Annual
Meeting must be received by the Secretary of the Company, 400 Coeur d'Alene
Mines Building, Post Office Box I, Coeur d'Alene, Idaho 83814 no later than
December 1, 1998, in order for them to be considered for inclusion in the 1999
Proxy Statement.
OTHER MATTERS
Management is not aware of any other matters to be considered at the
meeting. If any other matters properly come before the meeting, the persons
named in the enclosed Proxy will vote said Proxy in accordance with their
discretion.
This Proxy Statement is accompanied by the 1997 Annual Report to
Shareholders of the Company as well as a copy of the Company's Annual Report on
Form 10-K for the year ended December 31, 1997, which includes financial
statements for the year then ended. The Annual Report and Form 10-K are not to
be regarded as part of the proxy solicitation materials.
By order of the Board of Directors,
COEUR D'ALENE MINES CORPORATION
/s/ DENNIS E. WHEELER
Dennis E. Wheeler
Chairman of the Board
Coeur d'Alene, Idaho
April 1, 1998
18
<PAGE> 22
COEUR D'ALENE MINES CORPORATION
400 COEUR D'ALENE MINES BUILDING, 505 FRONT AVENUE, P.O. BOX I
COEUR D'ALENE, IDAHO 83814
MANDATORY ADJUSTABLE REDEEMABLE CONVERTIBLE
SECURITIES PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF SHAREHOLDERS ON MAY 12, 1998, 9:30 A.M., LOCAL TIME
The undersigned appoints Dennis E. Wheeler, proxy of the undersigned, with full
power of substitution, to vote all shares of Coeur d'Alene Mines Corporation
Mandatory Adjustable Redeemable Convertible Securities the undersigned is
entitled to vote at the Annual Meeting of Shareholders to be held May 12, 1998,
or at any adjournment thereof, with all powers the undersigned would have if
personally present.
(Continued on reverse side)
<PAGE> 23
<TABLE>
<S> <C>
THE SHARES WILL BE VOTED AS DIRECTED, AND WITH RESPECT TO OTHER MATTERS OF BUSINESS PROPERLY BEFORE [ ] Please mark
THE MEETING AS THE PROXIES SHALL DECIDE. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR your votes
PROPOSALS 1, 2 AND 3. like this
in blue or
black ink.
<CAPTION>
THE BOARD OF DIRECTORS RECOMMENDS VOTING FOR THE FOLLOWING PROPOSALS:
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
1. TO ELECT DIRECTORS FOR all seven WITHHOLD 2. TO RATIFY THE SELECTION OF [ ] [ ] [ ]
C.D. ANDRUS, J.C. nominees (except AUTHORITY ERNST & YOUNG AS THE
BENNETT, J.J. CURRAN, as marked to the to vote for all COMPANY'S INDEPENDENT
D.B. HAGADONE, J.A. contrary below) nominees listed at left PUBLIC ACCOUNTANTS FOR
McCLURE, J.H. ROBINSON 1998.
and D.E. WHEELER [ ] [ ]
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO
VOTE UPON SUCH OTHER BUSINESS AS MAY COME BEFORE
THE MEETING.
========================================================================
Dated: , 1998
-----------------------------------
-----------------------------------------------
Signature of Stockholder
-----------------------------------------------
Signature of Stockholder
Sign exactly as your name appears hereon. When
signing in a representative or fiduciary
capacity, indicate the title. If shares are
held jointly, each holder should sign.
</TABLE>
PLEASE COMPLETE, SIGN, DATE AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
/\ FOLD AND DETACH HERE /\
<PAGE> 24
COEUR D'ALENE MINES CORPORATION
400 COEUR D'ALENE MINES BUILDING, 505 FRONT AVENUE, P.O. BOX I
COEUR D'ALENE, IDAHO 83814
COMMON STOCK PROXY
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS FOR THE
ANNUAL MEETING OF SHAREHOLDERS ON MAY 12, 1998, 9:30 A.M., LOCAL TIME
The undersigned appoints Dennis E. Wheeler, proxy of the undersigned, with full
power of substitution, to vote all shares of Coeur d'Alene Mines Corporation
common stock the undersigned is entitled to vote at the Annual Meeting of
Shareholders to be held May 12, 1998, or at any adjournment thereof, with all
powers the undersigned would have if personally present.
(Continued on reverse side)
<PAGE> 25
<TABLE>
<S> <C>
THE SHARES WILL BE VOTED AS DIRECTED, AND WITH RESPECT TO OTHER MATTERS OF BUSINESS PROPERLY BEFORE [ ] Please mark
THE MEETING AS THE PROXIES SHALL DECIDE. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR your votes
PROPOSALS 1, 2 AND 3. like this
in blue or
black ink.
<CAPTION>
THE BOARD OF DIRECTORS RECOMMENDS VOTING FOR THE FOLLOWING PROPOSALS:
<S> <C> <C> <C>
FOR AGAINST ABSTAIN
1. TO ELECT DIRECTORS FOR all seven WITHHOLD 2. TO RATIFY THE SELECTION OF [ ] [ ] [ ]
C.D. ANDRUS, J.C. nominees (except AUTHORITY ERNST & YOUNG AS THE
BENNETT, J.J. CURRAN, as marked to the to vote for all COMPANY'S INDEPENDENT
D.B. HAGADONE, J.A. contrary below) nominees listed at left PUBLIC ACCOUNTANTS FOR
McCLURE, J.H. ROBINSON 1998.
and D.E. WHEELER [ ] [ ]
3. IN THEIR DISCRETION, THE PROXIES ARE AUTHORIZED TO
VOTE UPON SUCH OTHER BUSINESS AS MAY COME BEFORE
THE MEETING.
========================================================================
Dated: , 1998
-----------------------------------
-----------------------------------------------
Signature of Stockholder
-----------------------------------------------
Signature of Stockholder
Sign exactly as your name appears hereon. When
signing in a representative or fiduciary
capacity, indicate the title. If shares are
held jointly, each holder should sign.
</TABLE>
PLEASE COMPLETE, SIGN, DATE AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
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