<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
<TABLE>
<S> <C>
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
</TABLE>
COEUR D'ALENE MINES 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)(4) 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.:
- --------------------------------------------------------------------------------
(3) Filing party:
- --------------------------------------------------------------------------------
(4) Date filed:
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<PAGE> 2
COEUR D'ALENE MINES CORPORATION
400 COEUR D'ALENE MINES BUILDING
POST OFFICE BOX I
505 FRONT AVENUE
COEUR D'ALENE, IDAHO 83814
March 31, 2000
Dear Shareholder:
We are pleased to invite you to attend our Annual Meeting. This year it
will be held the morning of Tuesday, May 9, 2000, 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. Shareholders will vote on the election of directors and
ratification of the selection of Arthur Andersen LLP as the Company's
independent accounting firm.
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, it is important that you be represented by proxy.
If you cannot attend the meeting, we urge you to date and sign the enclosed
proxy card, and return it promptly. We have provided a return-addressed,
permit-stamped envelope for your convenience.
Sincerely,
DENNIS E. WHEELER
Chairman of the Board,
President and Chief Executive Officer
WE URGE YOU TO CAREFULLY CONSIDER EACH OF THE MATTERS TO BE VOTED UPON AT THE
ANNUAL MEETING AND THE BOARD'S RECOMMENDATION THAT SHAREHOLDERS VOTE FOR EACH OF
THE PROPOSALS BEING PRESENTED.
<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 9, 2000, at 9:30 A.M., local time, for the
following purposes:
1. To elect a Board of Directors of the Company consisting of ten
persons to serve for the ensuing year or until their respective successors
are duly elected and qualified;
2. To ratify the Board of Directors' selection of Arthur Andersen LLP
as the Company's independent accounting firm for the year ending December
31, 2000; and;
3. To transact such other business as properly may come before the
meeting.
Nominees for directors to be elected at the Annual Meeting are set forth in
the enclosed Proxy Statement.
Only shareholders of record at the close of business on March 17, 2000, 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,
DENNIS E. WHEELER
Chairman of the Board
Coeur d'Alene, Idaho
March 31, 2000
- --------------------------------------------------------------------------------
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" or
"Coeur"), of proxies of shareholders for shares to be voted at the Annual
Meeting of Shareholders to be held on May 9, 2000, and any and all adjournments
thereof.
Any shareholder executing a proxy has the right to revoke it at any time
prior to its exercise 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 6, 2000, to shareholders of the Company.
VOTING SECURITIES
All shareholders of record as of the close of business on March 17, 2000,
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. As of the close of business
on March 17, 2000, a total of 37,050,068 shares of common stock, $1 par value
per share (the "Common Stock") were outstanding. The previously outstanding
shares of the Company's Mandatory Adjustable Redeemable Preferred Stock
("MARCS") were mandatorily converted into shares of Common Stock on March 15,
2000.
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 ten nominees for
directors listed herein (or their substitutes in the event any of the nominees
is unavailable for election); (2) FOR the ratification of the selection of
Arthur Andersen L.L.P. as the Company's independent accountants for the year
ended December 31, 2000; 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.
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 $8,000 plus out-of-pocket expenses.
<PAGE> 5
PROPOSAL NO. 1
ELECTION OF DIRECTORS
Ten directors are to be elected at the Annual Meeting, each to serve for
one year or until his successor is elected and qualified. Proxies will be voted
at the Annual Meeting, unless authority is withheld, FOR the election of the ten
persons named below. All of the nominees currently are directors of the Company
except Messrs. Daniel Tellechea Salido and Xavier Garcia de Quevedo Topete, who
are designees of Grupo Mexico, S.A. de C.V., which is the parent of Asarco
Incorporated, a principal holder of the Company's Common Stock. 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........................................... 57 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. Member of the Board of Directors and
Chairman of the Finance and Planning Committee of the Board
of Directors of Sierra Pacific Resources (a public utility
holding company).
JOSEPH C. BENNETT........................................... 67 1981
Mining Consultant. Director of Equity Oil Company.
JAMES J. CURRAN............................................. 60 1989
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.
JAMES A. MCCLURE............................................ 75 1991
Of Counsel Givens & Pursley; Consultant to the Washington,
D.C. consulting 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.
CECIL D. ANDRUS............................................. 68 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............................................ 49 1998
Appointed to become Managing Director of the new Technology
Services Division of Amey PLC (business support services
specialist) on April 1, 2000, and to serve as an Executive
Director of that corporation. Vice Chairman of Black &
Veatch, an international engineering and construction firm,
from January 1999 to March 2000; Chief Development Officer
of that company from 1997-1998 and Managing Partner from
1996-1999; Chairman of Black and Veatch U.K., Ltd and
President of Black & Veatch International from 1994 to March
2000; employed by Black & Veatch since 1973; director of
Commerce Bancshares Inc. (a bank holding company), Alliance
Resource Partners LP (coal mining) and Protection One Inc.
(security alarm monitoring services).
</TABLE>
2
<PAGE> 6
<TABLE>
<CAPTION>
DIRECTOR
NOMINEE AGE SINCE
- ------- --- --------
<S> <C> <C>
ROBERT E. MELLOR............................................ 56 1998
Chief Executive Officer and President of Building Materials
Holding Corporation (distribution, manufacturing and sales
of building materials and component products) 1997 to
present, director since 1991; Of Counsel, Gibson, Dunn &
Crutcher, LLP, 1991-1997; held positions of director,
Executive Vice President and Chief Administrative Officer,
Senior Vice President, General Counsel and Secretary of
DiGiorgio Corporation (food wholesaler and building
materials distributor) from 1976 to 1990. Member of the
Board of Directors of The Ryland Group, Inc. (national
residential home builder).
TIMOTHY R. WINTERER......................................... 63 1998
President and Chief Operating Officer of Western Oil Sands
February 2000 to present. President and Chief Executive
Officer of BHP World Minerals Corporation (international
resources company) from 1997 to 1998; Group General Manager
and Executive Vice President, BHP World Minerals
(1996-1997); Senior Vice President and Group General
Manager, BHP World Minerals (1992-1996); Senior Vice
President Operations International Minerals, BHP Minerals
(1985-1992); Executive Vice President, Utah Development
Company (1981-1985).
DANIEL TELLECHEA SALIDO..................................... 54 --
Managing Director for Administration and Finance of Grupo
Mexico, S.A. de C.V. since 1994 and an alternate director of
that company since 1998; Managing Director of Mexicana de
Cobre, S.A. de C.V. from 1986 to 1993; director, Vice
President and Chief Financial Officer of ASARCO Incorporated
since November 1999; and Vice President, Finance of Southern
Peru Copper Corporation since December 1999 and a director
of that company since November 1999.
XAVIER GARCIA DE QUEVEDO TOPETE............................. 53 --
Vice President and Chief Operating Officer of Asarco
Incorporated since November 19, 1999. General Director of
Grupo Ferroviario Mexicano, S.A. de C.V. and of Ferrocarril
Mexicano, S.A. de C.V. from December 1997 to December 1999;
General Director of Development and Projects of Grupo
Mexico, S.A. de C.V. from 1994 to 1997 and an alternate
director of that company since 1998; director of Asarco
Incorporated since 1999; and director of Southern Peru
Copper Corporation since December 1999.
</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 seven times during 1999. The
Company has an Audit Committee comprised solely of outside directors and
consisting of Messrs. Curran, McClure and Winterer, which met three times during
1999. The Board also has a Compensation Committee, comprised solely of outside
directors and consisting of Messrs. Andrus, Bennett, Robinson and Mellor, which
met one time during 1999. Each director attended at least 75% of the meetings of
the Board of Directors and committees on which he served except Joseph C.
Bennett, who did not attend three meetings of the Board. The Company also has an
Executive Committee of its Board on which Messrs. Bennett, Curran, Mellor,
Robinson 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.
3
<PAGE> 7
SHARE OWNERSHIP
The following table sets forth information, as of March 17, 2000,
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, 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
--------------------------------
SHARES
BENEFICIALLY PERCENT OF
OWNED OUTSTANDING
------------ -----------
<S> <C> <C>
Asarco Incorporated(1)...................................... 7,175,000 19.4%
MacKay-Shields Financial Corporation(2)..................... 621,777 1.7
Dennis E. Wheeler........................................... 259,523(3)(4) .7
Joseph C. Bennett........................................... 8,984(3)(4) *
James J. Curran............................................. 34,590(3)(4) *
James A. McClure............................................ 4,625(3)(4) *
Cecil D. Andrus............................................. 4,378(4) *
John H. Robinson............................................ 2,473(4) *
Robert E. Mellor............................................ 1,524(4) *
Timothy R. Winterer......................................... 3,848(4) *
Daniel Tellechea Salido(5).................................. 0 *
Xavier Garcia de Quevedo Topete(5).......................... 0 *
All executive officers and nominees for director as a group
(19 persons).............................................. 359,817(4) 1.0
</TABLE>
- ---------------
(*) Holding constitutes less than .10% of the outstanding shares.
(1) Asarco Incorporated is primarily engaged in the mining and production of
copper and is a wholly-owned subsidiary of Grupo Mexico, S.A. de C.V., a
copper and precious metals mining company headquartered in Mexico. The
address of Asarco Incorporated is 180 Maiden Lane, New York, New York 10038.
(2) MacKay-Shields Financial Corporation is an investment advisory firm. Its
address is 9 West 57th Street, New York, NY 10019.
(3) 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.
(4) 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 -- 206,214 shares; Joseph C. Bennett -- 5,984
shares; James J. Curran -- 34,590 shares; James A. McClure -- 4,275 shares;
Cecil D. Andrus -- 4,278 shares; John H. Robinson -- 2,373 shares; Robert E.
Mellor -- 1,424 shares; Timothy R. Winterer -- 2,848 shares; and all
executive officers and directors as a group -- 296,748 shares.
(5) Daniel Tellechea Salido and Xavier Garcia de Quevedo Topete are designees of
Grupo Mexico, S.A. de C.V., a Mexican copper mining company that is the
parent of Asarco Incorporated.
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
4
<PAGE> 8
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 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 Hewitt Associates 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 changes 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 1999, 75% of each executive's annual incentive
compensation was determined by the Company's overall financial performance
relative to predetermined goals established by the Board of Directors, and the
remaining 25% was determined by the executive's performance relative to their
individual predetermined goals. Goals of the Chief Executive Officer are set and
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.
Seventy five percent (75%) 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 twenty five percent (25%) 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 1999, 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 1999, 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 1999, all long-term incentive awards under the
LTIP and LTPSP directly related to Company performance.
5
<PAGE> 9
As of March 17, 2000, a balance of 114,532 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 101,554 shares were granted to all participants in the Program in
1999.
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 $850,406 in 1999 compared to $404,878 in
1998 and $676,938 in 1997 and their total annual compensation was $1,154,872 in
1999 compared to $1,025,706 in 1998 and $1,072,353 in 1997.
The following Summary Compensation Table sets forth the annual salary,
annual bonus (including cash and stock) and long-term compensation (including
stock awards, options granted and long-term incentive cash payments) earned by
the Company's Chief Executive Officer and the other four highest paid executive
officers of the Company employed at the end of the year for services rendered
during each of the last three years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
-----------------------------------
AWARDS
ANNUAL COMPENSATION ------------------------- PAYOUTS
----------------------------------- SHARES -------
OTHER ANNUAL COMMON STOCK UNDERLYING LTIP ALL OTHER
SALARY BONUS COMPENSATION AWARD(S) OPTIONS PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($)(1) ($)(2) $(3) (#)(4) ($)(5) ($)(6)
- --------------------------- ---- -------- --------- ------------ ------------ ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dennis E. Wheeler........... 1999 $426,399 $394,281 -- 4,438 75,364 $ 9,615 43,585
Chairman, President & 1998 407,638 204,645 -- -- 42,569 -- 48,004
Chief Executive Officer 1997 394,417 330,472 -- 3,852 119,984 22,952 38,005
Robert Martinez(7).......... 1999 249,124 181,200 -- 363 25,500 784 21,214
Senior Vice-President -- 1998 208,243 81,555 -- -- 16,735 -- 19,472
Chief Operating Officer 1997 155,433 85,913 -- 474 15,485 2,825 14,024
Robert T. Richins........... 1999 171,216 100,206 -- -- 7,686 -- 13,757
Vice President -- 1998 143,179 40,996 -- -- 3,739 -- 13,123
Environmental & 1997 86,500 68,136 -- -- 1,755 -- 358
Governmental Affairs
James K. Duff............... 1999 157,578 84,375 -- -- 7,221 -- 13,972
Vice President -- 1998 138,921 32,715 -- -- 3,268 -- 14,337
Business Development 1997 130,000 53,243 -- -- 7,462 -- 11,893
Paul B. Valenti(8).......... 1999 150,555 90,344 -- -- -- -- 14,423
Vice President --
Operations 1998 127,725 44,967 -- -- 5,139 -- 11,446
1997 36,692 17,297 -- -- 2,169 -- --
</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. 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 1997, 1998 and 1999 were paid
in March 1998, March 1999 and March 2000, 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
$3.44 per share closing price of the shares on the New York Stock Exchange
on December 31, 1999) 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,
6
<PAGE> 10
1999 were as follows: Dennis E. Wheeler -- 15,445 shares ($53,131) and
Robert Martinez -- 2,011 shares ($6,918). 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 1998 and 1999 performance were
granted in March 1999 and March 2000, respectively. The options granted with
respect to 1997 performance include (i) a grant of options in July 1997 in
recognition of the fact that historical cash compensation had fallen below
industry norms, (ii) the customary grant of options in March 1998 and (iii)
a grant of options in September 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 1996 and are based on the
performance period ending December 31, 1999. 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 401(k)
Retirement Plan (the "Retirement Plan") and amounts credited to the
Company's Supplemental Retirement Plan (the "Supplemental Retirement Plan").
All full-time employees 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 1997, 1998 and 1999, the contribution
was 5%. In addition, the Retirement Plan provides for an Employee Savings
Plan which allows each employee to contribute up to 16% of compensation,
subject to a maximum contribution of $10,000. The Company contributes an
amount equal to 50% of the first 6% of any such contributed amount. Accrued
benefits under the Retirement Plan 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 1999, Messrs. Wheeler,
Martinez, Richins, Duff and Valenti were credited with Company contributions
of $12,800, $12,800, $11,161, $12,800, and $12,800, respectively, under the
Retirement Plan. In 1999, Messrs. Wheeler, Martinez, Richins, Duff and
Valenti, were credited with $22,582, $8,099, $2,535, $1,136, and $1,623,
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 1999, the amounts of above-market
interest earnings accrued for the benefit of Messrs. Wheeler, Martinez,
Richins and Duff, amounted to $8,202, $316, $61, and $37, respectively.
(7) Prior to his appointment as Senior Vice President -- Chief Operating Officer
on May 15, 1998, Mr. Martinez served as Vice President -- Operations from
April 1 1997 to May 15, 1998, as Vice President -- Engineering, Operational
Services and South American Operations of the Company from January 1, 1997
to March 30, 1997, and as Vice President and General Manager of the
Company's subsidiary, Rochester Coeur, Inc., from August 13, 1988 to
December 31, 1996.
(8) Prior to his appointment as Vice President -- Operations on December 31,
1999, Mr. Valenti served as Vice President -- Engineering and Development
since September 1997. Prior to September 1997, Mr. Valenti was Vice
President of Operations and Development for USMX, Inc.
The following Option Grants Table sets forth, for each of the named
executive officers, information regarding individual grants of options granted
under the LTIP in March 2000 for services rendered in 1999 and their potential
realizable values. Information regarding individual option grants includes the
number of options granted, the percentage of total grants to employees
represented by each grant, the per-share exercise price and the expiration date.
The potential realizable value of the options are based on assumed annual 0%, 5%
and 10% rates of stock price appreciation over the term of the option. Also set
forth is the amount of the
7
<PAGE> 11
increases in the value of all of the Company's outstanding shares of Common
Stock that would be realized in the event of such annual rates of stock price
appreciation.
OPTION GRANTS TABLE
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE VALUE AT
--------------------------------------------- ASSUMED ANNUAL RATES OF
NUMBER OF % OF TOTAL STOCK PRICE APPRECIATION
SHARES OPTIONS GRANTED FOR OPTION TERM(4)
UNDERLYING TO EMPLOYEES EXERCISE ---------------------------------------------
OPTIONS GRANTED IN FISCAL PRICE EXPIRATION
NAME (#)(1) YEAR(2) ($/SH)(3) DATE 0% 5%($) 10%($)
- ---- --------------- --------------- --------- ---------- --- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Dennis E. Wheeler.......... 75,364 40.4% $ 2.06 3/21/10 $ 0 $ 97,973 $ 247,194
Robert Martinez............ 25,500 13.7 2.06 3/21/10 0 33,150 83,640
Robert T. Richins.......... 7,686 4.1 2.06 3/21/10 0 9,992 25,210
James K. Duff.............. 7,221 3.9 2.06 3/21/10 0 9,387 23,685
Paul B. Valenti............ -- -- -- -- 0 -- --
All Shareholders(5)........ 0 48,165,088 121,524,223
Named Executive Officers'
Gains as a % of All
Shareholder Gains........ 0 .31% .31%
</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 186,603 shares granted to all employees.
(3) The exercise price is equal to the modified Black Scholls calculation option
value as a percent of 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 37,050,068 shares of Common Stock outstanding on March 17, 2000.
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, 1999. No options were
exercised during 1999 by such persons.
8
<PAGE> 12
AGGREGATE OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE
<TABLE>
<CAPTION>
NUMBER OF SHARES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT FY-END IN-THE-MONEY
SHARES ACQUIRED (#) OPTIONS AT FY-END ($)(1))
ON EXERCISE VALUE EXERCISABLE/ EXERCISABLE/
NAME (#) REALIZED ($) UNEXERCISABLE UNEXERCISABLE
- ---- --------------- ------------ ---------------------- -------------------------
<S> <C> <C> <C> <C>
Dennis E. Wheeler........... -- -- 181,964/129,179 $0/24,337
Robert Martinez............. -- -- 18,854/28,075 0/9,567
Robert T. Richins........... -- -- 439/5,055 0/2,138
James K. Duff............... -- -- 4,364/8,316 0/1,868
Paul B. Valenti............. -- -- 543/6,765 0/2,938
</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) made
in March 2000 for services rendered in 1999 under the LTPSP. (Payouts for the
completed four-year performance periods ending in 1997, 1998 and 1999 are
reported above under the LTIP Payouts column of the Summary Compensation Table.)
LONG-TERM INCENTIVE PLAN AWARDS TABLE
<TABLE>
<CAPTION>
NUMBER OF ESTIMATED FUTURE-PAYOUTS UNDER
SHARES, UNITS PERFORMANCE OR NON-STOCK PRICE BASED PLANS(2)
OR OTHER OTHER PERIOD -------------------------------
RIGHTS UNTIL MATURATION OR THRESHOLD TARGET MAXIMUM
NAME (#)(1) PAYOUT (#) (#) (#)
- ---- ------------- ------------------- ---------- ------- --------
<S> <C> <C> <C> <C> <C>
Dennis E. Wheeler.................... 66,319 01/01/00-12/31/03 33,160 66,319 99,479
Robert Martinez...................... 22,440 01/01/00-12/31/03 11,220 22,440 33,660
Robert T. Richins.................... 6,763 01/01/00-12/31/03 3,382 6,763 10,145
James K. Duff........................ 6,354 01/01/00-12/31/03 3,177 6,354 9,531
Paul B. Valenti...................... -- 01/01/00-12/31/03 -- -- --
</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.
(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 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%. Commencing with the calculation of LTPSP award
determinations in 1999, the Company changed the composition of the
Comparable Group to the 13 companies identified in the Compensation
Committee Report set forth below.
9
<PAGE> 13
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, John H. Robinson and Robert E.
Mellor. 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, utilize 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 1999 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 1999, 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 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 1999 were $850,406 compared to
$404,878 in 1998 and $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, 25% is allocated to stock options granted under the LTIP and
75% 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 Modified Black
Scholls calculation value as a percent of fair market value of the Common Stock
on the date of grant. As of March 17, 2000, nonqualified stock options and
incentive stock options to purchase a total of 623,514 shares of Common Stock at
an average exercise price of $9.31 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 150% 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"). Prior
10
<PAGE> 14
to 1999, the companies in the Comparable Group were Asarco, Barrick Gold Corp.,
Battle Mountain Gold Co., Echo Bay Mines, Ltd., Hecla Mining Co., Homestake
Mining Co., Meridian Gold, Inc. and Placer Dome, Inc. In order to constitute the
Comparable Group with companies closer in size to the Company and to reflect the
Company's recent emphasis on silver production, in 1999 the Company changed the
Comparable Group to include Apex Silver Mines Ltd., Battle Mountain Gold Co.,
Bema Gold Corp., Cambior Inc., Echo Bay Mines Corp., First Silver Reserve, Inc.,
Glamis Gold Ltd., Hecla Mining Co., Kinross Gold Corp., Meridian Gold, Inc., Pan
American Silver Corporation, TVX Gold, Inc. and Viceroy Resources Corp. 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.
Payments made in March 2000 under the AIP are based on 1999 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
objectives. With respect to the individual performance portion of the March 2000
AIP award to the Company's Chairman/President/CEO, the award was based on 1999
performance and reflected the following Company performance accomplishments in
1999:
- the successful negotiation and consummation in September 1999 of the
Company's purchase of silver properties and assets from Asarco, as a
result of which the Company owns 100% of Silver Valley, which owns the
Coeur and Galena Mines in the heart of the Coeur d'Alene Mining district,
historically one of the richest silver producing districts in the world,
as well as interests in silver exploration and development properties in
Bolivia and Peru;
- the successful implementation of a cost reduction program resulting in
decreases in the costs of production at several of the Company's mines,
including the Rochester Mine (where cash costs declined to $3.97 per
equivalent ounce of silver in 1999 from $4.07 in 1998), the Fachinal Mine
(where cash costs declined to $304 per equivalent ounce of gold in 1999
from $314 in 1998) and the Petorca Mine (where cash costs declined to
$271 per ounce of gold from $336 in 1998);
- the favorable $31.5 million settlement received in September 1999 by the
Company from a lawsuit regarding the Golden Cross Mine in New Zealand
that the Company had acquired in April 1993;
- the acquisition in August 1999 of the mineral rights to the Nevada
Packard Property adjacent to the Rochester Mine, which added
approximately 9.5 million low-cost, silver equivalent ounces to the
Rochester reserve base; and
- the realization of $4.9 million of gains in the Company's gold price
protection program, the acquisition of approximately $10.0 million of
outstanding convertible subordinated debentures at a cost of $6.2 million
and the reduction of approximately $3.0 million of general and
administrative expenses during 1999.
Compensation Committee of the
Board of Directors
Joseph C. Bennett, Chairman
Cecil D. Andrus
John H. Robinson
Robert E. Mellor
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 + 1% not to exceed 10% and payout may be affected by a lump
sum or an annuity. Any portion of the incentive award may be deferred into Coeur
d'Alene Mines' stock
11
<PAGE> 15
equivalents in the Supplemental Retirement and Deferred Compensation Plan for a
minimum of five years and will receive a 25% match on the amount deferred.
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. Information
relating to options granted to outside directors on January 4, 1999, was set
forth in last year's proxy statement relating to the 1999 Annual Meeting of
Shareholders. The following table sets forth information regarding options that
were granted under the Plan to non-employee directors on January 3, 2000:
<TABLE>
<CAPTION>
AMOUNT OF NUMBER OPTION
FOREGONE OF SHARES EXERCISE
DIRECTOR'S SUBJECT TO PRICE PER
NAME OF OUTSIDE DIRECTOR FEES OPTION* SHARE**
- ------------------------ ---------- ---------- ---------
<S> <C> <C> <C>
Cecil D. Andrus............................................. $ 5,000 2,193 $3.44
Joseph C. Bennett........................................... 5,000 2,193 3.44
James J. Curran............................................. 50,000 21,930 3.44
James A. McClure............................................ 5,000 2,193 3.44
Robert E. Mellor............................................ 5,000 2,193 3.44
John H. Robinson............................................ 5,000 2,193 3.44
Timothy R. Winterer......................................... 10,000 4,386 3.44
------- ------
Total.............................................. $85,000 37,281
======= ======
</TABLE>
- ---------------
* 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.
** 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 3,
2000, 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.
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.
12
<PAGE> 16
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 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 1999, and continuing from year-to-year thereafter unless terminated
by the Company by written notice, the Executive Severance Agreements with 11
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 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
As announced by the Company on August 2, 1999, the firm of Ernst & Young
LLP ceased to serve as the Company's independent accounting firm on July 27,
1999. On October 25, 1999, the Company engaged the firm of Arthur Andersen LLP
to serve as the Company's independent accounting firm for the year ended
December 31, 1999. The Company's Board of Directors has appointed Arthur
Andersen LLP to serve as the Company's independent accounting firm for the
current fiscal year ending December 31, 2000. A resolution will be presented at
the Annual Meeting to ratify the appointment by the Company's Board of Directors
of Arthur Andersen LLP to serve as the Company's independent accountants for the
current fiscal year. A majority vote is required for ratification. A
representative of Arthur Andersen 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 or she desires to do so.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE IN FAVOR OF THE
PROPOSED RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE COMPANY'S
INDEPENDENT ACCOUNTANTS FOR THE CURRENT FISCAL YEAR.
13
<PAGE> 17
STOCK PERFORMANCE CHART
The following chart compares the Company's cumulative total shareholder
return with (i) the S&P 500 Index, which is a performance indicator of the
overall stock market, (ii) a Company-determined peer group that was used in
preparing the stock performance charts set forth in the Company's past proxy
Statements (the "Old Peer Group"), (iii) the Company-determined peer group that
the Company has adopted for use in preparing the stock performance chart set
forth in this Proxy Statement and plans to use in preparing the stock
performance charts to be set forth in future Proxy Statements.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG COEUR D'ALENE MINES CORPORATION,
S&P 500 INDEX, OLD AND NEW PEER GROUP INDEXES
[LINE GRAPH]
<TABLE>
<CAPTION>
COEUR D' ALENE MINES
CORPORATION COMMON OLD PEER GROUP NEW PEER GROUP
STOCK S&P 500 INDEX INDEX** INDEX***
-------------------- ------------- -------------- --------------
<S> <C> <C> <C> <C>
Dec. 1994 100.00 100.00 100.00 100.00
Dec. 1995 105.48 137.45 109.10 96.48
Dec. 1996 93.92 168.93 105.00 92.57
Dec. 1997 55.49 225.21 66.58 54.60
Dec. 1998 28.72 289.43 65.35 43.30
Dec. 1999 21.35 349.92 57.81 33.51
</TABLE>
Assumes $100 invested on January 1, 1994, in the Company's Common Stock, S&P 500
Index and the peer group indexes.
- ---------------
* Total return assumes reinvestment of dividends.
** The issuers of common stock included in the Old Peer Group index are
Asarco, Barrick Gold Corp., Battle Mountain Gold Co., Echo Bay Mines, Ltd.,
Meridian Gold, Inc., Hecla Mining Company, Homestake Mining Company and
Placer Dome, Inc.
*** The issuers of common stock included in the New Peer Group are Apex Silver
Mines Ltd., Battle Mountain Gold Co., Bema Gold Corp., Cambior Inc., Echo
Bay Mines Corp., First Silver Reserve, Inc., Glamis Gold Ltd., Hecla Mining
Co., Kinross Gold Corp., Meridian Gold, Inc., Pan American Silver
Corporation, TVX Gold, Inc. and Viceroy Resources Corp. As in the case of
the change in 1999 in the Comparable Group of companies used for
determining awards under the LTPSP that is discussed above in the
Compensation Committee Report, the change in 1999 from the Old Peer Group
to the New Peer Group, which include the same companies that are in the new
Comparable Group, was made in order to include companies closer in size to
the Company and to reflect the Company's change in emphasis to silver
production.
**** Fiscal year ending December 31.
14
<PAGE> 18
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 on Form 4 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 1999 were
timely filed.
YEAR 2001 SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 2001 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 4, 2000, in order for them to be considered for inclusion in the 2000
Proxy Statement. A shareholder desiring to submit a proposal to be voted on at
next year's Annual Meeting, but not desiring to have such proposal included in
next year's proxy statement relating to that meeting, should submit such
proposal to the Company by February 15, 2001 (i.e., at least 45 days prior to
the expected date of the mailing of the proxy statement). Failure to comply with
that advance notice requirement will permit management to use its discretionary
voting authority if and when the proposal is raised at the Annual Meeting
without having had a discussion of the proposal in the 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 Company's 1999 Annual Report to
Shareholders, which includes financial statements for the year ended December
31, 1999. The Annual Report is not to be regarded as part of the proxy
solicitation materials.
By order of the Board of Directors,
COEUR D'ALENE MINES CORPORATION
DENNIS E. WHEELER
Chairman of the Board
Coeur d'Alene, Idaho
March 31, 2000
15
<PAGE> 19
PROXY
COEUR D'ALENE MINES CORPORATION
400 COEUR D'ALENE MINES BUILDING, 505 FRONT AVENUE, P.O. BOX 1
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 9, 2000, 9:30 A.M., LOCAL TIME
The undersigned appoints Dennis E. Wheeler or, in his absence, Geoffrey A.
Burns, 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 9, 2000,
or at any adjournment thereof, with all powers the undersigned would have if
personally present. The shares will be voted as directed, and with respect to
other matters of business properly before the meeting as the Proxies shall
decide. If no decision is made, this Proxy will be voted FOR Proposals 1 and 2.
(CONTINUED ON REVERSE SIDE)
- -------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
<PAGE> 20
Please mark
your votes like
this in blue or [X]
black ink.
THE BOARD OF DIRECTORS RECOMMENDS VOTING FOR THE FOLLOWING PROPOSALS:
WITHHOLD
FOR AUTHORITY
all seven nominees to vote for all
(except as marked to nominees
the contrary below) listed at left
TO ELECT DIRECTORS C.D.ANDRUS, [ ] [ ]
J.C. BENNETT, J.J. CURRAN,
J.A. McCLURE, R.E. MELLOR,
D.T. SALIDO, X.G.DE Q. TOPETE,
J.H. ROBINSON, and D.E. WHEELER
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FOR AGAINST ABSTAIN
2. TO RATIFY THE SELECTION [ ] [ ] [ ]
OF ARTHUR ANDERSEN LLP AS
THE COMPANY'S INDEPENDENT
PUBLIC ACCOUNTANTS FOR 2000
3. In their discretion, the Proxies
are authorized to vote upon such
other business as may come before
the meeting.
Dated:
--------------------------------, 2000
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Signature of Stockholder
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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.
PLEASE COMPLETE, SIGN, DATE AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
POSTAGE-PAID ENVELOPE.
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- FOLD AND DETACH HERE -
