Exhibit 10.1
EXECUTIVE SEVERANCE PLAN OF NEWMONT
Effective October 26, 2011

 

 

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TABLE OF CONTENTS

              Page  
 
        ARTICLE I

 
       
DEFINITIONS
    1  
 
        ARTICLE II
ELIGIBILITY

 
       
Section 2.01. General Eligibility Requirements
    3  
 
        ARTICLE III
BENEFITS

 
       
Section 3.01. Basic Severance Benefits
    4  
Section 3.02. Coordination With Certain Change in Control Programs
    4  
Section 3.03. Payment of Severance Benefits
    4  
Section 3.04. Other Benefits
    5  
Section 3.05. Return of Benefits in the Event of Cause
    5  
 
        ARTICLE IV

 
       
CONTINUATION OF HEALTH CARE COVERAGE
    6  
 
        ARTICLE V

 
       
PROTECTION OF MEDICAL PRIVACY
    6  
 
        ARTICLE VI
ADMINISTRATION COMMITTEE AND CLAIMS FOR BENEFITS

 
       
Section 6.01. Appointment of the Administration Committee
    6  
Section 6.02. Responsibilities of the Administration Committee
    6  
Section 6.03. Organization of the Administration Committee
    6  
Section 6.04. Indemnification of Administration Committee Members
    7  
Section 6.05. Benefits Claims and Appeals
    7  
 
        ARTICLE VII
MISCELLANEOUS

 
       
Section 7.01. Plan Documentation
    7  
Section 7.02. Funding of Severance Benefits
    7  
Section 7.03. Amount Payable Upon Death of Eligible Participant
    7  
Section 7.04. Confidential Information
    8  
Section 7.05. Release
    8  

Executive Severance Plan of Newmont
Effective October 26, 2011

 

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              Page  
 
       
Section 7.06. Employment Status
    8  
Section 7.07. Validity and Severability
    8  
Section 7.08. Governing Law
    8  
Section 7.09. Right of Offset
    8  
Section 7.10. Conformance With Applicable Laws
    9  
Section 7.11. Payments Due Minors or Incapacitated Persons
    9  
 
        ARTICLE VIII
DURATION, AMENDMENT AND TERMINATION

 
       
Section 8.01. Duration
    9  
Section 8.02. Amendment or Termination
    9  

Executive Severance Plan of Newmont
Effective October 26, 2011

 

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EXECUTIVE SEVERANCE PLAN OF NEWMONT
INTRODUCTION
Newmont USA Limited, and certain related entities (“Newmont”), hereby
establishes this Executive Severance Plan of Newmont (the “Plan”) effective
October 26, 2011 for the purpose of providing certain Executive Employees as
defined below with severance benefits.
This Plan is intended to constitute a health and welfare benefit plan under the
Employee Retirement Income Security Act of 1974 and not subject to the
provisions of Internal Revenue Code Section 409A. Notwithstanding any provision
herein to the contrary, Newmont explicitly reserves the right to amend or modify
the Plan in any manner necessary to comply with any laws or regulations that may
be determined by Newmont as applicable to the Plan.
ARTICLE I
DEFINITIONS
The following definitions shall apply to the Plan.
“Administration Committee” means the committee appointed by the Board or its
delegate in writing which serves in accordance with Article VI.
“Affiliated Entity” means any corporation or other entity, now or hereafter
formed, that is or shall become affiliated with the Employer, either directly or
indirectly, through stock ownership or control, and which is (a) included in the
controlled group of corporations (within the meaning of Code Section 1563(a)
without regard to Code Section 1563(a)(4) and Code Section 1563(e)(3)(C)) in
which the Employer is also included or (b) included in the group of entities
(whether or not incorporated) under common control (within the meaning of Code
Section 414(c)) in which the Employer is also included.
“Board” means the Board of Directors of Newmont USA Limited.
“Cause” means: a) engagement in illegal conduct or gross negligence or willful
misconduct, provided that if the Executive Employee acted in accordance with an
authorized written opinion of Employer’s, or an affiliated entity’s, legal
counsel, such action will not constitute “Cause;” b) any dishonest or fraudulent
activity by the Executive Employee or the reasonable belief by the Employer of
the Executive Employee’s breach of any contract, agreement or representation
with the Employer or an affiliated entity, or c) violation of Newmont Mining
Corporation’s Code of Business Ethics and Conduct.
“Code” means the Internal Revenue Code of 1986, as amended.
“Date of Termination” means the date on which a Executive Employee ceases to be
an Employee of the Employer or its Affiliated Entities.

 

 

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“Disability” means a condition that causes the Employee to terminate employment
with the Employer and/or all participating Employers and the Employee has
immediately begun receiving benefits from a disability plan of Newmont following
termination of employment.
“Employee” means an employee of an Employer who is not (a) an individual who
performs services for the Employer under an agreement, contract or arrangement
(which may be written, oral or evidenced by the Employer’s payroll practice)
between the Employer and the individual or with any other organization that
provides the services of the individual to the Employer pursuant to which the
individual is initially classified or treated as an independent contractor or
whose remuneration for services has not been treated initially as subject to the
withholding of federal income tax pursuant to Code Section 3401, or who is
otherwise treated as an employee of an entity other than the Employer,
irrespective of whether he or she is treated as an employee of the Employer
under common-law employment principles or pursuant to the provisions of Code
Section 414(m), 414(n) or 414(o), even if the individual is subsequently
reclassified as a common-law employee as a result of a final decree of a court
of competent jurisdiction, the settlement of an administrative or judicial
proceeding or a determination by the Internal Revenue Service, the Department of
the Treasury or the Department of Labor, (b) an individual who is a leased
employee, (c) a temporary employee, or (d) an individual covered by a collective
bargaining agreement.
“Employer” means Newmont USA Limited and any Affiliated Entities.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“Executive Employee” means an Employee with the classification or title of Chief
Executive Officer (“CEO”), Executive Vice President (“E2-E3”), Senior Vice
President (“E4”), Vice President (“E5”), Group Executive (“E6”) or Director
(“109”) and is on the Newmont’s United States payroll.
“Involuntary Termination” means any involuntary termination of employment of an
Executive Employee by the Employer for any reason other than: (a) Cause, as
determined in the sole discretion of Employer, (or if after termination it is
determined the Executive Employee could have been terminated for Cause),
(b) termination of employment due to disability under a disability plan of
Newmont (as determined by the Administration Committee or its delegate in its
sole discretion), (c) retirement as of Normal or Early Retirement pursuant to
the Pension Plan of Newmont as those terms are defined therein, and (d) death of
the Executive Employee prior to termination of employment. An Involuntary
Termination shall not be deemed to have occurred if the Executive Employee
accepts any position with Employer, or the Employer offers the Executive
Employee employment within a 75 mile radius of the Executive Employee’s prior
position, at Executive Employee’s same or higher annual base salary and within
one compensation grade level of Executive Employee’s prior position.
“Plan” means this Executive Severance Plan of Newmont.
“Salary” means the Executive Employee’s annual base salary as of termination of
employment. Salary shall not include any extra pay for foreign service or
foreign assignment, hardship pay, moving allowances, the cost of goods and
services, danger pay, the value of any stock/equity based compensation
(including but not limited to stock options, deferred stock, restricted stock,
restricted stock units, common stock or performance stock units).

 

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“Service” means continuous service with the Employer or an Affiliated Entity
commencing on the Executive Employee’s date of hire and each successive 12-month
period.
“Target Annual Bonus” means the Annual Incentive Compensation Payroll Practice
or other annual bonus payroll practice amount that the Executive Employee would
have received for the year in which his Date of Termination occurs if the target
goals had been achieved. “Annual Bonus” shall not include any extra pay for
foreign service or foreign assignment, hardship pay, moving allowances, the cost
of goods and services, danger pay, the value of any stock/equity based
compensation (including but not limited to stock options, deferred stock,
restricted stock, restricted stock units, common stock or performance stock
units).
ARTICLE II
ELIGIBILITY
Section 2.01. General Eligibility Requirements. The benefits provided under this
Plan will be available to any Executive Employee employed by Newmont or any of
its U.S. based affiliates in salary grades 109 to E-1 at the time of termination
of employment provided the following requirements are met:
(a) The Executive Employee leaves employment with the Employer due to
Involuntary Termination; and
(b) The Executive Employee delivers to the Administration Committee or its
delegate, within the timeframe prescribed by the Administration Committee or its
delegate, an executed Agreement and Release that conforms to Section 7.05 and is
acceptable to the Administration Committee or its delegate and the Agreement and
Release is not subsequently revoked.
Subject to the coordination provisions of Section 3.02 pertaining to change in
control plans, if an Executive Employee is eligible for benefits under this
Plan, the Executive Employee shall not be entitled to severance benefits under
any other severance plan of Newmont, including but not limited to the Severance
Plan of Newmont.

 

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ARTICLE III
BENEFITS
Section 3.01. Basic Severance Benefits. Severance benefits shall consist of a
portion of Salary and Target Annual Bonus calculated as follows:
(a) Salary Schedule by Grade

              Salary Grade           Benefit
CEO
    E1     24 months of Salary
 
           
EVP
    E2
E3     15 months of Salary + 1 month of Salary for every year of Service up to a
maximum total of 18 months of Salary
 
           
SVP
    E4     12 months of Salary + 1 month of Salary for every year of Service up
to a maximum total of 15 months of Salary
 
           
VP
    E5     12 months of Salary
 
           
Group Executive
    E6     9 months of Salary + 1 month of Salary for every year of Service up
to a maximum total of 12 months of Salary
 
           
Senior Director
    109     6 months of Salary + 1 month of Salary for every year of Service up
to a maximum total of 9 months of Salary

Monthly Salary is determined in one-twelfth increments based on regular annual
Salary at the time of termination of employment.
(b) The Executive Employee’s Target Annual Bonus pro-rated for the percentage of
the calendar year of termination for which the Employee was employed by
Employer. In the event that an Employee experiences an Involuntary Termination
at the beginning of a calendar year before the Annual Incentive Compensation
Payroll Practice or other annual bonus payroll practice amount is paid for the
prior calendar year, the Employee shall receive (i) the Target Annual Bonus
pro-rated for the percentage of the calendar year of termination for which the
Employee was employed by Employer and (ii) the actual Annual Incentive
Compensation Payroll Practice or other annual bonus payroll practice amount for
the prior calendar year when such payment is made in the normal course of
events.
Section 3.02. Coordination With Certain Change in Control Programs. If an
Executive Employee who is eligible for benefits and payments under this Plan is
also eligible to receive benefits and payments under a change of control plan of
Newmont, the Executive Employee shall only be entitled to receive payments and
benefits under this Plan or under the applicable change of control plan, but not
both, and shall be entitled to receive the greater of the benefits and payments
otherwise payable under this Plan or the benefits and payments otherwise payable
under the applicable change of control plan.
Section 3.03. Payment of Severance Benefits. The amount of severance benefits
payable to an Executive Employee under this Article III shall be paid in a
single cash lump sum as soon as administratively possible following the date of
the Executive Employee’s termination of employment and the Executive Employee’s
execution of a release described in Section 7.05 and the expiration of the
applicable revocation period. Such amount shall be paid no later than the
fifteenth day of the third month following the year in which the Executive
Employee met the requirements to receive benefits under this Plan.

 

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Section 3.04. Other Benefits.
(a) Medical, Vision, Prescription Drug and Dental Coverage. An Executive
Employee who is eligible to receive severance benefits under this Plan will be
entitled to Employer paid Consolidated Omnibus Budget Reconciliation Act
(“COBRA”) coverage for medical, vision, prescription drug and dental plan (if
and as such plans then exist) for a period of months equal to the number of
months of Salary that the Executive Employee receives as a severance benefit as
determined under Article III, if the Executive Employee elects COBRA coverage.
However, in no event shall the Employer paid COBRA coverage extend beyond the
period of time that the Executive Employee would otherwise be entitled to
continue coverage under the provisions of COBRA. The COBRA period will run
concurrent with medical coverage provided for under this Section. In the event
the number of months of salary paid as a severance benefit is less than the
Employee’s COBRA period, COBRA coverage shall continue at the Employee’s expense
for the remaining COBRA period.
(b) Life Insurance Plan. An Executive Employee will continue to be covered under
the basic group term life insurance portion of the Employer’s life insurance and
accidental death and dismemberment insurance plan (the “Life Insurance Plan”)
(if and as such plan then exists) to the extent such benefits are paid by the
Employer insuring the lives of the Executive Employee and his spouse for a
period of months equal to the number of months of Salary that the Executive
Employee receives as a severance benefit, but such coverage under the Life
Insurance Plan shall not exceed six months from the date of the Executive
Employee’s termination of employment. Coverage under the Life Insurance Plan
will cease at the end of such period without any notification by the Employer to
the Executive Employee. Any supplemental life insurance coverage and accidental
death and dismemberment coverage under the Life Insurance Plan will terminate on
the Executive Employee’s termination of employment.
(c) Outplacement Services. An Executive Employee who is eligible to receive
severance benefits under this Plan will be entitled to outplacement services
with a vendor of Employer’s choice for the period of months of Salary payable
under this Plan, not to exceed 12 months beginning with the month immediately
following termination of employment.
(d) Controlling Plan Provisions. Benefits provided pursuant to this Section 3.04
shall be governed by the respective benefit plans including rules pertaining to
HIPAA, COBRA and claims for benefits.
Section 3.05. Return of Benefits in the Event of Cause. In the event the
Employer determines that Cause existed for the termination of an Executive
Employee’s employment after the Executive Employee has been offered or received
benefits pursuant to this Plan, the Employer shall be entitled to recover such
amounts from the Executive Employee or offset any other amounts owed by the
Employer to the Executive Employee.

 

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ARTICLE IV
CONTINUATION OF HEALTH CARE COVERAGE
Continuation of coverage under the Plan shall be permitted only with respect to
health coverage described in Section 3.04(a) in accordance with the applicable
health plan and Section 3.04(a) of this Plan. No continuation of coverage is
otherwise permitted under this Plan.
ARTICLE V
PROTECTION OF MEDICAL PRIVACY
The Plan is generally not subject to HIPAA. HIPAA shall apply only with respect
to medical benefits described in Section 3.04(a) in accordance with the
applicable health plan.
ARTICLE VI
ADMINISTRATION COMMITTEE AND
CLAIMS FOR BENEFITS
Section 6.01. Appointment of the Administration Committee. The Board or its
delegate shall appoint the members of the Administration Committee who may be,
but need not be, officers, directors or Employees of Newmont. The members of the
Administration Committee shall hold office at the pleasure of the Board and
shall serve without compensation.
Section 6.02. Responsibilities of the Administration Committee. The
Administration Committee shall be responsible for the administration, operation
and interpretation of the Plan. The Administration Committee shall establish
rules from time to time for the transaction of its business. The Administration
Committee shall have the exclusive right to interpret the Plan’s provisions and
to exercise discretion where necessary or appropriate in the interpretation and
administration of the Plan and to decide any and all matters arising thereunder
or in connection with the administration of the Plan. Such decisions, actions
and records of the Administration Committee shall be conclusive and binding upon
all persons having or claiming to have any right or interest in or under the
Plan. Any decisions by the Administration Committee in respect of eligibility
for benefits under the Plan shall be subject to de novo review.
The Administration Committee may delegate some or all of its authority under the
Plan to any person, persons or entities. The Administration Committee may remove
any duly appointed delegate at any time at its sole discretion.
Section 6.03. Organization of the Administration Committee. The Administration
Committee shall adopt such rules as it deems desirable for the conduct of its
affairs and for the administration of its duties under the Plan. The
Administration Committee may appoint agents (who need not be members of the
Administration Committee) to whom it may delegate such powers as it deems
appropriate. The Administration Committee may make its determinations with or
without meetings, and it may authorize one or more of its members or agents to
sign instructions, notices and determinations on its behalf. Any action taken by
the Administration Committee shall be taken by a majority of the members
attending a meeting of the Administration Committee (provided at least a
majority of the Administration Committee members are at such meeting) or by a
majority of the members of the Administration Committee executing a written
instrument setting forth the action taken.

 

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Section 6.04. Indemnification of Administration Committee Members. Newmont shall
indemnify the members of the Administration Committee against any and all
claims, loss, damages, expense (including attorney fees) and liability arising
from any action or failure to act, except when the same is judicially determined
to be due to the gross negligence or willful misconduct of such member. Such
indemnification shall include the Administration Committee members or any
individuals delegated authority by the Administration Committee if such
individuals are employed by Newmont or an Affiliated Entity. Newmont does not
hereby indemnify any entity or person that is not an Employee of Newmont or an
Affiliated Entity. The indemnification provided hereunder shall continue as to a
person who has ceased acting as a director, officer, member, agent or Employee
of the Employer, and such person’s rights shall inure to the benefit of his
heirs and representatives.
Section 6.05. Benefits Claims and Appeals. The intention of Newmont is that the
Plan be construed as a “welfare plan,” as defined in Section 3(1) of ERISA, and
this Section 6.05 shall apply. The Administration Committee shall establish a
claims and appeals procedure applicable to persons eligible to participate in
the Plan. Unless otherwise required by applicable law, such procedures will
provide that any such person has not less than 60 days following receipt of any
adverse benefit determination within which to appeal the determination in
writing with the Administration Committee, and that the Administration Committee
must respond in writing within 60 days of receiving the appeal, specifically
identifying those Plan provisions on which the benefit denial was based and
indicating what, if any, information such person must supply in order to perfect
a claim for benefits. The claims procedures of this Section must be exhausted
prior to an individual bringing a legal claim or action for benefits under the
Plan.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Plan Documentation. This Plan shall constitute the “plan document”
for purposes of ERISA and other laws that may apply. In the event the provisions
of this Plan are inconsistent with other documents or communications, the
provisions of this Plan shall control.
Section 7.02. Funding of Severance Benefits. All severance benefit payments
under this Plan will be made by the Employer from its general funds and no
Executive Employee shall have any right with respect to any specific assets of
the Employer and shall be a general creditor of the Employer with respect to any
amounts payable hereunder.
Section 7.03. Amount Payable Upon Death of Eligible Participant. If an Executive
Employee dies after an Involuntary Termination of employment under the
provisions of this Plan but before receiving payment of the amount due
hereunder, such amount shall be paid, in a cash lump sum, to the beneficiary or
beneficiaries designated by the Executive Employee to receive life insurance
proceeds under the Employer’s Life Insurance Plan. In the absence of an
effective beneficiary designation, any amount payable hereunder following the
death of an Executive Employee shall be paid to the Executive Employee’s estate.

 

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Section 7.04. Confidential Information. Each Executive Employee shall hold in a
fiduciary capacity for the benefit of the Employer all secret or confidential
information, knowledge or data relating to the Employer or any of its Affiliated
Entities, and their respective businesses, which shall have been obtained by the
Executive Employee during the Executive Employee’s employment by the Employer or
any of its Affiliated Entities and which shall not be or become public knowledge
(other than by acts by the Executive Employee or representatives of the
Executive Employee in violation of this Plan). As a condition of participation
in this Plan, after termination of an Executive Employee’s employment with the
Employer, the Executive Employee shall not, without the prior written consent of
the Employer or as may otherwise be required by law or legal process,
communicate or divulge any such information, knowledge or data to anyone other
than the Employer and those designated by it.
Section 7.05. Release. As a condition to receipt of any benefits under this
Plan, an Executive Employee eligible to receive benefits under this Plan shall
execute an Agreement and Release, under which the Executive Employee:
(a) releases the Employer and Affiliated Entities and any director, officer,
Employee, agent or representative from any cause of action arising out of the
Executive Employee’s employment with and termination from an Employer;
(b) agrees to non-disparagement of Employer and Affiliated Entities, and;
(c) agrees to a non-solicitation clause of Employer’s and Affiliated Entities’
Employees. Such release shall include, but shall not be limited to, a waiver by
the Executive Employee of pursuit of any action based on wrongful termination,
state or federal nondiscrimination in employment laws or state and federal
compensation and benefits laws (including ERISA).
Section 7.06. Employment Status. This Plan does not constitute a contract of
employment or impose on the Employee or the Employer any obligation for the
Employee to remain an Employee or change the status of the Executive Employee’s
employment or the policies of the Employer regarding termination of employment.
Section 7.07. Validity and Severability. The invalidity or unenforceability of
any provision of the Plan shall not affect the validity or enforceability of any
other provision of the Plan, which shall remain in full force and effect, and
any prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 7.08. Governing Law. The validity, interpretation, construction and
performance of the Plan shall in all respects be governed by the laws of
Colorado, without reference to principles of conflict of law, except to the
extent preempted by federal law.
Section 7.09. Right of Offset. To the extent permitted by applicable law, the
Employer may, in its sole discretion, apply any payments otherwise due and
payable under this Plan against Employee or terminated Employee loans
outstanding to the Employer or other debts of the Employee or terminated
Employee to the Employer. By accepting payments under this Plan, the Executive
Employee shall consent to the reduction of any compensation paid to the
Executive Employee by the Employer to the extent the Executive Employee receives
an overpayment from the Plan. Notwithstanding the foregoing, however, the
Employer shall not offset any benefits payable pursuant to this Plan to the
extent such offset would result in the imposition of taxes or penalties pursuant
to Code Section 409A and the Treasury Regulations issued thereunder.

 

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Section 7.10. Conformance With Applicable Laws. Notwithstanding anything
contained herein to the contrary, this Plan shall be administered and operated
in accordance with any applicable laws and regulations, including, but not
limited to, laws affecting the timing of payments to Employees. The Board or its
delegate reserves the right to amend this Plan at any time in order for this
Plan to comply with any such laws and regulations.
Section 7.11. Payments Due Minors or Incapacitated Persons. If any person
entitled to a payment under this Plan is a minor, or if the Administration
Committee or its delegate determines that any such person is incapacitated by
reason of physical or mental disability, whether or not legally adjudicated as
an incompetent, the Administration Committee or its delegate shall have the
power to cause the payment becoming due to such person to be made to another for
his benefit, without responsibility of the Administration Committee or its
delegate, the Employer or any other person or entity to see to the application
of such payment. Payments made pursuant to such power shall operate as a
complete discharge of the Administration Committee, this Plan and the Employer.
ARTICLE VIII

DURATION, AMENDMENT AND TERMINATION
Section 8.01. Duration. Unless terminated by the Board, the Plan shall remain
effective hereafter.
Section 8.02. Amendment or Termination. The Board may amend or terminate this
Plan, at its sole discretion.
*The remainder of this page is intentionally left blank.

 

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The Plan Sponsor, by its duly authorized officer, has executed the Plan on the
date written below.

            NEWMONT USA LIMITED, Plan Sponsor
    Dated: October 26, 2011  By:   /s/ Stephen P. Gottesfeld         Name:  
Stephen P. Gottesfeld        Title:   Vice President, General Counsel and
Secretary   

 

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