EXHIBIT 10.23

Execution Copy

AMENDMENT NO. 1 TO LETTER AGREEMENT

This Agreement to Amend the Letter Agreement is made this 31st day of December,
2007 by and between Bucyrus International, Inc. (the “Company”) and William S.
Tate (the “Executive”).

WHEREAS, on August 8, 2007, the Company and the Executive entered into a Letter
Agreement (the “Letter Agreement”) with respect to the terms and conditions of
the Executive’s employment with the Company, which Letter Agreement provides,
among other items, a severance payment of 12 months of the Executive’s base
salary if the Company terminates the Executive’s employment without cause or if
the Executive resigns upon thirty days advance notice after completing 24 months
of service, and that allows the Executive to choose between a cash payment and
continued medical coverage upon termination of employment prior to age 65;

WHEREAS, the severance payments and the continued medical coverage provided
under the Letter Agreement are considered deferred compensation subject to the
provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”), which was effective January 1, 2005;

WHEREAS, the Company and the Executive desire to amend the Letter Agreement in
order to comply with final regulations issued by the Internal Revenue Service
under Section 409A of the Code.

NOW, THEREFORE, in consideration of the promises and for the mutual
consideration hereinafter set forth and provided in the Letter Agreement, the
parties agree as follows:

 

1. Effective January 1, 2008, the third paragraph of the letter agreement is
amended to read as follows:

Notwithstanding the foregoing, the first six months of severance payments due
under the Letter Agreement will be accumulated and paid in a lump sum following
the end of a six (6)-month delay which begins upon your Separation from Service.
For purposes of this Agreement:

(a) “Separation from Service” means your Termination of Employment, or if you
continue to provide services to the Company and its 409A Affiliates following
your Termination of Employment, such later date as is considered a separation
from service, within the meaning of Code Section 409A, from the Company and its
409A Affiliates. Specifically, if you continue to provide services to the
Company or a 409A Affiliate in a capacity other than as an employee, such shift
in status is not automatically a Separation from Service.

(b) “Termination of Employment” shall occur when you and the Company reasonably
anticipate that no further services will be performed by you for the Company

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and its 409A Affiliates or that the level of bona fide services that you will
perform as an employee of the Company and its 409A Affiliates will permanently
decrease to no more than twenty percent (20%) of the average level of bona fide
services that you performed (whether as an employee or independent contractor)
for the Company and its 409A Affiliates over the immediately preceding
thirty-six (36)-month period (or such lesser period of services).
Notwithstanding the foregoing, if you take a leave of absence for purposes of
military leave, sick leave or other bona fide leave of absence, you will not be
deemed to have incurred a Termination of Employment for the first six (6) months
of the leave of absence, or if longer, for so long as your right to reemployment
is provided either by statute or by contract, including this Agreement; provided
that if the leave of absence is due to a medically determinable physical or
mental impairment that can be expected to result in death or last for a
continuous period of not less than six (6) months, where such impairment causes
you to be unable to perform the duties of your position of employment or any
substantially similar position of employment, the leave may be extended for up
to twenty-nine (29) months without causing a Termination of Employment.

(c) “409A Affiliate” means a corporation, partnership, joint venture, trust,
association or other trade or business that, with the Company, forms part of a
controlled group of corporations or group of trades or businesses under common
control within the meaning of Code Section 414(b) or (c); provided that the
phrase “at least 50 percent” shall be used in place of the phrase “at least 80
percent” each place it appears therein or in the regulations thereunder.

 

2. Effective January 1, 2008, the fifth paragraph of the Letter Agreement is
replaced in its entirety with the following:

Should either you or the Company terminate your employment prior to age
sixty-five (65) for any reason other than for “Cause”, the Company agrees to
either (select one):

 

¨ Enhance your severance payment by an amount equal to the cost of the then in
effect monthly COBRA rates, for the active medical plan option in which you and
your spouse are enrolled, multiplied by the number of months between the date of
your termination and the beginning of the month in which you reach age
sixty-five (65). This enhanced severance payment will be paid in a lump sum
following the end of the six-month delay which begins upon your Separation from
Service; or

 

x From the time of your termination until age sixty-five (65), you may elect for
you and your spouse to participate in a medical plan option(s) offered by the
Company for active salaried employees. The Company will assume the full cost for
this coverage, which will be equal to the COBRA rates for the medical plan in
which you enroll, which are adjusted each calendar year until age sixty-five
(65).

 

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3. Except as provided herein, the provisions of the Letter Agreement shall
continue in full force and effect. This Amendment may be executed in one or more
counterparts, each of which will be deemed an original but all of which together
will constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.

 

EXECUTIVE     BUCYRUS INTERNATIONAL, INC.

/s/ William S. Tate

    By:  

/s/ T. W. Sullivan

William S. Tate     Name:   Timothy W. Sullivan     Title:   President & Chief
Executive Officer

 

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