Document:

Exhibit 10.4

 

CHANGE OF CONTROL AGREEMENT

 

[Name]

[Title]

[Address]

 

Dear [Name]:

 

Golden Minerals Company (the “Company”) considers it
essential to the best interests of its stockholders to foster the continuous
employment of key management personnel. 
In this connection, the Board of Directors of the Company (the “Board”)
recognizes that the possibility of a Change of Control (as defined in Section 2
hereof) may exist and that such possibility, and the uncertainty and questions
which it may raise among management, may result in the departure or distraction
of management personnel to the detriment of the Company and its stockholders.

 

The Board has determined that appropriate steps should
be taken to reinforce and encourage the continued attention and dedication of
members of the Company’s management, including yourself,
to their assigned duties without distraction in the face of potentially
disturbing circumstances arising from the possibility of a Change of Control,
although no such change is now contemplated.

 

In order to induce you to remain in the employ of the
Company, the Company agrees that you shall receive the severance benefits set
forth in this letter agreement (the “Agreement”) in the event your employment
with the Company is terminated subsequent to a Change of Control under the
circumstances described below.

 

1.             TERM OF AGREEMENT.  This Agreement shall be effective as of the
effective date of the Joint Plan of Reorganization of Apex Silver Mines Limited
and Apex Silver Mines Corporation Under Chapter 11 of
the Bankruptcy Code (the “Effective Date”) and shall continue from year to year
at the discretion of the Board.  Provided
no Change of Control shall have occurred, the Company may terminate this
Agreement at any time upon 12 months prior written notice to you; provided,
however, that in the event of a Change of Control during the term of
this Agreement, this Agreement shall remain in effect until the later of (a) the
date all of the obligations of the parties under the Agreement are satisfied or
(b) the second anniversary of the Change of Control.  Notwithstanding the foregoing, and provided
no Change of Control shall have occurred, this Agreement shall automatically
terminate upon the earlier to occur of (i) your termination of employment
with the Company, or (ii) the Company’s furnishing you with notice of
termination of employment, irrespective of the effective date of such
termination.

 

2.             CHANGE OF CONTROL.  No benefits shall be payable hereunder unless
there shall have been a Change of Control, as set forth below.  For purposes of this Agreement, a “Change of
Control” shall mean the first to occur of the following: (A) any person
becomes the beneficial owner, directly or indirectly, of securities of the
Company representing 35% or more of the combined voting power of the Company’s
then outstanding voting securities (other than (i) the Company, (ii) any
subsidiary of the Company, or (iii) one or more employee benefit plans
maintained by the Company); (B) three or more Directors of the Company, whose
election or nomination for election is not approved by a majority of the
applicable Incumbent Board, are 

 

 

elected within any single twelve month period to serve
on the Board; (C) members of the applicable Incumbent Board cease to
constitute a majority of the Board; (D) the consummation of a merger or
consolidation of the Company with or into any other corporation or entity or
person, or any other corporate reorganization, in which the stockholders of the
Company immediately prior to such consolidation, merger or reorganization own
less than 50% of the outstanding voting securities of the surviving entity (or
its parent) following the consolidation, merger or reorganization or (E) the
consummation of a sale, lease or other disposition of all or substantially all
of the assets of the Company.  For
purposes of Section 2(A) hereof, the terms “person” and “beneficial
owner” shall have the meanings set forth in Section 13(d) and Rule 13d-3,
respectively, of the Securities Exchange Act of 1934, as amended, and in the
regulations promulgated thereunder.  For
purposes of this Section 2, “Incumbent Board” means (i) members of
the Board of Directors of the Company as of the date hereof, to the extent that
they continue to serve as members of the Board, and (ii) any individual who becomes a member of the Board after the date
hereof, if such individual’s election or nomination for election as a Director
was approved by a vote of at least 75% of the then applicable Incumbent
Board.  Notwithstanding the foregoing, a
Change of Control shall not be deemed to occur under this Agreement unless the
events that have occurred would also constitute a “Change in the Ownership or
Effective Control of a Corporation or in the Ownership of a Substantial Portion
of the Assets of a Corporation” under Treasury Department Final Regulation
1.409A-3(j)(5), or any successor thereto.

 

3.             TERMINATION OF EMPLOYMENT FOLLOWING
CHANGE OF CONTROL.  If a Change of
Control occurs during the term of this Agreement, you shall be entitled to the
benefits provided in Subsection 4(iii) hereof upon the subsequent
termination of your employment within the two years immediately following the
Change of Control unless such termination is (A) because of your death or
Disability, (B) by the Company for Cause, or (C) by you other than
for Good Reason.

 

(i)            Disability.  If, as a result of your incapacity due to
physical or mental illness, you shall have been absent from the full-time
performance of your duties with the Company for six consecutive months, and within
30 days after written notice of termination is given you shall not have
returned to the full-time performance of your duties, your employment may be
terminated for “Disability.”

 

(ii)                                  Cause. 
Termination by the Company of your employment for “Cause” shall mean
termination for (A) the commission of a felony or a crime involving moral
turpitude or the commission of any other act involving dishonesty, disloyalty,
or fraud with respect to the Company, (B) conduct tending to bring the
Company into substantial public disgrace or disrepute, (C) substantial and
repeated failure to perform duties as reasonably directed by the Board, (D) gross
negligence or willful misconduct with respect to the Company or any of its
affiliated entities, or (E) any other material breach of any other
agreement between you and the Company or its affiliated entities which is not
cured within 15 days after written notice thereof to you.

 

(iii)                               Good Reason.  You shall be entitled to terminate your
employment for Good Reason.  For purposes
of this Agreement, “Good Reason” shall mean, without your express written
consent, the occurrence within the two years immediately following a Change of
Control of any of the following circumstances unless, in the case of paragraphs
(A), (B), (D), (E), 

 

 

(F), (G) or (H), such circumstances are fully
corrected prior to the Date of Termination specified in the Notice of
Termination, as such terms are defined in Subsections 3(v) and 3(iv) hereof,
respectively, given in respect thereof:

 

(A)                              the assignment to you of any duties
inconsistent with your current status as an executive of the Company or a
substantial adverse alteration in the nature or status of your responsibilities
from those in effect immediately prior to the Change of Control;

 

(B)                                a reduction by the Company in your annual
base salary as in effect on the date hereof or as the same may be increased
from time to time, except for across-the-board salary reductions similarly
affecting all senior executives of the Company and all senior executives of any
person in control of the Company;

 

(C)                                your relocation to a location not within 25
miles of your present office or job location, except for required travel on the
Company’s business to an extent substantially consistent with your present
business travel obligations;

 

(D)                               the failure by the Company to pay to you
any portion of your current compensation, or to pay to you any portion of an
installment of deferred compensation under any deferred compensation program of
the Company, within seven days of the date such compensation is due;

 

(E)                                 the failure by the Company to continue in
effect any bonus to which you were entitled, or any compensation plan in which
you participated immediately prior to the Change of Control which is material
to your total compensation, including but not limited to any bonus plan, stock
option plan, 401(k) profit sharing plan, or any substitute plan or plans
adopted prior to the Change of Control, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been made with
respect to such plan and such equitable arrangement provides substantially
equivalent benefits not materially less favorable to you (both in terms of the
amount of benefits provided and the level of your participation relative to other
participants), or the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on a basis not materially
less favorable (both in terms of the amount of benefits provided and the level
of your participation relative to other participants) as existed at the time of
the Change of Control of the Company.

 

(F)                                 the failure by the Company to continue to
provide you with benefits substantially similar or superior to those enjoyed by
you under any of the Company’s life insurance, medical, dental, and accident,
or disability plans in which you were participating at the time of the Change
of Control, the taking of any action by the Company which would directly or
indirectly materially reduce any of such benefits or deprive you of any
material fringe benefit enjoyed by you at the time of the Change of Control, or
the failure by the Company to provide you with the number of paid vacation days
to which you are entitled in accordance with the Company’s normal vacation policy
in effect at the time of the Change of Control;

 

 

(G)                                the failure of the Company to obtain a
satisfactory agreement from any successor to assume and agree to perform this
Agreement, as contemplated in Section 5 hereof; or

 

(H)                               any purported termination of your
employment which is not effected pursuant to a Notice of Termination satisfying
the requirements of Subsection 3(iv) hereof (and, if applicable, the
requirements of Subsection 3(ii) hereof); for purposes of this Agreement,
no such purported termination shall be effective.

 

Your rights to terminate your employment pursuant to this Subsection 3(iii) shall
not be affected by your incapacity due to physical or mental illness.  Your continued employment shall not
constitute consent to, or a waiver of rights with respect to, any circumstance
constituting Good Reason hereunder.

 

(iv)                              NOTICE OF TERMINATION.  Any purported termination of your employment
by the Company or by you shall be communicated by written Notice of Termination
to the other party hereto in accordance with Section 8 hereof.  For purposes of this Agreement, a “Notice of
Termination” shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination
of your employment under the provision so indicated.

 

(v)                                 DATE OF TERMINATION.  “Date of Termination” shall mean (A) if
your employment is terminated for Disability, 30 days after Notice of Termination
is given (provided that you shall not have returned to the full-time
performance of your duties during such 30-day period), (B) if your
employment is terminated for Good Reason, the date specified in the Notice of
Termination (which shall not be less than 15 nor more than 60 days from the
date such Notice of Termination is given) or (C) if your employment is
terminated by the Company other than for Disability or death, the date
specified in the Notice of Termination (which shall not be less than 30 nor
more than 60 days from the date such Notice of Termination is given).  Notwithstanding the foregoing, the “Date of
Termination” shall mean the date of your “separation from service”, as
determined in accordance with Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”).

 

4.             COMPENSATION UPON TERMINATION OF
EMPLOYMENT OR DURING DISABILITY.  During
a period of Disability or upon termination of your employment, in each case,
within the two years immediately after a Change of Control you shall be
entitled to the following benefits:

 

(i)                                     During any period that you fail to
perform your full-time duties with the Company as a result of incapacity due to
physical or mental illness, you shall continue to receive your base salary at
the rate in effect at the commencement of any such period, together with all
amounts payable to you under any compensation plan of the Company during such
period, until the Date of Termination. 
Thereafter, your benefits shall be determined under the Company’s insurance
or other compensation programs then in effect in accordance with the terms of
such programs.

 

 

(ii)                                  If your employment is terminated by the
Company for Cause, Disability or death, or by you other than for Good Reason,
the Company shall, to the extent not theretofore paid, pay to you in a lump sum
your full base salary through the Date of Termination, at the rate in effect at
the time Notice of Termination is given, within 10 business days of the Date of
Termination, plus all other amounts to which you are entitled under any
insurance and other compensation programs of the Company at the time such
payments are due (collectively, the “Accrued Obligations”), and the Company
shall have no further obligations to you under this Agreement.

 

(iii)                               If your employment is terminated by the
Company other than for Cause, Disability or death or by you for Good Reason,
then you shall be entitled to the following, after payment and/or provision of
which, the Company shall have no further obligations to you under this Agreement:

 

(A)                              The Company shall pay to you the Accrued
Obligations at the same time and in the same manner as set forth in Section 4(ii) above.

 

(B)                                The Company shall pay as severance pay to
you a lump sum severance payment (the “Severance Payment”) equal to two times
the sum of (a) your annual base salary in effect immediately prior to the
occurrence of the circumstance giving rise to the Notice of Termination given
in respect thereof, (b) 100% of your target bonus amount established
pursuant to the compensation or bonus plan in effect immediately prior to the
occurrence of the circumstance giving rise to the Notice of Termination, and (c) in
the event the Date of Termination occurs prior to the expiration of the
applicable notice period as set forth in Section 3(v) above, the base
salary you would have earned from the Date of Termination through the
expiration of such notice period had your employment continued through the
expiration of such notice period.  The
Severance Payment shall be paid no sooner than the 40th day following the Date
of Termination, provided you have not revoked the Release as of such date.

 

(C)                                You shall be reimbursed by the Company
for all reasonable legal fees and expenses incurred by you prior to December 31
of the second calendar year following the calendar year that includes the Date
of Termination as a result of such termination, including all such fees and
expenses, if any, incurred in contesting or disputing any such termination or
in seeking to obtain or enforce any right or benefit provided by this
Agreement.  All such expenses shall be
reimbursed in full within 30 business days after submission by you of a
detailed invoice to the Company in accordance with the Company’s general
reimbursement guidelines, as may be in effect from time to time, provided that
in no event shall such amounts be paid later than the end of the Company’s
taxable year following the taxable year in which the expense is incurred.  Any reimbursement provided hereunder may not
be subject to liquidation or exchange for another benefit.  In no event shall the benefits payable
pursuant to this Subsection 4(iii)(C) in one
taxable year affect the benefits payable pursuant to this Subsection 4(iii)(C) in
another taxable year.

 

 

(D)                               Provided you timely elect continuation
coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended (“COBRA”), the Company shall pay, on your behalf, the portion of
premiums of your group health insurance, including coverage for your eligible
dependents, that the Company paid immediately prior to the Date of Termination
(“COBRA Payments”) for the period that you are entitled to coverage under
COBRA, but not to exceed 24 months (“COBRA Period”).  The Company will pay such COBRA Payments for
your eligible dependents only for coverage for which those dependents were
enrolled immediately prior to the Date of Termination.  You will continue to be required to pay that
portion of the premium of your health coverage, including coverage for your
eligible dependents, that you were required to pay as
an active employee immediately prior to the Date of Termination.  The benefit provided under this Subsection
4(iii)(D) is intended to be exempt from Section 409A of the Code
pursuant to the medical benefits exception set forth in Section 1.409A-1(b)(9)(v)(b) of
the regulations promulgated thereunder.

 

(E)                                 For the 24-month period immediately
following the Date of Termination, the Company shall arrange to provide you, at
a cost not to exceed $5,000 in the aggregate, with life, disability, and
accident insurance benefits substantially similar to those that you are
receiving immediately prior to the Notice of Termination.  Benefits otherwise receivable by you pursuant
to this Subsection 4(iii)(E) shall be reduced to
the extent comparable benefits are actually received by you from another
employer during such 24-month period, and any such benefits actually received
by you shall be reported to the Company.

 

(F)                                 You shall be reimbursed by the Company
for reasonable expenses incurred for outplacement counseling (i) which are
pre-approved by the Company, (ii) which do not exceed $10,000 and (iii) which
are incurred by you within the 52 weeks immediately following the Date of
Termination.  All such expenses shall be
reimbursed in full within 30 business days after submission by you of a
detailed invoice to the Company in accordance with the Company’s general
reimbursement guidelines, as may be in effect from time to time, provided that
in no event shall such amounts be paid later than the end of the Company’s
taxable year following the taxable year in which the expense is incurred.  Any reimbursement provided hereunder may not
be subject to liquidation or exchange for another benefit.  In no event shall the benefits payable
pursuant to this Subsection 4(iii)(F) in one
taxable year affect the benefits payable pursuant to this Subsection 4(iii)(F) in
another taxable year.  The provision of
benefits under this Subsection 4(iii)(F) is intended to be exempt from Section 409A
of the Code pursuant to the in-kind benefits exception as set forth in Section 1.409A-1(b)(9)(v)(c) of
the regulations promulgated thereunder.

 

(G)                                Gross-Up of Benefits.  (a) Anything in this Agreement to the
contrary notwithstanding, in the event that this Agreement shall become operative
and it shall be determined (as hereafter provided) that any payment or
distribution by the Company or any of its affiliates to or for your benefit,
whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise

 

 

pursuant to or by reason of any other agreement, policy, plan, program
or arrangement, including without limitation any stock option, performance
share, performance unit, stock appreciation right or similar right, or the
lapse or termination of any restriction on, or the vesting or exercisability
of, any of the foregoing (a “Payment”), would be subject to the excise tax
imposed by Section 4999 of the Code (or any successor provision thereto)
by reason of being considered “contingent on a change in ownership or control”
of the Company, within the meaning of Section 280G of the Code (or any
successor provision thereto) or to any similar tax imposed by state or local
law, or any interest or penalties with respect to such tax (such tax or taxes,
together with any such interest and penalties, being hereafter collectively
referred to as the “Excise Tax”), then you shall be entitled to receive an
additional payment or payments (collectively, a “Gross-Up Payment”); provided,
however, that no Gross-up Payment shall be made with respect to the
Excise Tax, if any, attributable to (i) any incentive stock option, as
defined by Section 422 of the Code (“ISO”) granted prior to the Effective
Date, or (ii) any stock appreciation or similar right, whether or not limited,
granted in tandem with any ISO described in clause (i).  The Gross-Up Payment shall be in an amount
such that, after payment by you of all taxes (including any interest or
penalties imposed with respect to such taxes), including any Excise Tax imposed
upon the Gross-Up Payment, you retain an amount of the Gross-Up Payment equal
to the Excise Tax imposed upon the Payment.

 

(b)           Subject
to the provisions of Subsection 4(iii)(G)(f), all determinations required to be
made under this Subsection 4(iii)(G), including whether an Excise Tax is
payable by you and the amount of such Excise Tax and whether a Gross-Up Payment
is required to be paid by the Company to you and the amount of such Gross-Up
Payment, if any, shall be made by a nationally recognized accounting firm (the “Accounting
Firm”) selected by the Company.  The
Accounting Firm shall be directed to submit its determination and detailed
supporting calculations to both the Company and you within 30 calendar days
after the Date of Termination, and any such other time or times as may be
requested by the Company or you.  If the
Accounting Firm determines that any Excise Tax is payable by you, the Company
shall pay the required Gross-Up Payment to you within five business days after
receipt of such determination and calculations with respect to any Payment to
you, provided, however, that the Company can estimate and pay any
Excise Tax to any applicable taxing authority if the Company determines in its
sole discretion that such amount is due and payable prior to the date such
determination is made by the Accounting Firm, and such payment shall reduce the
amount of the Gross-Up Payment payable to you. 
If the Accounting Firm determines that no Excise Tax is payable by you,
it shall, at the same time as it makes such determination, furnish the Company
and you with an opinion that you have substantial authority not to report any
Excise Tax on your federal, state or local income or other tax return.  As a result of the uncertainty in the
application of Section 4999 of the Code (or any successor provision
thereto) and the possibility of similar uncertainty regarding applicable state
or local tax law at the time of any determination by the Accounting Firm
hereunder, it is possible 

 

 

that
Gross-Up Payments which will not have been made by the Company should have been
made (an “Underpayment”), consistent with the calculations required to be made
hereunder.  In the event that the Company
exhausts or fails to pursue its remedies pursuant to Section (G)(f) and you thereafter are required to make a payment
of any Excise Tax, you shall direct the Accounting Firm to determine the amount
of the Underpayment that has occurred and to submit its determination and
detailed supporting calculations to both the Company and you as promptly as
possible.  Any such Underpayment shall be
promptly paid by the Company to, or for your benefit within five business days
after receipt of such determination and calculations.

 

(c)           The
Company and you shall each provide the Accounting Firm access to and copies of
any books, records and documents in the possession of the Company or you, as
the case may be, reasonably requested by the Accounting Firm, and otherwise
cooperate with the Accounting Firm in connection with the preparation and
issuance of the determinations and calculations contemplated by Section (G)(b).  Any
determination by the Accounting Firm as to the amount of the Gross-Up Payment
shall be binding upon the Company and you, subject to (G)(d) below.

 

(d)           The
federal, state and local income or other tax returns filed by you shall be
prepared and filed on a consistent basis with the determination of the
Accounting Firm with respect to the Excise Tax payable by you.  You shall make proper payment of the amount
of any Excise Payment, and at the request of the Company, provide to the
Company true and correct copies (with any amendments) of your federal income
tax return as filed with the Internal Revenue Service and corresponding state
and local tax returns, if relevant, as filed with the applicable taxing
authority, and such other documents reasonably requested by the Company,
evidencing such payment.  If prior to the
filing of your federal income tax return, or corresponding state or local tax
return, if relevant, the Accounting Firm determines that the amount of the
Gross-Up Payment should be reduced, you shall within five business days pay to
the Company the amount of such reduction. 
Any such determination by the Accounting Firm as to such recalculation
of the Gross-Up Payment shall be binding upon the Company and you.

 

(e)           The
fees and expenses of the Accounting Firm for its services in connection with
the determinations and calculations contemplated by Section (G)(b) shall be borne by the Company.

 

(f)            You
shall notify the Company in writing of any claim by the Internal Revenue
Service or any other taxing authority that, if successful, would require the
payment by the Company of a Gross-Up Payment. 
Such notification shall be given as promptly as practicable but no later
than ten business days after you actually receive notice of such claim and you
shall further apprise the Company of the nature of such claim and the date on
which such claim is requested to be paid (in each case, to the extent known by
you).  You shall not pay such claim 

 

 

prior to the earlier of (i) the expiration of the
thirty calendar-day period following the date on which he gives such notice to
the Company and (ii) the date that any payment of amount with respect to
such claim is due.  If the Company
notifies you in writing prior to the expiration of such period that it desires to contest such claim, you shall:

 

(i)                                     provide the Company with any written
records or documents in his possession relating to such claim reasonably
requested by the Company;

 

(ii)                                  take such action in connection with
contesting such claim as the Company shall reasonably request in writing from
time to time, including without limitation accepting legal representation with
respect to such claim by an attorney competent in respect of the subject matter
and reasonably selected by the Company;

 

(iii)                               cooperate with the Company in good faith in order
effectively to contest such claim; and

 

(iv)                              permit the Company to participate in any
proceedings relating to such claim; provided, however, that the
Company shall bear and pay directly all costs and expenses (including interest
and penalties) incurred in connection with such contest and shall indemnify and
hold you harmless, on an after-tax basis, for and against any Excise Tax or
income tax, including interest and penalties with respect thereto, imposed as a
result of such representation and payment of costs and expenses.  Without limiting the foregoing provisions of
this Subsection 4(iii)(G)(f), the Company shall control all proceedings taken
in connection with the contest of any claim contemplated by this Subsection
4(iii)(G)(f) and, at its sole option, may pursue or forego any and all
administrative appeals, proceedings, hearings and conferences with the taxing
authority in respect of such claim (provided, however, that you
may participate therein at your own cost and expense) and may, at its option,
either direct you to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and you agree to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs you to
pay the tax claimed and sue for a refund, the Company shall advance the amount
of such payment to you on an interest-free basis and shall indemnify and hold
you harmless, on an after-tax basis, from any Excise Tax or income or other
tax, including interest or penalties with respect thereto, imposed with respect
to such advance; and provided  further, however, that any
extension of the statute of limitations relating to payment of taxes for your
taxable year with

 

 

respect to which the contested amount is claimed to be due is limited
solely to such contested amount. 
Furthermore, the Company’s control of any such contested claim shall be
limited to issues with respect to which a Gross-Up Payment would be payable hereunder
and you shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing authority.

 

(g)           If,
after your receipt of an amount advanced by the Company pursuant to Subsection
4(iii)(G)(f), you receive any refund with respect to such claim, you shall
(subject to the Company’s complying with the requirements of Section (G)(f))
within 10 business days after receiving such refund pay to the Company the
amount of such refund (together with any interest paid or credited thereon
after any taxes applicable thereto).  If,
after your receipt of an amount advanced by the Company pursuant to Section (G)(f),
a determination is made that you shall not be entitled to any refund with
respect to such claim and the Company does not notify you in writing of its
intent to contest such denial or refund prior to the expiration of thirty
calendar days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of any such advance shall
offset, to the extent thereof, the amount of Gross-Up Payment required to be
paid by the Company to you pursuant to this Subsection 4(iii)G.

 

(h)           Any
Gross-Up Payment payable hereunder, shall be paid by the Company to you within
five days of the receipt of the Accounting Firm’s determination; provided that,
the Gross-Up Payment shall in all events be paid no later than the end of your
taxable year next following your taxable year in which the Excise Tax (and any
income or other related taxes or interest or penalties thereon) on a Payment
are remitted to the Internal Revenue Service or any other applicable taxing
authority or, in the case of amounts relating to a claim that does not result
in the remittance of any federal, state, local and foreign income, excise,
social security and other taxes, the calendar year in which the claim is
finally settled or otherwise resolved. 
Notwithstanding any other provision herein to the contrary, the Company
may, in its sole discretion, withhold and pay over to the Internal Revenue
Service or any other applicable taxing authority, for your benefit, all or any
portion of any Gross-Up Payment, and you hereby consent to such withholding.

 

(iv)          All payments under this Agreement, other
than the Accrued Obligations, will be contingent upon the execution of a Release
of Claims by you and the Company within 30 days following the Date of
Termination, substantially in the form attached as an appendix to this
Agreement.

 

(v)           You shall not be required to mitigate the
amount of any payment provided for in this Section 4 by seeking other
employment or otherwise, nor shall the amount of any payment or benefit
provided for in this Section 4 be reduced by any compensation earned by
you as the result of employment by another employer, by retirement benefits, by
offset against any amount claimed to be owed by you to the Company (other than
by any cash 

 

 

payments which may be available to you under the
Company’s Severance Policy), or otherwise except as specifically provided in
this Section 4.

 

(vi)          Anything in this Agreement to the
contrary notwithstanding, if on the Date of Termination of your employment with
the Company, as a result of such termination, you would receive any payment
that, absent the application of this Subsection 4(viii), would be subject to
interest and additional tax imposed pursuant to Section 409A(a) of
the Code as a result of the application of Section 409A(2)(B)(i) of
the Code, then such payment shall be payable on the date that is the earliest
of (i) six (6) months after the Date of Termination, (ii) your death
or (iii) such other date as will not result in such payment being subject
to such interest and additional tax.  For
purposes of clarification, all amounts not subject to the six month delay as
set forth in Section 409A of the Code, shall be paid as otherwise provided
in this Agreement.  It is the intention
of the parties that payments or benefits payable under this Agreement not be
subject to the additional tax imposed pursuant to Section 409A of the
Code.  To the extent such potential
payments or benefits could become subject to such Section, the parties shall
cooperate to amend this Agreement with the goal of giving you the economic
benefits described herein in a manner that does not result in such tax being
imposed (it being understood that if such amendments do not avoid the
application of Section 409A of the Code, the Company will make such
payments nonetheless).

 

5.             SUCCESSORS; BINDING AGREEMENT.

 

(i)            The Company will require any successor
(whether direct or indirect, by purchase, merger, share exchange, consolidation
or otherwise) to all or substantially all of the business and/or assets of the
Company to assume expressly and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform it
if no such succession had taken place. 
As used in this Agreement, “Company” shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this agreement by operation of
law, or otherwise.

 

(ii)           This Agreement shall inure to the benefit
of and be enforceable by your personal or legal representatives, executors,
administrators, heirs, distributees and legatees.  If you should die while any amount would
still be payable to you hereunder if you had continued to live, all such
amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this agreement to your legatee or other designee or, if there is no
such designee, to your estate.

 

(iii)          In the event that you are employed by a
subsidiary of the Company, wherever in this Agreement reference is made to the “Company,”
unless the context otherwise requires, such reference shall also include such
subsidiary.  The Company shall cause such
subsidiary to carry out the terms of this Agreement insofar as they relate to
the employment relationship between you and such subsidiary, and the Company
shall indemnify you and save you harmless from and against all liability and
damage you may suffer as a consequence of such subsidiary’s failure to perform
and carry out such terms.  Wherever
reference is made to any benefit program of the Company, such reference shall 

 

 

include, where appropriate, the corresponding benefit
program of such subsidiary if you were a participant in such benefit program on
the date a Change of Control has occurred.

 

6.             COMPLIANCE WITH SECTION 409A OF THE
CODE.  This Agreement is intended to
comply with Section 409A of the Code and shall be construed and
interpreted in accordance with such intent. 
Any provision of this Agreement that would cause a violation of Section 409A
of the Code shall have no force or effect until amended to comply with Section 409A
of the Code, to the extent permitted by Section 409A.  Notwithstanding anything herein to the
contrary, in no event shall the Company be required to provide you with any
gross-up for any tax, interest or penalty incurred under Section 409A of
the Code.

 

7.             WITHHOLDING.  All payments shall be subject to the
withholding of such amounts as the Company is required to be withheld pursuant
to any applicable federal, state, or local law or regulation, and you are
responsible for any tax liability on such payments.

 

8.             NOTICE. 
For the purpose of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be deemed to have
been duly given when delivered or mailed by United States registered mail,
return receipt requested, postage prepaid, addressed to the respective
addresses set forth on the first page of this Agreement, provided that all
notices to the Company shall be directed to the attention of the Board with a
copy to the Secretary of the Company, or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.

 

9.             MISCELLANEOUS.  No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by you and such officer as may be specifically
designated by the Board.  No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.  No agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof have
been made by either party which are not expressly set forth in this Agreement.

 

10.           VALIDITY. 
The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.

 

11.           COUNTERPARTS.  This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

 

12.           ARBITRATION.  Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration
in the State of Colorado, in accordance with the rules of the American
Arbitration Association then in effect. 
Judgment may be entered on the arbitrator’s award in any court having
jurisdiction; provided, however, that you shall be entitled to
seek specific performance of your right to be paid until the Date of Termination

 

 

during the pendency of any dispute or controversy
arising under or in connection with this Agreement.

 

13.           WAIVER OF RIGHTS UNDER
CHANGE OF CONTROL AGREEMENT WITH APEX SILVER MINES LTD.  By signing this Agreement, you agree to waive all
rights and claims to any payments and benefits that you might otherwise be
entitled to receive pursuant to the Change of Control Agreement entered into by
you and Apex Silver Mines Ltd on [Date](1) (the “Apex Change of Control
Agreement”).  Furthermore, you agree that
the Apex Change of Control Agreement shall be terminated in its entirety as of
the Effective Date.

 

If this letter sets forth our agreement on the subject
matter hereof, kindly sign and return to the Company the enclosed copy of this
letter which will then constitute our agreement on this subject.

 

	
  Sincerely,

  	
   

  
	
   

  	
   

  
	
  Golden Minerals Company

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  [Name]

  	
   

  
	
   

  	
  [Title]

  	
   

  
	
   

  	
   

  
	
  Agreed to as of the             
  day of                                 
  ,                
  .

  	
   

  
	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  
	
   

  	
  [Name]

  	
   

  
				

 

(1)           To be inserted by the Company.

 

 

APPENDIX

 

FORM OF

 

GENERAL RELEASE

 

I,
                                                ,
for good and valuable consideration, including the performance by Golden
Minerals Company, a Delaware Company (the “Company”), of certain obligations
under that certain Change of Control Agreement dated as of
                    
between myself and the Company (the “Change of Control Agreement”), do hereby
release and forever discharge as of the date hereof, the Company and all
present, future and former subsidiaries, affiliates, directors, officers,
agents, attorneys, insurers, shareholders, representatives and employees of the
Company (including all subsidiaries, affiliates, directors, officers, agents,
attorneys, insurers, shareholders, partners, representatives and employees
thereof), and the successors and assigns of each of them (collectively, the “Released
Parties”) to the extent provided below.

 

1.             Except as provided in Section 2
below, I knowingly and voluntarily release and forever discharge the Company
and the other Released Parties from any and all claims, controversies, actions,
causes of action, cross-claims, counter-claims, demands, debts, damages
(however styled, including compensatory, liquidated, punitive or exemplary damages),
claims for costs and attorneys’ fees, or liabilities of any nature whatsoever
in law and in equity, both past and present (from the beginning of the world
through the date of this General Release) and whether known or unknown,
suspected, or claimed against the Company or any of the Released Parties which
I, my spouse, or any of my heirs, executors, administrators, representatives or
assigns, have or may have, which arise out of or are connected with my
employment or association with, or my separation or termination from, the
Company (including, but not limited to, any allegation, claim or violation,
arising under: Title VII of the Civil Rights Act of 1964, as amended; the Civil
Rights Act of 1991, as amended; the Equal Pay Act of 1963, as amended; the Americans
with Disabilities Act of 1990, as amended; the Family and Medical Leave Act of
1993, as amended; the Civil Rights Act of 1866, as amended; the Age
Discrimination in Employment Act (29 U.S.C. § 621 et seq.), as amended (“ADEA”),
subject to Section 15 below; the Worker Adjustment Retraining and
Notification Act, as amended; the Employee Retirement Income Security Act of
1974, as amended; any applicable Executive Order Programs; the Fair Labor
Standards Act, as amended; or their state or local counterparts; or under any
other federal, state or local civil or human rights law, or under any other
local, state, or federal law, regulation or ordinance; or under any public
policy, contract or tort, or under common law; or arising under any policies,
practices or procedures of the Company; or any claim for wrongful discharge,
breach of contract, infliction of emotional distress, defamation; or any claim
for costs, fees, or other expenses, including attorneys’ fees incurred in these
matters) (all of the foregoing collectively referred to herein as the “Claims”).  As part of the release set forth in this Section 1,
I fully and forever covenant not to sue or cause to be sued the Company or any
other Released Party with respect to any Claims.

 

2.             This General Release shall not
relinquish, diminish, or in any way affect (i) any accrued benefits under
the terms of the Change of Control Agreement or any other plans or programs of
the Company which are due to me, or (ii) rights for indemnification as a
director of 

 

1

 

the Company under the
Company’s certificate of incorporation or bylaws for duly approved acts taken
prior to the date of this General Release, subject to the provisions thereof.

 

3.             I represent that I have made no
assignment or transfer of any Claims, or any other matter covered by Section 1
above.  I agree that I will indemnify,
defend and hold harmless the Company from any and all Claims so assigned and
transferred.  I have not been involved in
any personal bankruptcy or other insolvency proceedings at any time since I
began my employment with the Company.  No
child support orders, garnishment orders, or other orders requiring that money
owed to me by the Company be paid to any other person are now in effect.

 

4.             In signing this General Release, I
acknowledge and intend that it shall be effective as a bar to each and every
one of the Claims hereinabove mentioned or implied that are released by
me.  I further acknowledge and agree that
my separation from employment with the Company shall not serve as the basis for
any claim or action.  I agree that this
General Release shall be given full force and effect according to each and all
of its express terms and provisions, including those relating to unknown and unsuspected
Claims (notwithstanding any state statute that expressly limits the
effectiveness of a general release of unknown, unsuspected and unanticipated
Claims), if any, as well as those relating to any other Claims hereinabove
mentioned or implied.  I acknowledge and
agree that this waiver is an essential and material term of this General
Release.  I therefore agree that in the
event a Claim is brought seeking damages against me in violation of the terms
of this General Release, or in the event a party should seek to recover against
the other in any Claim brought by a governmental agency on such party’s behalf,
this General Release shall serve as a complete defense to such Claims.  I further agree that I am not aware of any
pending or threatened charge or complaint of the type described above as of the
execution of this General Release.

 

5.             I agree that, by my signature below, I
hereby resign from all positions, including any board memberships, related to
the Company and its subsidiaries contemporaneously with the execution of this
General Release.

 

6.             I understand that this General Release
embodies the complete agreement and understanding among the parties with
respect to the subject matter hereof and supersedes and preempts any prior
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.

 

7.             Whenever possible, each provision of this
General Release shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this General Release is held by
any court of competent jurisdiction to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or any other jurisdiction, but this General Release shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.

 

8.             This General Release shall be binding in
all respects upon, and shall inure to the benefit of, the heirs, successors and
assigns of the parties hereto; provided that I acknowledge that I may not
assign my rights under the this General Release without the prior written
consent of the Company.  I agree, upon
reasonable request of the Company, to execute, acknowledge and 

 

 

deliver any additional
instrument or documents that may be reasonably required to carry out the
intentions of this General Release.  This
General Release may be executed in counterparts and facsimile signatures shall
be originals for all purposes.

 

9.             I agree that this General Release shall
be interpreted and construed in accordance with the laws of the State of
Colorado and that any disputes arising under this General Release or by any
asserted breach of it, or from the employment relationship between the Company
and Executive, shall be litigated in the state or federal courts in Colorado
and I consent to such jurisdiction.

 

10.           I represent that I am over the age of
forty (40).  As part of the release set
forth in Section 1, I knowingly and voluntarily agree to waive any rights
or claims arising out of or relating to the ADEA (the “ADEA Waiver”) and
acknowledge that I have been informed of the following:

 

a.             I represent and acknowledge that I am
waiving any and all rights or claims that I may have arising under the ADEA;

 

b.             I represent and acknowledge that I have
been informed of my right to consult with an attorney regarding these ADEA
rights, before executing this General Release;

 

c.             I know and understand that I am not
waiving any rights or claims that may arise after the date this waiver of ADEA
rights is executed;

 

d.             I know and understand that in exchange
for the waiver of my rights under the ADEA, I am receiving consideration in
addition to any consideration to which I am already entitled;

 

e.             BY SIGNING THIS GENERAL RELEASE, I
REPRESENT AND ACKNOWLEDGE THAT I HAVE BEEN INVITED AND ADVISED TO CONSULT AN
ATTORNEY BEFORE SIGNING THIS DOCUMENT.  I
acknowledge and understand that I have been given a period of at least
twenty-one (21) days in which to consider the terms of the ADEA Waiver provided
to me; and

 

f.              I understand that I have the right to
revoke this ADEA Waiver contained in this General Release at any time within
seven (7) days after signing this General Release, by providing written
notice to the following address:  Golden
Minerals Company,
                                                                  ,
and that, upon such revocation, this General Release will not have any further
legal force and effect.  I further
understand and agree that this General Release shall not become effective or
enforceable until this seven day revocation period has expired.

 

 

By signing this General Release, I further represent
and agree that:

 

(i)            I have read it carefully;

 

(ii)           I understand all of its terms and know
that I am giving up important rights, including but not limited to, rights
under Title VII of the Civil Rights Act of 1964, as amended; the Equal Pay Act
of 1963, as amended; the Americans with Disabilities Act of 1990, as amended;
and the Employee Retirement Income Security Act of 1974, as amended;

 

(iii)          I voluntarily consent to everything in
this General Release;

 

(iv)          I have been advised to consult with an
attorney before executing this General Release and I have done so or, after
careful reading and consideration I have chosen not to do so of my own
volition;

 

(v)           I have signed this General Release
knowingly and voluntarily and with the advice of any counsel retained to advise
me with respect to this General Release;

 

(vi)          I agree that the provisions of this
General Release may not be amended, waived, changed or modified except by an
instrument in writing signed by an authorized representative of the Company and
by me.

 

	
  DATE:
                            ,
  20

  	
   

  	
   

  
	
   

  	
   

  	
  [Executive]

  
	
   

  	
   

  	
   

  
	
  Acknowledged and agreed to this
                
  day of                                     ,
  20       

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Golden Minerals Company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:ex10_63.htm

    
      

    

    Exhibit 10.63

    
      

      

      FIRST
AMENDMENT TO

       

      NON-QUALIFIED
STOCK OPTION AGREEMENT

       

      This
First Amendment to Non-Qualified Stock Option Agreement (this "Amendment") is
entered this 19th day of
December, 2008 (the "Effective Date"), by
and between Far East Energy Corporation, a Nevada corporation (the "Company"), and
Michael R. McElwrath (the "Option
Holder").

       

       

      RECITALS

       

      WHEREAS,
the Company and the Option Holder entered into that certain Non-Qualified Stock
Option Agreement dated February 2, 2006 (the "Existing Agreement");
and

       

      WHEREAS,
the Company and the Option Holder desire to amend the Existing Agreement on the
terms herein provided.

       

      NOW,
THEREFORE, in consideration of the premises and mutual covenants and agreements
of the parties herein contained, the parties hereto agree as
follows:

       

      ARTICLE
I

       

      Definitions

       

      Section
1.01. Capitalized terms used in this Amendment that are not defined herein
shall have the meanings ascribed thereto by the Existing Agreement.

       

      ARTICLE
II

       

      Amendments

      

      Section
2.01.  Section
8.  The first sentence of Section 8 is hereby amended
and restated in its entirety to read as follows:

      

       

      "Upon a
Termination of Service for any reason (other than death or Disability), the
unexercised Option may thereafter be exercised during the period ending 90 days
after the date of such Termination of Service, subject to any earlier
termination of the Option as provided herein, but only to the extent to which
the Option was vested and exercisable at the time of such termination of
Service."

      

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      

       

      ARTICLE
III

       

      Miscellaneous

       

      Section
3.01. Ratifications.  The
terms and provisions set forth in this Amendment shall modify and supersede all
inconsistent terms and provisions set forth in the Existing
Agreement.  Except as expressly modified and superseded by this
Amendment, the Company and the Option Holder each hereby (a) ratifies and
confirms the Existing Agreement, (b) agrees that the same shall continue in full
force and effect, and (c) agrees that the same are the legal, valid and binding
obligations of the Company and the Option Holder, enforceable against the
Company and the Option Holder in accordance with its respective
terms.

       

      Section
3.02. Severability.  If,
for any reason, any provision of this Amendment is held invalid, illegal or
unenforceable such invalidity, illegality or unenforceability shall not affect
any other provision of this Amendment not held so invalid, illegal or
unenforceable, and each such other provision shall, to the full extent
consistent with law, continue in full force and effect.  In addition,
if any provision of  this Amendment shall be held invalid, illegal or
unenforceable in part, such invalidity, illegality or unenforceability shall in
no way affect the rest of such provision not held so invalid, illegal or
unenforceable and the rest of such provision, together with all other provisions
of this Amendment, shall, to the full extent consistent with law, continue in
full force and effect.  If any provision or part thereof shall be held
invalid, illegal or unenforceable, to the fullest extent permitted by law, a
provision or part thereof shall be substituted therefor that is valid, legal and
enforceable.

       

      Section
3.03. Headings.  The
headings of Sections are included solely for convenience of reference and shall
not control the meaning or interpretation of any of the provisions of this
Amendment.

       

      Section
3.04. Governing
Law.  This Amendment shall be governed by the laws of Texas,
without giving effect to any principles of conflicts of law.

       

      Section
3.05. Withholding.  All
amounts paid pursuant to the Existing Agreement and this Amendment shall be
subject to withholding for taxes (federal, state, local or otherwise) to the
extent required by applicable law.

       

      Section
3.06. Counterparts.  This
Amendment may be executed in counterparts, each of which, when taken together,
shall constitute one original agreement.

       

      Section
3.07. Waiver.  No
term or condition of the Existing Agreement or this Amendment shall be deemed to
have been waived, nor shall there be any estoppel against the enforcement of any
provision of this Amendment or the Existing Agreement except by written
instrument of the party charged with such waiver or estoppel.  No such
written waiver shall be deemed a continuing waiver unless specifically stated
therein, and each such waiver shall operate only as to the specific term or
condition waived and shall not

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      constitute
a waiver of such term or condition for the future or as to any act other than
that specifically waived.

       

      Section
3.08. Entire
Agreement.  The Existing Agreement and this Amendment,
together, contain the entire understanding between the parties hereto regarding
the subjects thereof except that this Amendment shall not affect or operate to
reduce any benefit or compensation inuring to Option Holder of a kind elsewhere
provided and not expressly provided for in the Existing Agreement or this
Amendment.

       

      IN
WITNESS WHEREOF, the Company has caused its duly authorized officer or director
to execute and attest to this Amendment, and the Option Holder has placed this
signature hereon, effective as of the latest date below.

      

      FAR
EAST ENERGY CORPORATION

      

      

      

      

      
        
          
            
              	
                      By:  
      /s/ Andrew
      Lai

                    	
                      Date:  December
      19, 2008

                    
	
                      Name:  Andrew
      Lai

                    	 
      
	
                      Title: Chief
      Financial Officer

                    	 
      
	 
      	 
      
	
                      OPTION
      HOLDER:

                    	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	
                      /s/ Michael R. McElwrath

                    	
                      Date:  December
      19, 2008

                    
	
                      Michael
      R. McElwrath

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00156-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00156-of-00352.parquet"}]]