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SWC > SEC Filings for SWC > Form 8-K on 6-Dec-2013All Recent SEC Filings

Show all filings for STILLWATER MINING CO /DE/ | Request a Trial to NEW EDGAR Online Pro

Form 8-K for STILLWATER MINING CO /DE/


6-Dec-2013

Change in Directors or Principal Officers, Other Events, Financial Stat


Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

(c) Appointment of Chief Executive Officer

On December 3, 2013, Stillwater Mining Company (the "Company") announced the appointment of Michael (Mick) McMullen as its President and Chief Executive Officer ("CEO"), effective December 3, 2013 (the "Effective Date"). As was previously announced, Francis McAllister, formerly CEO of the Company and a member of its board of directors, retired from those positions effective June 7, 2013, and the board of directors appointed Terrell I. Ackerman to serve on an interim basis as the CEO of the Company while it conducted a fulsome search for a new CEO.

Prior to his election to the Company's board of directors, Mr. McMullen served as a Principal at MRI Advisory AG, a private company focusing on the development of metal and minerals projects in the Americas, Europe and Africa. Since 2007, he has been responsible for investing the equity investments of the Principals of MRI Advisory AG and supervising the technical due diligence for a variety of commodity backed funding structures. Since March 2012, he has also served as the Executive Chairman of Nevada Iron Limited, an ASX-listed development company with iron ore assets in Nevada. Since 2007, Mr. McMullen has also served as Executive Chairman of Lachlan Star Limited, a TSX/ASX dual listed mining company, where he oversaw the acquisition of CMD Gold Mine in Chile. In 2007, Mr. McMullen formed Northern Iron Limited, which developed an iron ore mine in Norway; at Northern Iron Limited, he served as Managing Director from April 2007 to November 2009 and as President of Northern Iron Marketing AG until June 2010. From September 2005 to August 2007, he was a Partner and Audit Manager at RSG Global Consulting Pty Ltd, a mining consultancy firm, where Mr. McMullen was the partner in charge of bank finance and M&A due diligence consulting and expert and valuation reports, including for several PGM projects in South Africa. From September 2002 to August 2005, he was Technical Director of Tritton Resources Limited, which owned and operated a copper mine. Mr. McMullen also served as Executive Technical Director of Lafayette Mining Limited, which owned and operated a mine producing copper and zinc concentrates, as well as gold and silver by-products, from November 1998 to September 2002 and as Exploration Manager of Spinifex Gold Ltd. (Asia), an exploration company, from February 1997 to November 1998.

There is no agreement between Mr. McMullen and any other persons pursuant to which he was appointed as CEO of the Company. Mr. McMullen does not have any family relationships with any director or executive officer of the Company.

In connection with his appointment as CEO of the Company, Mr. McMullen resigned from the audit committee of the board of directors as of the Effective Date. The board of directors has appointed Mr. Charles R. Engles to replace Mr. McMullen on the audit committee as of the Effective Date. The board of directors has determined that Mr. Engles meets the independence requirements of the New York Stock Exchange and Rule 10A-3 of the Securities Exchange Act of 1934. The board of directors also determined that Mr. Engles is financially literate and capable of holding this position.

(e) Compensation Arrangements for Chief Executive Officer

On the Effective Date, the Company entered into the following employment and compensation agreements with Mr. McMullen. The following summaries do not purport to be complete descriptions of the terms and conditions of each agreement, and are qualified in their entirety by reference to the text of each agreement, which are attached as exhibits hereto.


Executive Employment Agreement

Term: The agreement provides for an initial term continuing through December 31, 2016. The agreement may be renewed for successive one-year terms upon written agreement of both parties no later than 30 days prior to the end of the then current term.

Base Salary: Mr. McMullen shall receive an initial base salary of $660,000 per year, subject to periodic review and adjustment; provided, however, such base salary may not be reduced except in connection with an across-the-board reduction of the salaries of all named executive officers of the Company.

Short Term Incentive Program: Mr. McMullen shall participate in the Company's Short-Term Incentive Program ("STIP") as follows:

For calendar year 2013, in lieu of an STIP award, Mr. McMullen will receive a fixed, pro-rata bonus for the portion of the year Mr. McMullen is employed by the Company in the amount of $49,816.43, which is based on a potential full year bonus equal to 95% of Mr. McMullen's base salary.

For each calendar year beginning January 1, 2014, Mr. McMullen will be eligible to earn a target STIP bonus of 95% of his base salary, and a maximum bonus of up to 190% of his base salary, determined based upon the Company's achievement of performance targets established by the board of directors. To the extent Mr. McMullen's bonus for any given year exceeds 114% of his base salary, all amounts over 114% will be paid in restricted stock units of the Company ("RSUs").

Long Term Incentive Program: Mr. McMullen shall participate in the Company's Long Term Incentive Plan ("LTIP") as follows:

For calendar year 2013, in lieu of an LTIP award, Mr. McMullen will receive a one-time award of 23,000 RSUs, vesting in equal 1/3 installments at the end of calendar years 2014, 2015 and 2016.

For each calendar year beginning January 1, 2014, Mr. McMullen will participate in the Company's LTIP, and will be eligible to earn a grant of equity instruments with a target value of 230% of Mr. McMullen's base salary. Awards under the LTIP may consist of both performance-vested awards, which vest based on achievement of performance goals over a three year period, and time-vested awards, which vest in equal 1/3 installments over three years. For calendar year 2014, the Company expects that Mr. McMullen's LTIP awards will consist of 70% performance-vested awards and 30% time-vested awards. The terms and conditions of each LTIP grant, vesting conditions and performance targets will be set forth in annual award agreements between the Company and Mr. McMullen approved by the board of directors and subject to the Company's 2012 Equity Incentive Plan.

Additional Benefits: During the term of the Agreement, Mr. McMullen shall be entitled to participate in all health, insurance, pension, retirement, profit-sharing or other benefit plans adopted by the Company for its senior management, and may take up to six weeks of paid vacation per year.

Compensation upon Termination: Upon termination of Mr. McMullen's employment during the term of the agreement, Mr. McMullen shall be entitled to the following:

If Mr. McMullen's employment is terminated by the Company for Cause (as defined in the agreement), or Mr. McMullen resigns without Good Reason (as defined in the agreement), the Company shall pay Mr. McMullen all accrued but unpaid base salary and all accrued but unused vacation earned through the date of termination or resignation, and any reimbursement of expenses owed to Mr. McMullen; however, Mr. McMullen will not be eligible for any STIP or LTIP award payments for the year in which such termination or resignation occurs, and unvested equity awards shall be forfeited on the date of such termination or resignation.


If Mr. McMullen's employment is terminated by the Company for Underperformance (as defined in the agreement), or Mr. McMullen resigns for Good Reason, the Company shall pay Mr. McMullen the following benefits upon execution of a release in favor of the Company: (a) all accrued but unpaid base salary and all accrued but unused vacation earned through the date of termination or resignation, (b) any reimbursement of expenses owed to Mr. McMullen, (c) an amount equal to two times Mr. McMullen's then effective base salary, paid out in 24 equal monthly installments, (d) an amount equal to two times the average of his target and actual STIP award for the calendar year immediately proceeding such termination or resignation, paid out in 24 equal monthly installments, and (f) an amount equally to 18 months of Mr. McMullen's cost to continue medical insurance coverage pursuant to COBRA, provided that he is eligible for and elects such continuation coverage.

If Mr. McMullen's employment terminates as a result of death or Disability (as defined in the agreement), the Company shall pay Mr. McMullen or his estate:
(a) all accrued but unpaid base salary and all accrued but unused vacation earned through the date of termination or resignation, (b) any reimbursement of expenses owed to Mr. McMullen, (c) a pro-rata portion of Mr. McMullen's STIP bonus for the year in which such termination occurs based on the Company's achievement of established performance targets in that year.

Restrictive Covenants: For two years following the termination of Mr. McMullen's employment with the Company for any reason, the agreement provides that, if Mr. . . .



Item 8.01 Other Events

In conjunction with the appointment of Mr. McMullen as CEO of Stillwater Mining Company on December 3, 2013, the Company's Board of Directors accepted Mr. McMullen's resignation from the Audit Committee and appointed Mr. Charles Engles to the Audit Committee, effective December 3, 2013. Mr. McMullen shall remain a member of the Board. Mr. McMullen and Mr. Engles have been members of the Board since May 2013.



Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit No.    Description

    10.1       Executive Employment Agreement between
               Stillwater Mining Company and Mr. Michael J.
               McMullen, dated December 3, 2013.

    10.2       Side Letter to the Executive Employment
               Agreement between Stillwater Mining Company and
               Mr. Michael J. McMullen, dated December 3, 2013.


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