Item 1.01 Entry into a Material Definitive Agreement
Effective March 16, 2017, Golden Queen
Mining Company Ltd. (the “
Company
”) appointed Guy Le Bel, a current director on the board, as the Company’s
Chief Financial Officer and the Company. In connection with Mr. Le Bel’s appointment, the Company and Mr. Le Bel entered
into an Employment Agreement effective on March 16, 2017.
The material terms of the Employment Agreement
are summarized as follows:
Mr. Le Bel will serve as the
Chief Financial Officer of the Company, reporting to the Chief Executive Officer of the Company and where appropriate to the board
of the Company. Mr. Le Bel’s duties will also include acting as the interim Chief Financial Officer of Golden Queen Mining
Company, LLC, until such time as his replacement is appointed.
Mr. Le Bel will be permitted
to hold up to four other board positions with the prior approval of the Company’s board of directors; provided there is no
conflict of interest and that his involvement on other boards do not materially impair his ability to perform his duties to the
Company.
The Company will pay Mr. Le Bel
compensation an annual base salary of C$175,000 (for the first twelve months of employment), payable in monthly installments and
subject to annual salary reviews conducted by the Company’s compensation committee.
Mr. Le Bel will receive a signing
bonus of C$25,000 and is entitled to a performance bonus of up to 50% of his annual base salary, based on the Company’s operating
results and other agreed targets or objectives determined on an annual basis during the Company’s standard executive compensation
review period (a “
Target Bonus
”).
Mr. Le Bel will be entitled to
participate in the Company’s group benefits plan, to the extent such benefits plan exists, on par with other senior management,
subject to the Company’s right to change or discontinue a benefit from time to time without notice.
Mr. Le Bel will be entitled to
four (4) weeks annual vacation, including four (4) weeks of vacation in the first year of service.
Mr. Le Bel will receive an initial
grant of 400,002 stock options to purchase common shares of the Company for a period of five years from the date of grant with
an exercise price determined at the effective time of the Employment Agreement or as soon thereafter as practical in the event
of a company trading blackout. The stock options will vest as follows: 133,334 options at 12 months, 133,334 options at 24 months,
and 133,334 options at 36 months.
Termination:
Mr. Le Bel may terminate the Employment
Agreement with four (4) weeks’ written notice.
The Employment Agreement and the
employment of Mr. Le Bel may be terminated for cause without notice of termination or payment in lieu of notice.
The Company may terminate the Employment
Agreement and Mr. Le Bel’s employment without cause at any time by notice in writing stating the last day of employment (the
“
Termination Date
”), such Termination Date being not more than 60 days from the date of notice and upon so doing:
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(a)
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If the Termination Date occurs on or before six months from the Effective Date, the Company shall
pay Mr. Le Bel 50% of the annual base salary as at the Termination Date, and 50% of the signing bonus.
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(b)
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If the Termination Date occurs after six months from the Effective Date, the Company shall pay
Mr. Le Bel 100% of the annual base salary as at the Termination Date, and 50% of the last annual Target Bonus or 100% of the signing
bonus if the Termination Date occurs within the first 12 months from the Effective Date.
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In the event that Mr. Le Bel is
terminated by the Company or its successor without cause, is terminated by the Executive “for good reason,” or is terminated
by Mr. Le Bel for any other reason after giving at least three (3) months’ notice, in any case within twelve (12) months
following a Change of Control, Mr. Le Bel will be entitled to receive a lump-sum severance payment equal to the sum of (i) twenty-four
(24) months’ base salary, (ii) the total Target Bonus and signing bonus paid or granted to the Executive in last 12 months
multiplied by two, in each case less applicable statutory deductions, and continuation of health benefits for a period of 24 months.
The above is a summary of the material
terms of the Employment Agreement and is qualified in its entirety by the Employment Agreement, which is attached hereto as Exhibit
10.1 and incorporated herein by reference.