DEF 14A of Royal Gold Inc
Filed Apr 8, 2024 · FY20230001104659-24-044768
A Message from the Chair of the Board
| OTHER COMPENSATION MATTERS | 65 | | CEO Pay Ratio | 65 | | 2023 Pay Versus Performance | 65 | | PROPOSAL 3—RATIFICATION OF APPOINTMENT OF ERNST & YOUNG LLP AS INDEPENDENT AUDITOR | 69 | | Independent Registered Public Accounting Firm Fees and Services | 69 | | Preapproval Policies and Procedures | 70 | | Audit Committee Report | 70 | | STOCK OWNERSHIP INFORMATION | 71 | | Security Ownership of Certain Beneficial Owners and Management | 72 | | Equity Compensation Plan Information | 73 | | Delinquent Section 16(a) Reports | 73 | | OTHER INFORMATION | 74 |
Director Nominees at a Glance
Director Nominees at a Glance Our Board is comprised of seven directors divided into three classes, with each class serving a term of three years. The following table summarizes important information about each director nominee standing for election to the Board for a three-year term expiring at our annual meeting in 2027.
Director Nominees at a Glance
| | | | William Heissenbuttel | Jamie Sokalsky | | ■ President and CEO since 2020 ■ Age 58 | ■ Independent director since 2015 ■ Chair of the Audit Committee ■ Retired mining executive ■ Age 66 |
Continuing Directors at a Glance
Continuing Directors at a Glance
Continuing Directors at a Glance
| Director Name Current Position | | Age | Director Since | Independent | Board Committees | | | | | | | | Audit Committee | CNG Committee | | CLASS II DIRECTORS (TERM EXPIRES 2025) | | | | | | | | | William Hayes Retired Mining Executive Chair of the Board | 79 | 2008 | | | | | | Ronald Vance Retired Mining Executive Corporate and Business Development Expert | 71 | 2013 | | | | | CLASS III DIRECTORS (TERM EXPIRES 2026) | | | | | | | | | Fabiana Chubbs Retired Mining Executive Financial and Internal Controls Expert | 58 | 2020 | | | | | | Kevin McArthur Retired Mining Executive Experienced Mine Operator | 69 | 2014 | | | | | | Sybil Veenman Retired Mining Executive Corporate Governance and Legal Expert Chair of the CNG Committee | 60 | 2017 | | | |
Continuing Directors at a Glance
| | 2024 Proxy Statement | 6 |
Board Characteristics
| Name and Principal Position | Salary ($) | Non-Equity Incentive Plan Compensation ($) | Stock Awards ($) | All Other Compensation ($) | Total Compensation ($) | | William Heissenbuttel President and CEO | 865,000 | 862,000 | 2,507,551 | 47,506 | 4,282,057 | | Daniel Breeze SVP Corp Dev, RGLD Gold AG | 495,441 | 380,766 | 761,710 | 50,877 | 1,688,794 | | Paul Libner SVP and CFO | 463,000 | 350,000 | 925,669 | 37,689 | 1,776,358 | | Martin Raffield SVP Operations | 382,337 | 294,000 | 626,160 | 37,224 | 1,339,721 | | Randy Shefman SVP and GC | 448,000 | 348,000 | 825,377 | 40,189 | 1,661,566 | | Mark Isto Former EVP and COO, Royal Gold Corp | 389,280 | 291,967 | 1,275,991 | 30,399 | 1,987,637 |
Election of Directors
Election of Directors Our Board consists of seven directors divided into three classes. Each class serves for a staggered three-year term. The Class I directors elected at our 2024 annual meeting will serve until our 2027 annual meeting or until their successors are elected and qualified or their earlier death or resignation. Our Board has nominated William Heissenbuttel and Jamie Sokalsky to stand for election as Class I directors at our 2024 annual meeting. Messrs. Heissenbuttel and Sokalsky are currently serving on our Board and were most recently elected by stockholders at our 2021 annual meeting. Each nominee was nominated by our Board based on the recommendation of the CNG Committee. In making these nominations, our Board and CNG Committee considered each nominee’s experience, qualifications, and skills as described below. Each nominee has consented to serve as a director if elected. We have no reason to believe that either nominee will be unable or unwilling to serve if elected. However, if that occurs prior to the annual meeting, proxies may be voted for another person nominated as a substitute by the Board or the Board may reduce the number of directors.
Director Nominees
Director Nominees
Director Nominees
| William Heissenbuttel Class I Director—term expires 2024 | | | Age: 58 Not Independent Director since: January 2020 ■ President and Chief Executive Officer | Prior Experience: Mr. Heissenbuttel has more than 36 years of corporate finance experience, including 30 years in project and corporate finance in the metals and mining industry. Mr. Heissenbuttel has served as our President and Chief Executive Officer and a Class I director since January 2020. Previously, he served as our Chief Financial Officer and Vice President Strategy from June 2018 to January 2020, Vice President Corporate Development from 2007 to June 2018, Vice President Operations from 2015 to June 2016, and Manager Corporate Development from 2006 to 2007. Prior to joining Royal Gold, Mr. Heissenbuttel served as Senior Vice President from 2000 to 2006 and Vice President from 1999 to 2000 at N M Rothschild & Sons (Denver) Inc. From 1994 to 1999, he served as Vice President and then Group Vice President at ABN AMRO Bank N.V. From 1987 to 1994, he was a Senior Credit Analyst and an Associate at Chemical Bank Manufacturers Hanover. Mr. Heissenbuttel holds a Master of Business Administration degree from the University of Chicago and a Bachelor of Arts degree from Northwestern University. Reasons for Nomination: Mr. Heissenbuttel was selected to serve on our Board because of his perspective and experience as our President and CEO; skills at stakeholder engagement; extensive business development, accounting and finance experience; broad understanding of global mining businesses; and risk management skills. These skills enable him to bring valuable expertise to our Board with respect to evaluating significant investments in royalty and stream interests in mining properties around the world, balancing competing interests, and addressing governance, disclosure and risk management challenges. |
Director Nominees
| | 2024 Proxy Statement | 16 |
Director Nominees
| Jamie Sokalsky Class I Director—term expires 2024 | | | Age: 66 Independent Director since: August 2015 ■ Finance and Strategic Planning Expert ■ Audit Committee Member since August 2015 ■ Audit Committee Chair since January 2022 ■ Audit Committee Financial Expert | Prior Experience: Mr. Sokalsky has over 30 years of progressive experience in the mining industry. Mr. Sokalsky’s experience in the mining industry began in 1993 as Treasurer and Vice President of Barrick Gold Corporation, where he also served as Chief Financial Officer from 1999 to 2012 and CEO, President, and a director from 2012 to 2014. Other Public Company Directorships: Mr. Sokalsky has served as Chairman of the Board of Directors of Probe Gold, Inc. (TSX: PRB) since 2015 (and currently serves on the Nominating and Corporate Governance Committee and the Compensation Committee) and as a director of Agnico-Eagle Mines Ltd. (NYSE: AEM) since 2015 (where he currently serves as Lead Director of the Board of Directors and a member of each of the Audit Committee and Corporate Governance Committee). Reasons for Nomination: Mr. Sokalsky’s extensive experience in the mining industry, experience in leading a large global mining company, his expertise in many of the issues facing complex, global companies, together with his finance and strategic expertise enable him to bring valuable expertise to our Board with respect to planning for the long term, offering value to mining operators, stakeholder engagement, and anticipating risks and competitive threats. |
Director Nominees
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Continuing Directors
Continuing Directors
Continuing Directors
| Fabiana Chubbs Class III Director—term expires 2026 | | | Age: 58 Independent Director since: November 2020 ■ Sarbanes-Oxley Act Controls Expert ■ Audit Committee Member since November 2020 ■ Audit Committee Financial Expert | Prior Experience: Ms. Chubbs has over 25 years of progressive experience in the mining industry. Ms. Chubbs served as Chief Financial Officer of Eldorado Gold Corporation from 2011 until her retirement in April 2018. She joined Eldorado Gold in 2007 and led treasury and risk management functions until accepting the Chief Financial Officer position. Prior to Eldorado Gold, Ms. Chubbs was a Senior Manager with PwC Canada. During her ten years at PwC Canada, she specialized in audits of public mining and technology companies. Ms. Chubbs started her career in her native Argentina, with experience divided between PwC Argentina and IBM. Ms. Chubbs holds dual degrees from the University of Buenos Aires, including a Certified Public Accountant bachelor’s degree and a Bachelor of Business Administration degree. She is a Chartered Public Accountant in Canada. Other Public Company Directorships: Ms. Chubbs has served as a director of Lithium Americas Corp. (TSX and NYSE: LAC) since June 2019. Ms. Chubbs currently serves as Chair of the Audit and Risk Committee and a member of the Governance and Nominating Committee at Lithium Americas Corp. Key Skills and Qualifications: Ms. Chubbs’ extensive international and financial experience as the CFO of a large public mining company with substantial international operations, together with her experience as an independent auditor of public mining companies during her tenure at PwC Canada and her expertise in Sarbanes-Oxley Act controls, risk management, and technology, enable her to bring valuable expertise to our Board with respect to global business issues and oversight of our financial position and condition and the accurate reporting thereof. |
Continuing Directors
| | 2024 Proxy Statement | 18 |
Continuing Directors
| William Hayes Class II Director—term expires 2025 | | | Age: 79 Independent Director since: January 2008 ■ Chair of Board since May 2014 ■ Strategic planning expert ■ CNG Committee Member since August 2023 ■ Former Audit Committee Member from November 2008-August 2023 | Prior Experience: Mr. Hayes has over 35 years of progressive experience focused on mining. Mr. Hayes retired from Placer Dome Inc., where he served as Executive Vice President for Project Development and Corporate Affairs from 2004 to 2006, Executive Vice President for USA and Latin America from 2000 to 2004, and Executive Vice President for Latin America from 1994 to 2000. Mr. Hayes also worked as an executive, including chief financial officer, for various mining operations in Latin America. Other Directorships: Mr. Hayes served as a director of Antofagasta plc (LON: ANTO) from 2006 to 2019, where he held various board positions over time, including Senior Independent Director, Audit Committee Chair, and member of the Safety and Sustainability Committee, Compensation Committee, and Nominating and Governance Committee. Mr. Hayes also served as Chairman of the Board of Tethyan Copper Company from 2007 through 2022. Key Skills and Qualifications: Mr. Hayes has provided a decade of leadership to our Board. His skills at building a relationship of mutual trust and candor with management ensure that our Board timely receives information and the Board’s feedback is reflected in Royal Gold’s day-to-day business. His experience in project and operations management for a large global mining company, enhanced by his oversight of project development and safety in his role as a board member of other global mining companies, also enables him to bring valuable expertise to our Board regarding human capital management, stakeholder engagement, and assessment of our strategic objectives from a financial, operational and sustainability perspective. |
Continuing Directors
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Continuing Directors
| Kevin McArthur Class III Director—term expires 2026 | | | Age: 69 Independent Director since: March 2014 ■ Experienced mine operator ■ CNG Committee Member since May 2014 | Prior Experience: Mr. McArthur has over 40 years of progressive experience encompassing many facets of the mining business, including operations, corporate development and executive management. Mr. McArthur retired from Tahoe Resources Inc. where he served as a director and Chief Executive Officer from 2009 to 2015 and Executive Chairman from 2015 to February 2019. Prior to joining Tahoe Resources, Mr. McArthur was President and Chief Executive Officer of Glamis Gold Ltd. from 1996 to 2006 when it was purchased by Goldcorp Inc., where Mr. McArthur served as President and Chief Executive Officer and a director until 2008. Other Public Company Directorships: Mr. McArthur has served as a director of Novagold Resources Inc. (TSX and NYSE: NG) since May 2022 (where he currently chairs the Engineering and Technical Committee and serves on the Corporate Governance and Nominations Committee) and of First Quantum Minerals Ltd. (TSX: FM) since May 2021 (where he currently chairs the Environmental, Health Safety & Corporate Social Responsibility Committee and serves on the Human Resources Committee). Mr. McArthur previously served as Chairman of the Board of Boart Longyear Limited (ASX: BLY) from September 2019 to November 2021 and a director of Pan American Silver Corp. (Nasdaq and TSX: PAAS) from February 2019 to May 2020. Key Skills and Qualifications: Mr. McArthur brings to our Board experience in areas important to the operations and strategy of Royal Gold, including, in particular, extensive experience managing mining operations as the chief executive officer of major precious metals mining companies and serving in positions focused on mine operations and project development with major international mining companies. As Royal Gold’s Board evaluates significant investments in royalty and stream interests in mining properties around the world, Mr. McArthur’s experience and expertise is invaluable as he provides an important and unique perspective in our investment review process. |
Continuing Directors
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Continuing Directors
| Ronald Vance Class II Director—term expires 2025 | | | Age: 71 Independent Director since: April 2013 ■ Corporate and business development expert ■ Audit Committee Member (since August 2023) ■ Audit Committee Financial Expert ■ Former CNG Committee Member from January 2014-August 2023 ■ Former CNG Committee Chair from November 2017-March 2023 | Prior Experience: Mr. Vance has over 40 years of experience in mining and corporate development. Mr. Vance retired from Teck Resources Ltd., where he served as Senior Vice President, Corporate Development from 2006 to 2014. Prior to joining Teck Resources, Mr. Vance worked as Managing Director of Rothschild (Denver) Inc. from 1991 to 2000 and as Managing Director/ Senior Advisor of Rothschild Inc. from 2000 to 2005. Other Directorships: Mr. Vance has served on the Board of Directors of Ivanhoe Electric Inc. since June 2023, where he currently serves as a member of the Audit Committee, and served as Chairman of the Board of Southern Peaks Mining L.P. in 2018. Key Skills and Qualifications: Mr. Vance’s business development experience with a large international mining company and his extensive experience in all aspects of corporate and business development and strategic planning enable him to bring valuable expertise to our Board with respect to the mining industry, financial markets, risk assessment, and regulatory matters. |
Continuing Directors
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Continuing Directors
| Sybil Veenman Class III Director — term expires 2026 | | | Age: 60 Independent Director since: August 2017 ■ Corporate governance and legal expert ■ CNG Committee Member since January 2018 ■ CNG Committee Chair since April 2023 | Prior Experience: Ms. Veenman has 30 years of progressive experience in the mining industry. Ms. Veenman retired from Barrick Gold Corporation in 2014, where she served in various officer positions from 1994 to 2014, including Senior Vice President and General Counsel and a member of the executive leadership team from 2010 to 2014. Other Directorships: Ms. Veenman has served as a director of Major Drilling Group International Inc. (TSX: MDI) since December 2019 (where she currently serves as Chair of the Corporate Governance and Nominating Committee and a member of the Human Resources and Compensation Committee) and NexGen Energy Ltd. (TSX and NYSE: NXE) since August 2018 (where she currently serves on the Sustainability Committee and the Audit Committee). Ms. Veenman previously served as a director of IAMGOLD Corporation (NYSE: IAG) from December 2015 to May 2021 and Noront Resources Ltd. (TSX-V: NOT) from August 2015 to February 2020. Ms. Veenman also serves on the Board of Directors of Boost Child & Youth Advocacy Centre, a non-profit organization dedicated to providing child and youth services and support. Key Skills and Qualifications: Ms. Veenman’s extensive mining industry, legal and corporate governance experience as chief legal officer and member of the leadership team at a global gold mining company, and her substantial involvement on public company boards, enable her to bring valuable expertise to our Board with respect to the mining industry and to Royal Gold’s corporate governance, compensation plans, investment stewardship strategy and management of legal and other risks. |
Components of Director Compensation
Components of Director Compensation Taking into account the benchmarking information described above and the recommendations of the Compensation Consultant, the CNG Committee recommended, and our independent directors approved, our 2023 director compensation program, as described below.
Components of Director Compensation
| Compensation Element for Non-employee Directors | 2023 | | Annual Board Retainer(1) | $70,000 | | Board and Committee Meeting Fees(1) | $1,500 / meeting attended | | Site Visit Fees(1)(2) | $1,500 / site visit | | Annual Retainer for Board Chair(1) | $115,000 | | Annual Retainer for Committee Chairs(1) | $25,000 | | Annual Equity Award(3) | $150,000 equity value target |
Components of Director Compensation
(1) Retainers and fees are paid quarterly in cash. (2) On August 22, 2023, the Board approved an additional fee of $1,500 to each non-employee director for each site visit attended by such non-employee director. There were no site visits attended by any non-employee directors in 2023. Non-employee directors received 1,205 shares of restricted stock (U.S. residents) or restricted stock units (Canadian residents) on March 2, 2023. Half of the shares vested immediately, and the remaining half vested on March 2, 2024, subject to continued service. The number of shares was determined based on the 30-day volume weighted average price per share of Royal Gold common stock (“VWAP”) for the period ended March 1, 2023, which was $124.50.
Components of Director Compensation
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2023 Director Compensation
2023 Director Compensation The following table provides information regarding compensation paid to or earned by our non-employee directors for their services during the year ended December 31, 2023. Mr. Heissenbuttel’s compensation is shown in the Summary Compensation Table; he does not receive any additional compensation for his service as a director.
2023 Director Compensation
| Director | Fees Earned or Paid in Cash ($) | Stock Awards (1)(2) ($) | Total ($) | | William Hayes | 204,500 | 145,444 | 349,944 | | Fabiana Chubbs | 88,000 | 145,444 | 233,444 | | Kevin McArthur | 85,000 | 145,444 | 230,444 | | Jamie Sokalsky | 113,000 | 145,444 | 258,444 | | Ronald Vance(3) | 99,000 | 145,444 | 244,444 | | Sybil Veenman(3) | 99,000 | 145,444 | 244,444 |
2023 Director Compensation
(1) Amount represents the grant date fair value of restricted stock or restricted stock units granted during 2023, calculated in accordance with financial statement reporting rules. You can find information about the assumptions used to calculate grant date fair values in Note 8 to the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2023. In accordance with financial statement reporting rules, the grant date fair value for each share of restricted stock or restricted stock unit was $120.70, which was the closing price of our common stock on the March 2, 2023, grant date. The value shown in this table ($145,444) differs from the target value of the award in the previous table ($150,000) because, for administrative purposes, we used the 30-day VWAP for the period ended March 1, 2023, which was $124.50, to calculate the number of shares to grant. For purposes of this table, we are required to report the awards at their grant date fair value calculated in accordance with financial statement reporting rules, as described above. (2) Restricted stock and restricted stock unit grants to non-employee directors vest 50% on the date of grant and 50% on the first anniversary of the date of grant. As of December 31, 2023, Messrs. Hayes and Vance held 602 shares of unvested restricted stock. All other non-employee directors elected to defer their 2023 equity compensation pursuant to our Deferred Compensation Plan, which is described below. Shares of restricted stock and restricted stock units that are deferred have the same vesting restrictions. (3) Mr. Vance served as Chair of the CNG Committee through March 31, 2023. Ms. Veenman was appointed as Chair of the CNG Committee effective April 1, 2023.
Summary of 2023 Compensation Decisions
Summary of 2023 Compensation Decisions The CNG Committee reviews executive compensation annually and retains an independent compensation consultant to benchmark executive compensation against our peer group every other year. The CNG Committee took a number of steps this past year to align the compensation of our executives with our strategy and changing market dynamics and to retain and motivate executives to achieve long-term value for our stockholders, including the following: ■ Total Compensation: Aligned NEO total compensation within a reasonable range of median executive compensation benchmark data per the Compensation Consultant’s market review, taking into account the tenure and experience of each individual NEO. ■ Base Salary: Reviewed salaries relative to executive compensation benchmark data per the Compensation Consultant’s market review, applied cost of living adjustments according to region and, in some cases, applied additional salary adjustments to individual NEOs whose salaries were being transitioned to median over the initial three years in role. Short-Term Incentive Cash Bonus: Maintained corporate bonus targets largely unchanged in terms of weighting and structure with a few modifications, including the use of a Gross GEO Production target instead of a Net GEO Production target to simplify the calculation of the metric and allow for reconciliation to actual revenue in the Company’s financial statements.
Compensation Philosophy and Objectives
| Drive growth and profitability | Increase long-term value for our stockholders | Manage Royal Gold in a responsible and sustainable manner and in the best interests of stockholders, employees, and other stakeholders | Maintain our reputation for management excellence and financial performance |
Compensation Governance
| Our executive compensation program is designed to align with governance best practices and the long-term interests of our stockholders. We believe these practices, some of which are in response to feedback from our stockholders, were key to receiving voter support of 98% for our executive compensation program at our 2023 annual meeting of stockholders. |
Compensation Governance
| ■ Guarantee salary increases, annual short-term incentive payments, or long-term incentive opportunities ■ Provide excessive perquisites ■ Permit repricing of stock options without stockholder approval | ■ Provide excise tax gross-ups, including for change-of-control payments ■ Permit executive officers to hedge or pledge our stock ■ Maintain a defined benefit pension plan or any special executive retirement plans |
Elements of Total Direct Compensation
| Element | Type | Objective of Compensation Element | | Base Salary | Fixed | ■ Provides fixed compensation based on an individual’s skills, experience and proficiency, market competitive data, and the relative value of the individual’s role within the Company ■ Attracts and retains executive talent and helps the Company remain competitive in our industry | | Short-term Incentive Awards | Variable | ■ Rewards annual Company performance ■ Aligns participants’ compensation with short-term financial and operational objectives specific to each calendar year ■ Motivates participants to meet or exceed internal and external performance expectations ■ Recognizes individual contributions to the Company’s results | | Long-term Incentive Awards —Restricted Shares —Performance Shares | Variable | ■ Rewards long-term performance, directly aligned with stockholder interests ■ Provides a strong performance-based equity component ■ Recognizes and rewards share performance relative to industry peers through performance shares based on relative TSR performance ■ Aligns compensation with sustained long-term value creation ■ Allows executives to acquire a meaningful and sustained ownership stake ■ Fosters executive retention by vesting awards over multiple years |
Elements of Total Direct Compensation
Base Salary Base salary is the fixed cash amount paid to an executive to perform his or her job duties. The CNG Committee reviews base salaries annually and retains an independent compensation consultant to benchmark salaries and other elements of compensation against our peer group every other year. When setting 2023 executive compensation in March 2023, the CNG Committee relied on market information presented in January 2023 by the Compensation Consultant. The CNG Committee also takes into account the recommendations of Mr. Heissenbuttel, our CEO, with respect to salary adjustments for executives who report to him. In general, base salaries are targeted at or near the median of our peer group, while also taking into account level of experience and performance. For Messrs. Heissenbuttel, Libner, and Shefman, who were appointed to their current roles in January 2020, the CNG Committee has taken an incremental approach to market adjustments to their salaries so that their total direct compensation has approached the median over the three-year period after their appointment. This same approach is being taken with Dr. Raffield, who took over the responsibilities of our principal operating officer in September 2023 upon the retirement of Mr. Isto.
Elements of Total Direct Compensation
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Elements of Total Direct Compensation
Mr. Breeze is paid in Swiss francs. Mr. Isto was paid in Canadian dollars. You can find information about our methodology for converting their base salaries into U.S. dollars in the Summary Compensation Table beginning on page 54.
Short-Term Incentive Program
Short-Term Incentive Program The CNG Committee uses a formulaic scorecard that sets predetermined financial, operational, strategic, investment stewardship, business integrity, and individual performance measures for determining awards of short-term incentives. These performance measures may be objective or subjective, depending on the nature of the measure. For example, measures tied to financial metrics are objective, while measures tied to investment stewardship, business integrity and individual performance allow for judgment on the part of the CNG Committee. Our CNG Committee continues to believe that the short-term incentive program should have non-financial, non-formulaic elements that allow for positive or negative compensation adjustment based on qualitative performance assessments. The CNG Committee believes the scorecard is transparent, uses measures that are understood by our executives and stockholders, and aligns executive pay with our performance. In March 2023, the CNG Committee established a short-term incentive target for each executive based on a percentage of the executive’s salary for 2023. The short-term incentive targets of 100% of base salary (the midpoint of the range of 75% to 125%) for Mr. Heissenbuttel and 75% of base salary (the midpoint of the range of 60% to 90%) for other NEOs were consistent with the targets set in prior fiscal years, and were considered by the CNG Committee, based on the market survey provided by the Compensation Consultant, to be competitive with our peers. The CNG Committee also approved various performance measures tied to corporate and individual performance and established threshold, target, and maximum performance goals for each objective measure. Payout under our short-term
Short-Term Incentive Program
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Short-Term Incentive Program
incentive program can range from zero if no threshold goals are achieved to 180% of an NEO’s short-term incentive target if each maximum goal was achieved. In general, the CNG Committee sets performance goals based on the following guideposts:
Short-Term Incentive Program
| Threshold | Target | Maximum | | Threshold performance goals are set to the minimum acceptable performance level, below which performance is not worthy of variable compensation | Target performance goals are generally consistent with our annual budget and strategic plan, but are challenging to achieve | Maximum performance goals require significant effort to achieve; they are exemplary performance levels that exceed targets and are worthy of payout up to a maximum 180% of target |
Short-Term Incentive Scorecard Actual
Short-Term Incentive Scorecard Actual Our 2023 short-term incentive program consisted of five categories of goals that were key to our continued success. These goals are summarized in the table below. In February 2024, the CNG Committee evaluated our corporate performance against each preestablished performance measure.
Short-Term Incentive Scorecard Actual
| Performance Measure | Weight | Threshold (0% payout) | Target (100% payout) | Maximum (180% payout) | % of Target Achieved | | Gross GEO Production(1) as compared to budget, holding metal prices constant | 22.5% | 20% below budget | At budget | 20% over budget | 70% | | Net GEOs in Reserves and M&I Resources(2) compared to budget, using budgeted metal prices | 15% | 10% below budget | At budget | 10% above budget | 129% | | Adjusted Cash G&A Expense(3) as compared to budget | 10% | 10% above budget | At budget | 15% below budget | 120% | | ESG Achievements to support the long-term sustainability of our business | 20% | CNG Committee assessment | | | 100% | | Business Integrity including sufficiency of liquidity for new investments, effectiveness of internal financial controls and cyber risk prevention, and portfolio health and asset valuation | 7.5% | CNG Committee assessment | | | 100% | | Individual performance against preestablished goals | 25% | CNG Committee and CEO assessment of individual performance | | | Varies (see table below) | | Total | 100% | | | | |
Short-Term Incentive Scorecard Actual
(1) Gross GEO Production equals (a) our revenue, adjusted to keep metal prices constant at budgeted metal prices, divided by (b) the budgeted gold price. Budgeted metal prices for 2023 were $1,825 per ounce for gold, $22.50 per ounce for silver and $3.80 per pound for copper. For 2023, our Gross GEO Production was 315,714 ounces, compared to budgeted Gross GEO Production of 337,000 ounces. Net GEOs in Reserves and M&I Resources equals the sum of the Company’s estimated mineral reserves and mineral resources (for producing and development properties only), net of our cost of sales, divided by budgeted metal price of $1,825 per ounce for gold. Our mineral reserves and mineral resources and our cost of sales are adjusted to keep metal prices constant at budgeted metal prices of $1,825 per ounce for gold, $22.50 per ounce for silver, and
Short-Term Incentive Scorecard Actual
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Short-Term Incentive Scorecard Actual
$3.80 per pound for copper. The target and award amounts were determined by reference to the change in net GEOs in reserves and M&I resources from December 1, 2022 to November 30, 2023. For 2023, the Company recognized 8,264,000 actual net GEOs in reserves and M&I resources from producing and development properties as of November 30, 2023, compared to 8,030,000 net GEOs in reserves and M&I resources as of December 1, 2022. (3) Adjusted Cash G&A Expense equals our cash general and administrative expense less (a) litigation expenses, (b) charitable contributions (unless in excess of the budgeted amount), and (c) other extraordinary items, if any. For 2023, Adjusted Cash G&A Expense was $27.8 million, compared to budgeted Adjusted Cash G&A Expense of $28.7 million.
Short-Term Incentive Award Assessments
Short-Term Incentive Award Assessments In February 2024, our CNG Committee determined payouts for our NEOs under our short-term incentive program based on the Company’s performance and individual performance. In assessing Royal Gold’s performance, the CNG Committee determined that our performance exceeded target on the following metrics: (1) Net GEOs in Reserves and M&I Resources grew during the year, resulting in a payout of 129% of target; and (2) Expense Control/Adjusted Cash G&A Expense exceeded target, resulting in a payout of 120% of target. However, Gross GEO Production did not reach the target, resulting in a payout of 70% of target on that metric. With respect to the ESG Achievements metric to support the long-term sustainability of our business, the CNG Committee approved a payout of 100% of target based on issuance of the ESG Report in April 2023, advancement of other investment stewardship reporting measures during the year, support for educational opportunities in the mining industry with two new university scholarships, and the maintenance of carbon neutrality with respect to emissions associated with the Company’s direct corporate operations. With respect to the Business Integrity metric, the CNG Committee approved a payout of 100% of target based on the Company’s improved liquidity and an assessment of the effectiveness of internal financial controls and cyber risk prevention efforts. The CNG Committee evaluated Mr. Heissenbuttel’s performance against his individual performance measures. The CNG Committee and Mr. Heissenbuttel evaluated the performance of our other NEOs against their individual performance measures. Individual performance goals for Mr. Heissenbuttel related to corporate strategy, stockholder engagement, expanded investment stewardship efforts, employee health and safety, and succession planning. Individual performance goals for the other NEOs covered specific tasks relating to their areas of responsibility and covered topics such as asset management, business development efforts, expanded investment stewardship efforts, or cost reductions, depending on the NEO. The following tables show the payouts for the year ended December 31, 2023, for our NEOs.
Performance Versus Pre-established Performance Measures
Performance Versus Pre-established Performance Measures
Performance Versus Pre-established Performance Measures
| Performance Measure | % of Target Achieved | Weight | Heissenbuttel | Breeze | Libner | Raffield | Shefman | | Gross GEO Production | 70% | 22.5% | 15.7% | 15.7% | 15.7% | 15.7% | 15.7% | | Net GEOs in Reserves and M&I Resources | 129% | 15.0% | 19.4% | 19.4% | 19.4% | 19.4% | 19.4% | | Adjusted Cash G&A Expense | 120% | 10.0% | 12.0% | 12.0% | 12.0% | 12.0% | 12.0% | | ESG Achievements | 100% | 20.0% | 20.0% | 20.0% | 20.0% | 20.0% | 20.0% | | Business Integrity | 100% | 7.5% | 7.5% | 7.5% | 7.5% | 7.5% | 7.5% | | Individual Performance | varies | 25.0% | 25.0% | 28.0% | 26.3% | 28.0% | 28.0% | | Individual Score | | | 99.6% | 102.6% | 100.9% | 102.6% | 103.5% |
Performance Versus Pre-established Performance Measures
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Short-Term Incentive Awards Made for 2023
Short-Term Incentive Awards Made for 2023
Short-Term Incentive Awards Made for 2023
| Measure for 2023 | Heissenbuttel | Breeze | Libner | Raffield | Shefman | | Target | $865,000 | CHF333,750 | $347,250 | $286,753(1) | $336,000 | | Individual Score | 99.6% | 102.6% | 100.9% | 102.6% | 103.5% | | Actual Short-Term Incentive | $862,000 | CHF342,000 | $350,000 | $294,000 | $348,000 |
Short-Term Incentive Awards Made for 2023
(1) Dr. Raffield’s base salary was increased in September 2023 in connection with his assumption of the role of principal operating officer. Dr. Raffield’s target short-term incentive award, which was set at 75% of his base salary, was prorated based on the portion of the year at each level of base salary. Long-Term Incentive Awards
Program Design
Program Design Long-term incentive compensation is designed to encourage executives to manage our business for the long term by delivering a significant portion of each executive’s potential total direct compensation at a future date. Awards during 2023 were consistent with compensation program modifications implemented since August 2021 by our CNG Committee, following the recommendations of our Compensation Consultant, designed to simplify our long-term incentive program in a way that aligns with stockholder expectations and competitive market practices and to remove overlap between the performance measures under our short- and long-term incentive programs.
Restricted Shares
Restricted Shares Awards of restricted stock awards (“RSAs”) and restricted stock units (“RSUs”) focus on retention by securing the long-term commitment of our executives. RSAs and RSUs granted in March 2023 vest ratably over three years. In August 2021, the CNG Committee changed the vesting schedule for restricted stock grants from vesting on the third, fourth and fifth anniversaries of the date of grant to vesting on the first, second and third anniversaries, as the delayed ratable vesting was not consistent with market practices. Our U.S.-based executives receive RSAs, and our executives based in Canada and Switzerland receive RSUs. RSAs are treated as issued and outstanding shares of common stock with voting and dividend rights. RSUs are not issued and outstanding shares upon which the grantee may vote or receive dividends; however, grantees are entitled to a cash payment (or dividend equivalent) in the amount of declared dividends at the time dividends are paid.
Performance Shares
Performance Shares Performance shares are intended to incentivize the achievement of long-term share price appreciation. Performance shares vest after three years only if we achieve a TSR compared to the TSRs of certain enumerated precious metals companies between defined threshold and maximum levels over that three-year period. No performance shares vest if the threshold goal is not met. Performance shares vest by linear interpolation within a range from zero shares if the threshold goal is met, to 100% if the target goal is met, and then to 200% if the maximum goal is met or exceeded. For all performance shares, the grantee must be in continuous service from the grant date through any vesting date to receive any shares. If the performance goals are not achieved during this period, the shares expire unvested for non-attainment. Performance shares are not issued and outstanding shares upon which the grantee may vote or receive dividends. Performance shares vest only if the CNG Committee determines that the underlying performance goals are met and the service condition is satisfied. Vested performance shares are settled in shares of our common stock.
Performance Shares
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Performance Shares
In August 2021, the CNG Committee eliminated performance measurement periods of less than three years for performance shares. Performance shares granted in 2023 vest at the end of three years subject to our relative TSR and the executive’s continued service. Our TSR performance group is a customized group of companies comparable to Royal Gold with respect to geography (TSR group is limited to North American companies), capitalization (TSR group includes companies with over a $1.5 billion market capitalization or enterprise value, with two exceptions for 2023), and a gold focus. For 2023, our CNG Committee revised the TSR performance peer group to remove Yamana Gold Inc. and Wesdome Gold Mines Ltd. and to add Equinox Gold Corp., Coeur Mining, Inc. and IAMGOLD Corporation. See “Peer Group Used for TSR Performance Benchmarking” on page 50.
Value of Awards Granted
Value of Awards Granted The CNG Committee, informed by market information presented in March 2023 by the Compensation Consultant, set equity award values for executives in March 2023 taking into account the following factors: ■ The CNG Committee generally sets the value of long-term equity awards at 225%-300% of base salary for our CEO and at 125%-200% of base salary for other NEOs and at an amount that results in targeted total direct compensation within 15% of the median of our peers, depending on the NEO’s experience. ■ The CNG Committee returned to granting full-year equity awards in March 2023 and plans to grant full-year target equity values in the future. In connection with the change to the Company’s fiscal year end from June 30 to December 31, effective December 31, 2021, the CNG Committee determined that target awards for the year ended December 31, 2022, when combined with the target awards granted during the six-month transition period ended December 31, 2021, would reflect 18 months of value to reward and incentivize long-term performance directly aligned with stockholder interests. The CNG Committee granted full-year target equity values in August 2021 for the six-month 2021 Transition Period and half-year target equity values for equity grants in March 2022 for the year ended December 31, 2022.
Value of Awards Granted
| Name | Target Value of 2021 Transition Period Equity Grants(1) | Target Value of 2022 Equity Grants (50% Value)(2) | Target Value of 2023 Equity Grants(3) | Percentage Change— Annualized 2022 to 2023(4) | | Heissenbuttel | $2,250,000 | $1,020,000 | $2,380,000 | 17% | | Breeze | $736,000 | $364,000 | $722,000 | (1)% | | Libner | $750,000 | $316,000 | $880,000 | 39% | | Raffield(5) | $ — | $272,000 | $552,000 | 1% | | Shefman | $750,000 | $316,000 | $784,000 | 24% | | Isto | $914,000 | $454,000 | $1,210,000 | 33% |
Vesting of Previously Granted Awards
Vesting of Previously Granted Awards Performance shares granted in 2021, 2022, and 2023 vest based on three-year performance periods ending June 30, 2024, December 31, 2024, and December 31, 2025, respectively. Performance shares granted in 2018, 2019 and 2020 were subject to vesting conditions during 2023. These awards had the following characteristics:
Vesting of Previously Granted Awards
The vesting of GEO Shares awarded annually in August of 2018 through 2020 is summarized below: GEO SHARES VESTING THROUGH DECEMBER 31, 2023
Vesting of Previously Granted Awards
| Grant Date | Incremental Percentage of Target GEO Shares Vesting During 12 Months Ended: | | Vesting Result | Cumulative Percentage of Target GEO Shares Vested | | August 2018 | 6/30/2019 | 0% | No Vesting | 0% | | | 6/30/2020 | 0% | No Vesting | 0% | | | 6/30/2021 | 0% | No Vesting | 0% | | | 6/30/2022 | 0% | No Vesting | 0% | | | 6/30/2023 | 0% | No Vesting | 0% | | August 2019 | 6/30/2020 | 0% | No Vesting | 0% | | | 6/30/2021 | 0% | No Vesting | 0% | | | 6/30/2022 | 11% | Between threshold and target | 11% | | | 6/30/2023 | 0% | No Vesting | 11% | | August 2020 | 6/30/2021 | 28% | Between threshold and target | 28% | | | 6/30/2022 | 33% | Between threshold and target | 61% | | | 6/30/2023 | 0% | No Vesting | 61% |
Vesting of Previously Granted Awards
Old TSR Shares Goal for Performance Shares Awarded Prior to August 2021: Achieve the highest percentile in TSR among certain enumerated precious metals companies for defined one- and three-year periods: ■ 50% of the Old TSR Shares are evaluated for the three-year measuring period ending on June 30 of the third fiscal year after the grant date ■ 50% of the Old TSR Shares are evaluated for vesting in equal one-third increments for each one-year measuring period ending on June 30 of the first, second, and third fiscal years after the grant date Vested Old TSR shares are settled in shares of common stock following June 30 of the third fiscal year after the grant date, when and if the CNG Committee determines that the relative TSR goal has been met. TSR Shares Goal for Performance Shares Awarded During and After August 2021: Achieve the highest percentile in TSR among certain enumerated precious metals companies for the defined three-year period: ■ 100% of TSR shares are evaluated for the three-year measuring period ending on June 30 for the awards granted in August 2021 and the three-year measuring period ending December 31 for the awards granted during and after March 2022 Vested TSR shares are settled in shares of common stock when and if the CNG Committee determines that the relative TSR goal has been met.
Vesting of Previously Granted Awards
| Metric | TSR | Vesting | | For awards granted prior to August 2021 | | | | Threshold | Less than 50th percentile | 0% of target shares awarded | | Target | 75th percentile | 100% of target shares awarded | | Maximum | 100th percentile | 200% of target shares awarded | | For awards granted during or after August 2021 | | | | Threshold | Less than 35th percentile | 0% of target shares awarded | | Target | 60th percentile | 100% of target shares awarded | | Maximum | 85th percentile | 200% of target shares awarded |
Vesting of Previously Granted Awards
| Grant Date | Tranche | Percentile Achieved | CNG Committee Vesting Determination | | August 2020 | 1 year, tranche 1 | 59th | Percentile between threshold and target; 36% of shares vested | | | 1 year, tranche 2 | 84th | Percentile between threshold and target; 136% of shares vested | | | 1 year, tranche 3 | 33rd | Percentile between threshold and target; 0% of shares vested | | | 3 year | 71st | Percentile between threshold and target; 84% of shares vested | | August 2021 | 3 year | N/A | Not yet subject to evaluation | | March 2022 | 3 year | N/A | Not yet subject to evaluation | | March 2023 | 3 year | N/A | Not yet subject to evaluation |
Executive Compensation Process
| OVERALL PROCESS The CNG Committee leads the annual executive compensation process, with involvement from its independent Compensation Consultant and management. |
Executive Compensation Process
| CNG Committee | ■ Consists of three independent directors in accordance with securities laws and Nasdaq listing rules ■ Oversees administration of policies governing executive compensation ■ Reviews stockholder feedback and trends in executive compensation design ■ Reviews and sets compensation philosophy, objectives, and design and reviews any updates or changes with the Board annually ■ Ensures alignment with strategic goals and stockholder value through establishment of performance measures and goals consistent with our strategy and long-term value creation for stockholders ■ Determines whether performance measures are met ■ Conducts annual assessment of CEO performance, with input from all independent directors ■ Determines CEO compensation outside the presence of CEO and other management ■ Considers, without being bound by, input from independent Compensation Consultant and CEO on executive compensation ■ Determines executive compensation, other than for CEO, with input from CEO | | Management | ■ Provides input to CNG Committee on strategy and program design ■ Develops initial recommendations for short- and long-term incentives based on achievement of performance measures | | Independent Compensation Consultant | ■ Retained annually by CNG Committee; independence determined annually by CNG Committee ■ Performs work at direction and under supervision of CNG Committee ■ Provides expertise on compensation design, market practices, peer group construction, and benchmarking ■ Benchmarks executive officer and director compensation in alternating years ■ Provides in-depth review of and recommendations for compensation framework and design |
Executive Compensation Process
The Compensation Consultant reports directly to the CNG Committee and assisted with the preparation of the compensation disclosures, including the pay-versus-performance disclosures, during 2023. The CNG Committee is responsible for making all equity grants. Our management does not have the authority to make any equity grants. Peer Group Used for Compensation Benchmarking The CNG Committee reviews and selects executive compensation peers based primarily on similar industry profile and size as measured by market capitalization. Our compensation peer group includes our closest direct streaming and royalty competitors, as well as comparably sized gold and silver mining companies.
CEO Employment Agreement
CEO Employment Agreement Our employment agreement with Mr. Heissenbuttel provides that he will serve as our President and CEO and that our Board will continue to nominate him for reelection as a director. The agreement had an initial one-year term beginning on January 2, 2020, and automatically renews for four consecutive one-year periods unless either party timely elects for nonrenewal. Under the agreement, Mr. Heissenbuttel is entitled to an annual base salary of at least $650,000, which may be increased annually as determined by our Board or CNG Committee. Mr. Heissenbuttel’s base salary for 2023 was $865,000. Mr. Heissenbuttel is also eligible to participate in our short-term incentive and long-term equity programs, as well as other employee benefits made available to similarly situated executives. Mr. Heissenbuttel is entitled to severance benefits in connection with a termination of employment with or without a change of control as described below under “Potential Payments Upon Termination or Change of Control” on page 60. Mr. Heissenbuttel is prohibited from competing against us or soliciting our employees, customers, or business relationships for 12 months following termination of his employment.
Employment Agreements for Other NEOs
Employment Agreements for Other NEOs We have entered into an employment agreement with each of our other NEOs. The agreement for Mr. Breeze is between him and our wholly owned subsidiary, RGLD Gold AG. His agreement began on January 1, 2019, and has an indefinite term. The agreements with Messrs. Libner and Shefman had an initial one-year term beginning on January 2, 2020, and the agreement for Dr. Raffield had an initial one-year term beginning on January 3, 2022, and each of these agreements automatically renews for four consecutive one-year periods unless either party timely elects for nonrenewal. Each NEO is entitled to a minimum annual base salary, which salary may be increased annually as determined by our Board or CNG Committee. Each NEO is also eligible to participate in our short-term incentive and long-term equity programs, as well as other employee benefits made available to similarly situated executives. Each NEO is entitled to severance benefits in connection with a termination of employment with or without a change of control as described below under “Potential Payments Upon Termination or Change of Control” on page 60. Each NEO is prohibited from competing against us or soliciting our employees, customers, or business relationships for 12 months following termination of his employment.
Benefit Programs
Benefit Programs Benefit programs for our executives are common in design and purpose to the programs offered to all of our employees in the U.S., Canada, and Switzerland. Executives can also participate in various health and welfare benefit programs to the extent appropriate in the country of employment under applicable laws. We share the cost of certain health and retirement benefit programs with all of our employees. We also offer, directly or indirectly, retirement plans for all of our employees. The U.S. plan is a Salary Reduction/Simplified Employee Pension Plan (“SARSEP Plan”), in which all U.S. employees are eligible to participate. The Canadian plan is a Group Registered Retirement Savings Plan (“Group RRSP”), in which all Canadian employees are eligible to participate. The SARSEP Plan and Group RRSP are voluntary plans. The plan for Swiss employees is regulated by Swiss statutes, is mandated for all Swiss employees within defined limits, and provides for employees’ retirement, survivors, and disability insurance (“Pension Plan”). The SARSEP Plan and Group RRSP allow employees to reduce their pre-tax salary, subject to certain regulatory limitations, and to put this money into a tax-deferred investment plan. We may make non-elective contributions to the employee’s SARSEP Plan and Group RRSP up to 7% of an individual’s annual salary and short-term incentive, subject to limits. Employer contributions to the employee’s SARSEP Plan or Group RRSP are immediately 100% vested. Total employee and employer contributions to the SARSEP Plan and Group RRSP are subject to annual regulatory limitations. Our Swiss subsidiary pays approximately 50% of the contributions to the Pension Plan according to the applicable regulations of the pension scheme provider. The contribution due is a percentage of the relevant covered salary and depends on the age of the Swiss employee. We do not generally provide perquisites or other special benefits to executives that are not available to all of our employees. Executive Stock Ownership Guidelines Our Stock Ownership Guidelines encourage our executive officers to achieve and maintain a minimum investment in our stock. We believe these guidelines incentivize our executive officers to focus on improving long-term stockholder value and align our executive officers’ interests with the interests of stockholders generally. The requirement is set as a number of shares with a dollar value that is equivalent to a multiple of the executive officer’s base salary. Unearned performance shares and unexercised stock options and stock-settled stock appreciation rights (“SARs”) are not considered owned for purposes of the requirement. There is no timeframe in which executive officers must meet ownership targets. Each executive officer must, however, hold 50% of the shares acquired under any equity grant, net of shares withheld or sold to cover taxes, until the executive officer reaches the ownership requirement. If a significant decline in Royal Gold’s stock price, a recoupment of incentive compensation under our clawback policy, or other event approved by the Board causes an individual’s holdings to fall below the applicable threshold, the executive will not be required to purchase additional shares to meet the threshold but must refrain from selling shares until the threshold has again been achieved.
Benefit Programs
* Actual values were calculated using the 30-day volume weighted average stock price as of December 31, 2023, of $119.36 per share, pursuant to our Stock Ownership Guidelines. Clawback Policy In November 2023, our CNG Committee and Board approved amendments to our Incentive Compensation Recoupment Policy (or clawback policy) to comply with the newly adopted Nasdaq listing requirements regarding the recoupment of incentive-based compensation in connection with an accounting restatement. The amended policy retained the discretionary, fault-based policy for improper conduct but expanded it to cover all executive officers. The policy provides that, if we undertake an accounting restatement, the Board will recoup any incentive-based compensation received by current or former executive officers during the three completed fiscal years prior to the date the restatement determination is made that was in excess of what would have been received by the executive officers after giving effect to the restatement. In addition, if an executive officer has engaged in improper conduct that results in, or could reasonably be expected to result in, material financial harm to Royal Gold or its stockholders, material reputational risk to Royal Gold, or criminal proceedings against Royal Gold or its directors, officers, or employees, the Board may, in its sole discretion after evaluating the associated costs and benefits, recoup or take other action regarding any incentive-based compensation paid or granted during the previous three years to that executive officer. For purposes of the policy, improper conduct means an executive officer’s willful misconduct (including fraud, bribery, or other illegal acts) or gross negligence, including any failure to report properly, or to take appropriate remedial action with respect to, misconduct or gross negligence by another person. Each of our executive officers as of January 1, 2024, has signed an acknowledgment agreeing to comply with the terms of the clawback policy. Post-termination Compensation We do not provide pension or other retirement benefits apart from the SARSEP Plan, the Group RRSP, and the Pension Plan, each described above. We provide certain post-termination benefits pursuant to the terms of our equity incentive plan and employment agreements described above under “Employment Agreements” on page 50 and below under “Potential Payments Upon Termination or Change of Control” on page 60. None of the employment agreements provide for excise tax gross-ups in a change of control. Risk Assessment of Compensation Policies and Practices We conducted an assessment of our compensation policies and practices, including our executive compensation program, to evaluate the potential risks associated with these policies and practices. We reviewed this assessment with
Benefit Programs
the CNG Committee. We have concluded that our compensation programs are designed with an appropriate balance of risk and reward and do not encourage excessive or unnecessary risk-taking behavior. As a result, we do not believe that risks relating to our compensation policies and practices are reasonably likely to have a material adverse effect on Royal Gold. In conducting this review, we considered the following attributes of our programs: ■ Mix of base salary, short-term incentive awards, and long-term equity compensation ■ Alignment between performance measures used under performance-based compensation and performance measures used by our Board to chart corporate strategy ■ Multiple performance measures under short-term incentive awards to avoid placing excessive emphasis on any single measure ■ Capped performance multipliers for short-term incentives and performance share awards ■ CNG Committee discretion to adjust compensation downward to reflect performance or other factors ■ Current equity vesting periods of up to three years designed to reward high-performing executives and key employees who drive long-term stockholder value ■ Benchmarking of compensation levels to ensure programs are consistent with industry practices ■ Internal controls that serve to preclude decisionmakers from taking excessive risk to earn the incentives provided under our compensation plans ■ CNG Committee oversight of compensation programs ■ Stock ownership guidelines that align the interests of executive officers with those of our stockholders generally Clawback policy allowing for the recoupment of executive incentive-based compensation for accounting restatements or serious misconduct
Executive Compensation Tables
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Non-Equity Incentive Plan Compensation ($) | Stock Awards ($)(1) | Option Awards ($)(2) | All Other Compensation ($)(3) | Total ($) | | William Heissenbuttel President and CEO | 2023 | 865,000 | — | 862,000 | 2,507,551 | — | 47,506 | 4,282,057 | | | 2022 | 777,000 | — | 949,000 | 1,298,851 | — | 35,689 | 3,060,540 | | | Stub 2021 | 375,000 | — | 460,000 | 2,303,817 | — | 9,395 | 3,148,212 | | | FY2021 | 670,000 | — | 570,000 | 1,133,532 | 635,796 | 32,956 | 3,042,284 | | Daniel Breeze(4) SVP Corporate Development, RGLD Gold AG | 2023 | 495,441 | — | 380,766 | 761,710 | — | 50,877 | 1,688,794 | | | 2022 | 432,800 | — | 399,288 | 464,679 | — | 32,615 | 1,329,382 | | | Stub 2021 | 222,650 | — | 205,254 | 752,297 | — | 22,292 | 1,202,493 | | | FY2021 | 419,100 | — | 269,500 | 456,366 | 255,750 | 42,877 | 1,443,593 | | Paul Libner SVP and CFO | 2023 | 463,000 | — | 350,000 | 925,669 | — | 37,689 | 1,776,358 | | | 2022 | 388,500 | — | 356,000 | 402,563 | — | 42,189 | 1,189,252 | | | Stub 2021 | 187,500 | 30,000 | 170,000 | 768,721 | — | 26,624 | 1,182,845 | | | FY2021 | 350,000 | — | 226,000 | 396,148 | 222,911 | 40,010 | 1,235,069 | | Martin Raffield SVP Operations | 2023 | 382,337 | — | 294,000 | 626,160 | — | 37,224 | 1,339,721 | | Randy Shefman SVP and General Counsel | 2023 | 448,000 | — | 348,000 | 825,377 | — | 40,189 | 1,661,566 | | | 2022 | 388,500 | — | 356,000 | 402,563 | — | 36,097 | 1,183,160 | | | Stub 2021 | 187,500 | — | 172,000 | 768,721 | — | 20,943 | 1,149,164 | | | FY2021 | 335,000 | 30,000 | 218,000 | 333,421 | 187,719 | 30,719 | 1,134,859 | | Mark Isto(5) Former EVP and Chief Operating Officer, Royal Gold Corporation | 2023 | 389,280 | — | 291,967 | 1,275,991 | — | 30,399 | 1,987,637 | | | 2022 | 540,500 | — | 498,951 | 577,665 | — | 42,268 | 1,659,384 | | | Stub 2021 | 272,000 | — | 250,967 | 934,197 | — | 23,298 | 1,480,462 | | | FY2021 | 501,900 | 46,800 | 319,800 | 597,986 | 335,135 | 36,637 | 1,838,258 |
Option Exercises and Stock Vested in 2023
Option Exercises and Stock Vested in 2023 This table provides information on the exercise of stock options and SARs and the vesting of restricted shares and performance shares for each of our NEOs during 2023.
Option Exercises and Stock Vested in 2023
| | Option Awards | | Stock Awards | | | Name | Number of Shares acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | | William Heissenbuttel | | | 10,214 | $1,137,518 | | Daniel Breeze | | | 3,856 | $431,272 | | Paul Libner | | | 3,541 | $393,472 | | Martin Raffield | | | 416 | 50,116 | | Randy Shefman | | | 3,322 | $369,614 | | Mark Isto | 21,929 | 1,059,977 | 5,387 | $598,052 |
Option Exercises and Stock Vested in 2023
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Option Exercises and Stock Vested in 2023
Value determined by multiplying the number of shares exercised by the difference between the market price (closing price) of our common stock at exercise and the exercise price. (2) Value determined by multiplying the number of shares that vested by the closing market price of our common stock on the vesting date. Potential Payments Upon Termination or Change of Control The table below shows the estimated payments and benefits payable to our NEOs as a result of termination of employment with or without a change of control of Royal Gold. We assume that the applicable trigger event took place on December 31, 2023. The value of accelerated vesting of equity awards is based on the closing market price of our common stock on December 29, 2023 ($120.96). “Change of control” is defined in each NEO’s employment agreement and equity award agreements. In general, for purposes of the table, “involuntary termination” includes an involuntary termination of employment by us without cause, a termination of employment by the executive for good reason, or our nonrenewal of the executive’s employment, if applicable. Mr. Breeze’s employment agreement has an indefinite term, so termination for non-renewal is not possible. Pursuant to their employment agreements, upon an involuntary termination without a change of control, each NEO is entitled to a cash payment equal to the sum of the NEO’s base salary plus the average of the annual short-term incentive awards paid to the NEO for the last three full fiscal years prior to the involuntary termination. Upon an involuntary termination with a change of control, each NEO is entitled to a payment equal to the sum of 1.5 times the NEO’s base salary (or 2.5 times base salary in the case of Mr. Heissenbuttel) plus 1.5 times the average of the annual short-term incentive awards paid to the NEO for the last three full fiscal years prior to an involuntary termination (or 2.5 times such average award amount in the case of Mr. Heissenbuttel). In addition, upon a change of control, the Company will pay for 12 months of COBRA coverage at active employee rates. All payments under the employment agreements are subject to the terms and conditions set forth in the employment agreements. In general, outstanding equity awards vest in full (at maximum, if applicable) upon an involuntary termination of service in connection with a change of control. In the case of an involuntary termination of service outside a change of control: ■ unvested stock options and SARs vest in full; ■ outstanding RSAs and RSUs vest in full for executives with at least 15 years of service, which includes Mr. Heissenbuttel and Mr. Libner as of December 31, 2023; ■ for executives with less than 15 years of service, a prorated portion of outstanding RSAs and RSUs granted before August 2021 vest, while outstanding RSAs and RSUs granted during and after August 2021 are forfeited; ■ a prorated portion of outstanding GEO Shares and Old TSR Shares vest based on the Company’s performance through the last day of the fiscal year in which the executive’s service is terminated; and ■ all new TSR shares are forfeited. The following table does not show employee benefits that are provided to our employees on a non-discriminatory basis. See “Retirement and Consulting Agreements for Mark Isto” on page 51 for a description of the Isto Agreements entered into in connection with Mr. Isto’s retirement from Royal Gold in September 2023.
Option Exercises and Stock Vested in 2023
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Option Exercises and Stock Vested in 2023
| | | | Value of Accelerated Vesting of Outstanding Equity Awards | | | | | Name | Cash Compensation ($)(1) | Value of Medical Insurance Continuation ($) | Restricted Stock ($) | Stock Options and SARs ($) | Performance Stock Awards ($) | Total ($) | | William Heissenbuttel Involuntary Termination without a Change of Control | 1,775,333 | — | 2,437,707 | — | — | 4,213,040 | | Involuntary Termination with a Change of Control | 4,438,333 | 51,036 | 2,437,707 | — | 6,202,224 | 13,129,300 | | Daniel Breeze Involuntary Termination without a Change of Control | 892,295 | — | 209,133 | — | — | 1,101,428 | | Involuntary Termination with a Change of Control | 1,338,443 | — | 879,379 | — | 2,048,337 | 4,266,158 | | Paul Libner Involuntary Termination without a Change of Control | 811,667 | — | 852,647 | — | — | 1,664,314 | | Involuntary Termination with a Change of Control | 1,217,500 | 52,248 | 852,647 | — | 2,128,412 | 4,250,807 | | Martin Raffield Involuntary Termination without a Change of Control | 714,500 | — | — | — | — | 714,500 | | Involuntary Termination with a Change of Control | 1,071,750 | 46,296 | 391,185 | — | 897,523 | 2,406,754 | | Randy Shefman Involuntary Termination without a Change of Control | 797,333 | — | 111,430 | — | — | 908,764 | | Involuntary Termination with a Change of Control | 1,196,000 | 52,140 | 780,918 | — | 2,020,153 | 4,049,211 |
Option Exercises and Stock Vested in 2023
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