PROXY PROXY
ROYAL GOLD, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Stanley Dempsey and Pierre Gousseland or
either of them, as attorneys, agents and proxies (the "Proxies"), each with
full power of substitution to vote, as designated below, all the shares of
Common Stock of Royal Gold, Inc. held of record by the undersigned on
September 29, 2000, at the Annual Meeting of Stockholders of Royal Gold, Inc.
(the "Meeting") to be held at the Oxford Hotel, Sage Room, 1600 Seventeenth
Street, Denver, Colorado, on November 14, 2000, at 9:30 A.M., or at any
postponement or adjournment thereof.
1. PROPOSAL to elect, as Class I directors for a term of three years
(term to expire in 2003) or until each such Director's successor is
elected and qualified, each of the following nominees:
FOR THE NOMINEES BELOW (except as marked to the contrary)
WITHHOLD AUTHORITY to vote for the nominees below
Peter B. Babin Stanley Dempsey John W. Goth
INSTRUCTION: To withhold authority to vote for any single nominee, draw a
line through the nominee's name above.
2. PROPOSAL to ratify the appointment of PricewaterhouseCoopers as
independent auditors of the Company for the fiscal year ended
June 30, 2001.
FOR AGAINST ABSTAIN
In their discretion, the Proxies are also authorized to vote all of the
shares of the undersigned upon such other business as may properly come
before the Meeting. Management and Directors are not currently aware of
any other matters to be presented at the Meeting.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS
MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 and 2.
The undersigned acknowledges receipt of this Proxy and a copy of the Notice
of Annual Meeting and Proxy Statement, dated October 13, 2000.
Dated _________________________________________________
__________________________________________________
(Signature)
__________________________________________________
(Signature if Held Jointly)
Please sign exactly as name appears on this Proxy. When shares are held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
Please mark, sign, date and return this Proxy promptly.
ROYAL GOLD, INC.
1660 Wynkoop Street, Suite 1000
Denver, Colorado 80202
303/573-1660 (Phone)
303/595-9385 (Fax)
[email protected] (E-mail)
www.royalgold.com (Web site)
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held November 14, 2000
* * * *
To the Stockholders of ROYAL GOLD, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of the
Stockholders of Royal Gold, Inc. (the "Company"), a Delaware
corporation, will be held at the Oxford Hotel, Sage Room, 1600
Seventeenth Street, Denver, Colorado, on Tuesday, November 14,
2000, at 9:30 A.M., Mountain Standard Time, for the following
purposes:
1. To elect three Class I directors to serve until the 2003
Annual Meeting of Stockholders or until each such
director's successor is elected and qualified;
2. To ratify the appointment of PricewaterhouseCoopers as
independent auditors of the Company for the fiscal year
ended June 30, 2001; and
3. To transact any other business that may properly come
before the meeting and any postponements or adjournments
thereof.
Only stockholders of record at the close of business on
September 29, 2000, will be entitled to notice of and to vote at
the meeting and any postponements or adjournments of the meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/
Karen P. Gross
Vice President & Corporate Secretary
Denver, Colorado
October 13, 2000
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE COMPLETE,
SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE. THE
PROMPT RETURN OF YOUR COMPLETED PROXY WILL ASSIST THE COMPANY IN
OBTAINING A QUORUM OF STOCKHOLDERS FOR THE ANNUAL MEETING. YOU ARE
ALSO ENTITLED TO REVOKE YOUR PROXY AT ANY TIME PRIOR TO THE
MEETING, OR TO CHANGE YOUR VOTE BY SUBSEQUENT PROXY, OR TO VOTE IN
PERSON AT THE MEETING.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
ROYAL GOLD, INC.
1660 Wynkoop Street
Suite 1000
Denver, Colorado 80202
303/573-1660
303/595-9385 (Fax)
[email protected] (E-mail)
www.royalgold.com (Web site)
SOLICITATION AND REVOCATION OF PROXIES
This Proxy Statement is furnished to the Stockholders of Royal
Gold, Inc. (the "Company" or "Royal Gold"), a Delaware corporation,
in connection with the solicitation, by and on behalf of the Board
of Directors of the Company, of proxies to be voted at the Annual
Meeting of the Stockholders of the Company (the "Meeting") to be
held at 9:30 A.M. on Tuesday, November 14, 2000, at the Oxford
Hotel, Sage Room, 1600 Seventeenth Street, Denver, Colorado. This
Proxy Statement, the enclosed Proxy and the Company's Annual Report
for the fiscal year ended June 30, 2000, are being mailed to Stockholders
on or about October 13, 2000.
Only holders of shares of the Common Stock ($.01 par value) of
the Company ("Common Stock") of record at the close of business on
September 29, 2000, will be entitled to notice of, and to vote at,
the Meeting and at any and all postponements and adjournments
thereof.
If the enclosed Proxy is properly executed and received by the
Company by 10:00 a.m., Mountain Standard Time, on November 14,
2000, the shares represented by the Proxy will be voted at the
Meeting in accordance with the instructions indicated thereon. If
no choice is indicated, the shares will be voted FOR each of the
proposals identified herein. Stockholders who execute Proxies
retain the right to revoke such Proxies at any time before they are
voted by filing with the Secretary of the Company either an
instrument revoking the Proxy or a duly executed Proxy bearing a
later date. Proxies may also be revoked by any Stockholder present
at the Meeting who desires to vote his or her shares in person.
Solicitation of Proxies may be made by directors, officers or
employees of the Company, without additional compensation, by
telephone, facsimile, or personal interview as well as by mail.
The Company will request banks and brokers to solicit their
customers who beneficially own Common Stock listed in the name of
the nominees and will reimburse said banks and brokers for the
reasonable out-of-pocket expense of such solicitation. Costs of
solicitation will be borne by the Company.
VOTING RIGHTS AND OUTSTANDING STOCK
All voting rights are vested exclusively in the holders of the
Common Stock. As of the record date, September 29, 2000, there
were issued and outstanding 17,910,814 shares of Common Stock, each
of which entitles the holder thereof to one vote on all matters
which may come before the Meeting. A majority of the issued and
outstanding shares of Common Stock, whether represented in person
or by Proxy, shall constitute a quorum at any meeting of the
Stockholders. Abstentions will be counted as present for purposes
of determining whether there is a quorum. The affirmative vote of
sixty percent (60%) of the shares that are represented at a meeting
at which a quorum is present shall be the act of the Stockholders.
In the election of directors, each Stockholder eligible to vote may
vote the number of shares of Common Stock held for as many persons
as there are directors to be elected, but cumulative voting is not
permitted. Under Delaware law, holders of Common Stock are not
entitled to appraisal or dissenters' rights with respect to the
matters to be considered at the Meeting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows the beneficial ownership, as of
August 31, 2000, of the Common Stock by each director, by each
executive officer, by any person who is known to the Company to be
the beneficial owner of more than 5% of the issued and outstanding
shares of Common Stock, and by all of the Company's directors and
executive officers as a group.
Number of Shares of Common Stock
Name and Address Beneficially Owned Percent
of Beneficial Subject to of
Owner Shares Options(a) Total(b) Class
------------------------------------------------------------------------------
Stanley Dempsey (c) 607,883 369,684 977,567 5.52%
Royal Gold, Inc.
1660 Wynkoop Street
Suite 1000
Denver, Colorado 80202
Edwin W. Peiker, Jr. (d) 415,778 25,000 440,778 2.49%
555 Ord Drive
Boulder, CO 80302
John W. Goth 24,500 25,000 49,500 *
14142 Denver West Parkway
Suite 170
Golden, CO 80401
Pierre Gousseland 46,500 25,000 71,500 *
4 Lafayette Court, #1B
Greenwich, CT 06830
James W. Stuckert 1,738,705 25,000 1,763,705 9.96%
Hilliard, Lyons, Inc.
P.O. Box 32760
Louisville, Kentucky 40232
Merritt E. Marcus 425,243 25,000 450,243 2.54%
Marcus Paint Co.
235 East Market Street
Louisville, KY 40202
S. Oden Howell, Jr. 570,680 25,000 595,680 3.36%
Howell & Howell Painting
Contractors, Inc.
P.O. Box 36097
Louisville, KY 40233
Peter B. Babin (e) 270,900 197,576 468,476 2.64%
Royal Gold, Inc.
1660 Wynkoop Street
Suite 1000
Denver, CO 80202
Donald Worth 4,000 0 4,000 *
2679 Bayview Avenue
Willowdale, Ontario M2L 1C1
Canada
Karen P. Gross 75,650 107,826 183,476 1.03%
Royal Gold, Inc.
1660 Wynkoop Street
Suite 1000
Denver, CO 80202
Donald Baker 5,200 80,075 85,275 *
Royal Gold, Inc.
1660 Wynkoop Street
Suite 1000
Denver, CO 80202
John Skadow 11,360 123,670 135,030 *
Royal Gold, Inc.
1660 Wynkoop Street
Suite 1000
Denver, CO 80202
All Directors & 4,196,399 1,028,831 5,225,230 29.5%
Officers as a
Group (12 persons)
Societe Generale Asset
Management 1,163,793 0 1,163,793 6.57%
2, place de la Coupole
La Defense
Paris 92972
__________________
* Less than 1% ownership of the Company's Common Stock.
(a) See "Compensation of Directors and Executive Officers --
Option Exercises and Year-End Values."
(b) The amounts shown in the table reflect all shares
beneficially owned, including shares subject to outstanding
stock options that are exercisable within sixty (60) days of
the date of this Proxy Statement.
(c) The amount shown in the table includes 265,032 shares
beneficially owned by certain members of Mr. Dempsey's
immediate family. Mr. Dempsey disclaims beneficial ownership
of these 265,032 shares of Common Stock.
(d) The amount shown in the table includes 14,200 shares
beneficially owned by certain members of Mr. Peiker's immediate
family. Mr. Peiker disclaims beneficial ownership of these
14,200 shares of Common Stock.
(e) The amount shown in the table includes 70,850 shares
beneficially owned by certain members of Mr. Babin's
immediate family. Mr. Babin disclaims beneficial ownership
of these 70,850 shares of Common Stock.
PROPOSAL 1.
ELECTION OF CLASS I DIRECTORS
The Company's Board of Directors consists of three classes of
directors, with each class of directors serving for a three-year
term ending in a successive year. The Company's current Class I
directors are Messrs. Dempsey, Babin and Goth; the Class II
directors are Messrs. Stuckert, Marcus and Gousseland; and the
Class III directors are Messrs. Howell, Peiker and Worth.
If the enclosed Proxy is duly executed and timely received
for the Meeting, and if no contrary specification is made as
provided therein, it is the intention of the persons named therein
to vote the shares represented thereby FOR Peter B. Babin, Stanley
Dempsey, and John W. Goth as Class I directors of the Company. If
any of the nominees for election as a Class I director should
refuse or be unable to serve (an event that is not anticipated),
the Proxy will be voted for such person who is designated by the
Board of Directors to replace such nominee. Each Class I director
elected at the Meeting shall serve until the 2003 Annual Meeting,
or until his successor is elected and qualified.
Information concerning the nominees for election as directors
is set forth below under "Directors and Officers."
Vote Required For Approval And Recommendation. The
affirmative vote of sixty percent (60%) of the shares that are
represented at a meeting at which a quorum is present is required
for the election of directors. Each stockholder eligible to vote
may vote the number of shares of Common Stock held for as many
persons as there are directors to be elected, but cumulative voting
is not permitted.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY RECOMMENDS
A VOTE "FOR" THE DIRECTOR NOMINEES.
DIRECTORS AND OFFICERS
Set forth below are the names, position with the Company,
periods of service and experience of the directors and officers of
the Company. The persons who are nominated for election as
directors at the Meeting are indicated with an asterisk.
*Stanley Dempsey
Age 61; Chairman of the Board of Directors and Chief Executive
Officer of the Company since August 1984. Class I director; Term
expires 2000.
President and Chief Operating Officer of the Company from July 1,
1987 to April 4, 1988. From 1984 through June 1986, Mr. Dempsey
was a partner in the law firm of Arnold & Porter. During the same
period, he was a principal in Denver Mining Finance Company. From
1960 through 1987, Mr. Dempsey was employed by AMAX, Inc. serving
in various managerial and executive capacities. Mr. Dempsey is
also a member of the board of directors of various mining-related
associations.
*Peter B. Babin
Age 46; President of the Company since December 10, 1996. Class I
director since October 1997. Term expires 2000.
Executive Vice President of the Company from January 1, 1995 to
December 10, 1996. Senior Vice President from July 1, 1993 to
January 1, 1995. From 1989 until 1993, Mr. Babin was a consultant
to the Company. From 1986 through 1989, Mr. Babin was Senior Vice
President and General Counsel of Medserv Corporation, a provider of
ancillary health care services.
*John W. Goth
Age 72 Class I director since August 1988; Term expires 2000
Executive Director of the Denver Gold Group and past chairman of
the Minerals Information Institute. A consultant to the mining
industry since 1985. Mr. Goth was formerly a senior executive of
AMAX, Inc. and director of Magma Copper Corporation. He is
currently a director of U.S. Gold Corporation and Qualchem, Inc.
(1) (2)
Pierre Gousseland
Age 78 Class II Director since June 1992; Term expires 2001
Financial Consultant. From 1977 until January 1986, Mr. Gousseland
was chairman and chief executive officer of AMAX, Inc. He is
presently a Director of Guyanor Ressources S.A. Formerly, Director
of the French American Banking Corporation of New York, the
American International Group, Inc., Union Miniere, S.A. (Belgium),
Degussa AG (Germany), IBM World Trade Europe/Middle East Africa
Corporation and Pancontinental Mining Europe GmbH (Germany). Mr.
Gousseland has served on the Chase Manhattan International and
Creditanstaldt International (Vienna, Austria) Advisory Boards, and
is past president of the French-American Chamber of Commerce in the
United States. (2)
Merritt E. Marcus
Age 66; Class II director since December 1992. Term expires 2001.
President and Chief Executive Officer of Marcus Paint Company, a
manufacturer of industrial coatings, and Performance Powders, LLC,
a manufacturer of industrial powder coatings, since 1983. Mr.
Marcus has served several terms as a director of the National Paint
and Coatings Association.
James W. Stuckert
Age 62; Class II director since September 1989; Term expires 2001.
Chairman and Chief Executive Officer of Hilliard, Lyons, Inc.,
Louisville, Kentucky. Mr. Stuckert is also a Director of Hilliard,
Lyons, Inc. and Thomas Transportation. He joined Hilliard, Lyons
in 1962 and served in several capacities prior to being named
Chairman in December 1995. Mr. Stuckert is a member of the
Hilliard, Lyons Trust Company Board. (1) (2)
S. Oden Howell, Jr.
Age 60; Class III director since December 1993. Term expires 2002.
President of Howell & Howell Painting Contractors, Inc. and owner
of Kessinger Service Industries, LLC. Consultant to H&N
Constructors, Inc. From 1972 until 1988, Mr. Howell was
Secretary/Treasurer of Howell & Howell, Inc.
Edwin W. Peiker, Jr.
Age 69; Class III director since May 1987. Term expires 2002.
President and Chief Operating Officer of the Company from April
1988 until February 1992. Vice President of Engineering of the
Company from May 1987 to April 4, 1988. Principal in Denver Mining
Finance Company from 1984 until 1986. From 1983 to 1986, Mr.
Peiker was engaged in mineral consulting activities. During the
period 1966-1983, Mr. Peiker served in a variety of positions with
the Climax Molybdenum division of AMAX, Inc. involved in
exploration activities worldwide. (1)
Donald Worth
Age 68. Class III director since April 1999. Term expires 2002.
Mr. Worth has been involved in the mining industry since 1949. He
formerly was a mining specialist and a vice president of Canadian
Imperial Bank of Commerce (Canada). Mr. Worth is a director of
Canarc Resource Corporation, Cominco Ltd., Founders Capital
Corporation, and Tiomin Resources Inc. He is also a trustee of
Labrador Iron Ore Royalty Income Fund, and is involved with several
professional associations both in Canada and the United States.
Karen P. Gross
Age 46
Vice President of the Company since June 1994 and Corporate
Secretary since 1989. From 1987 until 1989, Ms. Gross was the Assistant
Secretary to the Company. Ms. Gross is in charge of investor
relations, public relations and ensuring the Company's compliance
with various corporate governance standards.
Donald J. Baker
Age 51
Vice President Corporate Development of the Company since November
1998. From January 1997 until 1998, Mr. Baker was Manager of
Corporate Development. From 1994 until 1997, he was a consultant
to the Company. Mr. Baker was previously employed by Climax
Molybdenum Company and Homestake Mining Company.
John Skadow
Age 42
Controller of the Company since 1993. Treasurer of the Company
since November 1999. Mr. Skadow was previous employed by Dekalb
Energy where he held various accounting and finance positions.
___________
(1) Member of Audit Committee.
(2) Member of Compensation Committee.
MEETINGS AND COMMITTEES OF THE BOARD
During the fiscal year ended June 30, 2000, the Board of
Directors held four regular meetings, and on three separate
occasions action was taken by unanimous consent. Each director
attended (in person or by telephone) at least 75% of the aggregate
number of meetings of the Board and of the Committee(s) of the
Board on which he served.
The Board of Directors has a standing Audit Committee and a
standing Compensation Committee. During the year ended June 30,
2000, the Audit Committee consisted of James W. Stuckert, John W.
Goth, and Edwin W. Peiker, Jr. The Audit Committee held three
meetings during the fiscal year. The function of the Audit
Committee is to aid the directors in undertaking and fulfilling
their responsibilities for financial reporting to the stockholders;
to review internal financial procedures and reports; to recommend
changes in the method of reporting to ensure timely and accurate
reporting of financial data; to review audit principles in
conjunction with the Company's independent auditors; to provide
better avenues of communication between the Board of Directors,
management and the external auditors and internal accounting
personnel; and to recommend the appointment of the Company's
independent auditors.
During the year ended June 30, 2000, the Compensation
Committee consisted of John W. Goth, James W. Stuckert and Pierre
Gousseland. The Compensation Committee met twice during the last
fiscal year. The Compensation Committee assumes the crucial role of
implementing compensation plans for top executives, as well as
directors. The Committee forges the key link between the Board and
management that balances the interests of shareholders and those of
management. The Compensation Committee's function is to review
new or modified programs in the areas of executive salary,
incentive compensation, and stock plans; and review and make
recommendations to the Company's Board of Directors concerning the
levels and forms of compensation paid to the officers and key
employees of the Company.
None of the members of the Compensation Committee is or has
been an officer or employee of the Company, and none of the
executive officers of the Company has served as a member of the
Compensation Committee or as a director of another entity, any of
whose executive officers served on the Compensation Committee or as
a director of the Company.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as
amended, requires the Company's officers and directors, and persons
who own more than 10% of a registered class of the Company's equity
securities, to file reports of ownership and changes in ownership
to the Securities and Exchange Commission. Officers, directors and
greater than 10% stockholders are required by the regulations of
the Securities and Exchange Commission to furnish the Company with
copies of all Section 16(a) reports they file. Based solely on its
review of copies of such reports received by it and written
representations from certain persons that no other reports were
required for those persons, the Company believes that all filing
requirements applicable to its officers, directors and greater than
10% stockholders were complied with for the fiscal year ended June
30, 2000.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The following table reflects all compensation awarded or paid
to or earned by the chief executive officer of the Company and any
other executive officers of the Company, for the fiscal year ended
June 30, 2000.
SUMMARY COMPENSATION TABLE
Name and Year Other
Principal Ended Annual Compensation Annual
Position June 30 Salary($) Bonus($) Compensation ($)
Stanley Dempsey 2000 250,000 122,500 -
Chairman & Chief 1999 250,000 60,000 -
Executive Officer 1998 240,000 110,000 -
Peter B. Babin 2000 185,000 90,000 -
President 1999 185,000 50,000 -
1998 175,000 80,000 -
Karen P. Gross 2000 105,000 45,000 -
Vice President 1999 105,000 25,000 -
& Corporate 1998 100,000 30,000 -
Donald Baker 2000 95,000 45,000 -
Vice President 1999 (1) 95,000 40,000 -
of Corporate
Development
John Skadow 2000 (2) 80,000 30,000 -
Controller &
Treasurer
Long-Term Compensation
Awards Payouts
-----------------------------------------
Name and Year Restricted
Principal Ended Stock Options/ LTIP All
Position June 30 Awards SARs(#) Payouts($) Other
Compensation($)
Stanley Dempsey 2000 - 62,500 - 28,799 (3)
Chairman & Chief 1999 - 50,250 - 24,861
Executive Officer 1998 - 164,250 - 29,487
Peter B. Babin 2000 - 55,000 - 26,021 (4)
President 1999 - 30,000 - 22,783
1998 - 105,120 - 23,028
Karen P. Gross 2000 - 45,000 - 13,334 (5)
Vice President 1999 - 20,000 - 11,460
& Corporate 1998 - 67,525 - 11,477
Donald Baker 2000 - 47,000 - 10,732 (6)
Vice President 1999 - 25,000 - 10,383
of Corporate
Development
John Skadow 2000 - 45,000 - 10,125 (7)
Controller &
Treasurer
(1) Prior to 1999, Mr. Baker was not an officer of the Company.
(2) Prior to 2000, Mr. Skadow was not an officer of the Company
(3) The Company's SARSEP payments made to Mr. Dempsey in fiscal
2000, 1999, and 1998, were $22,938, $19,000, and $22,325,
respectively, and the Company's payment of group term life
insurance and long-term disability insurance premiums paid in
fiscal 2000, 1999, and 1998 were $5,861, $5,861, and $7,162,
respectively.
(4) The Company's SARSEP payments made to Mr. Babin in fiscal
2000, 1999, and 1998 were $19,250, $16,450, and $17,854,
respectively, and the Company's payment of group term life
insurance and long-term disability insurance premiums paid in
fiscal 2000, 1999, and 1998 were $6,771, $6,333, and $5,172,
respectively.
(5) The Company's SARSEP payments made to Ms. Gross in fiscal
2000, 1999, and 1998 were $10,905, $9,100, and $9,878,
respectively, and the Company's payment of group term life
insurance and long-term disability insurance premiums paid in
fiscal 2000, 1999, and 1998 were $2,429, $2,360, and $1,599,
respectively.
(6) The Company's SARSEP payments made to Mr. Baker in fiscal
2000 and 1999 were $9,800, and $9,450, and the Company's
payment of group term life insurance premiums paid in fiscal
2000 and 1999 were $933, and $933.
(7) The Company's SARSEP payment made to Mr. Skadow in fiscal
2000 was $8,075, and the Company's payment of group term life
insurance and long-term disability insurance premiums paid in
fiscal 2000 was $2,050.
Option Grants in Last Fiscal Year
During the fiscal year ended June 30, 2000, officers of the
Company were awarded a total of 255,000 stock options, no stock
appreciation rights were awarded to any of the officers of the
Company, and no existing options held by any of the officers of the
Company were repriced by the Company.
The following table sets forth certain information on option
grants in fiscal 2000 to the named executive officers.
Individual Grants
---------------------------------------------------
Number % of Total
of Options
Securities Granted to
Underlying Employees Exercise
Options in Fiscal Price Expiration
Name Granted (#) Year (1) ($/share)(2) Date
-----------------------------------------------------------------------------
Stanley Dempsey 47,500 23.8% $4.875 November 16, 2009
15,000 20.0% $3.00 June 6, 2010
Peter B. Babin 40,000 20.1% $4.875 November 16, 2009
15,000 20.0% $3.00 June 6, 2010
Karen P. Gross 30,000 15.0% $4.875 November 16, 2009
15,000 20.0% $3.00 June 6, 2010
Donald Baker 32,500 16.3% $4.875 November 16, 2009
15,000 20.0% $3.00 June 6, 2010
John Skadow 30,000 15.0% $4.875 November 16, 2009
15,000 20.0% $3.00 June 6, 2010
Potential Realizable
Number of Value at
Securities Assumed Annual Rates
Underlying of Stock Price
Options Appreciation for Option
Name Granted (#) Term (3)
--------------------------------------------------------
5% 10%
-----------------
Stanley Dempsey 47,500 145,628 369,051
15,000 28,300 71,718
Peter B. Babin 40,000 122,634 310,780
15,000 28,300 71,718
Karen P. Gross 30,000 91,976 233,085
15,000 28,300 71,718
Donald Baker 32,500 99,640 252,509
15,000 28,300 71,718
John Skadow 30,000 91,976 233,085
15,000 28,300 71,718
(1) The percentage of total options granted is stated for the
entire number of options granted to each employee.
(2) The exercise price for all options listed of $4.875 and $3.00
was the fair market value of the Company's common stock on
the date of grant.
(3) The potential realizable values are stated for the entire
number of options granted to each employee. Actual gains, if
any, on stock option exercises are dependent on the future
performance of the common stock (as well as the option
holder's continued employment through the vesting period).
The amounts reflected in this table may not necessarily be
achieved.
Option Exercises in Last Fiscal Year and Year-End Values
The table below sets forth information regarding the deemed
value of options exercised by officers during the year ended June
30, 2000, and the deemed value of options held by such persons at
June 30, 2000.
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
Shares at FY-End (#)(1) at FY-End ($)(2)
Acquired on Value Exercisable/ Exercisable/
Name Exercise (#) Realized($)(3) Unexercisable Unexercisable
Stanley Dempsey 70,000 $201,270 322,184/62,500 $400,950/0
Peter B. Babin 40,000 $135,520 157,576/55,000 $123,750/0
Karen P. Gross 7,000 $ 23,191 77,826/45,000 $ 0/0
John Skadow 0 $ 0 78,670/45,000 $ 0/0
Donald Baker 0 $ 0 47,575/50,000 $ 0/0
(1) Of the total of 973,908 options, 74,463 Non-Statutory Options
("NSOs") are exercisable through December 7, 2000, at
$5.375/share; 2,500 NSO are exercisable through December
7,2000, at $8.50/share; 190,800 Incentive Stock Options
("ISOs") are exercisable through December 21, 2001, at
$0.125/share; 21,944 ISOs are exercisable through December 6,
2004, at $5.375/share; 20,328 ISOs are exercisable through
December 7, 2005, at $5.375/share, 92,369 NSOs are
exercisable through December 10, 2006, at $5.375/share;
15,395 ISOs are exercisable through December 10, 2006, at
$5.375/share; 118,255 NSOs are exercisable through October 3,
2007 at $5.375/share; 35,353 ISOs are exercisable through
October 3, 2007 at $5.375/share; 105,100 ISOs are exercisable
through November 17, 2008, at $4.594/share; and 39,900 NSOs
are exercisable through November 17, 2008, at $4.594/share;
102,500 ISOs are exercisable through November 16, 2009, at
$4.875 per share; 77,500 NSOs are exercisable through
November 16, 2009, at $4.875 per share; and 75,000 ISOs are
exercisable through June 6, 2010, at $3.00 per share.
(2) Value calculated based on closing "sale" price as reported on
The Nasdaq National Market ("NASDAQ"), on the last day of our
fiscal year, June 30, 2000, of $2.75 share.
(3) Based on difference between exercise price and closing "sale"
price as reported on NASDAQ, on the dates of exercise.
Compensation To Directors
During fiscal 2000, each non-employee director of the Company
received an annual fee of $12,000 for service as a director.
Directors are not compensated for committee participation. The
outside directors' fee has remained fixed at $12,000 per year since
1997. On, November 16, 1999, as a special award, each outside
director was awarded 4,000 treasury shares. These treasury shares
are outside of the Company's Equity Incentive Plan and are subject
to the requirement that each outside director remain a director of
the Company for twelve (12) months ending November 16, 2000, before
the shares are eligible for sale or otherwise transferable; that
since the shares are not registered with the SEC, the share
certificates will bear the appropriate '33 Act restricted legend;
and that the Company will hold the share certificates until all
restrictions lapse. The closing price of the Company's common
stock on November 16, 1999, was $4.875.
Pursuant to the Company's Equity Incentive Plan, each non-
employee director of the Company is granted annually a Non-
Statutory Option ("NSO") to purchase 5,000 shares of Common Stock
at an exercise price equal to the fair market value of the
Company's Common Stock on the date of grant. Accordingly, on
November 16, 1999, each non-employee director of the Company was
granted 5,000 NSOs, at an exercise price of $4.875 per share.
These options have a ten year term and are exercisable immediately
with respect to 2,500 shares and after 12 months with respect to
the other 2,500 shares.
Mr. Edwin W. Peiker, Jr. has a consulting agreement with the
Company, in which he is paid a hourly fee plus expenses. During
fiscal year 2000, the total paid to Mr. Peiker under this agreement
was $1,000.
Employment Contracts
Certain officers of the Company (Messrs. Dempsey, Babin, and
Ms. Gross) are employed pursuant to an employment contract
providing for salary at current salary levels. Each of the
employment contracts is renewable, for a term of 12 months, every
February. Pursuant to each of the employment contracts, salary and
benefits are to be continued for 12 months following such
employee's involuntary termination, or following such employee's
voluntary termination after a "change in control" event. A change
in control event, as defined in the employment contracts, will
occur upon: (1) the acquisition, directly or indirectly, by any
person or related group of persons, of beneficial ownership of
securities possessing more than thirty percent (30%) of the total
combined voting power of the Company's outstanding securities; (2)
a change in the composition of the Board over a period of eighteen
(18) consecutive months or less such that fifty percent (50%) or
more of the Board members cease to be directors who either (A) have
been directors continuously since the beginning of such period, or
(B) have been unanimously elected or nominated by the Board for
election as directors during such period; (3) a stockholder-
approved merger or consolidation to which the Company is a party
and in which (A) the Company is not the surviving entity, or (B)
securities possessing more than thirty percent (30%) of the total
combined voting power of the Company's outstanding securities are
transferred to a person or persons different from the persons
holding those securities immediately prior to such transaction; or
(4) the sale, transfer or other disposition of all or substantially
all of the Company's assets in complete liquidation or dissolution
of the Company.
Compensation Committee Interlocks and Insider Participation
The Company's Compensation Committee during the 2000 fiscal
year consisted of Mr. Goth, who serves as Chairman, Mr. Stuckert
and Mr. Gousseland. No member of such Committee was, at any time
during the 2000 fiscal year or at any other time, an officer or
employee of the Company. No executive officer of the Company
served on the Compensation Committee or another entity, or any
other committee of the board of directors of another entity
performing similar functions during the Company's last fiscal year.
Board Compensation Committee Report on Executive Compensation
The Compensation Committee of the Board of Directors (the
"Committee") is responsible for setting and administering the
policies that govern the compensation for the executive officers of
the Company. The Compensation Committee evaluates the performance
of management and recommends to the full Board of Directors the
compensation level for all officers and key employees. The
Compensation Committee also administers the Company's Equity
Incentive Plan and determines the amount of stock options granted
to officers and key employees. The Committee is comprised of three
outside directors appointed annually by the Board of Directors.
The primary objectives of the Company's executive
compensation program are: to attract and retain key executives who
are critical to the long-term success of the Company by offering
compensation packages believed to be appropriate in light of
compensation in the industry; to provide an economic framework that
will motivate executives to achieve goals consistent with the
Company's business strategy; to reward performance that benefits
all Stockholders; and to provide a compensation package that
recognizes individual results and contributions to the overall
success of the Company.
The Committee's policy objectives are to pay base salaries
that are comparable with those paid by the mining industry. Due to
the Company's small staff, compensation practices are flexible and
entrepreneurial, with compensation geared to meeting the
requirements of the Company and the individual. Bonus payments are
paid when individual performance and significant achievements for
the Company's future revenue growth or other circumstances warrant
special recognition. Bonuses are based upon the contribution of
each individual and are usually paid on an annual basis. Long-term
incentives, in the form of stock options, are another component of
executive compensation and are granted to ensure an incentive
exists to maximize shareholder wealth by tying executive
compensation to share price performance, and to reward those
executives making a long-term commitment to the Company.
The Committee is responsible for considering various
information when reviewing salary levels, as outlined in the
Company's Business Plan, and when making recommendations to the
full Board. When reviewing individual performance of officers of
the Company, the Committee also takes into account the views of the
Company's Chairman and Chief Executive Officer. Before or at the
end of each year, the Committee evaluates each individual officer's
performance in order to determine whether to recommend the payment
of bonuses and/or options and, if so, the amount of each such bonus
and/or options.
In making recommendations concerning executive compensation,
the Committee reviews individual executive compensation, individual
performance, corporate performance, stock price appreciation, and
total return to Stockholders of the Company. The salary levels of
the Company's executives and officers are usually established by
the Board of Directors at its June meeting.
The Committee also reviews and approves stock option awards,
under the Company's Equity Incentive Plan. The purpose of stock
option awards is to provide key employees with an incentive to
continue as employees of the Company over a long term, and to align
such employees' long range interests with those of the Stockholders
by providing the opportunity of having an equity interest in the
Company. The Committee grants stock option awards based on salary,
level of responsibility, and performance. All stock options are
granted with an exercise price equal to the market price of the
Common Stock on the date of grant. Incentive Stock Options vest in
one year and have a 10-year term. Non-Statutory Options typically
vest on the date of grant and have a 10-year term.
During the fiscal year ended June 30, 2000, options to
acquire 255,000 shares were awarded to officers of the Company and
options to acquire 19,000 shares were awarded to employees of the
Company who are not officers or directors.
Chief Executive Officer. In evaluating the performance and
setting the compensation of the Chairman and Chief Executive
Officer, the Committee took into account the base salaries of chief
executive officers of other royalty and mining companies, including
those companies that are listed in the Cumulative Total Shareholder
Return Chart, and the assessment of Mr. Dempsey's individual
performance, including his leadership with respect to the
development of long-term business strategies for the Company to
improve its economic value. The Committee also took into account
the longevity of Mr. Dempsey's service to the Company and its
belief that Mr. Dempsey is an excellent representative of the
Company to the public by virtue of his stature in the community and
the industry in which the Company operates.
The Committee believes that the Chairman and Chief Executive
Officer, as well as the other officers of the Company, are strongly
motivated and are dedicated to the growth of the Company and to
increasing stockholder value. Because of the leadership provided
by the Chairman and other officers of the Company, the Committee
felt that bonuses should be awarded for the Chairman as well as the
other officers of the Company. Therefore, in fiscal 2000, a bonus
of $122,500 was awarded to the Chairman, and bonuses totaling
$229,210 were awarded to the other officers. No salary increase
was given to the Chairman nor to any of the other officers of the
Company in fiscal year 2000.
This Report has been provided by the Compensation Committee:
John W. Goth, Chairman, James W. Stuckert, and Pierre Gousseland
Audit Committee Report
The Company's Audit Committee is comprised of three
independent members, each of whom is able to read and understand
fundamental financial statements and at least one of whom has past
employment experience in finance or accounting or other comparable
experience. The Committee actively oversees the Company's
financial condition, ensures that the Company's corporate economic
value is enhanced, and sees that the Company achieves legal and
ethical compliance. The main function of the Audit Committee is
ensure that effective accounting policies are implemented and that
internal controls are put in place in order to deter fraud,
anticipate financial risks and promote accurate, high quality and
timely disclosure of financial and other material information to
the public markets, the board and the stockholders. The Audit
Committee also reviews and recommends to the Board the approval of
the annual financial statements and provides a forum, independent
of management, where the Company's auditors can communicate any
issues of concern.
The independent members of the Audit Committee believe that
the present composition of the Committee accomplishes all of the
necessary goals and functions of an audit committee as recommended
by the Blue Ribbon Committee on Improving the Effectiveness of
Corporate Audit Committees and adopted by the U.S. stock exchanges
and the Securities & Exchange Commission. In accordance with the
promulgated new rules regarding audit committees, the Audit
Committee has adopted a formal, written charter (Appendix A)
approved by the full board of directors of the Company. The Charter
specifies the scope of the Audit Committee's responsibilities and
how it should carry out those responsibilities.
The Audit Committee has reviewed and discussed the audited
financial statements of the Company for the fiscal year ended June
30, 2000, with the Company's management. The Audit Committee has
discussed with PricewaterhouseCoopers LLP, the Company's
independent public accountants, the matters required to be
discussed by Statement on Auditing Standards No. 61 (Communication
with Audit Committees). The Audit Committee has also received the
written disclosures and the letter from PricewaterhouseCoopers LLP
required by Independence Standards Board Standard No. 1
(Independence Discussion with Audit Committees) and the Audit
Committee has discussed the independence of PricewaterhouseCoopers
LLP with that firm.
Based on the review and discussions with the Company's
auditors for the fiscal year ended June 30, 2000, the Audit
Committee recommended to the Board of Directors that the financial
statements be included in the Company's Annual Report on Form 10-K.
This Report has been provided by the Audit Committee:
James W. Stuckert, Chairman, John W. Goth, and Edwin W. Peiker, Jr.
Pension Plans
In fiscal 1994, the Company established a variation of a
Simplified Employee Pension ("SEP") Plan, known as a Salary
Reduction/Simplified Employee Pension Plan ("SARSEP"). Management
chose this Plan because of regulatory compliance simplicity,
avoidance of significant administrative expense, availability of
substantial tax-advantaged investment opportunities, and relative
freedom from significant vesting or other limitations. Under this
Plan, the Company may contribute to a designated IRA account, on an
annual basis, up to 15% of each employee-participant's base
compensation. Each such contribution would, within limits, be a
deductible expense to the Company; would be free of federal income
taxation as to the employee; and would be subject to continuing
investment, on a tax-deferred basis, until assets are actually
distributed to the employee. All employees of Royal Gold are
eligible to participate in the Company's SEP Plan.
Performance Graph
The following graph compares the cumulative total return on
Royal Gold's Common Stock with the cumulative total return of two
other stock market indices: Standard and Poor's 500 Index and
Standard and Poor's Gold Mining Index.
CUMULATIVE TOTAL SHAREHOLDER RETURN CHART
June 30,
1995 1996 1997 1998 1999 2000
----------------------------------------------
S&P 500 Index 100.00 126.00 169.72 220.91 271.18 290.84
Gold & Precious
Metal Mining-500 100.00 106.42 83.29 63.37 57.11 53.02
Royal Gold 100.00 160.00 104.62 61.54 56.15 33.85
(i) S&P 500 Index. Represents the return an investor would
have secured (assuming reinvestment of all dividends) on the
basis of an investment of $100 in the 500 equity issues that
make up the Standard and Poor's 500 Index.
(ii) S&P Gold Mining Index. Represents the return an investor
would have secured (assuming reinvestment of all dividends)
on the basis of an investment of $100 in the four equity
issues that make up the Standard and Poor's Gold Mining Index
(Barrick Gold Corporation, Homestake Mining Company, Newmont
Gold Company, and Placer Dome Inc.).
(iii) The material in this chart is not "soliciting material," is
not deemed "filed" with the Commission, and is not to be
incorporated by reference in any filing of the Company under
the Securities Act or the Exchange Act, whether made before
or after the date hereof and irrespective of any general
incorporation language in any such filing.
PROPOSAL 2.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors recommends that the Stockholders
ratify the appointment of PricewaterhouseCoopers LLP, independent
certified public accountants, to audit the consolidated financial
statements of the Company for the fiscal year ended June 30, 2001.
The ratification of the appointment of PricewaterhouseCoopers
is being submitted to the Stockholders because the Board of
Directors believes this to be a good corporate practice. Should the
Stockholders fail to ratify this appointment, the Board of Directors
will review the matter.
Representatives of PricewaterhouseCoopers are expected to
attend the Annual Meeting of Stockholders. They will have an
opportunity to make a statement, if they so desire, and will have
an opportunity to respond to appropriate questions from the
Stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR"
THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS
AS INDEPENDENT AUDITORS OF THE COMPANY.
OTHER MATTERS
The Board of Directors knows of no other matters to be brought
before the Meeting. However, if other matters should come before
the Meeting, it is the intention of each person named in the Proxy
to vote such Proxy in accordance with their own judgment on such
matters.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the 2001
Annual Meeting of Stockholders must be received by the Company at
its principal executive office in Denver, Colorado, by March 16,
2001, if such proposals are to be considered timely and included in
the proxy materials for the 2001 Annual Meeting of Stockholders.
The inclusion of any Stockholder proposal in the proxy materials for
the 2001 Annual Meeting of Stockholders will be subject to
applicable rules of the Securities and Exchange Commission.
Proxies for the 2001 Annual Meeting of Stockholders will
confer discretionary authority to vote with respect to all matters
of which the Company does not receive notice by August 31, 2001.
BY ORDER OF THE BOARD OF DIRECTORS
/s/
Karen P. Gross
Vice President & Corporate Secretary
Denver, Colorado
October 13, 2000
Upon the written request of any record holder or beneficial owner
of Common Stock entitled to vote at the Annual Meeting, the Company
will provide, without charge, a copy of its Annual Report on Form
10-K including financial statements and any required financial
statement schedules, as filed with the Securities and Exchange
Commission for the fiscal year ended June 30, 2001. Requests for
a copy of such Annual Report should either be mailed, faxed, or sent
via e-mail to Karen P. Gross, Vice President & Corporate Secretary,
Royal Gold, Inc., 1660 Wynkoop Street, Suite 1000, Denver, Colorado
80202-1132, 303-595-9385 (fax), or [email protected].
APPENDIX A
ROYAL GOLD INC.
CHARTER OF THE AUDIT COMMITTEE
Organization
There shall be a committee of the board of directors to be known as
the Audit Committee. The Audit Committee shall be composed of at
least three (3) directors who are independent of the management of
the corporation and are free of any relationship that, in the
opinion of the board of directors (which shall be guided by any
applicable rules of the Securities and Exchange Commission and the
listing requirements of the applicable securities market), would
interfere with their exercise of independent judgment as a committee
member.
Statement of Policy
The audit committee shall provide assistance to the corporate
directors in fulfilling their responsibility to the shareholders,
potential shareholders, and investment community relating to
corporate accounting, reporting practices of the corporation, and
the quality and integrity of the financial reports of the
corporation. In so doing, it is the responsibility of the audit
committee to maintain free and open means of communication between
the directors, the independent auditors, and the financial
management of the corporation.
Responsibilities
In carrying out its responsibilities, the audit committee believes
its policies and procedures should remain flexible, in order to best
react to changing conditions and to ensure to the directors and
shareholders that the corporate accounting and reporting practices
of the corporation are in accordance with all requirements and are
of the highest quality.
In carrying out these responsibilities, the audit committee will:
1. Hold such regular meetings as may be necessary and such
special meetings as may be called by the chairman of the
Audit Committee or at the request of the independent auditors
of the corporation.
2. Review and recommend to the directors the independent
auditors to be selected to audit the financial statements of
the corporation and its divisions and subsidiaries. Where
appropriate, and as a result of the independent auditors'
ultimate accountability to the board of directors and the
audit committee as representatives of the stockholders,
replace or recommend the replacement of the independent
auditors.
3. Meet with the independent auditors and financial management
of the corporation to review the scope of the proposed audit
for the current year and the audit procedures to be utilized,
and at the conclusion thereof review such audit, including
any comments or recommendations of the independent auditors.
4. Review with the independent auditors and the company's
financial and accounting personnel, the adequacy and
effectiveness of the accounting and financial controls of the
corporation, and elicit any recommendations for the
improvement of such internal control procedures or particular
areas where new or more detailed controls or procedures are
desirable. Particular emphasis should be given to the
adequacy of such internal controls to expose any payments,
transactions, or procedures that might be deemed illegal or
otherwise improper.
5. Ensure the receipt from the independent auditors of a formal
written statement delineating all relationships between the
auditor and the company, consistent with Independence
Standards Board Standard 1; and to actively engage in a
dialogue with the independent auditor with respect to any
disclosed relationships or services that may impact the
objectivity and independence of the auditor, and to take, or
recommend that the board take, appropriate action to ensure
the independence of the independent auditor.
6. Review the internal financial function of the corporation
including the independence and authority of its reporting
obligations, the proposed audit plans for the coming year,
and the coordination of such plans with the independent
auditors.
7. Receive, prior to each meeting, a summary of findings from
completed internal audits and a progress report on the
proposed internal audit plan, with explanations for any
deviations from the original plan.
8. Review the financial statements contained in the annual
report to shareholders with management and the independent
auditors to determine that the independent auditors are
satisfied with the quality of disclosure and content of the
financial statements to be presented to the shareholders. Any
changes in accounting principles should be reviewed.
9. Provide sufficient opportunity for the independent auditors
to meet with the members of the audit committee without
members of management present. Among the items to be
discussed in these meetings are the independent auditors'
evaluation of the corporation's financial, accounting, and
auditing personnel, and the cooperation that the independent
auditors received during the course of the audit.
10. Review accounting and financial human resources and
succession planning within the company.
11. Submit the minutes of all meetings of the audit committee to,
or discuss the matters discussed at each committee meeting
with, the board of directors.
12. Provide in the proxy statement a report that describes the
committee's composition and responsibilities, and how such
responsibilities were executed.
13. Investigate any matter brought to its attention within the
scope of its duties, with the power to retain outside
counsel for this purpose if, in its judgment, that is appropriate.
