IKN

On March 7, Goldcorp filed its proxy circular in connection with its
proposed acquisition by Newmont, where it was disclosed that:

“In contemplation of the Arrangement, Goldcorp and Ian W. Telfer
(Chairman) amended the terms of Mr. Telfer’s employment agreement to
provide that, in connection with completion of the Arrangement,
Mr. Telfer will be entitled to receive a lump sum payment retirement
allowance from Goldcorp equal to approximately US$12 million, an
increase from his current entitlement of approximately US$4.5 million.
The increased amount of the retiring allowance
was recommended by the Human Resources and Compensation Committee,
reviewed and considered by the Goldcorp Special Committee, and approved
by the Goldcorp Board on the basis of Mr. Telfer’s role as founder and
strategic leader of Goldcorp subsequent to the
acquisition of Glamis Gold Ltd. in November, 2006.” (Emphasis added)

The Shareholders’ Gold Council (SGC) expresses its condemnation for
Goldcorp’s Board for approving this gratuitous additional payment to Mr.
Telfer, and in particular for the members of its Human Resources and
Compensation Committee, Kenneth Williamson (Chair),
Margot Franssen, Randy Reifel and Charlie Sartain.  On top of having
awarded Chief Executive Officer David Garofalo an outrageous change of
control package of up to Cdn. $11 million, despite his role in
destroying over Cdn. $3.7 billion in shareholder value,
Goldcorp’s Board saw fit to continue its blatant disregard for
alignment between executive compensation and the interests of Goldcorp’s
shareholders by altering the Chairman’s already bloated pay package
ahead of the transaction with Newmont.  While Goldcorp
is telling its shareholders to sell their shares close to a 13-year
low, Goldcorp management stands to reap over US$33 million in potential
change of control payments.    

As if lining his pockets with Goldcorp shareholders’ money – to the tune
of approximately US$11.8 million since 2006 – was not enough, Mr.
Telfer, with the support of Goldcorp’s Board, is now effectively
pillaging Newmont shareholders for an additional US$12
million, even though he will be continuing on as Newmont’s new Deputy
Chair.  This comes despite the fact that under Mr. Telfer’s perennial
reign as Chairman of Goldcorp’s Board, Goldcorp’s stock price has
collapsed by nearly 60%.  In Mr. Telfer’s role as
a “strategic leader” at Goldcorp, he has presided over one of the most
disastrous and egregious examples of shareholder value destruction in
the mining industry.

SGC asks that the Goldcorp Board and the Newmont Board each publicly
state how increasing Mr. Telfer’s retirement allowance benefits their
respective shareholders.     

  

In the view of SGC, the Goldcorp Board’s approval of this additional
“retirement allowance” to Mr. Telfer is another showcase example of
directors choosing cronyism over the interests of shareholders. 
Shareholders are advised to remember the actions of the
above-mentioned directors as well as Beverley Briscoe, Cristina Bitar,
Matthew Coon Come and Clement Pelletier.  SGC believes that continued
consolidation in the gold sector is plainly necessary so that the
enrichment of directors and management teams at the
expense of shareholders comes to an end by ridding the industry of poor
stewards of shareholder capital.