Neal D. Shah
Kosmos EnergyAbout Neal D. Shah
Neal D. Shah is Senior Vice President and Chief Financial Officer of Kosmos Energy, age 40, serving as CFO since May 2020 after previously acting as Deputy CFO (Nov 2019–May 2020). He joined Kosmos in 2010 across finance, treasury, IR, IT, internal audit, and led the Equatorial Guinea business unit; earlier he was an investment banker at Morgan Stanley. He holds a bachelor’s degree with honors in finance from the University of Texas at Austin . Kosmos’ compensation framework ties executive pay to EBITDAX (Company Selected Measure) and TSR; in 2024 the company reported Net Income of $189.9M, EBITDAX of $1,070.4M, and cumulative TSR value of $61.04 vs peer $97.57, which directly influences incentive outcomes .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Kosmos Energy | Deputy Chief Financial Officer | Nov 2019–May 2020 | Led finance, treasury, investor relations, IT, and internal audit |
| Kosmos Energy | Head, Equatorial Guinea BU; roles in finance/treasury/IR/international ops | Since 2010 (years not specified) | Operational leadership and multi-function finance roles |
| Kosmos Energy | Senior Vice President & CFO | Since May 2020 | Executive financial leadership |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Morgan Stanley | Investment Banker (Oil & Gas) | Not disclosed | Advised oil and gas companies on financing/transactions |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | 574,750 | 603,487 | 621,592 |
| All Other Compensation ($) | 36,189 | 39,103 | 39,983 |
| Benefits/perqs (summary) | — | — | Health/vision/dental, annual executive physicals, financial/tax planning; 401(k) match 8% in 2024; no supplemental executive retirement; no non-qualified deferred comp plan |
- 2024 base salaries were increased 3% for all NEOs (including Shah) versus 2023 .
- Deferred compensation program: none currently maintained .
Performance Compensation
| Component | Metric | Weighting/Design | Target | Actual/Payout | Vesting/Notes |
|---|---|---|---|---|---|
| Annual Cash Bonus (2024) | KPI composite (production, EBITDAX, CapEx, FCF, refinancing; ESG and strategic goals) | Company KPI achievement determined bonus pool; committee applied negative discretion | Target bonus 100% of base salary ($621,592) | Actual bonus $776,990; KPI achievement 68.4% resulted in 88.4% pool, reduced to 87% by committee | Individual awards reflect contributions; bonus max 200% of target |
| RSUs (2024 grant) | Service-based | ~1/3 of equity; vests one-third annually over three years | 148,500 shares granted; GDFV $948,915 | Value realized depends on share price at vest | Scheduled to vest ratably Jan 31, 2025–2027 |
| PSUs (2024 grant) | Relative TSR vs nine peer companies | ~2/3 of equity; 3-year performance period; payout 0–200% | Target 301,500 shares; threshold 75,375; max 603,000; GDFV $2,607,975 | Attainment interpolated between 25% and 175% except top/bottom ranks; payout depends on TSR ranking | Performance period Jan 2, 2024–Jan 2, 2027; service condition lapses one-third annually |
| PSU Payouts (2022 grant) | Relative TSR | Fixed 3-year measurement | Target (not disclosed here) | Payout at 129.1% of target on Jan 3, 2025; Shah received 389,237 shares | Subject to TSR achievement and service condition |
2024 KPI details and results:
- Deliver 2024 corporate targets: production 65 Mboepd vs target 73–77 Mboepd, EBITDAX $1,070M vs $1,300–1,400M target, CapEx $829M above $700–750M target, FCF not delivered; refinancing achieved; result entries indicate partial achievement .
- ESG goals: zero anticorruption violations; delivered HSES plan targets; extended Scope 1/2 neutrality; Scope 3 Cat 11 disclosed/assured; increased social investment; workforce engagement improved .
- Accelerate strategic delivery: M&A opportunities high-graded; result achieved .
Equity Ownership & Alignment
| Ownership Measure | Value |
|---|---|
| Beneficially owned shares | 1,264,815; less than 1% of 477,904,652 shares outstanding (as of Mar 6, 2025) |
| RSUs/PSUs outstanding (12/31/2024) | RSUs not vested: 284,118 (MV $971,684); PSUs unearned: 865,269 (MV $2,959,220) |
| Shares acquired on vesting (2024) | 858,476; value realized $5,202,363 (at $6.06/share) |
| Stock ownership guidelines | CFOs and other executive officers: 3x base salary; all executives in compliance as of Dec 31, 2024 |
| Hedging/pledging | Hedging prohibited; publicly traded options/margin accounts require prior written authorization; no hedging by NEOs in past five years; no stock options granted to NEOs |
Detailed vesting schedule (as of 12/31/2024):
- RSUs: 49,500 vest Jan 31, 2025; 86,118 vest ratably Jan 31, 2025–2026; 148,500 vest ratably Jan 31, 2025–2027 .
- PSUs: 301,500 (performance period ended Jan 3, 2025; service condition Jan 31, 2025); 262,269 (performance period ends Jan 3, 2026; service condition ratably Jan 31, 2025–2026); 301,500 (performance period ends Jan 2, 2027; service condition ratably Jan 31, 2025–2027) .
2024 PSU peers:
- Africa Oil Corp.; Aker BP ASA; Capricorn Energy plc; Energean plc; Genel Energy plc; Harbour Energy Plc; Murphy Oil Corporation; Talos Energy Inc.; Tullow Oil plc .
Employment Terms
| Scenario (as of 12/31/2024) | Equity Acceleration ($) | Salary Payments ($) | Bonus ($) | Benefits Continuation ($) | Outplacement ($) | Total ($) |
|---|---|---|---|---|---|---|
| Change in Control (No Termination) | — | — | — | — | — | — |
| Involuntary Termination in Connection with Change in Control | 6,890,124 | 2,486,368 (24 months base + 2x target bonus) | 621,592 (prorated target) | 21,050 (24 months healthcare premium) | 20,700 (18 months) | 10,039,834 |
| Termination without Cause/Good Reason (No CIC) | — | — | — | — | — | — |
| Death/Disability | 6,890,124 | — | — | — | — | 6,890,124 |
- Double-trigger acceleration: RSUs/PSUs generally accelerate upon a change in control only if terminated without cause or for good reason within one year; CEO has certain enhanced protections .
- Severance policy covers NEOs (including Shah) for terminations in connection with a change in control; offer letters provide separate terms for some NEOs, but Shah is not party to an offer letter .
- Good Reason definition includes reduction in base/target bonus, >50-mile relocation, or material reduction in duties (with notice and cure periods) .
- Clawbacks: Financial Restatement Compensation Recoupment Policy per Section 10D/NYSE; Detrimental Conduct Compensation Recoupment Policy allows recovery of incentive and other compensation for misconduct within prior 3 years .
- No excise tax gross-ups; no guaranteed payouts; risk mitigation and ownership guidelines emphasized .
Multi-Year Compensation Summary
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | 574,750 | 603,487 | 621,592 |
| Bonus ($) | — | — | — |
| Non-Equity Incentive ($) | 1,149,500 | 543,139 | 776,990 |
| Stock Awards ($) | 2,733,705 | 4,203,583 | 3,556,890 |
| All Other Compensation ($) | 36,189 | 39,103 | 39,983 |
| Total ($) | 4,494,144 | 5,389,312 | 4,995,455 |
Company Performance Context (Pay vs Performance)
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Value of $100 TSR (Company) | 41.94 | 61.75 | 113.51 | 119.76 | 61.04 |
| Value of $100 TSR (Peer Group) | 68.12 | 92.13 | 117.02 | 118.12 | 97.57 |
| Net Income (Loss) ($) | (411,586,000) | (77,836,000) | 226,551,000 | 213,520,000 | 189,851,000 |
| EBITDAX ($) | 424,987,000 | 969,136,000 | 1,436,342,000 | 1,238,151,000 | 1,070,355,000 |
Compensation Structure Analysis
- Equity-heavy, at-risk compensation: ~2/3 PSUs tied to 3-year relative TSR, ~1/3 RSUs; aligns with long-term shareholder value and retention .
- Annual bonus funding applied negative discretion (2024 pool reduced to 87%) due to KPI shortfalls (production, CapEx, FCF), demonstrating performance accountability .
- Shift to PSUs/RSUs; no stock options granted, reducing potential for option-related repricing risks .
- Independent consultant Meridian engaged; practices emphasize ownership guidelines, clawbacks, risk assessment .
Risk Indicators & Red Flags
- Hedging prohibited; no hedging by NEOs in past five years; no disclosure of pledging policy—no pledging activity noted .
- No excise tax gross-ups; no guaranteed payouts .
- Related party transactions: none since Jan 1, 2024; procedures in place .
Equity Ownership & Vesting Pressure Signals
- Material scheduled vesting clusters at end-January each year (RSUs and PSUs service conditions met on Jan 31), which can create early-year liquidity or selling windows; 2022 PSU payout settled Jan 3, 2025 at 129.1% (Shah: 389,237 shares) .
- 2024 vesting realized: 858,476 shares, $5.20M value; future vest tranches through 2027 .
Employment Terms Summary
- Covered by change-in-control severance policy (double trigger); no separate offer letter for Shah; benefits include 24 months base salary, 2x target bonus, prorated current-year bonus, healthcare premium coverage, and outplacement upon qualifying CIC termination .
Investment Implications
- Alignment: Shah’s pay mix is strongly at-risk and equity-linked, with PSUs tied to relative TSR and annual bonus tied to KPI achievement; this creates direct sensitivity to production, EBITDAX, FCF delivery and share performance .
- Retention vs. selling pressure: Significant RSU/PSU schedules with annual January vest dates and recent large PSU payouts may create near-term selling pressure windows; however, 3x salary ownership guidelines and compliance mitigate misalignment risk .
- Performance headwinds: 2024 KPI underachievement (production shortfall, CapEx overspend, FCF miss) led to reduced bonus pool, yet Shah’s individual bonus exceeded target, signaling recognition of execution in refinancing and strategic initiatives—watch for 2025 KPI trajectories to gauge bonus and PSU payout prospects .
- Change-in-control economics: Substantial equity acceleration and severance under CIC double-trigger (~$10.0M total for Shah) could influence executive incentives around strategic transactions; monitor governance and shareholder responses .