Exhibit 10.1

AMENDED AND RESTATED LOAN AGREEMENT
between
ROYAL GOLD, INC.
and
HSBC BANK USA, NATIONAL ASSOCIATION
Dated as of December 14, 2005

 

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TABLE OF CONTENTS

              Page  
ARTICLE I DEFINITIONS
    1  
1.1 Definitions
    1  
1.2 Accounting Principles
    10  
ARTICLE II LOAN FACILITY
    10  
2.1 The Loan
    10  
2.2 Promissory Note
    11  
2.3 Interest
    11  
2.4 Repayment of the Loan
    12  
2.5 Permanent Reduction of Maximum Credit Amount
    12  
2.6 Fees
    13  
2.7 Extension of Scheduled Maturity Date
    13  
2.8 Miscellaneous
    14  
2.9 Taxes
    15  
2.10 Illegality; Capital Requirements; Increased Costs; Indemnity for Breakage
Costs
    15  
2.11 Borrowing Base Determination
    17  
ARTICLE III COLLATERAL SECURITY
    19  
3.1 Collateral Agreements
    19  
3.2 Perfection and Maintenance of Collateral Agreement Liens
    19  
3.3 Debt Service Reserve Account
    19  
ARTICLE IV CONDITIONS PRECEDENT
    20  
4.1 Conditions Precedent to the Initial Advance
    20  
4.2 Conditions Precedent to All Advances
    22  
ARTICLE V REPRESENTATIONS AND WARRANTIES
    22  
5.1 Due Organization, Good Standing and Authority
    22  
5.2 Due Authorization; Non-Contravention
    22  
5.3 No Approvals
    23  
5.4 Validity
    23  
5.5 Financial Statements
    23  
5.6 Litigation
    23  
5.7 Disclosure
    23  

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TABLE OF CONTENTS

              Page  
5.8 Title to Royalty Interests; Liens
    24  
5.9 Royalty Agreements
    24  
5.10 Project Permits
    24  
5.11 Payment of Taxes
    24  
5.12 Agreements
    24  
5.13 Compliance with Laws
    24  
5.14 Events of Default
    25  
ARTICLE VI AFFIRMATIVE COVENANTS
    25  
6.1 Notice to the Lender
    25  
6.2 Financial Statements, Calculations and Information
    26  
6.3 Maintenance of Existence
    27  
6.4 Compliance with Laws
    27  
6.5 Payment of Indebtedness
    27  
6.6 Taxes
    27  
6.7 Books and Records; Right to Inspection
    27  
6.8 Insurance
    28  
6.9 Maintenance of Liens
    28  
6.10 Defend Title
    28  
6.11 Compliance with ERISA
    28  
6.12 Financial Covenants
    28  
6.13 Delivery of Royalty Interest Proceeds
    29  
6.14 Maintenance of Credit Balances in the Debt Service Reserve Account
    29  
6.15 Further Assurances
    29  
6.16 Post Closing Requirements
    29  
ARTICLE VII NEGATIVE COVENANTS
    29  
7.1 Indebtedness
    30  
7.2 Liens
    30  
7.3 Liquidation; Merger
    30  
7.4 Asset Sales
    30  
7.5 Guarantees/Assumptions
    30  

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TABLE OF CONTENTS

              Page  
7.6 Change in Business
    30  
7.7 Changes in Constating Documents or Capital Structure
    30  
7.8 Gold Sales
    30  
7.9 Modification of Material Agreements
    31  
7.10 Maintenance of Royalty Interests
    31  
7.11 Restrictive and Inconsistent Agreements
    31  
7.12 Amount Outstanding
    31  
ARTICLE VIII EVENTS OF DEFAULT
    31  
8.1 Events of Default
    31  
8.2 Remedies Upon Event of Default
    33  
ARTICLE IX MISCELLANEOUS
    34  
9.1 Notices
    34  
9.2 Amendments, etc
    34  
9.3 No Waiver; Cumulative Remedies
    35  
9.4 Costs and Expenses
    35  
9.5 Application of Debt Service Reserve Account; Right of Set-off
    35  
9.6 Usury Savings; Limitation on Interest
    36  
9.7 Binding Effect; Assignment of Rights
    36  
9.8 Consent to Jurisdiction
    37  
9.9 Governing Law
    38  
9.10 Counterparts; Signatures
    38  
9.11 Confidentiality; Public Announcements
    38  
9.12 Entire Agreement
    38  

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SCHEDULES

     
Schedule 1.1(a)
  Projects; Project Managers
Schedule 1.1(b)
  Royalty Agreements
Schedule 1.1(c)
  Royalty Interests
Schedule 5.6
  Litigation
Schedule 5.7
  Disclosures
Schedule 5.9
  Royalty Agreement Disclosures
Schedule 5.10
  Project Permit Exceptions
Schedule 5.12
  Material Agreements
Schedule 5.13
  Compliance with Laws
Schedule 6.8
  Insurance
Schedule 6.16
  Post-Closing Requirements

EXHIBITS

     
Exhibit A
  Form of Request for Advance
Exhibit B
  Form of Borrower’s Omnibus Certificate
Exhibit C
  Form of Amended and Restated Promissory Note
Exhibit D
  Form of Mortgage Amendment
Exhibit E
  Form of Proceeds Agreement
Exhibit F
  Form of Ratification and Confirmation Agreement
Exhibit G
  Form of Royalty Payment Confirmation

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AMENDED AND RESTATED LOAN AGREEMENT
     This AMENDED AND RESTATED LOAN AGREEMENT is entered into as of December 14,
2005, between ROYAL GOLD, INC., a corporation incorporated under the laws of the
State of Delaware (the “Borrower”) and HSBC BANK USA, NATIONAL ASSOCIATION a
national banking association organized under the laws of the United States (the
“Lender”).
Recitals
     A. The Borrower and the Lender entered into that certain Loan Agreement
dated as of December 18, 2000 (as amended and modified prior to the date hereof,
the “Existing Agreement”). The Borrower and the Lender desire to extend the
maturity date of the Existing Agreement, to increase the Maximum Credit Amount
under the Existing Agreement and to otherwise amend, restate, modify and
continue the Existing Agreement as provided in this Agreement and to continue
any Loans under the Existing Agreement as Loans under this Agreement.
     B. This Agreement and the Loans made pursuant hereto are secured by Liens
on the Collateral in favor of the Lender, which Liens, and the associated
Collateral Agreements, shall be ratified, continued and affirmed.
     C. The Existing Agreement is hereby amended, continued and restated in its
entirety as set forth in this Agreement.
Agreement
     NOW, THEREFORE, the parties agree as follows:
ARTICLE I
DEFINITIONS
     1.1 Definitions. When used in this Agreement the following terms have the
following meanings:
     “Advance” means an advance of a Loan by the Lender to the Borrower in
accordance with Section 2.1.
     “Agreement” means this Amended and Restated Loan Agreement, as it may be
amended, supplemented, restated or otherwise modified in accordance herewith and
in effect from time to time.
     “Amount Cancelled” means the aggregate amount from time to time by which
the Maximum Credit Amount has been reduced by the Borrower in accordance with
Section 2.5(a).

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     “Amount Outstanding” means the total principal amount of the Loans
outstanding on any date of determination (which shall be a Business Day), from
time to time.
     “April Calculation” shall have the meaning specified in Section 2.11(b)
hereof.
     “Authorized Officer” means any officer of the Borrower who has been duly
authorized to act on behalf of the Borrower with respect to the applicable
matters by appropriate resolution of the board of directors of the Borrower, and
any other person duly authorized in writing by any such officer by notice to the
Lender.
     “Availability Period” means the period commencing on the date on which all
conditions precedent to the Advance are satisfied pursuant to Section 4.1 and
ending on the first to occur of (a) December 31, 2008 and (b) the Maturity Date.
     “Borrower” means Royal Gold, Inc., a corporation incorporated under the
laws of the State of Delaware.
     “Borrower’s Account” means a demand deposit of the Borrower with the
Lender, which is Account Number 66C-00355 (as of the Closing Date), or any
successor account.
     “Borrowing Base” means, as of any date of determination, an amount approved
by the Lender, which is equal to (x) one hundred percent (100%) multiplied by
(y) Projected Facility Term Revenue. The Lender’s determination of the Borrowing
Base shall be conclusively presumed to be correct save for manifest error.
     “Borrowing Base Gold Price” shall equal the lesser of (x) $350 per Ounce of
Gold or (y) the then prevailing open market bid price in Dollars per Ounce of
Gold maintained by the Lender on any date of determination.
     “Borrowing Period” shall have the meaning given thereto in Section 2.3(b).
     “Borrowing Rate” means an interest rate per annum equal to the sum of LIBOR
plus the Interest Margin.
     “Business Day” means any day other than a Saturday, Sunday or holiday on
which banks in New York City, London and Denver, Colorado are open to conduct
their usual business.
     “Cash Equivalent” means, at any time:

  (a)   any Government Security;     (b)   commercial paper, maturing not more
than nine months from the date of issue, which is (i) rated at least A-1 by
Standard & Poor’s Rating Group and P-1 by Moody’s Investors Service, Inc.,
(ii) issued by a corporation or company other than the Borrower and (iii) in
certificated form; or     (c)   any negotiable certificate of deposit or
banker’s acceptance, maturing not more than one year after the purchase thereof,
which is issued (or, in the

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      case of a banker’s acceptance, accepted) by a commercial banking
institution organized under the laws of an Organization for Economic Cooperation
and Development member country that has combined capital and surplus and
undivided profits of not less than $1,000,000,000;

     which in any case is purchased with funds standing to the credit of any
account of the Borrower.
     “Closing Date” means the date hereof.
     “Code” means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended or modified from time to time.
     “Collateral” means all property, assets, rights and interests of the
Borrower subject or intended to be subject from time to time to any Lien
pursuant to a Collateral Agreement, consisting initially of (i) the GSR #1
Royalty, (ii) GSR #3 Royalty, (iii) the NVR #1 Royalty, (iv) all rights and
interests of the Borrower related to the interests described in clauses (i),
(ii) and (iii) whether now owned or hereafter acquired, and (v) the Debt Service
Reserve Account, together with, from time to time, all additional Royalties,
real property rights or interests or other rights, properties or interests, of
any kind or character whatsoever, that are included in or covered by a
Collateral Agreement as security for the Obligations.
     “Collateral Agreements” means the Mortgage, the Proceeds Agreement, the
Ratification and Confirmation and each other Instrument delivered from time to
time to secure the Borrower’s Obligations under this Agreement and under the
Collateral Agreements or to perfect such interest, as any of the foregoing may
be amended, modified, extended, supplemented, continued or restated in
accordance with their respective terms.
     “Collateral Royalties” means, initially, (i) the GSR #1 Royalty, (ii) the
GSR #3 Royalty and (iii) the NVR #1 Royalty, together with, from time to time
hereafter, each other Royalty Interest approved by the Lender for inclusion in
calculation of the Royalty Ounces as set forth in Section 2.11(e) hereof.
     “Commitment Fee” has the meaning set forth in Section 2.6(b) hereof.
     “Cortez Royalty Agreement” means, collectively, (1) the Royalty Agreement
dated as of April 1, 1999 by and among The Cortez Joint Venture, a joint venture
formed under and governed by the laws of Nevada and comprised of Placer Cortez
Inc., a Delaware corporation, and Kennecott Explorations (Australia) Ltd., a
Delaware corporation; Placer Dome U.S. Inc., a California corporation; the
Borrower, and Royal Crescent Valley Inc., a Nevada corporation; (2) the First
Amended Memorandum of Grant of Royalty dated as of April 1, 1999 by and among
the same Persons as are identified in (1) above; (3) the Second Amended
Memorandum of Grant of Royalty dated as of December 8, 2000, and (4) all
amendments, modifications, extensions and renewals of the Instruments identified
in (1), (2) and (3) above in accordance with the terms thereof.
     “Date of Default” has the meaning set forth in Section 8.2(a) hereof.

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     “Debt” means as to any Person: (a) indebtedness, present or future, actual
or contingent, of such Person for borrowed money or other assets or for the
deferred purchase price of property or services (other than obligations under
agreements for the purchase of goods and services in the normal course of
business which are not more than 60 days past due); (b) obligations of such
Person under capital leases, conditional sale agreements or any other financing
transaction; and (c) obligations of such Person under any direct or indirect
guaranty in respect of, and obligations (contingent or otherwise) to purchase or
otherwise acquire, or otherwise to assure a creditor against loss in respect of,
indebtedness or obligations of any other Person of the kinds referred to in
clause (a) or (b) above.
     “Debt Service Reserve Account” means a demand deposit account of the
Borrower located at and controlled by the Lender and in which the Lender has a
security interest as provided for in Section 3.3 which shall initially be the
Borrower’s Account, and all successor accounts.
     “Default Rate” means an interest rate per annum equal to the prevailing
Borrowing Rate plus two and one-half percent (2.5%).
     “Dollar(s)” or “$” means, unless otherwise expressly provided, United
States dollars.
     “Environmental Laws” means all federal, state, local and foreign laws or
regulations, codes, orders, decrees, judgments or injunctions issued,
promulgated, approved or entered thereunder applicable to the Projects, the
Project Properties, the Products or any of the Borrower’s other assets and
relating to pollution or protection of the environment, including, without
limitation, laws relating to emissions, discharges, releases or threatened
releases of pollutants, contaminants, chemicals, or industrial, toxic or
hazardous substances or wastes into the environment (including, without
limitation, ambient air, surface water, ground water, land surface or subsurface
strata) or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants, contaminants,
chemicals or industrial, toxic or hazardous substances or wastes; expressly
including all applicable Federal and State of Nevada, county or municipal
environmental laws.
     “ERISA” means the Employee Retirement Income Security Act of 1974, and the
rules and regulations thereunder, each as amended or modified from time to time.
     “ERISA Affiliate” means any Person who together with the Company or any of
its Subsidiaries are treated as a single employer within the meaning of
Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.
     “Establishment Fee” shall have the meaning specified in Section 2.6(a)
hereof.
     “Event of Default” means those events specified in Section 8.1 hereof.
     “Existing Agreement” shall have the meaning specified in Recital A hereto.
     “GAS Claims” means 200 unpatented lode mining claims situated in Lander
County, Nevada with the following names and corresponding Nevada BLM Serial
Numbers: GAS #17-

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101, NMC Numbers 403024-403108; GAS #102-130, NMC Numbers 410529-410557; GAS
#131-211, NMC Numbers 429207-429287; and GAS #12-16, NMC Numbers 403019-403023.
     “Gold” means gold of minimum 0.995 fineness in gold bars conforming in all
respects with the requirements for good delivery on the London Bullion Market.
     “Government Security” means, at any time, any security maturing not more
than one year after the purchase thereof, issued by the United States Treasury
that is maintained in book entry form on the records of a Federal Reserve Bank
in the United States.
     “Governmental Authority” means the government of any nation and the state,
provincial, territorial, divisional, county, city and political subdivisions
thereof, in which the Borrower or any Royalty Interest or other property right
or interest of Borrower is located, or which exercises valid jurisdiction over
any such property, or in which the Borrower conducts business or is otherwise
present, and any entity, court, agency, department, commission, board, bureau or
instrumentality of any of them exercising executive, legislative, judicial,
regulatory or administrative functions, and any securities exchange to which the
Borrower is subject. Governmental Authority shall also include any regulatory
agency and the rules and regulations of said governmental agency with which the
Borrower must comply.
     “GSR #1 Royalty” means the sliding-scale gross smelter returns royalty over
seventy-nine mining and millsite claims that encompass all of the reserves at
the Pipeline Project as of April 1, 1999, established pursuant to the Cortez
Royalty Agreement, which sliding-scale royalty ranges from 0.40% when the price
of Gold is less than $210 per Ounce up to 5.00% when the price of Gold is more
than $470 per Ounce, with such royalty rates described in Schedule 1.1(c).
     “GSR #3 Royalty” means the gross smelter returns royalty over approximately
four hundred sixty-one mining and millsite claims, including the seventy-nine
mining and millsite claims that encompass all of the reserves at the Pipeline
Project as of April 1, 1999, established pursuant to the GSR #3 Royalty Deeds,
which is currently equal to 0.7125% of the value of production from such claims.
     “GSR #3 Royalty Deeds” means the nine Special Warranty Deeds that are more
particularly identified on Schedule 1.1(b) and 1.1(c).
     “Instrument” means any contract, agreement, indenture, mortgage, document,
writing or other instrument (whether formal agreement, letter or otherwise)
under which any obligation is evidenced, assumed or undertaken, or any Lien (or
right or interest therein) is granted or perfected.
     “Interest Margin” means one and one-half percent (1.5%) per annum.
     “Lender” means HSBC Bank USA, National Association, a national banking
association organized under the laws of the United States.
     “LIBOR” means the rate per annum (rounded upwards if necessary to the
nearest whole one-sixteenth of one percent (1/16%)) equal to (a) the average of
the offered rates as of 11:00 a.m., London time, on the date of determination
appearing on the display designated as page

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“LIBO” on the Reuter Monitor Money Rates Service (or such other page as may
replace the LIBO page on that service for the purpose of displaying London
interbank offered rates of major banks) for Dollar deposits for the relevant
period of time, or (b) if fewer than two offered rates appear on the display
referred to in clause (a) above, the rate determined by the Lender (which
determination shall be conclusive in the absence of manifest error) to be the
average of the rates at which banks are offered Dollar deposits for the relevant
period of time in the interbank Eurodollar market at about 11:00 a.m., London
time.
     “Lien” means, as to any Person, any mortgage, lien, pledge, hypothecation,
charge, assignment, security interest, preferential purchase right or other
encumbrance in or on, or any interest or title of any vendor, lessor, lender or
other secured party to, or of such Person under any conditional sale or other
title retention agreement or capital lease with respect to, any property or
asset owned or held by such Person, or the signing or filing of a financing
statement or other instrument or document for filing which names such Person as
debtor, or the signing of any security agreement, pledge or other instrument
authorizing any other party as the secured party thereunder to file any
financing statement or other instrument. A Person shall be deemed to be the
owner of any assets that it has placed in trust for the benefit of the holders
of its indebtedness which indebtedness is deemed to be extinguished under
generally accepted accounting principles in the United States, but for which
such Person remains legally liable, and such trust shall be deemed to be a Lien.
     “Loan” and “Loans” means the funds Advanced from time to time by the Lender
to the Borrower pursuant to this Agreement.
     “Loan Documents” means this Agreement, the Note, each Request for Advance,
the Collateral Agreements, the Royalty Payment Agreements, the Ratification and
Confirmation and all other Instruments contemplated hereby or executed in
connection herewith, and all amendments, modifications, supplements,
restatements, continuations and extensions of any of the foregoing in accordance
with their terms.
     “London Bullion Market” means the market in London known as the “London
Bullion Market” and on which members of the London Bullion Market Association,
amongst others, quote prices for the buying and selling of Gold and Silver.
     “London Gold Fixing” means a p.m. gold price fixing meeting among the gold
fixing members for the time being of the London Bullion Market.
     “London Gold Fixing Price” means the price per ounce of Gold established at
a London Gold Fixing.
     “Material Adverse Effect” means a material adverse effect on the business
or financial condition of the Borrower or on the Borrower’s ability to perform
any of its material obligations under any of the Loan Documents. In determining
whether any individual event would result in a Material Adverse Effect,
notwithstanding that such event does not itself have such effect, a Material
Adverse Effect shall be deemed to have occurred if the cumulative effect of such
event and all other then-existing events would result in a Material Adverse
Effect.

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     “Maturity Date” means the date on which the Loans are payable in full by
the Borrower, being the first to occur of (a) any date on which the Lender
accelerates the due date of any of the Loans by reason of an Event of Default
pursuant to Section 8.1, or (b) the Scheduled Maturity Date.
     “Maximum Availability” means the lesser of the Maximum Credit Amount and
the Borrowing Base.
     “Maximum Credit Amount” shall mean $30,000,000 on the date hereof, and
thereafter shall mean the lesser of the amounts to which it has been reduced
from time to time pursuant to Section 2.5(a).
     “Mortgage” means the Mortgage, Deed of Trust, Security Agreement, Pledge
and Financing Statement dated as of December 18, 2000 made by the Borrower for
the benefit of the Lender with Stewart Title of Northeastern Nevada as trustee,
which was filed in the official records of Lander County, Nevada on January 10,
2001 at Book 485, Pages 131-154, as the same may be amended, modified,
supplemented, continued or restated from time to time in accordance with its
terms.
     “Mortgage Amendment” means the amendment and supplement to the Mortgage to
be delivered by Borrower as set forth on Schedule 6.16.
     “Multiemployer Plan” means a “multiemployer plan” as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is
making, or is accruing an obligation to make, or has accrued, an obligation to
make contributions within the preceding six (6) years.
     “Net Worth” means the Borrower’s consolidated tangible net worth determined
in accordance with the same United States generally accepted accounting
principles as were used in the preparation of the Borrower’s financial
statements referred to in Sections 5.5 and 6.2 hereof.
     “Note” means the Amended and Restated Promissory Note in the form of
Exhibit C attached hereto issued by the Borrower and payable to the order of the
Lender.
     “NVR #1 Royalty” means the fixed rate royalty equal to 0.39% of the net
value of all production from the GAS Claims, which are located on a portion of
the Pipeline Project.
     “Obligations” means all obligations of the Borrower with respect to the
repayment of principal, interest, fees and other amounts when due hereunder and
the performance of all obligations (monetary or otherwise) of the Borrower
arising under or in connection with this Agreement and each other Loan Document,
whether direct or indirect, absolute or contingent, due or to become due, now
existing or hereafter arising and however arising.
     “October Calculation” shall have the meaning specified in Section 2.11(b)
hereof.
     “Ounce” means a fine ounce troy weight.
     “Other Taxes” has the meaning set forth in Section 2.9 hereof.

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     “PBGC” means the Pension Benefit Guaranty Corporation or any successor
agency.
     “Person” means an individual, partnership, corporation, limited liability
company, trust, unincorporated association, joint venture, governmental agency
or other entity of whatever nature.
     “Pipeline Project” means the Project relating to the Pipeline Project
Properties.
     “Pipeline Project Properties” means the unpatented mining and millsite
claims located in Lander County, Nevada identified as the “Reserve Claims” in
the Cortez Royalty Agreement and subject to the terms and conditions of the
Cortez Royalty Agreement, together with all relocations, modifications or
amendments thereof, all patented mining claims which may be issued based
thereon, and all lands subject thereto.
     “Plans” means any Employee Benefit Plan, other than a Multiemployer Plan,
which is subject to the provisions of Title IV of ERISA or Section 412 of the
Code and which (a) is maintained for the employees of the Borrower or any ERISA
Affiliates or (b) has at any time within the preceding six (6) years been
maintained for the employees of the Borrower or any of its current or former
ERISA Affiliates.
     “Potential Event of Default” means any event which with the giving of
notice or lapse of time or both, based on reasonable projections, would become
an Event of Default.
     “Proceeding” has the meaning set forth in Section 9.8(a) hereof.
     “Proceeds Agreement” means the Proceeds Agreement by and among the
Borrower, the Lender and Johnson Matthey or any other purchaser from the
Borrower of any portion of its share of mineral production from the Project
Properties, which Instrument is substantially in the form of Exhibit E hereto,
as the same may be amended, modified, supplemented, continued or restated from
time to time in accordance with its terms, and any confirmation of such
agreement.
     “Products” means without limitation all ore, minerals, concentrate, doré
bar and refined Gold, silver or other metals produced on behalf of the Borrower
and the Royalty Interests from the Project Properties.
     “Projects” means all of the mining projects in which the Borrower has or
acquires a Royalty Interest, including, without limitation, the Pipeline
Project, with the Projects in effect on the date hereof described with greater
particularity on Schedule 1.1(a) hereto.
     “Project Managers” means the operator or manager of each Project, with the
Project Managers for each Project in effect on the date hereof set forth in
Schedule 1.1(a) hereto.
     “Project Properties” means all of the real property rights or interests,
now owned or hereafter acquired, included in each of the Projects which are
burdened with a Royalty Interest, including all unpatented mining claims which
are identified in any Royalty Agreement, together with all relocations,
modifications or amendments thereof, all patented mining claims which may be
issued based thereon, and all lands subject thereto.

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     “Projected Facility Term Revenue” means an amount approved by the Lender,
which shall be equal to the Royalty Ounces multiplied by the Borrowing Base Gold
Price. The Lender’s determination of Projected Facility Term Revenue shall be
conclusively presumed to be correct save for manifest error.
     “Ratification and Confirmation” means the Ratification and Confirmation
Agreement of even date herewith in the form set forth in Exhibit F hereto.
     “Request for Advance” means the irrevocable request by the Borrower for an
Advance of a Loan, in the form set forth in Exhibit A hereto, signed by an
Authorized Officer of the Borrower.
     “Requirements of Law” means, as to any Person, any law, statute, code,
treaty, ordinance, order, rule or regulation, decree, injunction, franchise,
permit, certificate, license or authorization, or determination of an arbitrator
or a court or other governmental agency, in each case applicable to or binding
upon such Person or any of its properties or to which such Person or any of its
properties is subject, and specifically including, without limitation,
Environmental Laws.
     “Reserve Amount” shall have the meaning given thereto in Section 3.3.
     “Royalties” means any share of mineral production free of the costs of
production, including, without limitation overriding royalties,
non-participating royalties, production payments, net profit interests and all
other mineral royalties of every type and characterization, whether constituting
a real property or a personal property interest.
     “Royalty Agreements” means, collectively, (i) the Cortez Royalty Agreement,
(ii) each of the other royalty agreements set forth on Schedule 1.1(b) hereto,
(iii) any other agreement with or for the benefit of the Borrower pursuant to
which the Borrower receives or is entitled to receive any Royalties, whether now
or hereafter in existence which is acquired by the Borrower in whole or in part
with proceeds of the Loans, and (iv) all amendments, modifications, extensions
and renewals of the Instruments identified in (i), (ii) and (iii) above in
accordance with the terms thereof.
     “Royalty Interests” means all Royalties now owned or hereafter acquired by
or for the benefit of the Borrower in or relating to all of the Projects, as set
forth with greater particularity in Schedule 1.1(c) hereto, and all Products
received or receivable with respect thereto, now held or hereafter acquired by
the Borrower, whether pursuant to Royalty Agreements or otherwise.
     “Royalty Ounces” means an amount approved by the Lender, which shall be
equal to the aggregate ounces of Product projected to be payable to the Borrower
(in cash or in kind) from the date of determination through the Scheduled
Maturity Date with respect to the Collateral Royalties, which shall be based on
current, commercially reasonable projections of production from the Pipeline
Project and each other applicable Project Property. Calculations of Royalty
Ounces for the GSR #1 Royalty, the GSR #3 Royalty and the NVR #1 Royalty shall
be based on the reserve reports set forth in the then-current mine plan for the
Cortez Joint Venture. Calculations of Royalty Ounces to be included as
Collateral Royalties from Projects either not in production at the Closing Date
or acquired by the Borrower after the Closing Date and accepted

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by the Lender as Collateral Royalties for the purpose of calculating the
Borrowing Base shall be based on the reserve report set forth in the applicable
then-current mine plan for such Project, unless the Lender, in its sole
discretion, elects to audit the information contained in the reserve report set
forth in the applicable mine plan for such Project, develop its own conclusions
based on its independent analysis of such information and estimate the Royalty
Ounces for such Project, in which event the Lender’s determination shall be
conclusive. Calculations of Royalty Ounces shall include all reasonable
deductions for shipping, smelting, contractual and other standard deductions
(which deductions shall be described with reasonable specificity in the
Borrower’s calculations).
     “Royalty Payment Confirmations” means the letters substantially in the form
of Exhibit G hereto.
     “Scheduled Maturity Date” means December 31, 2008, unless otherwise
extended by the Lender in its sole discretion upon the request of the Borrower
in accordance with Section 2.7.
     “Semi-Annual Calculations” shall have the meaning specified in
Section 2.11(b) hereof.
     “Title Opinion” means a legal opinion from counsel to the Borrower
pertaining to the Collateral Royalties and Borrower’s right, title and interest
in and to the Collateral Royalties, in form and substance acceptable to the
Lender.
     1.2 Accounting Principles. All accounting terms not otherwise defined
herein shall be construed, all financial computations required under this
Agreement shall be made, and all financial information required under this
Agreement shall be prepared, in accordance with generally accepted accounting
principles in effect in the United States applied on a consistent basis (except
where such inconsistencies are disclosed in the notes to the audited financial
statements provided to the Lender under Section 6.2), except as specifically
provided herein.
ARTICLE II
LOAN FACILITY
     2.1 The Loan.
          (a) General. The Lender agrees, on the terms and conditions
hereinafter set forth, to Advance Loans to the Borrower from time to time during
the Availability Period, as requested by the Borrower; provided, that the
aggregate Amount Outstanding (after giving effect to any amount requested) shall
not exceed the Maximum Availability. Subject to the terms and conditions hereof,
the Borrower may borrow, repay and reborrow funds hereunder until termination of
the Availability Period.
          (b) Loan Advance; Request for Advance. Not less than three Business
Days prior to the desired date of an Advance of a Loan, the Borrower shall
submit to the Lender a Request for Advance. The Request for Advance will specify
(i) the amount of the Advance, which shall be in an aggregate principal amount
of $1,000,000 or a whole multiple of $1,000,000 in excess thereof, (ii) the
Borrowing Period for such Advance and (iii) the Business Day on which the
Advance is requested to be made. Subject to the Borrower’s satisfaction of the

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conditions precedent set forth in Article IV, and on the terms and conditions
stated herein, no later than five Business Days after the Lender’s receipt of a
Request for Advance, the Lender shall Advance the Loan to the Borrower’s Account
on the Business Day specified by the Borrower in the Request for Advance. The
Request for Advance shall be irrevocable and binding on the Borrower and in
respect of the Loan amount specified therein, the Borrower shall indemnify the
Lender against any loss or expense incurred by the Lender as a result of any
failure to fulfill on or before the date specified for such Loan the applicable
conditions set forth in Article IV hereof, including, without limitation, any
loss (including loss of anticipated profits) or expense incurred by reason of
the liquidation or reemployment of funds or deposits acquired or borrowed by the
Lender to fund the Loan to be made by the Lender when the Loan, as a result of
such failure, is not made on such date. A certificate as to such amounts
sufficient to compensate the Lender under such indemnification obligation
submitted by the Lender to the Borrower shall, in the absence of manifest error,
be presumed to be correct and binding for all purposes.
          (c) Use of Proceeds. The Borrower may utilize the proceeds of the
Loans for general corporate purposes, including, without limitation, the
acquisition of Royalties.
          (d) Amendment, Restatement and Continuance. This Agreement amends,
restates, continues and replaces the Existing Agreement and nothing contained in
this Agreement shall be deemed or construed to be a repayment, satisfaction or
novation of the Obligations or to release, terminate, novate or in any way
impair any Lien or Collateral Agreement that secures the payment and performance
of the Obligations.
     2.2 Promissory Note. The Loans shall be evidenced by the Note, representing
the obligation of the Borrower to repay the Amount Outstanding of the Loans,
together with interest as set forth herein. The Borrower authorizes the Lender
to endorse the date and amount of the Advance and each repayment on the schedule
annexed to and constituting a part of the Note, which endorsement shall
constitute prima facie evidence of the accuracy of the information endorsed, in
the absence of manifest error. The failure so to record any such amount or any
error in so recording any such amount shall not, however, limit or otherwise
affect the obligations of the Borrower hereunder or under the Note to repay the
Amount Outstanding of the Loans together with all interest accruing thereon and
fees accruing with respect thereto.
     2.3 Interest.
          (a) General. The Borrower shall pay interest on the Amount Outstanding
calculated on a 360-day year basis. Except as provided in Section 2.8(b),
interest shall accrue at the Borrowing Rate and shall be payable by the Borrower
at the end of each Borrowing Period (defined below) except that, with respect to
a Borrowing Period of 90 days or more which extends beyond the last day of a
calendar quarter, on such last day of the calendar quarter.
          (b) Borrowing Periods. The Borrower may select borrowing periods (a
“Borrowing Period”) for each Loan of 30, 60, 90 or of a longer period of days if
available (or of such other period of days agreed to by the Lender) on a 360-day
year basis; provided, however, that the Borrower may not select a Borrowing
Period if the Lender determines that Dollar deposits are not being offered in
the London interbank Dollar market for such Borrowing Period

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in accordance with customary practice (in which event the Borrower must select
another Borrowing Period which does not present such problems). The Borrower
will select the initial Borrowing Period for each Loan by giving the Lender
notice thereof in the Request for Advance. After the Advance the Borrower may
select Borrowing Periods by giving notice to the Lender at least three Business
Days prior to the expiration of a Borrowing Period then in effect. If at any
time the Borrower fails to give timely notice of its selection, then the
Borrower shall be deemed to have selected a Borrowing Period of 30 days. The
Lender shall not be required to maintain more than four different Borrowing
Periods hereunder at any one time.
     2.4 Repayment of the Loan.
          (a) Principal Payments. The Borrower agrees to repay the Loans as
provided herein. The Borrower shall repay the outstanding principal amount of
the Loans as amortized by the Lender on a monthly basis from the date of Advance
through the Scheduled Maturity Date. Subject to the other terms hereof
pertaining to mandatory repayment of the Loans, the Borrower shall repay the
Loans in full, together with accrued interest thereon, on the Maturity Date.
          (b) Voluntary Repayments. The Borrower may repay any Amount
Outstanding of the Loans in integral multiples of $1,000,000 at the end of any
Borrowing Period, without penalty or premium by providing the Lender not less
than five Business Days’ prior written notice. Upon the giving of such notice,
which shall be irrevocable, the amount to be repaid, as set forth in said
notice, together with interest thereon, shall be due and payable on the date set
forth therein.
          (c) Priority of Prepayments. All payments made pursuant to this
Section 2.4 shall be applied first to accrued, outstanding and unpaid fees and
expenses (including costs and expenses identified in Section 9.4), then to any
accrued and unpaid interest on the Loan as of the end of the most recent
Borrowing Period, then to principal.
     2.5 Permanent Reduction of Maximum Credit Amount.
          (a) Voluntary Reduction. The Borrower shall have the right at any time
and from time to time, upon at least five (5) Business Days prior written notice
from the Borrower to the Lender, to permanently reduce the Maximum Credit Amount
by an aggregate principal amount not less than $1,000,000, plus any whole
multiples of $1,000,000 in excess thereof or any amount in excess thereof which
would reduce the Maximum Credit Amount to the Amount Outstanding.
          (b) Commitment Reduction Repayment. Upon the giving of notice set
forth in Section 2.5(a), which shall be irrevocable, each permanent reduction in
the Maximum Credit Amount permitted pursuant to this Section 2.5 and any amounts
due as a result thereof shall be due and payable on the date set forth therein
by a payment of principal sufficient to eliminate any excess of the Amount
Outstanding over the Maximum Credit Amount as so reduced.

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     2.6 Fees.
          (a) Establishment Fee. The Borrower agrees to pay the Lender a total
fee (the “Establishment Fee”) in the amount of $50,000 for the establishment of
this loan facility, which shall be due and payable concurrently with Borrower’s
execution hereof (minus the $20,000 advance on the Establishment Fee that the
parties acknowledge the Lender has been paid by Borrower prior to the date of
this Agreement). No portion of the Establishment Fee will be refundable by the
Lender to the Borrower under any circumstances, including an election by the
Borrower not to submit a Request for Advance hereunder or the failure of the
Borrower to satisfy, or the failure of the Lender to waive satisfaction of, the
conditions to any Advance set forth in Article IV hereof.
          (b) Commitment Fee. The Borrower agrees to pay to the Lender a fee
(the “Commitment Fee”) in an amount determined daily during the period beginning
on the Closing Date and ending on the Maturity Date at the rate of
three-quarters of one percent (0.75%) per annum of the difference between the
Amount Outstanding and the Maximum Availability. The Commitment Fee will be
payable in arrears to the Lender on the fifth Business Day of each calendar
quarter following conclusion of the calendar quarter in which the Commitment Fee
is accrued.
          (c) Agent’s Fee. In the event that the Lender assigns or grants
participations in the Loans, or any part thereof, and the Loan Documents, then,
in order to compensate the Lender for structuring and managing any such
syndication or participation of the Loans and for its obligations hereunder, the
Borrower agrees to pay to the Lender, for its account, an agent’s fee in the
amount of $10,000 per annum payable on the date that the Lender makes such
assignment or grants a participation and on each anniversary of such date during
the term hereof.
     2.7 Extension of Scheduled Maturity Date.
          (a) First Request for Extension. So long as no Potential Event of
Default or Event of Default has occurred, the Borrower may irrevocably request
in writing that the Lender extend the Scheduled Maturity Date for an additional
year from the date of December 31, 2008 to December 31, 2009 (the “First Request
for Extension”), which such request shall be made not later than June 30, 2008.
Upon receipt of the First Request for Extension, the Lender shall have ninety
(90) days to consider and approve or reject in its sole discretion the
Borrower’s First Request for Extension.
          (b) Second Request for Extension. So long as no Potential Event of
Default or Event of Default has occurred and so long as the Borrower has
requested and the Lender has approved an extension of the Scheduled Maturity
Date to December 31, 2009, the Borrower may irrevocably request in writing that
the Lender extend the Scheduled Maturity Date for an additional year from the
date of December 31, 2009 to December 31, 2010 (the “Second Request for
Extension”), which such request shall be made not later than June 30, 2009. Upon
receipt of the Second Request for Extension, the Lender shall have ninety
(90) days to consider and approve or reject in its sole discretion the
Borrower’s Second Request for Extension.

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          (c) Terms and Conditions Binding. If the Lender agrees to extend the
Scheduled Maturity Date pursuant to a First Request for Extension or a Second
Request for Extension, this Agreement shall continue with full force and effect
upon the same terms and conditions as those set forth herein (except as amended,
supplemented or modified in accordance with the terms hereof) until the Maturity
Date (with the Scheduled Maturity Date as extended in accordance herewith).
          (d) Miscellaneous Terms. Each Request for Extension shall be
irrevocable and binding on the Borrower. The failure of the Borrower to make any
Request for Extension within the time period specified therefor shall thereby
terminate the Borrower’s option to make such a Request for Extension. The
failure of the Borrower to make the First Request for Extension within the time
period set forth therefor shall thereby terminate its ability to make the Second
Request for Extension.
     2.8 Miscellaneous.
          (a) Same-day Funds. All payments by the Borrower to the Lender
hereunder and under any other Loan Document, whether for principal, interest,
fees, expenses or other amounts, shall be made without set-off, recoupment,
deduction or counterclaim in immediately available funds to such account as the
Lender shall specify from time to time by not later than 12:00 p.m. Eastern time
on the date when due.
          (b) Penalty Interest.
     (i) The Borrower shall pay to the Lender, on demand, interest on any amount
which is not paid by the Borrower when due at the Default Rate.
     (ii) Without prejudice to the rights of the Lender under the foregoing
provisions of this Section 2.8(b), the Borrower shall indemnify the Lender
against any loss or expense which it may sustain or incur as a result of the
failure by the Borrower to pay when due any Amount Outstanding of the Loan, to
the extent that any such loss or expense is not recovered pursuant to such
foregoing provisions. A certificate or other notice of the Lender setting forth
the basis for the determination of the interest due on overdue principal and of
the amounts necessary to indemnify the Lender in respect of such loss or
expense, submitted to the Borrower by the Lender, shall constitute prima facie
evidence of the accuracy of the information contained therein in the absence of
manifest error and, absent notice from the Borrower of such error, shall be
conclusive and binding for all purposes.
          (c) Lender’s Counsel’s Fees. The Borrower shall pay to the Lender such
amount as invoiced to the Lender by the Lender’s counsel, Davis Graham & Stubbs
LLP, for such firm’s fees and charges incurred in connection with the
transactions contemplated by the Loan Documents. Alternatively, with such
counsel’s consent, payment may be made by the Borrower directly to such counsel.
          (d) Lender’s Other Expenses. On the Closing Date, the Borrower shall
pay the Lender all of the Lender’s costs incurred to date (as reasonably
detailed in advance) in connection with the transactions contemplated by the
Loan Documents in accordance with

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Section 9.4 hereof and thereafter the Borrower shall pay the Lender all of the
Lender’s subsequent and additional costs in connection with the transactions
contemplated by the Loan Documents within 30 days of receipt from the Lender of
a reasonably detailed invoice therefor in accordance with Section 9.4 hereof.
     2.9 Taxes.
          (a) Other Taxes. The Borrower agrees to pay any present or future
stamp or documentary taxes or any other excise, mortgage, or property taxes,
charges or similar levies (exclusive of income taxes) which arise from any
payment made hereunder or under the Note or from the execution, delivery,
recordation or registration of, or otherwise with respect to, this Agreement or
the Note or the Collateral Agreements or any other Loan Documents (hereinafter
referred to as “Other Taxes”). The Borrower will indemnify the Lender for and
hold it harmless from the full amount of Other Taxes (including, without
limitation, any Other Taxes imposed by any jurisdiction on amounts payable under
this Section 2.9) paid by the Lender or any liability (including penalties,
interest and expenses) arising therefrom or with respect thereto, whether or not
such Other Taxes were correctly or legally asserted; provided, however, that the
Borrower shall have the right to contest in good faith any such tax levied upon
the Lender. This indemnification shall be made within thirty days from the date
the Lender makes written demand therefor, unless the Borrower is contesting the
tax in good faith, in which event the foregoing indemnification shall not be
triggered until the final determination of such contest or proceeding and the
exhaustion of all applicable appeals.
          (b) Withholding Tax; Gross-up. All payments to be made by the Borrower
to any Person hereunder shall be made free and clear of and without deduction
for or on account of any present or future taxes, duties, assessments or
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority having the power to tax; provided, however, that if the
Borrower is required to make such a payment subject to the deduction or
withholding of such tax, duty, assessment or governmental charge (exclusive of
income taxes), then the sum payable by the Borrower in respect of which such
deduction or withholding is required to be made shall be increased to the extent
necessary to ensure that, after the making of such deduction or withholding, the
Person receiving the payment receives a net sum equal to the sum which it would
have received and so retained had no such deduction or withholding been made or
required to be made.
          (c) Survival. Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.9 shall survive the payment in full of the Loan.
     2.10 Illegality; Capital Requirements; Increased Costs; Indemnity for
Breakage Costs.
          (a) Illegality. If after the date hereof, the introduction of, or any
change in, any applicable law or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or

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administration thereof, or compliance by the Lender with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency, shall make it unlawful or impossible for the
Lender to honor its obligations hereunder to make or maintain the Loan based on
a LIBOR rate, the Lender shall promptly give notice thereof to Borrower.
Thereafter, subject to paragraph (e) below, until the Lender notifies Borrower
that such circumstances no longer exist (which notification shall be given
within thirty (30) days after the Lender obtains actual knowledge that such
circumstances no longer exist), (i) the obligations of the Lender to make the
Loan based on a LIBOR rate shall be suspended and thereafter Borrower may borrow
only at an annual rate equal to the Lender’s prime rate plus a margin of one and
one half percent (1.5%) (the “Prime Borrowing Rate”), and (ii) if the Lender may
not lawfully continue to maintain the Loan based on a LIBOR rate to the end of
the then current Borrowing Period applicable thereto, shall immediately be
converted to a Loan based on the Prime Borrowing Rate for the remainder of such
Borrowing Period.
          (b) Capital Requirements. If, subsequent to the date of this
Agreement, either (i) the establishment of, or any change in, or in the
interpretation of, any applicable Requirement of Law or (ii) compliance with any
guideline or request from any central bank or comparable agency or other
governmental authority (whether or not having the force of law), has or would
have the effect of reducing the rate of return on the capital of, or would
affect the amount of capital required to be maintained by, the Lender or any
corporation controlling the Lender in connection with the Loan or its commitment
to extend the Loan thereunder, below the rate which the Lender or such other
corporation could have achieved but for such establishment or introduction,
change or compliance, then within fifteen (15) Business Days after written
demand of the Lender, subject to paragraph (e) below, Borrower shall pay to the
Lender from time to time as specified by the Lender additional amounts
sufficient to compensate the Lender or other corporation for such reduction. A
certificate as to such amounts shall be submitted to the Borrower by the Lender
as soon as practicable following an event covered by this Section 2.10(b), and
shall, in the absence of manifest error, be presumed to be correct and binding
for all purposes.
          (c) Increased Costs. If, after the date hereof, the establishment or
introduction of, or any change in, any applicable Requirement of Law, or in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by the Lender with any request or directive (whether or
not having the force of law) of such authority, central bank or comparable
agency:
          (i) shall subject the Lender to any tax, duty or other charge with
respect to the Loan or the Note, or shall change the basis of taxation of
payments to the Lender of the principal of or interest on the Loan or the Note,
or any other amounts due under this Agreement in respect thereof (except for
changes in the rate of tax on the overall net income of the Lender imposed by
the jurisdiction in which the Lender is organized or is or should be qualified);
and
          (ii) shall impose, modify or deem applicable any reserve (including,
without limitation, any imposed by the Board of Governors of the Federal Reserve
System), special deposit, insurance or capital or similar requirement against
assets of,

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deposits with or for the account of, or credit extended by the Lender or shall
impose on the Lender or the foreign exchange and interbank markets any other
condition affecting the Loan or the Note;
and the result of any of the foregoing is to increase the costs to the Lender of
maintaining the Loan or to reduce the yield or amount of any sum received or
receivable by the Lender under this Agreement or under the Note in respect of
the Loan, then the Lender shall promptly notify Borrower of such fact and demand
compensation therefor and, subject to paragraph (e) below, within fifteen
(15) days after such notice by the Lender, the Borrower shall pay to the Lender
such additional amount or amounts as will compensate the Lender for such
increased cost or reduction. The Lender will promptly notify Borrower of any
event of which it has knowledge which will entitle the Lender to compensation
pursuant to this Section 2.9(c). A certificate of the Lender setting forth the
basis for determining such additional amount or amounts necessary to compensate
the Lender shall be conclusively presumed to be correct save for manifest error.
          (d) Indemnity for Breakage Costs. Borrower hereby indemnifies the
Lender against any loss or expense which may arise or be attributable to the
Lender’s obtaining, liquidating or employing deposits or other funds acquired to
effect, fund or maintain the Loan (i) due to any failure of Borrower to borrow
on a date specified therefor in the Request for Advance or (ii) due to any
payment or prepayment of the Loan on a date other than the last day of the
Borrowing Period therefor. The Lender’s calculations of any such loss or expense
shall be furnished to Borrower and shall be conclusive, absent manifest error.
          (e) Cancellation of Commitment as a Result of Increased Costs. If
Borrower has received a notice of increased costs under paragraphs (a), (b) or
(c) above, in lieu of paying such increased amounts Borrower may provide notice
to the Lender that it elects to prepay the Loan, in which case the Borrower
shall pay to the Lender any loss or expense of the Lender due to the prepayment
of the Loan on a date other than the last day of the Borrowing Period therefor.
     2.11 Borrowing Base Determination.
          (a) The Borrower shall calculate the Royalty Ounces, the Projected
Facility Term Revenue and the Borrowing Base in accordance with the requirements
of this Agreement, using its good faith best efforts, and it shall then provide
such amounts and calculations to the Lender by written notice. The Lender may
request such clarifications, explanations, supporting data, documents,
calculations, re-calculations or other information as it reasonably deems
appropriate, all of which shall be promptly provided by the Borrower. The final
determination of the Royalty Ounces, the Projected Facility Term Revenue and the
Borrowing Base shall be made by the Lender, using its commercially reasonable
discretion, and no calculation of the Borrowing Base, the Projected Facility
Term Revenue or the Royalty Ounces shall be used, or otherwise be deemed final
and effective, until approved in writing by the Lender. The Lender, using its
commercially reasonable discretion, may decide to undertake its own calculation
of the Borrowing Base, the Projected Facility Term Revenue and the Royalty
Ounces at any time and from time to time and shall promptly notify the Borrower
of the results of such calculations. The Lender’s determination of the Borrowing
Base, the Projected Facility Term Revenue and the Royalty Ounces, at any time
and from time to time, whether based on the Borrower’s

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calculations or its own calculations, shall be made by the Lender, using its
commercially reasonable discretion, and shall be used for all purposes under
this Agreement.
          (b) The Borrower shall calculate the Royalty Ounces, the Projected
Facility Term Revenue and the Borrowing Base (i) semi-annually, with written
notice of such calculations to be delivered to the Lender by not later than
April 15 of each year (the “April Calculation”) and by not later than October 15
of each year (the “October Calculation”, and together with the April
Calculation, the “Semi-Annual Calculations”) and (ii) at any other time
reasonably requested by the Lender, with written notice of such calculations to
be delivered to the Lender within five (5) Business Days of such Lender request
(each, a “Special Calculation”). The Lender may request a Special Calculation,
or a re-calculation of any of the foregoing amounts, at any time, and from time
to time, while any Loans are outstanding or prior to the Advance of any Loan.
          (c) Each Semi-Annual Calculation shall include a separate calculation
of the Royalty Ounces, the Projected Facility Term Revenue and the Borrowing
Base as of the end of then-current calendar quarter and each of the subsequent
two calendar quarters (for the purpose of clarification, the April Calculation
shall include projected calculations for each of the 2nd, 3rd and 4th calendar
quarters and the October Calculation shall include projected calculations for
each of the 4th, 1st and 2nd calendar quarters). Each Special Calculation shall
include a calculation of the Royalty Ounces, the Projected Facility Term Revenue
and the Borrowing Base as of the date of determination as well as a calculation
of the projected Royalty Ounces, Projected Facility Term Revenue and Borrowing
Base as of the end of the then-current calendar quarter and the subsequent two
calendar quarters. All calculations of future, projected amounts shall use
commercially reasonable assumptions with respect to such projections.
          (d) The Lender’s determination of the Borrowing Base, whether based on
actual numbers as of a date of determination or as projected as of the end of a
future calendar quarter, shall remain effective for all purposes under this
Agreement until a subsequent Semi-Annual Calculation or Special Calculation is
completed and the Lender makes a determination of the Borrowing Base based on
such calculations.
          (e) From time to time, the Borrower may provide the Lender with a
written request to include other Royalty Interests of the Borrower as Collateral
Royalties and Royalty Ounces for the purposes of determining the Borrowing Base,
which request shall include appropriate data, documentation and information
about such Royalty Interest and the Project and Project Properties related
thereto. Upon receipt of such request from the Borrower, the Lender may request
such additional data, documentation and information about such Royalty Interest,
Project and Project Properties as it deems necessary or appropriate, which the
Borrower shall promptly provide. The Lender shall have a period of forty-five
(45) days from the Lender’s receipt of such request to either accept or reject
the Borrower’s request, which the Lender may do in its sole discretion
reasonably exercised. The Lender shall provide the Borrower with written notice
of its decision. The failure of the Lender to provide a written notice of
acceptance of such additional Royalty Interests as Royalty Ounces shall be
deemed a rejection of the Borrower’s request.

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          (f) Upon the Lender’s written acceptance of the inclusion of new or
additional Royalty Interests as Royalty Ounces and Collateral Royalties, the
Borrower shall re-calculate the Royalty Ounces, the Projected Facility Term
Revenue and the Borrowing Base in accordance with the requirements of this
Agreement. Any re-calculation of the Borrowing Base including new or additional
Royalty Interests shall not be effective until (i) the Lender has provided
written approval of such calculation, (ii) the Borrower has granted, and the
Lender has obtained, a first priority, perfected Lien over such new or
additional Royalty Interests free from other Liens and (iii) the Lender has
received both a Title Opinion confirming the Borrower’s right, title and
interest in such new or additional Royalty Interests and a supplemental legal
opinion with respect thereto confirming the inclusion of such Royalty Interests
as part of the Collateral and the perfection of the Lender’s security interest
therein, with each such opinion to be in form and content satisfactory to the
Lender.
ARTICLE III
COLLATERAL SECURITY
     3.1 Collateral Agreements. All of the Borrower’s Obligations are secured by
the Collateral Agreements. The Collateral Agreements and the Liens on the
Collateral to secure the payment and performance of all Obligations are
continuing and have been ratified and confirmed by the Borrower pursuant to the
Ratification and Confirmation.
     3.2 Perfection and Maintenance of Collateral Agreement Liens. The Borrower
hereby authorizes the Lender to file such UCC Financing Statements in such
jurisdictions as it determines to be desirable and to take such other actions as
it determines to be necessary or desirable to perfect and maintain the
perfection of first priority Liens in the Debt Service Reserve Account and all
other Collateral identified in the Collateral Agreements. The Borrower agrees to
cooperate with the Lender in completing all such recording and filing, to
promptly execute such other Instruments, and to promptly take all such other
actions, as the Lender may reasonably determine to be necessary or appropriate
to confirm, perfect and maintain the perfection of such Liens. Prior to any
Advance of a Loan hereunder, the Mortgage Amendment shall have been filed and
recorded in the appropriate records of the Lander County, Nevada Clerk and
Recorder and such other jurisdictions necessary to perfect the Liens granted
therein.
     3.3 Debt Service Reserve Account. The Borrower has established, and until
this Agreement has been repaid in full and cancelled the Borrower shall
maintain, the Debt Service Reserve Account with the Lender. Such Debt Service
Reserve Account is subject to the custody, control and right of set-off of the
Lender and constitutes part of the Collateral. Commencing prior to the initial
Advance of a Loan hereunder and continuing until the termination of this
Agreement, the Borrower shall promptly deposit or cause to be deposited in the
Debt Service Reserve Account all cash amounts received by the Borrower from or
with respect to (i) all existing Royalty Interests, and (ii) all Royalty
Interests purchased or otherwise acquired using Loan proceeds after the date of
this Agreement. The balance in the Debt Service Reserve Account at all times
shall be not less than an amount equal to the aggregate of any payments of
principal, interest, fees and expenses payable with respect to the Loans and the
Loan Documents and due at any time during the then current calendar quarter and
the next succeeding calendar quarter, which amount shall be determined by the
Lender in its commercially reasonable

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discretion, including with reference to the Borrowing Base applicable to such
period of time (the “Reserve Amount”). The Borrower hereby grants to the Lender
a continuing security interest in and lien upon the Debt Service Reserve
Account, all cash balances from time to time credited to the Debt Service
Reserve Account and any and all proceeds of any thereof, whether now or
hereafter existing or arising. So long as no Potential Event of Default or Event
of Default has occurred and is continuing, the Lender will promptly disburse to
the Borrower, in accordance with written instructions provided by the Borrower
to the Lender (which instructions the Borrower may revise upon five days written
notice to the Lender), any credit balances in the Debt Service Reserve Account
which are in excess of the Reserve Amount from time to time.
ARTICLE IV
CONDITIONS PRECEDENT
     4.1 Conditions Precedent to the Initial Advance. The obligation of the
Lender to make the initial Advance of a Loan is subject to satisfaction (or
waiver by the Lender in its sole discretion) of each of the following conditions
precedent.
          (a) Receipt of Instruments. The Lender or its counsel shall have
received each of the following Instruments:
          (i) this Agreement, duly executed by an Authorized Officer of the
Borrower;
          (ii) the Note, duly executed by an Authorized Officer of the Borrower;
          (iii) the Mortgage Amendment, the Ratification and Confirmation and
each of the other Collateral Agreements, together with appropriate UCC financing
statements relating thereto, duly executed by an Authorized Officer of the
Borrower and by all other Persons parties thereto;
          (iv) an Omnibus Certificate of the Borrower, substantially in the form
of Exhibit B hereto, duly executed by an Authorized Officer of the Borrower;
          (v) a legal opinion from legal counsel for the Borrower, in form and
content reasonably acceptable to the Lender and substantially in the form of the
legal opinion delivered to the Lender in connection with the Existing Agreement;
          (vi) a Title Opinion from Nevada legal counsel to the Borrower, in
form and content reasonably acceptable to the Lender;
          (vii) a supplemental legal opinion from Nevada legal counsel to the
Borrower, in form and content reasonably acceptable to the Lender, confirming
the perfection in favor of the Lender of enforceable first priority Liens on the
Collateral Royalties and on the other property rights and interests of the
Borrower subject to the Collateral Agreements, substantially in the form of the
security legal opinion delivered to the Lender in connection with the Existing
Agreement;

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          (viii) a certificate from the Secretary of State of Delaware
confirming the good standing of the Borrower in that State;
          (ix) certificates from the Secretaries of State of Colorado and Nevada
confirming the good standing of the Borrower in each of such States;
          (x) Royalty Payment Confirmations and Proceeds Agreements (or
confirmations thereof) duly executed by an Authorized Officer of the Borrower
and each other Person a party thereto;
          (xi) a certificate from an Authorized Officer of the Borrower setting
forth a calculation of the Royalty Ounces, the Projected Facility Term Revenue
and the Borrowing Base as of (a) September 30, 2005, (b) December 31, 2005,
(c) March 31, 2006 and (d) June 30, 2006; and
          (xii) such other approvals, opinions, documents or Instruments as the
Lender may reasonably request.
          (b) Additional Conditions. Each of the following shall be correct:
          (i) since the date of the financial statements of the Borrower most
recently delivered to the Lender (referred to in Section 5.5), there has been no
adverse change in the financial condition, operations or business of the
Borrower which would constitute a Material Adverse Effect;
          (ii) there is no pending or overtly threatened action or proceeding
affecting the Borrower, the Royalty Interests, the Pipeline Project Properties
or the Pipeline Project before any court, governmental agency or arbitrator,
which could be reasonably expected to have a Material Adverse Effect;
          (iii) the Borrower shall have performed and complied with all
agreements, conditions and Obligations herein and in the other Loan Documents
required to be performed and complied with on or prior to the date of the
Advance;
          (iv) there shall exist no Event of Default or Potential Event of
Default;
          (v) all representations and warranties made by the Borrower herein and
in any other Loan Document or other certificate or Instrument delivered in
connection herewith shall be true and correct on the date of the Advance;
          (vi) all Instruments that are necessary to perfect the security
interests of the Lender in the Collateral described in the Collateral Agreements
shall have been received by the Lender and the Lender shall have received
evidence reasonably satisfactory to the Lender that upon filing and recording
such Instruments, the security interests represented thereby will constitute
valid and perfected Liens subject only to Permitted Liens; and

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          (vii) there shall be a current credit balance of not less than the
Reserve Amount in the Debt Service Reserve Account.
     4.2 Conditions Precedent to All Advances. The obligation of the Lender to
make each Advance of Loans (including the initial Advance) is subject to
satisfaction (or waiver by the Lender in its sole discretion) of each of the
following conditions precedent:
          (a) the Lender shall have received a Request for Advance, duly
executed by an Authorized Officer;
          (b) on the date of such Advance, the Lender shall have received such
approvals, opinions, documents or Instruments as the Lender may reasonably
request;
          (c) such Advance shall not cause the Amount Outstanding to exceed the
Maximum Availability;
          (d) there shall exist no Potential Event of Default or Event of
Default;
          (e) each of the conditions precedent to the initial Advance set forth
in Section 4.1 is and remains satisfied; and
          (f) all representations and warranties made by the Borrower shall be
true and correct on the date of such Advance except for those changes disclosed
to the Lender in writing and acceptable to the Lender in its sole discretion.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
     In order to induce the Lender to enter into this Agreement, the Borrower
represents and warrants to the Lender that:
     5.1 Due Organization, Good Standing and Authority. The Borrower is duly
organized, validly existing and in good standing under the laws of Delaware and
is qualified to do business in Colorado and Nevada and every other jurisdiction
where necessary in light of its business and properties. The Borrower has full
power, authority and legal right (a) to own or lease its assets and properties
and to conduct its business as now being conducted, and (b) to incur its
obligations under this Agreement and each other agreement, document and
instrument executed or to be executed by it pursuant hereto or in connection
herewith and to perform the terms hereof and thereof applicable to it.
     5.2 Due Authorization; Non-Contravention. The execution and delivery by the
Borrower of this Agreement and the other Loan Documents, and the performance of
all transactions contemplated hereby and thereby, and the fulfillment of and
compliance with the respective terms of this Agreement and the other Loan
Documents by the Borrower are within the Borrower’s powers, have been duly
authorized by all necessary action corporate or otherwise and do not and will
not (a) conflict with or result in a breach of the terms, conditions or
provisions of, (b) constitute a default under, (c) result in the creation of any
Lien (except

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pursuant to the Loan Documents) upon capital stock or assets pursuant to,
(d) give any third party any right to accelerate any obligation under,
(e) result in a violation of, or (f) require any authorization, consent,
approval, exemption or other action by or notice to any Governmental Authority
pursuant to (i) the Articles of Incorporation or Bylaws of the Borrower,
(ii) any Requirement of Law applicable to the Borrower or its properties, or
(iii) any agreement, instrument, order, judgment or decree to which the Borrower
is subject or by which its properties are bound.
     5.3 No Approvals. No authorization or approval or other action by, and no
notice to or filing with, any Governmental Authority is required for the due
execution, delivery and performance by the Borrower of this Agreement, or any
other Loan Document, except for filings necessary to perfect Liens pursuant to
the Loan Documents.
     5.4 Validity. This Agreement is, and the other Loan Documents, when
delivered hereunder will be, legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their respective
terms subject to bankruptcy and insolvency laws affecting rights of creditors
generally and rules of equity.
     5.5 Financial Statements. The audited consolidated financial statements of
the Borrower for the twelve-month period ending June 30, 2005, which have been
furnished to the Lender, have been prepared in accordance with generally
accepted accounting principles in the United States consistently applied (except
as disclosed in the notes thereto) and present fairly and fully the financial
position and results of operations of the Borrower as of the latest date and for
the periods specified therein. Subsequent to the respective dates as of which
information is given in such financial statements there has been no change
resulting in a Material Adverse Effect.
     5.6 Litigation. Except as set forth in Schedule 5.6 hereto, Borrower is not
a party to any action, suit or proceeding at law or in equity, by or before any
Governmental Authority or arbitral tribunal now pending (or, to the knowledge of
the Borrower, threatened in writing) against or affecting the Borrower, the
Royalty Interests, the Project Properties or any Project or which may have a
Material Adverse Effect, or which may affect the legality, validity or
enforceability of this Agreement or any other Loan Document. Except as set forth
in Schedule 5.6, to the knowledge of the Borrower, without duty of further
inquiry, there is no action, suit or proceeding at law or in equity, by or
before any Governmental Authority or arbitral tribunal now pending or threatened
against or, with direct and specific application, affecting, the Borrower, the
Royalty Interests, the Project Properties or any Project which may have a
Material Adverse Effect, or which may affect the legality, validity or
enforceability of this Agreement or any other Loan Document.
     5.7 Disclosure. Except as set forth in Schedule 5.7 hereto, this Agreement,
the other Loan Documents and the schedules, attachments, written statements,
documents, certificates or other items prepared by the Borrower and provided to
the Lender do not contain any untrue statements of a material fact or omit a
material fact necessary to make the statements contained herein or therein not
misleading. The Borrower represents and warrants that there is no fact which it
has not disclosed to the Lender in writing and of which any of its officers or
directors are aware which could reasonably be anticipated to constitute a
Material Adverse Effect.

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     5.8 Title to Royalty Interests; Liens. Schedule 1.1(a) and Schedule 1.1(c),
respectively, set forth a complete and accurate listing and description of each
of the Projects and the Royalty Interests as of the date hereof. The Borrower
has good and marketable title to the Royalty Interests free and clear of any
claims or rights of title and free and clear of all Liens except (a) Liens
established pursuant to the Collateral Agreements, (b) Liens for taxes not yet
due and payable, (c) inchoate Liens established by statute arising in the
ordinary course of business securing obligations that are not overdue for a
period of more than 20 days and (d) Liens and title defects reflected in the
Title Opinion.
     5.9 Royalty Agreements. Schedule 1.1(b) sets forth a complete and accurate
list of all Royalty Agreements of the Borrower in effect as of the Closing Date;
each Royalty Agreement is a legal, valid and binding obligation of the Borrower,
and to the Borrower’s knowledge, each other party thereto. Other than as set
forth in Schedule 5.9, each such Royalty Agreement is, and after giving effect
to the transactions contemplated by the Loan Documents will be, in full force
and effect in accordance with the terms thereof. The Borrower has delivered or
made available to the Lender a true and complete copy of each Royalty Agreement
required to be listed on Schedule 1.1(b). The Borrower is not in breach of or in
default under any Royalty Agreement. The Borrower has not alleged that any
Royalty Agreement counterparty has breached or defaulted under any Royalty
Agreement. To the Borrower’s knowledge, no counterparty to any Royalty Agreement
is in breach of or in default of any Royalty Agreement.
     5.10 Project Permits. To the knowledge of the Borrower, without duty of
further inquiry, except as set forth in Schedule 5.10, and except for matters
that do not or would not have a material adverse effect on such Projects, the
Project Managers of each of the Projects have obtained all material licenses,
operating and reclamation bonds, permits and approvals from all governmental
commissions, boards and other agencies required to operate such Projects as
currently being operated in accordance with the then effective mine plan
therefor, and such Project Managers are operating the Projects in material
compliance therewith.
     5.11 Payment of Taxes. The Borrower has filed, or caused to be filed, all
federal, state and local tax returns which to the knowledge of the Borrower are
required to be filed and has paid or caused to be paid all taxes as shown on
such returns or any assessment received by the Borrower to the extent that such
taxes or assessments have become due, except such as may be diligently contested
in good faith and by appropriate proceedings or as to which a bona fide dispute
may exist and for which adequate reserves are being maintained. The Borrower has
established reserves which are reasonably believed by the officers and
representatives of the Borrower to be adequate for the payment of such taxes.
     5.12 Agreements. Except as set forth in Schedule 5.12 hereto, the Borrower
is not a party to any material agreement or instrument or subject to any charter
or other corporate restriction which has a Material Adverse Effect. The Borrower
is not in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in the Royalty Agreements or any
other agreement or instrument to which it is a party, the effect of which would
constitute a Material Adverse Effect.
     5.13 Compliance with Laws. Except as set forth in Schedule 5.13 hereto, (a)
the Borrower has complied in all material respects with all Requirements of Law,
and (b) with

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respect to the Project Properties and operations thereon and the Projects, to
the knowledge of the Borrower, without duty of further inquiry, the Project
Managers have complied in all material respects with and the Projects and
Project Properties are in material compliance with all Requirements of Law
relating to the operation of each Project, and the Borrower is not aware of any
investigation (other than a routine inspection) underway by any local, state or
federal agency with respect to enforcement of such Requirements of Law. The
Borrower has no knowledge (except as disclosed to the Lender in Schedule 5.13)
of any past or existing violations of any such Requirements of Law or notices
thereof issued by any Governmental Authority with respect to the Borrower that
would constitute a Material Adverse Effect, and the Borrower has no knowledge
(except as disclosed to the Lender in Schedule 5.13) of any past or existing
violations of any Requirements of Law or notices thereof issued by any
Governmental Authority with respect to any Project or any Project Property that
would have a material adverse effect on such Project, Project Property or any
Royalty Interest.
     5.14 Events of Default. No event has occurred and is continuing, or would
result from the incurring of obligations by the Borrower under this Agreement,
which constitutes an Event of Default or a Potential Event of Default.
ARTICLE VI
AFFIRMATIVE COVENANTS
     The Borrower covenants and agrees from the date hereof, so long as any
portion of the Loans remain outstanding and unpaid, in whole or in part, or any
other amount is owing to the Lender under this Agreement or any other Loan
Document that, unless the Lender shall otherwise consent in writing:
     6.1 Notice to the Lender. The Borrower will promptly give notice to the
Lender as soon as it becomes aware of:
          (a) Any Event of Default or Potential Event of Default;
          (b) Any default under, breach of or event which, with notice or lapse
of time or both, would become a material default under or breach of any other
Loan Document;
          (c) Any loss or damage to the Collateral in excess of $100,000,
exclusive of diminution in value caused solely by changes in the price of Gold
from time to time;
          (d) The consummation by Borrower of any purchase or acquisition of a
Royalty Interest, whether a new Royalty Interest or an addition to or increase
in an existing Royalty Interest;
          (e) Any additional interests in the Project Properties acquired by the
Borrower which are not included in the Collateral;
          (f) Every default or other adverse claim, demand or litigation made by
any Person which would, if successful, constitute a Material Adverse Effect, or
with respect to any

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Royalty Interest or any other Collateral could have a material adverse effect on
such Royalty Interest or Collateral;
          (g) Every notice, and the contents thereof, received by the Borrower
in relation to any renewal of any rights with respect to, or having a material
adverse effect upon any Royalty Interest or Project including (without
limitation) notices pertaining to the loss of or a failure to obtain or a
failure to be able to renew such interest in a material part of such Project,
together with a copy of such notice if in writing;
          (h) Every press release issued by the Borrower together with a copy of
such press release, and any other occurrence, matter, event or thing (other than
changes in the price of Gold) constituting a Material Adverse Effect, together
with a reasonably detailed explanation of such other occurrence, matter, event
or and thing; and
          (i) Each material memorandum, letter or report received by the
Borrower from any Project Manager concerning any Royalty Interest or Project,
including (to the extent received by the Borrower and not subject to
confidentiality restrictions that prevent the Borrower from disclosure thereof)
the annual strategic business plan for the Pipeline Project and all reserve,
mine plan and/or operating reports for the Projects or the Project Properties,
together with a copy of such plans and reports.
     6.2 Financial Statements, Calculations and Information.
          (a) As soon as practicable (and in any event not later than 90 days
after each fiscal year and 60 days after each fiscal quarter), the Borrower
shall furnish the Lender annual (audited) and quarterly (unaudited) consolidated
financial statements, which shall include all of the information contained in
the statements heretofore furnished to the Lender and referred to in Section 5.5
hereof, together with a certificate of an Authorized Officer of the Borrower to
the effect that such financial statements have been prepared in accordance with
generally accepted accounting principles in the United States consistently
applied and present fairly the financial position and results of the operations
of the Borrower as of the respective dates and for the respective periods
specified therein.
          (b) Within 60 days after each fiscal quarter, the Borrower shall cause
an Authorized Officer of the Borrower to deliver to the Lender a certificate as
to the Borrower’s compliance with the financial covenants provided in
Section 6.12 hereof.
          (c) By not later than April 15 and October 15 of each year, the
Borrower shall provide to the Lender the Semi-Annual Calculations of the Royalty
Ounces, the Projected Facility Term Revenue and the Borrowing Base together with
all supporting information, documentation and materials, for the Lender’s review
and approval, as further described in Section 2.11 hereof.
          (d) The Borrower shall deliver to the Lender such other information
(in form reasonably acceptable to the Lender) regarding the conditions or
operations, financial or otherwise, of the Borrower, the Royalty Interests, the
Projects, the Project Properties or any of Borrower’s other properties or
activities as the Lender may reasonably request from time to time

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to the extent such information is in the possession or control of the Borrower
and not subject to confidentiality restrictions that prevent the Borrower’s
disclosure thereof.
     6.3 Maintenance of Existence. The Borrower will preserve and maintain its
legal existence and all of its rights, privileges and franchises necessary for
the proper conduct of its business and will qualify and remain qualified to do
business in Nevada and Colorado and in each jurisdiction where necessary in
light of its business and properties.
     6.4 Compliance with Laws. The Borrower shall comply with all Requirements
of Law, including, without limitation, any Environmental Law (except any
noncompliance or violation which, in the judgment of the Lender, could not
reasonably be expected to constitute a Material Adverse Effect).
     6.5 Payment of Indebtedness. The Borrower will pay, discharge or otherwise
satisfy at or before maturity or before they become delinquent, as the case may
be, all of its Debts and other material obligations of whatever nature, except
for any Debts or other material obligations which are being contested in good
faith and by appropriate proceedings if (a) reserves in conformity with
generally accepted accounting principles with respect thereto are maintained on
its books, and (b) such contest does not involve any material risk of the sale,
forfeiture or loss of any part of the Collateral.
     6.6 Taxes. The Borrower shall pay and discharge all federal, state and
local taxes imposed on it or on any of its property prior to the date on which
penalties attach thereto, and all lawful claims which, if unpaid, might become a
Lien upon the Collateral. The Borrower shall have the right, however, to contest
in good faith the validity or amount of any such taxes by proper proceedings
timely instituted, and may permit the taxes so contested to remain unpaid during
the period of such contest if: (a) it diligently prosecutes such contest, (b) it
sets aside on its books adequate reserves in conformity with generally accepted
accounting principles with respect to the contested items, (c) during the period
of such contest, the enforcement of any contested item is effectively stayed,
(d) such contest does not involve any material risk of the sale, forfeiture or
loss of any part of the Collateral and provided such non-payment is permitted by
the appropriate taxing legislation. The Borrower will promptly pay or cause to
be paid any valid final judgment enforcing any such taxes and cause the same to
be satisfied of record.
     6.7 Books and Records; Right to Inspection. The Borrower shall keep proper
books of record in accordance with generally accepted accounting principles and
permit representatives of the Lender to examine the books of record and accounts
and to discuss the affairs, finances and accounts of the Borrower with the
Borrower’s principal officers, engineers, technical staff and independent
accountants, all at such reasonable times during business hours and at such
intervals as the Lender may desire; provided, however, that the Lender shall
provide the Borrower with at least five Business Days’ notice of any visit and
shall use commercially reasonable efforts not to disrupt the Borrower’s business
during any such visits. Upon any request by the Lender to visit and inspect any
Project Property, the Borrower will use commercially reasonable efforts to make
arrangements with the Project Manager for such a visit to and inspection of such
Project Property by the Lender or its representatives.

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     6.8 Insurance. The Borrower shall maintain insurance coverage, with
responsible and reputable insurance companies or associations, in respect of its
properties, assets, and business against such risks and in such amounts as are
customarily maintained in accordance with good industry practice for a company
in the Borrower’s business and as may be required by Requirements of Law. Such
insurance policies shall name the Lender as an additional insured or loss payee,
as appropriate, and shall provide that the policies cannot be cancelled, allowed
to lapse or terminate by the insurer without at least ten (10) days prior
written notice to the Lender. Attached as Schedule 6.8 hereto is a detailed list
and description of all such insurance maintained by or for the benefit of the
Borrower as of the Closing Date, in form reasonably satisfactory to the Lender.
From time to time after the Closing Date the Borrower shall deliver to the
Lender upon its request a detailed list of the insurance then in effect, stating
the names of the insurance companies, the amounts and rates of the insurance.
     6.9 Maintenance of Liens. The Borrower will take all action required or
desirable to maintain and preserve the Lender’s Liens on the Collateral and the
first priority thereof. The Borrower, at no cost to the Lender, shall from time
to time execute, deliver, file and record, and the Borrower authorizes the
Lender to file and record, any and all further Instruments (including financing
statements, continuation statements and similar statements with respect to any
of the Collateral Agreements) reasonably requested by the Lender for such
purposes, including such as may be necessary to include within the Collateral
(a) any additional real property interests or other increase in the Collateral
Royalties and (b) any other or additional Royalty Interests included or added as
a Collateral Royalty.
     6.10 Defend Title. The Borrower shall, at its own cost and expense, warrant
and defend the title to the Royalty Interests and the other Collateral against
the claims and demands of all Persons whomsoever, except as permitted in writing
by the Lender and except for matters disclosed in the Title Opinion and not
objected to by the Lender.
     6.11 Compliance with ERISA. The Borrower will (a) comply with all
applicable provisions of ERISA and the regulations and published interpretations
thereunder with respect to all Plans, (b) not take any action or fail to take
any action the result of which could be a liability to the PBGC or to a
Multiemployer Plan, (c) not participate in any prohibited transaction that would
result in any civil penalty under ERISA or tax under the Code, (d) operate each
Plan in such a manner that will not incur any tax liability under Section 4980B
of the Code or any liability to any qualified beneficiary as defined in
Section 4980B of the Code and (e) furnish to the Lender upon the Lender’s
request such additional information about any Plan as may be reasonably
requested by the Lender.
     6.12 Financial Covenants.
          (a) Tangible Net Worth. The Borrower shall at all times maintain a Net
Worth of at least $50,000,000.
          (b) Current Ratio. The Borrower shall not permit the ratio of its
(x) consolidated assets properly classified as current assets under United
States generally accepted accounting principles, to (y) consolidated liabilities
properly classified as current

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liabilities under United States generally accepted accounting principles, at any
time, to be less than 1.5 to 1.0.
          (c) Minimum Cash Balance. The Borrower shall at all times maintain a
minimum balance of cash and Cash Equivalents in demand deposit accounts of
$500,000.
     6.13 Delivery of Royalty Interest Proceeds.
          (a) Delivery and Sale of Gold. The Borrower shall cause all Products
produced from the Project Properties to which the Borrower is entitled pursuant
to the Royalty Interests to be delivered by the Project Managers directly to the
Lender’s account for the credit of the Borrower at Johnson Matthey in Salt Lake
City, Utah, or such other locations approved by the Lender. The Borrower hereby
irrevocably agrees to sell all such Products to the Lender forthwith upon
receipt thereof at Johnson Matthey, or such other locations approved by the
Lender, with such Products to be sold, at the discretion of the Borrower, at
either the then prevailing open market bid price maintained by the Lender or at
the price of the London Gold Fixing for such date, with the proceeds of such
sales to be deposited into the Debt Service Reserve Account immediately
following trade settlement.
          (b) Delivery of Cash Royalties. The Borrower shall cause all cash to
which the Borrower is entitled pursuant to the Royalty Interests to be deposited
by the Project Managers directly to the Debt Service Reserve Account.
     6.14 Maintenance of Credit Balances in the Debt Service Reserve Account.
The Borrower will maintain at all times in the Debt Service Reserve Account a
credit balance which is not less than the Reserve Amount.
     6.15 Further Assurances. The Borrower shall execute, acknowledge and
deliver to the Lender such other and further documents and Instruments and do or
cause to be done such other acts as the Lender reasonably determines to be
necessary or desirable to effect the intent of the parties to this Agreement or
otherwise to protect and preserve the interests of the Lender hereunder,
promptly upon request of the Lender.
     6.16 Post Closing Requirements. As soon as practicable after the date
hereof, but in any event within the time limitations set forth on Schedule 6.16
attached hereto, the Borrower shall have performed, delivered and/or completed
each of the items set forth on Schedule 6.16 in the form and substance
satisfactory to Lender in its sole discretion.
ARTICLE VII
NEGATIVE COVENANTS
     From the date hereof, so long as any portion of the Loans remain
outstanding and unpaid, in whole or in part, or any other amount is owing to the
Lender under this Agreement, or any other Loan Document without the prior
written consent of the Lender, the Borrower unconditionally covenants and agrees
that it will not:

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     7.1 Indebtedness. Incur any Debt except for (a) the Loans, (b) items of
accrued taxes prior to the date on which such items are due and payable,
(c) capital lease or rental arrangements if the payments thereon, in the
aggregate, do not exceed $250,000 in any fiscal year and (d) trade payables
incurred in the ordinary course of business which are not evidenced by a
promissory note or other evidence of indebtedness and which are not the subject
of a genuine dispute or are not more than ninety (90) days past due.
     7.2 Liens. Directly or indirectly, create, incur, assume or suffer to exist
any Lien upon any of its property, assets, income or profits, including, without
limitation, the Royalty Interests, the Deposit Reserve Account or any
Collateral, whether now owned or hereafter acquired, or enter into any agreement
or option with respect to any of the foregoing, except for Liens for taxes not
yet due and payable and inchoate Liens established by statute arising in the
ordinary course of business securing obligations that are not overdue for a
period of more than twenty days.
     7.3 Liquidation; Merger. Liquidate or dissolve, or, without the prior
written consent of the Lender, not unreasonably withheld, enter into any
consolidation or merger, or enter into any partnership, joint venture or other
combination where such combination involves a contribution by the Borrower of
all or a substantial portion of its assets, or sell, lease or dispose of its
business or assets as a whole or in an amount which constitutes a substantial
portion thereof.
     7.4 Asset Sales. Without the Lender’s prior written consent not to be
unreasonably withheld, convey, sell, lease, assign, transfer or otherwise
dispose of any material portion of its property, business or assets, including,
without limitation, the Royalty Interests or any portion thereof, individually
or in the aggregate, whether now owned or hereafter acquired, except for
conveyances, sales, leases, assignments and transfers of property or assets,
other than Collateral, entered into in the ordinary course of business, which do
not exceed $250,000 in the aggregate per year.
     7.5 Guarantees/Assumptions. Directly or indirectly, assume, guarantee,
endorse or otherwise become directly or contingently liable (including, without
limitation, liable by way of agreement, contingent or otherwise, to purchase, to
provide funds for payment, to supply funds to or otherwise invest in the debtor
or otherwise to assure the creditor against loss) in connection with any Debt of
any other Person, except guarantees by endorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary course of
business.
     7.6 Change in Business. Engage in any business activities or operations
substantially different from the business of ownership of non-executory
interests in mining properties.
     7.7 Changes in Constating Documents or Capital Structure. Without the
Lender’s prior written consent not to be unreasonably withheld, amend or
otherwise modify its articles of incorporation, bylaws or capital structure.
     7.8 Gold Sales. Enter into any agreement or any Instrument for any sale,
assignment, transfer or delivery of Gold or other Products except as provided in
Section 6.13.

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     7.9 Modification of Material Agreements. Without the Lender’s prior written
consent not to be unreasonably withheld, allow any modification or amendment to
any Royalty Agreement or other agreement or Instrument material to the Borrower
or allow any modification or amendment to any confidentiality agreements or
provisions to which the Borrower is a party or otherwise subject. Without the
Lender’s prior written consent not to be unreasonably withheld, the Borrower
shall not enter into or allow itself to become subject to any new
confidentiality agreement or provision governing information from any existing
Royalty Interest or the Project or properties underlying such Royalty Interest
or any Royalty Interest or the Project or properties underlying such Royalty
Interest acquired after the date hereof with Loan proceeds.
     7.10 Maintenance of Royalty Interests. Without the Lender’s prior written
consent not to be unreasonably withheld, enter into any agreement or
undertaking, or otherwise act to sell, assign, transfer or create or suffer the
creation of rights of any Person other than the Borrower or the Lender in or
with respect to the Royalty Interests or Products or Gold accruing to the
account of the Borrower pursuant thereto.
     7.11 Restrictive and Inconsistent Agreements. The Borrower will not enter
into any agreement, Instrument or undertaking or incur or suffer any obligation
prohibiting or inconsistent with the performance by the Borrower of the
Obligations or its obligations under any Royalty Agreement.
     7.12 Amount Outstanding. Allow the Amount Outstanding to be greater than
the Maximum Availability at any time.
ARTICLE VIII
EVENTS OF DEFAULT
     8.1 Events of Default. The occurrence of any one or more of the following
events (whether or not in the control of the Borrower) shall constitute an Event
of Default:
          (a) Nonpayment. The Borrower shall fail to make, on or before the due
date, in the manner required, any payment of principal, interest, costs, fees or
any other sums due under this Agreement.
          (b) Covenant Defaults. The Borrower shall fail to observe or perform
any of its covenants contained in this Agreement, other than the covenants
referred to in paragraph (a) above, and the Borrower shall have not remedied
such default within 10 days after written notice of such default has been given
by the Lender to the Borrower.
          (c) Representation or Warranty. Any representation, warranty or
statement made or deemed to be made by the Borrower herein or in any other Loan
Document given hereunder shall prove to have been untrue in any material respect
as of the time made or deemed made.
          (d) Cross-Default. A default shall occur under any Loan Document, any
Royalty Agreement or any agreement pertaining to Debt permitted hereunder; or
the Borrower

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shall fail to pay any Debt with a value in excess of Fifty Thousand Dollars
($50,000) (excluding Debt evidenced by the Note) of the Borrower, or any
interest or premium thereon, when due (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise) and such failure shall continue
after the applicable grace period, if any, specified in the Instrument relating
to such Debt; or any other default under any Instrument relating to any such
Debt, or any other event, shall occur and shall continue after the applicable
grace period, if any, specified in such Instrument, if the effect of such
default or event is to accelerate, or to permit the acceleration of, the
maturity of such Debt; or any such Debt shall be declared to be due and payable,
or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof.
          (e) Insolvency. The Borrower shall generally not pay its debts as such
debts become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors; or
(i) the Borrower shall commence any case, proceeding or other action (A) under
any existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it as
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
wind-up, liquidation, dissolution, composition or other relief with respect to
it or its debts, or (B) seeking appointment of a receiver, trustee, custodian or
other similar official for it or for all or any substantial part of its assets,
or (ii) there shall be commenced against the Borrower any such case, proceeding
or other action referred to in clause (i) above which (A) results in the entry
of an order for relief or any such adjudication or appointment or (B) remains
undismissed, undischarged or unbonded for a period of 60 days; or the Borrower
shall take any other action to authorize any of the actions set forth in this
paragraph (f).
          (f) Involuntary Liens. Any involuntary Lien or Liens for amounts then
due in the aggregate sum of Fifty Thousand Dollars ($50,000) or more, of any
kind or character shall attach to any assets or property of the Borrower if such
Lien or Liens are not discharged or bonded pending proceedings to release such
Lien or Liens within sixty (60) days after the date of attachment or unless such
Lien or Liens are being contested in good faith.
          (g) Judgments. Any judgment or order for the payment of money in
excess of One Hundred Thousand Dollars ($100,000) shall be rendered against the
Borrower and there shall be a period of 30 consecutive days during which such
judgment or order shall not have been discharged or a stay of enforcement of
such judgment or order, by reason of a pending appeal or otherwise, shall not be
in effect.
          (h) Condemnation. Any of the Royalty Interests are taken by power of
expropriation or eminent domain or sold under threat of such taking, or
possession of any material portion of the Project Properties is taken through
exercise of such power.
          (i) Regulatory Action. Any Governmental Authority shall commence an
investigation or take any action with respect to any of the Borrower or any
Project or the Collateral which would result in a Material Adverse Effect on the
Borrower, unless such action is set aside, dismissed or withdrawn within ninety
(90) days of its institution or such action is being contested in good faith and
its effect is stayed during such contest.

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          (j) Title to Royalty Interests and Mining Properties. There shall
exist a defect or deficiency in title to the Royalty Interests or the Project
Properties (other than as identified in the Title Opinion) which results in a
Material Adverse Effect, and the Borrower shall have not remedied such default
within 10 days after written notice of default has been given by the Lender to
the Borrower.
          (k) Collateral Security. Any of the Liens established or purported to
be established by the Collateral Agreements shall fail to be first priority
perfected Liens in the Collateral, or the Borrower shall so state in writing,
and the Borrower shall have not remedied such default within 10 days after
written notice of default has been given by the Lender to the Borrower.
          (l) Adverse Changes to the Pipeline Project. Any event or change
occurs with respect to the Pipeline Project, including, without limitation, the
abandonment or termination or the taking by power of expropriation or eminent
domain of all or any material portion thereof, which has a Material Adverse
Effect.
          (m) Amount Outstanding in Excess of Maximum Availability. The Amount
Outstanding shall exceed the Maximum Availability at any time, as the Maximum
Availability is determined from time to time.
          (n) Redirection of Royalties. Any payment of cash, Products, proceeds
or other amounts owing to the Borrower with respect to the Royalty Interests
shall be paid to any Person other than as required hereby.
          (o) Debt Service Reserve Account. The Borrower shall fail to maintain
in existence the Debt Service Reserve Account or shall fail to maintain therein
at all times the Reserve Amount, and the Borrower shall not have remedied such
default within 60 days after written notice of default has been given by the
Lender to the Borrower.
     8.2 Remedies Upon Event of Default.
          (a) Upon the occurrence of an Event of Default specified in
Section 8.1(e) hereof or, in the case of any other Event of Default, upon notice
by the Lender to the Borrower of the Lender’s election to declare the Borrower
in default, the obligations of the Lender hereunder including, without intending
any limitation, the Lender’s obligation to lend shall terminate. The date on
which such notice is sent or, in the case of an Event of Default specified in
Section 8.1(e) hereof the date of such Event of Default, shall be the “Date of
Default.”
          (b) On the Date of Default, (i) there shall immediately be due and
payable to the Lender an amount equal to the total principal Amount Outstanding
of the Loan plus interest, fees, expenses, and all other amounts owed by the
Borrower pursuant to this Agreement and the other Loan Documents shall
immediately become due and payable, and (ii) the commitment of the Lender to
Advance Loans hereunder shall terminate.
          (c) Upon the occurrence of an Event of Default, all of the remedies
provided to the Lender in all of the Collateral Agreements shall immediately
become available to the Lender and the Lender shall have all other rights and
remedies available at law or in equity. The

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enumeration of the rights and remedies of the Lender set forth in this Agreement
and the other Loan Documents is not intended to be exhaustive and the exercise
by the Lender of any right or remedy shall not preclude the exercise of any
other rights and remedies, all of which shall be cumulative and shall be in
addition to any other right or remedy given hereunder or under the other Loan
Documents or that may now or hereafter exist at law or in equity or by suit or
otherwise.
          (d) Except as expressly provided above in this Section 8.2,
presentment, demand, protest and all other notices of any kind are hereby
expressly waived. From and after the Date of Default, interest shall accrue at
the Default Rate and shall be payable on demand.
ARTICLE IX
MISCELLANEOUS
     9.1 Notices. All notices, requests, demands, consents or other
communications in connection with or pursuant to this Agreement shall be in
writing and shall be delivered by hand or sent by registered or certified mail
or by facsimile (such facsimile followed by a registered or certified letter)
addressed to the parties as set forth below (or to such other address as the
parties may designate by notice):
If to the Lender:
HSBC Bank USA, National Association
452 Fifth Avenue
New York, New York 10018
Attention: Ted Kavanagh
Facsimile No.: (212) 525-6581
If to the Borrower:
Royal Gold, Inc.
1660 Wynkoop Street, Suite 1000
Denver, Colorado 80202-1132
Attention: Randy Parcel, Esq.
Facsimile No.: (303) 595-9385
A notice delivered by hand to a party shall be deemed received when delivered. A
notice sent by mail shall be deemed received on the fifth Business Day after
mailing. A notice sent by facsimile shall be deemed received upon receipt of the
relevant confirmation or answer back. Notices received after 4:00 p.m. local
time shall be deemed received on the following day.
     9.2 Amendments, etc. No amendment or waiver of any provision of this
Agreement or the Note, nor consent to any departure by the Borrower therefrom,
shall in any event be effective unless the same shall be in writing and signed
by the Lender, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.

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     9.3 No Waiver; Cumulative Remedies. No failure on the part of the Lender to
exercise, and no delay in exercising, any right hereunder or under any Note
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of
any other right. The remedies herein provided are cumulative and not exclusive
of any remedies provided by law.
     9.4 Costs and Expenses.
          (a) The Borrower agrees to pay on demand all costs and expenses in
connection with the preparation, negotiation, execution, delivery, registration
and administration of this Agreement, the Note and the other Loan Documents and
any amendments to any thereof including, without limitation, the reasonable fees
and out-of-pocket expenses of counsel and of technical advisors and consultants
for the Lender with respect thereto and with respect to advising the Lender as
to its rights and responsibilities under this Agreement. The Borrower further
agrees to pay on demand all losses, costs and expenses, if any (including
reasonable counsel fees and expenses), in connection with the preservation of
any rights of the Lender under, or the enforcement of, or legal advice in
respect of the rights or responsibilities of the Lender under, this Agreement,
the Note and the other Loan Documents, including, without limitation, losses,
costs and expenses sustained by the Lender as a result of any failure by the
Borrower to perform or observe its obligations contained herein or in the Note
held by the Lender or in connection with any refinancing or restructuring of the
Loan in the nature of a “workout.”
          (b) If, due to acceleration of the maturity of the Note pursuant to
Article VIII hereof or due to any other reason, the Lender receives payments of
principal of any Loan other than on the last day of a Borrowing Period relating
to such Loan, the Borrower shall, upon demand by the Lender, pay to the Lender
any amounts required to compensate the Lender for any additional losses, costs
or expenses which it may reasonably incur as a result of such payment,
including, without limitation, any loss (including loss of anticipated profits)
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by the Lender to fund or maintain such Loan.
     9.5 Application of Debt Service Reserve Account; Right of Set-off. Upon the
occurrence and during the continuance of any Event of Default, the Lender is
hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to apply the credit balances of the Debt Service Reserve
Account and to set-off and apply any and all deposits or other obligations
(general or special, time or demand, provisional or final) at any time held and
other indebtedness at any time owing by the Lender to or for the credit or the
account of the Borrower against any and all of the obligations of the Borrower
now or hereafter existing under this Agreement, the Note and the other Loan
Documents, irrespective of whether or not the Lender shall have made any demand
under this Agreement or otherwise and although such obligations may be
unmatured. The Lender agrees promptly to notify the Borrower after any such
set-off and application made by the Lender, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of the Lender under this Section are in addition to other rights and
remedies (including, without limitation, other rights to set-off) which the
Lender may have.

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     9.6 Usury Savings; Limitation on Interest. It is the intention of the
parties hereto to contract in strict compliance with applicable usury law from
time to time in effect. In furtherance thereof the parties stipulate and agree
that none of the terms and provisions contained herein and in the other Loan
Documents shall ever be construed to create a contract for the use, forbearance
or detention of money, or a contract to pay interest, in excess of the maximum
amount of interest permitted to be charged by applicable law from time to time
in effect. Neither the Borrower nor any future guarantors or other parties
hereafter becoming liable for payment of the Borrower’s indebtedness to the
Lender shall ever be required to pay interest thereon in excess of the maximum
interest that may be lawfully charged or contracted for under applicable law
from time to time in effect, and the provisions of this Section 9.6 shall
control over all other provisions hereof or of the other Loan Documents which
may be in conflict or apparent conflict herewith. If the maturity of the
Borrower’s indebtedness to the Lender or any part thereof shall be accelerated
for any reason, any amounts held to constitute interest, which are then unearned
and have theretofore been collected by the Lender or any other holder of such
indebtedness, shall be applied to reduce the principal balance thereof then
outstanding. In the event that the Lender or any other holder of the Borrower’s
indebtedness to the Lender shall collect monies that are deemed to constitute
interest which would otherwise increase the effective interest on the Borrower’s
indebtedness to the Lender or any part thereof to an amount in excess of that
permitted to be charged by applicable law then in effect, all such sums deemed
to constitute interest in excess of such legal limit shall be either immediately
returned to the Borrower or other payor thereof upon such determination or
applied as a credit against the then unpaid principal of the Borrower’s
indebtedness, at the option of the Lender or other holder. In determining
whether or not the interest paid or payable under any specific contingency
exceeds the maximum amount permitted under applicable law, the Borrower (and any
other payor thereof) and the Lender shall, to the greatest extent permitted
under applicable law (a) characterize any non-principal payment as an expense,
fee or premium rather than as interest, (b) exclude voluntary prepayments and
the effects thereof, and (c) amortize, prorate, allocate or spread the total
amount of interest throughout the entire contemplated term of the instruments
evidencing the Borrower’s indebtedness to the Lender in accordance with the
amounts outstanding from time to time thereunder and the maximum legal rate of
interest from time to time in effect under applicable law in order to lawfully
charge the maximum amount of interest permitted under applicable law. Upon any
such determination, to the extent permitted by law, the Lender or other holder
shall not be subject to any penalty provided for charging, receiving or
contracting for interest in excess of any such maximum legal rate, regardless of
when or the circumstances under which such refund or application was made.
     9.7 Binding Effect; Assignment of Rights. This Agreement shall become
effective when it shall have been executed by the parties hereto and thereafter
shall be binding upon and inure to the benefit of the Borrower and the Lender
and their respective successors, transferees and assigns; provided that the
Borrower shall not have the right to transfer or assign any of its rights or
obligations hereunder or any interest herein without the prior written consent
of the Lender. The Lender may at any time, without the consent of the Borrower,
assign or transfer by way of assignment or novation to any branch or affiliate
of the Lender or to any financial institution all or any part of, or any
interest in the Lender’s rights and benefits and obligations hereunder and under
the Note issued to it hereunder or the other Loan Documents; provided that such
transfer or assignment does not diminish the rights or increase the obligations
of the Borrower, and to the extent of such assignment such assignee shall have
the same rights and

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benefits vis-a-vis the Borrower as it would have had if it were the Lender
hereunder, and all references in this Agreement to the Lender shall thereafter
be construed as a reference to the Lender and its transferee or transferees or,
in the case of a transfer of all of its rights, benefits and obligations, to its
transferee or transferees alone. For the purposes hereof, the Lender may
disclose to a potential transferee such information about the Borrower, its
businesses, assets and financial condition as the Lender shall consider
appropriate. Nothing contained herein shall be construed to prevent the Lender
from granting by way of sub-participation (being a right to share in the
financial effects of this Agreement without any rights against the Borrower) or
risk participation in all or any of its rights and benefits hereunder to any
person without the consent of the Borrower; provided that such transfer or
assignment does not diminish the rights or increase the obligations of the
Borrower, and that such transfer is done in compliance with applicable laws;
provided, further, that upon any such assignment the Lender will act as agent
and will be the sole party with whom the Borrower is required to have dealings
when no Event of Default is outstanding.
     9.8 Consent to Jurisdiction.
          (a) THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY
STATE OR FEDERAL COURT SITTING IN NEW YORK, NEW YORK OVER ANY SUIT, ACTION OR
PROCEEDING (A “PROCEEDING”) ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE
NOTE OR THE COLLATERAL AGREEMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES
THAT ALL CLAIMS IN RESPECT OF ANY SUCH PROCEEDING MAY BE HEARD AND DETERMINED IN
SUCH STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. THE
BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO
SO, THE DEFENSE OF AN INCONVENIENT FORUM OR IMPROPER VENUE TO THE MAINTENANCE OF
ANY SUCH PROCEEDING. THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF ANY AND
ALL PROCESS IN ANY SUCH PROCEEDING BY THE MAILING OF COPIES OF SUCH PROCESS TO
THE BORROWER AT ITS ADDRESS REFERRED TO IN SECTION 9.1 HEREOF. THE BORROWER
AGREES THAT A FINAL JUDGMENT IN ANY SUCH PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE EXECUTED UPON AND ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW.
          (b) NOTHING IN THIS SECTION 9.8 SHALL AFFECT THE RIGHT OF THE LENDER
TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT
OF THE LENDER TO BRING ANY SUIT, ACTION OR PROCEEDING AGAINST THE BORROWER OR
ITS PROPERTY IN THE COURTS OF OTHER JURISDICTIONS. THE TAKING OF ANY PROCEEDINGS
IN ANY ONE OR MORE JURISDICTIONS SHALL NOT PRECLUDE THE TAKING OF ANY
PROCEEDINGS IN ANY OTHER JURISDICTION.

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          (c) THE BORROWER AND THE LENDER HEREBY IRREVOCABLY WAIVE ALL RIGHT TO
TRIAL BY JURY IN ANY PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE NOTE, THE COLLATERAL AGREEMENTS AND ANY OTHER LOAN DOCUMENTS
REFERRED TO HEREIN OR THE OBLIGATIONS UNDER ANY THEREOF.
     9.9 Governing Law. THIS AGREEMENT, AND ANY INSTRUMENT OR AGREEMENT REQUIRED
HEREUNDER, UNLESS OTHERWISE SPECIFICALLY PROVIDED HEREIN OR THEREIN, SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
PROVIDED, HOWEVER, THAT THE MORTGAGE SHALL BE GOVERNED BY AND CONSTRUED UNDER
THE LAWS OF THE STATE OF NEVADA AND ANY FINANCING STATEMENTS FILED PURSUANT
HERETO SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE IN WHICH
THEY ARE FILED.
     9.10 Counterparts; Signatures. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of such
counterparts together shall constitute one and the same instrument. This
Agreement may be validly executed and delivered by facsimile or other electronic
transmission, and a signature by facsimile or other electronic transmission
shall be as effective and binding as an original signature.
     9.11 Confidentiality; Public Announcements.
          (a) The Lender agrees to use best efforts to ensure that any
information concerning the Borrower, the Royalty Interests or the Projects
obtained by the Lender or any of the Lender’s authorized agents or
representatives which is not contained in a report or other document filed with
a securities commission or regulatory authority, distributed by the Borrower to
its shareholders or otherwise available to the public generally (other than by
the Lender’s breach of these confidentiality obligations) will, to the extent
permitted by law and except as may be required by valid subpoena (including
rules and regulations of the United States Securities Exchange Commission), any
governmental authority having jurisdiction over the Lender or other external
reporting requirements, be treated confidentiality by the Lender’s employees,
agents or representatives who have a reasonable need to know such information.
These confidentiality obligations shall survive the term of this Agreement by
one year.
          (b) Public announcements or reports by the Borrower of information
relating to this Agreement or the Lender’s financing provided for herein
(whether given to stock exchanges or otherwise) shall be made only on the basis
of agreed texts approved by the Lender in advance of issuance, except to the
extent required by Requirements of Law, applicable court order or rules of an
applicable stock exchange.
     9.12 Entire Agreement. This Agreement, the Schedules and Exhibits hereto
and the other Loan Documents, constitute the entire agreement between the Lender
and the Borrower with respect to the various commitments by the Lender to the
Borrower and indebtedness of the Borrower to the Lender to be incurred under
this Agreement; and no other agreements, promises, representations and
warranties (express or implied), except those expressly set forth herein have
been relied upon by the Borrower or have been made by the Lender. This Agreement
restates,

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replaces and supersedes all prior agreements and understandings, both written
and oral, between the parties, with respect to the subject matter hereof.
[ REMAINDER OF THIS PAGE INTENTIONALLY BLANK ]

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     IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to be
duly executed and delivered by its respective duly authorized officers as of the
day and year first above written.

                  LENDER:    
 
                HSBC BANK USA, NATIONAL ASSOCIATION    
 
           
 
  By:        
 
           
 
          William S. Edge, III    
 
          Managing Director    
 
           
 
  By:        
 
           
 
          P. E. Kavanagh    
 
          Senior Vice President    
 
                BORROWER:    
 
                ROYAL GOLD, INC.    
 
           
 
  By:        
 
           
 
      Name: Randy Parcel    
 
      Title: Vice President and General Counsel    

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Schedule 6.16
Post-Closing Requirements

      Document   Delivery/Completion Date
Mortgage Amendment
  60 days after the date of the Agreement
 
   
Legal opinion from legal counsel for Borrower substantially in the form of the
legal opinion delivered to Lender in connection with the Existing Agreement
  15 days after the date of the Agreement
 
   
Title opinion from Nevada legal counsel to Borrower
  60 days after the date of the Agreement
 
   
Supplemental legal opinion from Nevada legal counsel to Borrower confirming
perfection in favor of Lender of enforceable first priority Liens on the
Collateral Royalties and on the other property rights and interests of Borrower
subject to the Collateral Agreements, substantially in the form of the security
legal opinion delivered to the Lender in connection with the Existing Agreement
  60 days after the date of the Agreement
 
   
Certificate from Secretary of State of Nevada confirming the good standing of
the Borrower in Nevada
  10 days after the date of the Agreement

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