Exhibit 10.5
Grant No.:                     
ROYAL GOLD, INC.
2004 OMNIBUS LONG-TERM INCENTIVE PLAN
PERFORMANCE SHARE AGREEMENT
Royal Gold, Inc., a Delaware corporation (the “Company”), hereby grants
performance shares relating to shares of its common stock, $.01 par value (the
“Stock”), to the individual named below as the Holder, subject to the vesting
conditions set forth in the attachment. Additional terms and conditions of the
grant are set forth in this cover sheet, in the attachment and in the Royal
Gold, Inc. 2004 Omnibus Long-Term Incentive Plan (the “Plan”).
Grant Date:
Name of Holder:
Holder’s Social Security Number:
Number of Performance Shares Covered
     by Grant:
This Performance Share grant is subject to all of the terms and conditions
described in this Agreement and in the Plan, a copy of which is available for
your review upon request to the Corporate Secretary. You should carefully review
the Plan, and the Plan will control in the event any provision of this Agreement
should appear to be inconsistent with the terms of the Plan.

         
Grantee:
       
 
 
 
(Signature)    
 
       
Company:
       
 
       
 
  (Signature)    
 
       
Title:
  President and Chief Executive Officer    

Attachment
This is not a stock certificate or a negotiable instrument.

 

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ROYAL GOLD, INC.
2004 OMNIBUS LONG-TERM INCENTIVE PLAN
PERFORMANCE SHARE AGREEMENT

     

   
Performance Shares Transferability
  This grant is an award of performance shares in the number of shares set forth
on the cover sheet, subject to the vesting conditions described below (the
“Performance Shares”). Your Performance Shares may not be transferred, assigned,
pledged or hypothecated, whether by operation of law or otherwise, nor may the
Performance Shares be made subject to execution, attachment or similar process.
 
   
Vesting
  The Performance Shares shall vest as follows: (i) twenty-five percent (25%) of
the total number of Performance Shares granted hereunder shall vest for each
twenty-five percent (25%) increase in free cash flow per share (“FCFPS”) (as
defined in the Company’s most recent annual report and on a trailing twelve
month basis, calculated quarterly) over FCFPS in the trailing twelve month
period ended September 30, 200___ of $  per share (you will be one-hundred
percent (100%) vested in the Performance Shares if there has been a one-hundred
percent (100%) increase in FCFPS over FCFPS in the trailing twelve month period
ended September 30, 200     ); and (ii) twenty-five percent (25%) of the total
number of Performance Shares granted hereunder shall vest for each twenty-five
percent (25%) increase of the total royalty ounces in reserve (as determined
below) on a per share of Stock basis for any annual reporting period over total
royalty ounces in reserve on a per share of Stock basis of 0.      ounces per
share at the Grant Date. The vesting thresholds set forth in subsections (i) and
(ii) above are separate and independent thresholds that will each result in
vesting; both thresholds need not be met for vesting to occur. For purposes of
the forgoing vesting rules, total royalty ounces in reserve shall equal the sum
of the royalty ounces in reserve for each royalty owned by the Company, each
calculated by multiplying (C) times (D) where (C) equals the total ounces of
gold (attributable to the Royal Gold royalty) in reserve as reported by the
operator (if a royalty is for a metal other than gold, for purposes of this
calculation, the total reserve of such metal shall be adjusted to a
proportionate number of ounces of gold, based on the price of such metal to the
price of gold at the time of such determination) and (D) equals the applicable
royalty rate at the time of such calculation.

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  No additional Performance Shares will vest after your Service has terminated
for any reason.  
 
  All Performance Shares that have not vested by the fifth anniversary of the
Grant Date will be forfeited.  
 
  The Compensation, Nominating and Corporate Governance Committee has the
authority to certify whether the vesting thresholds set forth above have been
achieved within the meaning of Treasury Regulations, Section 1.162-27(e)(5). Any
such determinations shall be made in the sole discretion of the Compensation,
Nominating and Corporate Governance Committee. The resulting aggregate number of
vested Performance Shares will be rounded down to the nearest whole number of
Performance Shares. You may not vest in more than the number of Performance
Shares covered by this grant.
 
   

   
Termination without Cause, Good Reason or Non-Renewal of Employment Agreement;
Change of Control
  Notwithstanding the foregoing vesting rules, if (i) the Company terminates
your Service or your Employment Agreement without “Cause” (as defined in your
Employment Agreement) during the term of your Employment Agreement, (ii) you
terminate your Service or your Employment Agreement for “Good Reason” (as
defined in your Employment Agreement) during the term of your Employment
Agreement, or (iii) your Service is terminated upon the Company’s election not
to renew the term for one of the four successive one-year renewal terms pursuant
to Section 2 of your Employment Agreement, and any such termination does not
occur within two (2) years after the occurrence of a “Change of Control” (as
defined in your Employment Agreement), then, you will be vested as of the date
of your termination in all or a portion of the Performance Shares to which you
would be entitled based on the Company’s performance through the last day of the
Company’s fiscal quarter in which your Service is terminated and determined in
accordance with the Company’s practices as in effect at such time. The resulting
aggregate number of vested shares will be rounded to the nearest whole number,
and you cannot vest in more than the number of shares covered by this grant.

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  If (i) the Company terminates your Service or your Employment Agreement
without “Cause” (as defined in your Employment Agreement) during the term of
your Employment Agreement, (ii) you terminate your Service or your Employment
Agreement for “Good Reason” (as defined in your Employment Agreement) during the
term of your Employment Agreement, or (iii) your Service is terminated upon the
Company’s election not to renew the term for one of the four successive one-year
renewal terms pursuant to Section 2 of your Employment Agreement, and any such
termination occurs within two (2) years after the occurrence of a “Change of
Control” (as defined in your Employment Agreement), then, you will be one
hundred percent (100%) vested in the Performance Shares as of the date of your
termination.  
 
  As used herein, the term “Employment Agreement” shall mean that certain
Employment Agreement between you and the Company dated September 15, 2008, as
the same may be amended after the date hereof.
 
   
Delivery of Stock Pursuant to Vested Performance Shares
  A certificate for all of the shares of Stock represented by the vested
Performance Shares (which shares of Stock will be rounded down to the nearest
number of whole shares) will be delivered to you on or immediately after you
have vested in such Performance Shares provided that, if vesting occurs during a
period in which you are (i) subject to a lock-up agreement restricting your
ability to sell shares of Stock in the open market, or (ii) restricted from
selling shares of Stock in the open market because you are not then eligible to
sell under the Company’s insider trading plan or similar plan as then in effect
(whether because a trading window is not open or you are otherwise restricted
from trading), delivery of such shares of Stock will be delayed until the first
date on which you are no longer prohibited from selling shares of Stock due to a
lock-up agreement or insider trading plan restriction.
 
   
Forfeiture of Unvested Performance Shares
  In the event that your Service terminates for any reason, except as provided
above in the section entitled “Termination without Cause, Good Reason or
Non-Renewal of Employment Agreement; Change of Control,” you will forfeit all of
the Performance Shares that have not yet vested.
 
   
Withholding Taxes
  You agree, as a condition of this grant, that you will make acceptable
arrangements to pay any withholding or other taxes that may be due as a result
of vesting in Performance Shares or your acquisition of Stock under this grant.
In the event that the Company determines that any federal, state, local or
foreign tax or

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  withholding payment is required relating to this grant, the Company will have
the right to: (i) require such payments from you; (ii) withhold such amounts
from other payments due to you from the Company or any Affiliate; or (iii) cause
an immediate forfeiture of shares of Stock subject to the Performance Shares
granted pursuant to this Agreement in an amount equal to the withholding or
other taxes due.
 
   
Retention Rights
  Neither the Performance Shares nor this Agreement give you the right to be
retained by the Company (or any parent, Subsidiaries or Affiliates) in any
capacity. The Company (and any parent, Subsidiaries or Affiliates) reserve the
right to terminate your Service at any time and for any reason.
 
   
Shareholder Rights
  You, or your estate or heirs, have no rights as a shareholder of the Company
until a certificate for shares of Stock relating to the vested Performance
Shares has been issued (or an appropriate book entry has been made). No
adjustments are made for dividends or other rights if the applicable record date
occurs before your stock certificate is issued (or an appropriate book entry has
been made), except as described in the Plan.
 
   
Adjustments
  In the event of a stock split, a stock dividend or a similar change in the
Stock, the number of Performance Shares covered by this grant shall be adjusted
(and rounded down to the nearest whole number) if required pursuant to the Plan.
 
   
Applicable Law
  This Agreement will be interpreted and enforced under the laws of the State of
Delaware, other than any conflicts or choice of law, rule or principle that
might otherwise refer construction or interpretation of this Agreement to the
substantive law of another jurisdiction.
 
   
Consent to Electronic Delivery
  The Company may choose to deliver certain statutory materials relating to the
Plan in electronic form. By accepting this grant you agree that the Company may
deliver the Plan prospectus and the Company’s annual report to you in an
electronic format. If at any time you would prefer to receive paper copies of
these documents, as you are entitled to, the Company would be pleased to provide
copies. Please contact the Corporate Secretary at (303) 573-1660 to request
paper copies of these documents.
 
   
The Plan
  The text of the Plan is incorporated in this Agreement by reference. Certain
capitalized terms used in this Agreement are defined in the Plan, and have the
meaning set forth in the Plan.

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  This Agreement and the Plan constitute the entire understanding between you
and the Company regarding the Performance Shares. Any prior agreements,
commitments or negotiations concerning the Performance Shares are superseded.
 
   
Stock Ownership Requirements
  You are required to continue to hold fifty percent (50%) of the shares of
Stock acquired pursuant to this Performance Share grant (such 50% to be
determined after reducing the shares of Stock covered by this grant by the
number shares of Stock equal in value to the amount required to be withheld to
pay taxes in connection with this grant) until the number of shares of stock
owned by you equals or exceeds                     .

By signing the cover sheet of this Agreement, you acknowledge that you have
received, read and understand the Plan and this Agreement, and agree to abide by
and be bound by their terms and conditions.

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