Exhibit
10.3


PRODUCTION PAYMENT AGREEMENT


Dated October 13, 2004


between


GENESIS INC.


and


ROYAL GOLD, INC.


THE
TROY MINE


Lincoln County, Montana


















Production Payment Agreement


Table of Contents


	
  CAPTION

  	
   

  	
   

  	
  PAGE

  
	
  RECITALS

  	
   

  	
   

  	
  1

  
	
  ARTICLE I

  	
   

  	
  ROYAL GOLD PAYMENT TO GENESIS; GENESIS

  	
   

  
	
   

  	
   

  	
  USE OF PROCEEDS

  	
  1

  
	
  Section 1.1

  	
   

  	
  Royal Gold Payment

  	
  1

  
	
  Section 1.2

  	
   

  	
  Genesis Use of Proceeds

  	
  1

  
	
  ARTICLE II

  	
   

  	
  PRODUCTION PAYMENT BY GENESIS TO ROYAL GOLD

  	
  2

  
	
  Section 2.1

  	
   

  	
  Grant of Production Payment

  	
  2

  
	
  Section 2.2

  	
   

  	
  Deed of Production Payment

  	
  2

  
	
  ARTICLE III

  	
   

  	
  CONDITIONS PRECEDENT TO CLOSING

  	
  2

  
	
  Section 3.1

  	
   

  	
  Conditions to Obligations of Royal Gold and Genesis
  at Closing

  	
  2

  
	
  Section 3.2

  	
   

  	
  Additional Conditions to Obligations of Royal Gold
  at Closing

  	
  2

  
	
  Section 3.3

  	
   

  	
  Additional Conditions to Obligations of Genesis at
  Closing

  	
  4

  
	
  ARTICLE IV

  	
   

  	
  CLOSING

  	
  4

  
	
  Section 4.1

  	
   

  	
  Closing Date

  	
  4

  
	
  Section 4.2

  	
   

  	
  Deliveries by Genesis and Revett at Closing

  	
  4

  
	
  Section 4.3

  	
   

  	
  Deliveries by Royal Gold at Closing

  	
  4

  
	
  ARTICLE V

  	
   

  	
  REPRESENTATIONS AND WARRANTIES OF GENESIS

  	
  5

  
	
  Section 5.1

  	
   

  	
  Due Organization, Good Standing and Authority

  	
  5

  
	
  Section 5.2

  	
   

  	
  Due Authorization; Non-Contravention

  	
  5

  
	
  Section 5.3

  	
   

  	
  Validity

  	
  5

  
	
  Section 5.4

  	
   

  	
  Litigation

  	
  5

  
	
  Section 5.5

  	
   

  	
  Title to Properties

  	
  5

  
	
  Section 5.6

  	
   

  	
  Compliance with Laws

  	
  5

  
	
  Section 5.7

  	
   

  	
  Permits

  	
  6

  
	
  ARTICLE VI

  	
   

  	
  ROYAL GOLD’S REPRESENTATIONS AND WARRANTIES

  	
  6

  
	
  Section 6.1

  	
   

  	
  Due Organization, Good Standing and Authority

  	
  6

  
	
  Section 6.2

  	
   

  	
  Due Authorization; Non-contravention

  	
  6

  
	
  Section 6.3

  	
   

  	
  Validity

  	
  6

  
	
  ARTICLE VII

  	
   

  	
  INTERIM PERIOD

  	
  6

  



 



 i
 









 


	
  CAPTION

  	
   

  	
   

  	
  PAGE

  
	
  Section 7.1

  	
   

  	
  Access

  	
  6

  
	
  Section 7.2

  	
   

  	
  Ordinary Course

  	
  6

  
	
  Section 7.3

  	
   

  	
  Work Diligently Towards Closing

  	
  7

  
	
  Section 7.4

  	
   

  	
  Prompt Notification of Breach

  	
  7

  
	
  ARTICLE VIII

  	
   

  	
  POST-CLOSING COVENANTS

  	
  7

  
	
  Section 8.1

  	
   

  	
  Maintenance of Existence

  	
  7

  
	
  Section 8.2

  	
   

  	
  Compliance with Laws

  	
  7

  
	
  Section 8.3

  	
   

  	
  Use of Royal Gold Payment Proceeds

  	
  7

  
	
  Section 8.4

  	
   

  	
  Taxes

  	
  7

  
	
  Section 8.5 

  	
   

  	
  Protection from Liens and Encumbrances and Defense of
  Title to Properties 

  	
  7 

  
	
  Section 8.6

  	
   

  	
  Mine-Based Environmental Professional

  	
  7

  
	
  Section 8.7

  	
   

  	
  Rail Siding

  	
  8

  
	
  Section 8.8

  	
   

  	
  Final Marketing Agreement

  	
  8

  
	
  Section 8.9

  	
   

  	
  Inspection and Maintenance of Tailings Pipeline

  	
  8

  
	
  Section 8.10 

  	
   

  	
  Royal Gold Right to Notice and Option to Cure in
  Event of Genesis Default under Kennecott Note or Mortgage 

  	
  8 

  
	
  ARTICLE IX

  	
   

  	
  TERMINATION

  	
  9

  
	
  Section 9.1

  	
   

  	
  Right to Terminate

  	
  9

  
	
  Section 9.2

  	
   

  	
  Effect of Termination

  	
  9

  
	
  Section 9.3

  	
   

  	
  Due Diligence Information to be Provided to Genesis

  	
  9

  
	
  ARTICLE X

  	
   

  	
  GENERAL PROVISIONS

  	
  10

  
	
  Section 10.1

  	
   

  	
  Confidentiality

  	
  10

  
	
  Section 10.2

  	
   

  	
  Expenses

  	
  10

  
	
  Section 10.3

  	
   

  	
  Amendments

  	
  10

  
	
  Section 10.4

  	
   

  	
  Successors and Assigns

  	
  10

  
	
  Section 10.5

  	
   

  	
  Entire Agreement

  	
  10

  
	
  Section 10.6

  	
   

  	
  No Waiver

  	
  10

  
	
  Section 10.7

  	
   

  	
  Notices

  	
  11

  



 



 ii
 









 


	
  CAPTION

  	
   

  	
   

  	
  PAGE

  
	
  Section 10.8

  	
   

  	
  Governing Law

  	
  11

  
	
  Section 10.9

  	
   

  	
  Exhibits

  	
  11

  
	
  Section 10.10

  	
   

  	
  Headings

  	
  11

  
	
  Section 10.11

  	
   

  	
  Counterparts

  	
  12

  
	
  Section 10.12

  	
   

  	
  Authority

  	
  12

  



EXHIBITS


	
  Exhibit A

  	
   

  	
  Part I - Description of Properties 

  Part II — Liens and Encumbrances

  
	
  Exhibit B

  	
   

  	
  Feasibility Study Budget

  
	
  Exhibit C

  	
   

  	
  Deed of Production Payment

  
	
  Exhibit D

  	
   

  	
  Form of Opinion of Counsel for Genesis and Revett

  
	
  Exhibit E

  	
   

  	
  Description of Litigation

  



 



 iii















PRODUCTION PAYMENT AGREEMENT


THIS PRODUCTION
PAYMENT AGREEMENT (“Agreement”) is made and entered into effective as of the
13th day of October, 2004, by and between ROYAL GOLD, INC., a Delaware
corporation (“Royal Gold”), and GENESIS INC., a Montana corporation (“Genesis”).


RECITALS


A.           Genesis owns certain
assets in northwestern Montana for the mining, milling and sale of copper and
silver concentrates and the exploration for copper and silver, known
collectively as the “Troy Mine”.


B.             The Troy Mine assets
include patented and unpatented mining claims and fee properties, more
particularly described in Part 1 of Exhibit A hereto (collectively, the “Properties”).


C.             Genesis requires
certain funds to enable it to re-start production of minerals at the Troy Mine.


D.            Royal Gold is willing
to provide such funds in consideration for receipt of a production payment from
the Properties, in accordance with and subject to the terms and conditions of
this Agreement.


NOW,
THEREFORE, in consideration of the mutual covenants contained herein and the
mutual benefits to be enjoyed by the parties hereto, Royal Gold and Genesis
hereby agree as follows:


ARTICLE I


ROYAL GOLD PAYMENT TO GENESIS; GENESIS USE OF PROCEEDS


1.1         Royal Gold Payment.
Subject to the conditions precedent set forth in Sections 3.1, 3.2 and 3.3 ,
and Genesis’ covenants in Article VIII, Royal Gold hereby agrees to pay Genesis
the total sum of Seven Million Two Hundred Fifty Thousand United States Dollars
(US$7,250,000) (the “Royal Gold Payment”), payable at Closing (defined in
Section  4.1).


1.2         Genesis Use of
Proceeds.  The Royal Gold Payment
proceeds received by Genesis shall not be used by it for any purposes other
than those contemplated by the Feasibility Study Budget attached hereto as
Exhibit B, unless Royal Gold authorizes otherwise in writing, which
authorization shall not be withheld unreasonably.



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ARTICLE II


PRODUCTION PAYMENT BY GENESIS TO ROYAL GOLD


2.1        Grant of Production
Payment. Genesis hereby agrees to convey to Royal Gold a limited term
royalty interest (the “Production Payment”) in silver, copper and all other
minerals and products produced and sold from the Properties, as provided in
this Agreement.


2.2        Deed of Production
Payment. Genesis shall convey the Production Payment to Royal Gold by means
of a Deed of Production Payment in the form of Exhibit C hereto, to be
delivered at Closing.


ARTICLE III


CONDITIONS PRECEDENT TO CLOSING


3.1        Conditions to
Obligations of Royal Gold and Genesis at Closing. The respective
obligations of Royal Gold and Genesis to effect the Closing are subject to
fulfillment of the following conditions:


(a) No order, statute,
rule, regulation, executive order, stay, decree, judgment, or injunction shall
have been enacted, entered, issued, promulgated or enforced by any court or
governmental authority which prohibits or restricts the effectuation of the
Closing; and


(b)         No governmental action or
proceeding shall have been commenced or threatened seeking any injunction,
restraining or other order which seeks to prohibit, restrain, invalidate or set
aside the effectuation of the Closing.


3.2        Additional Conditions
to Obligations of Royal Gold at Closing. The obligations of Royal Gold to
make the Royal Gold Payment and to perform its other obligations at Closing are
subject to the condition precedent that Royal Gold shall have received, on or
before the Closing Date (defined in Section 4.1) the following, each in form
and substance satisfactory to Royal Gold:


(a)          Title Opinion. A
written title opinion by Montana counsel, which concludes that [subject only to
the rights and interests of ASARCO Incorporated (“Asarco”) pursuant to the
Asset Purchase and Sale Agreement between it, as Seller, and Sterling Mining
Company (“Sterling”, now Revett Silver Company, 
“Revett”), as Buyer, dated effective as of September 9, 1999, as amended
(the “Asarco Agreement”), and of Kennecott Montana Company (“Kennecott”)
pursuant to the Asset Purchase and Sale Agreement between it, as Seller,
and  Genesis and Sterling, collectively,
as Buyer, dated effective February 21, 2001 (the “Kennecott Agreement”)]:


(i)                                     with
respect to Properties that are patented mining claims or fee properties,
Genesis owns those Properties free and clear of all liens 



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and encumbrances, except
those specifically identified in Part 2 of Exhibit A hereto; and


(ii)                                  with
respect to Properties that are unpatented mining claims, except as specifically
identified in Part 2 of Exhibit A hereto and subject to the paramount title of
the United States: (A) location notices and certificates were properly filed
and recorded in the appropriate local, state and federal records; (B)
assessment work affidavits, notices of intention to hold and other filings
necessary to maintain the claims through September 1, 2005 were properly filed
and recorded; (C) all maintenance fees necessary to maintain the claims through
September 1, 2005 have been properly paid; (D) the claims are free and clear of
all liens and encumbrances, except those specifically identified in Part 2 of
Exhibit A hereto; and (E) the records examined disclosed no conflicting claims.


(b)         Permits, Bonds and
Approvals. Genesis shall have received all permits (including but not
limited to the Operating Permit from the Montana Department of Environmental
Quality and all necessary explosives permits), bonds and approvals (including
but not limited to approval of Genesis’ Plan of Operations by the United States
Forest Service) necessary for Genesis to conduct the operations contemplated by
the “Independent Technical Report on the Troy Cu-Ag Project, Montana”, dated
August 16, 2004, prepared by SRK Consulting (CANADA) INC. (the “Feasibility
Study”). Notwithstanding the foregoing sentence, Royal Gold agrees and
understands that, in lieu of Genesis receiving said Operating Permit, bonds,
approval of Plan of Operations and other permits, Genesis and Revett have
entered into contracts with Asarco whereby Asarco shall remain the party to the
Operating Permit, bonds, Plan of Operations and, possibly, other permits; and
Genesis and Revett shall make contract and subcontract arrangements,
respectively, with Asarco for the conduct of operations on the Properties.
Royal Gold agrees that such arrangements are an acceptable alternative to
Genesis being the permitee or party to the bonds, on the condition that, prior
to Closing, the State of Montana approves in writing of that procedure.


(c)          Genesis’
Representations and Warranties. Genesis’ representations and warranties in
Article V of this Agreement shall be true and correct as of the date hereof,
and shall be deemed to have been made again at and as of the Closing and shall
then be true and correct in all material respects, except for breaches that
have been cured before Closing.


(d)         Deliveries at Closing.
Genesis and Revett shall have executed and delivered to Royal Gold at Closing
all documents described in Section 4.2.


(e)          No Material Adverse
Change. No material adverse change to the physical condition or permitting
status of the Troy Mine shall have occurred prior to Closing.



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(f)            Tailings Pipeline.
Written documentation and data that demonstrate that the tailings pipeline at
the Troy Mine is in satisfactory condition, as well as a written inspection and
maintenance protocol for that pipeline.


3.3        Additional Conditions
to Obligations of Genesis at Closing. The obligations of Genesis to effect
the Closing are contingent upon the fulfillment of the following additional
conditions:


(a)          Royal Gold’s
Representations and Warranties. Royal Gold’s representations and warranties
in Article VI shall be true and correct as of the date hereof, and shall be
deemed to have been made again at and as of the Closing and shall then be true
and correct in all material respects, except for breaches that have been cured
prior to Closing.


(b)         Deliveries at Closing.
Royal Gold shall have delivered to Genesis at Closing the items described in
Section 4.3.


ARTICLE IV


CLOSING


4.1        Closing Date. The
deliveries described in Sections 4.2 and 4.3 (“Closing”) shall occur at Royal
Gold’s Denver, Colorado offices as soon as possible after each condition
precedent set forth in Sections 3.1, 3.2 and 3.3 has been met or, in the
alternative, waived by the party to whose Closing obligation the condition
precedent applies, but in no event later than October 15, 2004 (“Closing Date”),
or at such other location or locations and date as the parties hereto may
mutually agree.


4.2        Deliveries by Genesis
and Revett at Closing. At Closing:


(a)           Genesis shall deliver
to Royal Gold a duly executed and notarized Deed of Production Payment in the
form attached as Exhibit C hereto;


(b)          Genesis and Revett shall
deliver to Royal Gold a duly signed Opinion of Counsel in the form of Exhibit D
hereto; and


(c)           Genesis shall deliver
to Royal Gold signed certificates of duly authorized officers of Genesis and
Revett confirming that, as at the Closing Date, all of the warranties of
Genesis contained in this Agreement are true, complete and correct, as if made
on such date, and that Genesis has performed or complied with all of the terms,
covenants and conditions of this Agreement to be performed or complied with by
Genesis at or prior to Closing.


4.3        Deliveries by Royal
Gold at Closing. At Closing:


(a)          Royal Gold shall remit
to Genesis the Royal Gold Payment  by
wire transfer to an account designated in writing by Genesis; and



 4
 









(b)         Royal Gold shall deliver
to Genesis a signed certificate of a duly authorized officer of the company
confirming that, as at the Closing Date, all of the warranties of Royal Gold
contained in this Agreement are true, complete and correct, as if made on such
date, and that Royal Gold has performed or complied with all of the terms,
covenants and conditions of this Agreement to be performed or complied with by
Royal Gold at or prior to Closing.


ARTICLE V


REPRESENTATIONS AND
WARRANTIES OF GENESIS


Genesis hereby represents
and warrants to Royal Gold as follows:


5.1        Due Organization, Good
Standing and Authority. Genesis is duly organized, validly existing and in
good standing under the laws of the State of Montana. Genesis has the full
power, authority and legal right to: (a) own its assets and properties
(including but not limited to the Properties) and to conduct its business as
now being conducted, and (b) incur its obligations under this Agreement and
each other document and instrument to be executed by it pursuant to this
Agreement and to perform the terms hereof and thereof applicable to it.


5.2        Due Authorization;
Non-contravention. The execution by Genesis of this Agreement and the Deed
of Production Payment and the performance of all transactions contemplated
hereby and thereby, have been duly authorized by all necessary action,
corporate and otherwise, and do not and will not conflict with or result in a
breach of the terms, conditions or provisions of, or constitute a default
under, or result in a violation of,  any
authorization, consent, approval, exemption or other action by any court or
administrative or governmental body.


5.3        Validity. This
Agreement is, and the Deed of Production Payment when executed and delivered
hereunder, will be, legal, valid and binding obligations of Genesis enforceable
against Genesis in accordance with their respective terms.


5.4        Litigation. Except
as set forth in Exhibit E hereto, there is no action, suit or proceeding at law
or in equity, by or before any governmental or regulatory authority, court or
other tribunal now pending (or, to the best knowledge of Genesis, threatened)
against or affecting Genesis or Revett or any of the Properties.


5.5        Title to Properties.  Title to the Properties is as set forth in
Subsections 3.2(a)(i) and (ii), and Genesis is in exclusive possession of the
Properties and has no knowledge of any adverse claims to any of the Properties,
other than as set forth in Part 2 of Exhibit A.


5.6        Compliance with Laws.
With respect to the Properties and the Troy Mine, Genesis has complied with all
applicable local, state and federal laws and regulations, and 



 5
 









Genesis is not aware of any investigations (other than
routine inspections) underway by any governmental agency with respect to the
Properties or the Troy Mine.


5.7        Permits. Genesis
has obtained, or as of the Closing Date, will have obtained, all permits, bonds
and approvals necessary for Genesis to conduct the operations contemplated by
the Feasibility Study; or, in the alternative, it and Revett shall have entered
into the contracts with Asarco and received the approval of same, as set forth
in Section 3.2(b).


ARTICLE VI


ROYAL GOLD’S
REPRESENTATIONS AND WARRANTIES


Royal Gold hereby
represents and warrants to Genesis as follows:


6.1        Due Organization, Good
Standing and Authority. Royal Gold is duly organized, validly existing and
in good standing under the law of the States of Delaware and Colorado.  Royal Gold has the full power, authority and
legal right to: (a) conduct its business as now being conducted, and (b) incur
its obligations under this Agreement and to perform the terms hereof and
thereof applicable to it.


6.2        Due Authorization;
Non-contravention. The execution by Royal Gold of this Agreement and the
performance of all transactions contemplated hereby have been duly authorized
by all necessary action, corporate and otherwise, and does not and will not:
(a) conflict with or result in a breach of the terms, conditions or provisions
of, or constitute a default under, (b) result in a violation of, or (c) require
any authorization, consent, approval, exemption or other action by or notice to
any court or administrative or governmental body.


6.3        Validity. This
Agreement is legal, valid and a binding obligation of Royal Gold enforceable
against Royal Gold in accordance with its terms.


ARTICLE VII


INTERIM PERIOD


Genesis and Royal
Gold covenant and agree that between the date of this Agreement and the Closing
Date:


7.1        Access. Royal Gold,
its counsel, consultants, accountants and other representatives shall be
permitted reasonable access during normal business hours to inspect the
Properties and the Troy Mine.


7.2        Ordinary Course.
Except as otherwise requested by Royal Gold in writing, Genesis shall, to the
best of its ability, maintain the Properties and the Troy Mine in the ordinary
course consistent with past practice (except as otherwise provided herein or
for events beyond Genesis’ reasonable control).



 6
 









7.3        Work Diligently Towards
Closing. Genesis and Royal Gold each shall use its reasonable best efforts
to work diligently, including but not limited to obtaining all governmental
approvals and filings, towards completing the transactions contemplated by this
Agreement on or before the Closing Date.


7.4        Prompt Notification of
Breach. Genesis and Royal Gold each shall use its reasonable best efforts
to notify the other party of any breach of any of the notified party’s
representations, warranties, covenants or agreements to be breached.  The parties shall remain obligated to close
the transaction hereunder provided that any such breach is cured prior to
Closing.


ARTICLE VIII


POST-CLOSING
COVENANTS


8.1        Maintenance of
Existence. Genesis shall preserve and maintain its legal existence and all
of its rights, privileges and franchises necessary for the proper conduct of
its business (including but not limited to the operation and development of the
Troy Mine) and will remain qualified to do business in the State of Montana.


8.2        Compliance with Laws.
Genesis will comply with all requirements of applicable local, state and
federal laws and regulations and shall maintain in full force and effect all
permits, approvals and authorizations necessary to conduct its operations in
the manner contemplated by the Feasibility Study.


8.3        Use of Royal Gold
Payment Proceeds. Genesis shall not use the Royal Gold Payment proceeds for
any purposes other than those contemplated by the Feasibility Study Budget,
unless authorized otherwise in writing by Royal Gold, which authorization shall
not be withheld unreasonably.


8.4        Taxes. Genesis
shall pay and discharge all local, state and federal taxes imposed upon it or
any of the Properties prior to the date upon which penalties attach thereto and
prior to the date that any tax liens attach to the Properties.


8.5        Protection from Liens
and Encumbrances and Defense of Title to Properties. Genesis shall maintain
the Properties free and clear of all liens and encumbrances, other than those
related to project financing for the Troy Mine; provided, however, that
such project financing liens shall be and remain subordinate to the Production
Payment.  Genesis at all times shall
defend title to the Properties and notify Royal Gold in writing promptly upon
being informed of any third party challenges to Genesis’ title to any of the
Properties.


8.6        Mine-Based
Environmental Professional. By no later than December 1, 2004, Genesis
shall have hired a full-time qualified environmental professional, who shall be
based at the Troy Mine, and that person shall commence such employment by no
later than 



 7
 









January 1, 2005. Genesis shall provide Royal Gold with
monthly reports on the status of its efforts to fill that position until it has
been filled.


8.7        Rail Siding. By no
later than November 1, 2004, Genesis shall have obtained property rights to a
rail siding sufficient for stockpiling and loading concentrates onto rail cars
for shipment to one or more purchasers. Genesis shall provide Royal Gold with
monthly reports on the status of its efforts to obtain those property rights
until it has obtained same.


8.8        Final Marketing
Agreement. Genesis diligently shall work to complete and execute a “Final
Agreement” between it and Trafugura AG (“Trafigura”) by no later than November
1, 2004, as defined in and contemplated by the Memorandum of Agreement
currently in effect between it and Trafigura.


8.9        Inspection and
Maintenance of Tailings Pipeline. Genesis shall inspect and maintain the
tailings pipeline at the Troy Mine in accordance with best industry practices,
which shall include at a minimum, but shall not be limited to, compliance with
the protocol described in Section 3.2(f) above.


8.10 Royal Gold
Right to Notice and Option to Cure in Event of Genesis Default Under   Kennecott Note or Mortgage. Royal Gold
and Genesis hereby acknowledge and recognize that Genesis is a party to a
Promissory Note (the “Note”) in the principal amount of $5,000,000, dated
February 21, 2000, as amended by Third Amendment dated February 1, 2003 (the “Third
Amendment”), from Genesis and Sterling, collectively as “Maker”, to Kennecott
Montana Company (“Kennecott”, with Kennecott and any subsequent holder of the
Note referred to herein and in the Note as “Payee”), as “Lender”. The Note is
secured by a Mortgage, Security Agreement and Financing Statement, dated
February 21, 2000 (the “Mortgage”), from Genesis, as “Mortgagor”, to Kennecott,
as “Mortgagee”.  Genesis hereby agrees
that if it receives a notice from the Payee that requests an interest payment,
as provided in the Third Amendment, Genesis shall so inform Royal Gold in
writing and provide Royal Gold with a copy of that notice within two (2)
business days after Genesis’ receipt of same. Genesis shall exercise its best
efforts to make payment of that interest payment on or before two (2) days
prior to its due date. If Genesis fails to do so, it shall so notify Royal Gold
in writing on or before that interest payment due date, in which event Royal
Gold shall have the exclusive right and option, but not the obligation, to make
such payment. If Genesis defaults in any of its other obligations under either
the Note or Mortgage and receives a notice of default from the Payee pursuant
to either the Note or Mortgage, Genesis shall so inform Royal Gold in writing
and provide Royal Gold with a copy of the default notice within two (2)
business days after Genesis’ receipt of same. Genesis then shall exercise its
best efforts to cure the default within twenty (20) days after its receipt of
the default notice. If Genesis fails to cure, or determines that it is unable
to cure, the default within that time period, it shall so notify Royal Gold by
telephone, facsimile and e-mail on or before the first business day after the
twentieth (20th)
day, after which Royal Gold shall have the exclusive right and option, but not
the obligation, to cure the default cited by the Payee in its 



 8
 









notice to Genesis. Genesis further agrees that Royal
Gold shall have the exclusive right and option, but not the obligation, to
assume the position of the Payee under the Note and under the Mortgage in the
event that the Payee commences foreclosure proceedings pursuant to the
Mortgage; provided, however, that Royal Gold would extend the Term of the Note
(as defined in the Third Amendment) to February 21, 2010. If for any reason
Royal Gold is unable to obtain the Payee’s agreement to Royal Gold’s assumption
of Payee’s position, Genesis agrees that Royal Gold shall, have the exclusive
right and option, but not the obligation, to pay off the remaining balance due
under the Note, in which event Genesis shall execute a replacement promissory
note, as a Maker, with Royal Gold as the Payee. That replacement note shall be
for the same principal amount and interest and shall contain the same other
provisions as those contained in the Note, provided, however, that the Term of
the replacement note shall be extended to February 21, 2010. The replacement
note shall be secured by a replacement security instrument that contains the
same terms and conditions and encumbers the same properties and interests as
the Mortgage, with the exception that the replacement security instrument shall
reflect the extended term of the replacement note.


ARTICLE IX


TERMINATION


9.1        Right to Terminate.
This Agreement may be terminated under the following circumstances:


(a)          by mutual written
consent of both Royal Gold and Genesis; or


(b)         by either Royal Gold or
Genesis if Closing has not occurred by October 15, 2004 (or such other Closing
Date mutually agreed upon in writing by the parties), other than due to the
failure of  the party seeking termination
to comply fully with its obligations under this Agreement.


9.2        Effect of Termination.
Each party’s right of termination under Section 9.1(b) is in addition to any
other rights that it may have under this Agreement or otherwise, and the
exercise of a right of termination will not be deemed to be an election of
remedies.  If this Agreement is
terminated pursuant to Section 9.1, all further obligations of the parties
hereunder shall terminate; provided, however, that if this Agreement is
terminated because one or more conditions to the terminating party’s
obligations under this Agreement is not satisfied as a result of the other
party’s breach of its obligations under this Agreement, the terminating party’s
right to pursue all legal remedies will survive such termination unimpaired. A
party shall not be deemed to have breached its obligations under this Agreement
if a condition precedent applicable to it is not satisfied, if that party used
its reasonable best efforts to work diligently to satisfy that condition.


9.3        Due Diligence Information
to be Provided to Genesis. If Closing does not occur, Royal Gold shall
provide Genesis with copies of factual, non-interpretive, 



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non-proprietary information obtained by Royal Gold
from its due diligence investigations of the Properties and the Troy Mine.  Such information shall be provided by Royal
Gold to Genesis with no representations or warranties by Royal Gold as to its
accuracy or completeness.  Any reliance
upon or use of such information by Genesis, Revett or any parties to whom they
provide same shall be at those parties’ sole risk and expense.


ARTICLE X


GENERAL PROVISIONS


10.1              Confidentiality.
Neither party shall, without the prior written consent of the other party,
disclose to any third party (excluding, however, any representative, affiliate,
agent, consultant or contractor of the disclosing party who has a bona fide
need to be informed) any information or data concerning operations, including
but not limited to exploration, on the Properties that is not generally
available to the public; provided, however, that upon not less than five
(5) days’ prior written notice to the other party setting forth the nature and
content of a proposed disclosure, the disclosing party may disclose information
or data pertaining to the Properties: (a) to any third party to whom the
disclosing party in good faith anticipates selling all or part of its interest
hereunder, or (b) to any lender or underwriter from whom the disclosing party
is borrowing or raising funds secured by or based upon the Properties, provided
that such lender or underwriter executes a confidentiality agreement in a form
that is reasonably acceptable to the non-disclosing party.  If a disclosure is, in the good faith
judgment of a party, required for compliance with applicable laws, rules,
regulations or orders of any governmental agency or stock exchange having
jurisdiction over the disclosing party, that party shall provide as much prior
notice to the other party of the nature and contents of the proposed
disclosure, for the review and comment of the non-disclosing party, as is
reasonable possible in the circumstances.


10.2              Expenses.
Royal Gold and Genesis each shall bear and pay their own expenses, including
attorneys’ fees, incident to the preparation and performance of this Agreement,
whether or not the transactions contemplated herein are consummated.


10.3              Amendments.
This Agreement shall not be amended or modified except by means of a written
instrument that is signed by both Royal Gold and Genesis.


10.4              Successors and
Assigns. This Agreement shall be binding upon and inure to the benefit of
the parties’ respective successors and assigns.


10.5              Entire Agreement.
This Agreement and the Exhibits hereto supersede and replace all prior
understandings and agreements between Royal Gold and Genesis regarding the
Properties and the Troy Mine, including but not limited to the financing offer
dated May 18, 2004.


10.6              No Waiver. No
waiver of any breach of any one or more of the conditions or covenants of this
Agreement by any party shall be deemed to imply or constitute a 



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waiver of a breach of any other condition or covenant
in this Agreement or of a breach of the same condition or covenant in the
future.


10.7              Notices. All
notices, consents, requests and approvals, any notice of change of address for
the purpose of this Section 10.7, and other communications provided for or
required herein, shall be given: (a) by personal delivery to the other party,
(b) by certified or registered mail, return receipt requested, (c) by reputable
overnight courier, or (d) by facsimile that is acknowledged upon receipt. All
notices, consents, requests and approvals and other communications provided for
or required herein, shall be effective and shall be deemed delivered on the
date of delivery if delivered during normal business hours, and, if not
delivered during normal business hours, on the next business day following
delivery:


(a)          If to Royal Gold, at:


Royal Gold, Inc.


1660 Wynkoop
Street


Suite 1000


Denver, Colorado
80202-1132


Attention:
President


Facsimile Number: 303-595-9385


:


(b)         If to Genesis, at:


Genesis Inc., c/o
Revett Silver Company


11115 E.
Montgomery


                         Suite G


Spokane Valley,
Washington 99206


Attention:
President


Facsimile Number:
509-891-8901


Either party may, from
time-to-time, change its address for future notices hereunder by notice in
accordance with this Section 10.7.


10.8              Governing Law.
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of Montana, without regard to those principles of
conflicts of laws that might otherwise require the application of the laws of
another jurisdiction.


10.9              Exhibits. All
Exhibits referred to in this Agreement hereby are incorporated into this
Agreement by reference.


10.10        Headings. The
various headings used in this Agreement are for convenience only and are not to
be used in interpreting the text of the Article or Section in which they appear
or to which they relate.



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10.11        Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, and all of which shall constitute one and the same
instrument.


10.12        Authority. By their
signatures below, each respective signatory represents that he or she has the
express authority of the party for which he or she executes this Agreement and
further has the express authority to bind his or her principal to the terms
hereof.


IN WITNESS
WHEREOF, Royal Gold and Genesis have caused this Agreement to be executed the
day and year first above written.


	
  

  	
   

  	
  ROYAL GOLD, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  GENESIS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
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