Document:

exv10w1

 

Exhibit 10.1

AMENDED AND RESTATED FUNDING AGREEMENT

 

SOCIÉTÉ DES MINES DE TAPARKO (SOMITA, SA)

and

ROYAL GOLD, INC.

 

Taparko — Bouroum Project

Republic of Burkina Faso

$35,000,000

Dated as of February 22, 2006

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Page	 
	ARTICLE I DEFINITIONS AND REFERENCES	 	 	2	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 1.1	 	Defined Terms	 	 	2	 
	 	 	Section 1.2	 	Exhibits and Schedules; Additional Definitions	 	 	11	 
	 	 	Section 1.3	 	Amendment of Defined Instruments	 	 	11	 
	 	 	Section 1.4	 	References and Titles	 	 	12	 
	 	 	Section 1.5	 	Joint Preparation; Construction of Indemnities and Releases	 	 	12	 
	 	 	Section 1.6	 	Currency	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE II THE FUNDING	 	 	12	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 2.1	 	Commitment to Fund	 	 	12	 
	 	 	Section 2.2	 	Requests for Tranches	 	 	13	 
	 	 	Section 2.3	 	Use of Funds	 	 	13	 
	 	 	Section 2.4	 	Security	 	 	13	 
	 	 	Section 2.5	 	Project Engineer	 	 	13	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE III CONDITIONS PRECEDENT AND SUBSEQUENT TO FUNDING	 	 	14	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 3.1	 	Conditions to Disbursement of First Tranche	 	 	14	 
	 	 	Section 3.2	 	Conditions to Disbursement of Second Tranche	 	 	15	 
	 	 	Section 3.3	 	Additional Conditions Precedent	 	 	18	 
	 	 	Section 3.4	 	Condition to Disbursement of Tranches After March, 2006	 	 	19	 
	 	 	Section 3.5	 	Condition Subsequent	 	 	19	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES	 	 	19	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 4.1	 	Organization and Good Standing	 	 	19	 
	 	 	Section 4.2	 	Power; Authorization	 	 	20	 
	 	 	Section 4.3	 	No Conflicts or Consents	 	 	20	 
	 	 	Section 4.4	 	Enforceable Obligations	 	 	20	 
	 	 	Section 4.5	 	Other Obligations and Restrictions	 	 	20	 
	 	 	Section 4.6	 	Financial Condition	 	 	20	 
	 	 	Section 4.7	 	Capitalization of Somita	 	 	21	 
	 	 	Section 4.8	 	Relationship Between Somita and its Parent Companies	 	 	21	 
	 	 	Section 4.9	 	Full Disclosure	 	 	22	 
	 
	 	Section 4.10	 	 	 	Litigation	 	 	22	 
	 
	 	Section 4.11	 	 	 	Labor Disputes and Acts of God	 	 	22	 
	 
	 	Section 4.12	 	 	 	Subsidiaries	 	 	22	 
	 
	 	Section 4.13	 	 	 	Bank Accounts	 	 	22	 
	 
	 	Section 4.14	 	 	 	Easements, Property Interests, Permits, Utilities, Etc	 	 	22	 
	 
	 	Section 4.15	 	 	 	Environmental Matters	 	 	23	 

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	 	 	 	 	 	 	 	 	page	 
	 
	 	Section 4.16	 	 	 	Project Cost and Project Completion	 	 	23	 
	 
	 	Section 4.17	 	 	 	Projections	 	 	23	 
	 
	 	Section 4.18	 	 	 	Interest in Land	 	 	23	 
	 
	 	Section 4.19	 	 	 	Project Documents	 	 	23	 
	 
	 	Section 4.20	 	 	 	No Sovereign Immunity	 	 	24	 
	 
	 	Section 4.21	 	 	 	Taxes and Reports	 	 	24	 
	 
	 	Section 4.22	 	 	 	Defaults	 	 	24	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE V AFFIRMATIVE COVENANTS	 	 	24	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 5.1	 	Project Completion	 	 	24	 
	 	 	Section 5.2	 	Company Operations; Maintenance of Project	 	 	25	 
	 	 	Section 5.3	 	Payment and Performance	 	 	25	 
	 	 	Section 5.4	 	Compliance with Agreements and Law	 	 	25	 
	 	 	Section 5.5	 	Books, Financial Statements and Reports	 	 	25	 
	 	 	Section 5.6	 	Access and Inspections	 	 	27	 
	 	 	Section 5.7	 	Notice of Material Events	 	 	28	 
	 	 	Section 5.8	 	Maintenance of Existence and Qualifications	 	 	28	 
	 	 	Section 5.9	 	Payment of Trade Liabilities, Taxes, etc.	 	 	28	 
	 
	 	Section 5.10	 	 	 	Insurance	 	 	29	 
	 
	 	Section 5.11	 	 	 	Studies, Protocols and Action Plans	 	 	30	 
	 
	 	Section 5.12	 	 	 	Government Approvals and Notices	 	 	31	 
	 
	 	Section 5.13	 	 	 	Refining Contracts	 	 	31	 
	 
	 	Section 5.14	 	 	 	Evidence of Compliance	 	 	31	 
	 
	 	Section 5.15	 	 	 	HRG Fundings	 	 	31	 
	 
	 	Section 5.16	 	 	 	Further Assurances	 	 	32	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE VI NEGATIVE COVENANTS	 	 	32	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 6.1	 	Indebtedness	 	 	32	 
	 	 	Section 6.2	 	Limitation on Liens	 	 	32	 
	 	 	Section 6.3	 	Project Abandonment	 	 	32	 
	 	 	Section 6.4	 	Limitation on Mergers, Issuances of Securities	 	 	32	 
	 	 	Section 6.5	 	Limitation on Asset Disposition	 	 	33	 
	 	 	Section 6.6	 	Limitation on Dividends and Redemptions	 	 	33	 
	 	 	Section 6.7	 	Limitation on Investments and New Businesses	 	 	33	 
	 	 	Section 6.8	 	Transactions with Affiliates	 	 	33	 
	 	 	Section 6.9	 	Contracts	 	 	34	 
	 
	 	Section 6.10	 	 	 	No Subsidiaries	 	 	34	 
	 
	 	Section 6.11	 	 	 	Satisfaction of Conditions Precedent	 	 	34	 
	 
	 	 	 	 	 	 	 	 	 	 
	ARTICLE VII EVENTS OF DEFAULT AND REMEDIES	 	 	34	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 7.1	 	Events of Default	 	 	34	 
	 	 	Section 7.2	 	Remedies	 	 	36	 

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	 	 	 	 	 	 	 	 	 	Page	 
	ARTICLE VIII MISCELLANEOUS	 	 	37	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	Section 8.1	 	Waivers and Amendments; Acknowledgments	 	 	37	 
	 	 	Section 8.2	 	Survival of Agreements; Cumulative Nature	 	 	38	 
	 	 	Section 8.3	 	Notices	 	 	38	 
	 	 	Section 8.4	 	Payment of Expenses; Indemnity	 	 	39	 
	 	 	Section 8.5	 	Parties in Interest; Assignments	 	 	40	 
	 	 	Section 8.6	 	Confidentiality	 	 	41	 
	 	 	Section 8.7	 	Governing Law	 	 	41	 
	 	 	Section 8.8	 	Limitation on Interest	 	 	41	 
	 	 	Section 8.9	 	Termination; Limited Survival	 	 	42	 
	 
	 	Section 8.10	 	 	 	Severability	 	 	42	 
	 
	 	Section 8.11	 	 	 	Counterparts; Facsimile Execution	 	 	42	 
	 
	 	Section 8.12	 	 	 	Dispute Resolution.	 	 	42	 
	 
	 	Section 8.13	 	 	 	Service of Process.	 	 	44	 
	 
	 	Section 8.14	 	 	 	English Language.	 	 	45	 
	 
	 	Section 8.15	 	 	 	Termination of Agreement.	 	 	45	 
	 
	 	Section 8.16	 	 	 	Good Faith and Fair Dealing.	 	 	45	 

iii

 

SCHEDULES AND EXHIBITS

	 	 	 	 	 
	Schedule I
	 	—	 	Bouroum Permit
	Schedule II
	 	—	 	Taparko Permit
	Schedule III
	 	—	 	Completion Test and Process
	Schedule IV
	 	—	 	Taparko Mining Convention
	Schedule V
	 	—	 	Tranche Funding Schedule
	Schedule VI
	 	—	 	Project Milestones Schedule
	Schedule 4.13
	 	—	 	Bank Accounts

	 	 	 	 	 
	Exhibit A-1
	 	—	 	Form of Guaranty I
	Exhibit A-2
	 	—	 	Form of Guaranty II
	Exhibit B-1
	 	—	 	Form of Pledge I
	Exhibit B-2
	 	—	 	Form of Pledge II
	Exhibit C
	 	—	 	Form of CAT Agreement
	Exhibit D-1
	 	—	 	Form of Conveyance of Production Payments
	Exhibit D-2
	 	—	 	Form of Conveyance of Tail Royalty and Grant of Milling Fee
	Exhibit E
	 	—	 	Form of Funding Request
	Exhibit F
	 	—	 	Form of Project Engineer Certificate
	Exhibit G
	 	—	 	Form of Responsible Officer Certificate
	Exhibit H
	 	—	 	Form of Legal Opinions to be delivered at Second Funding
	Exhibit I
	 	—	 	Form of Certificate Accompanying Financial Statements
	Exhibit J
	 	—	 	Form of Monthly Construction Report
	Exhibit K
	 	—	 	Form of Monthly Operations Report
	Exhibit L
	 	—	 	Form of Contribution Agreement

iv

 

AMENDED AND RESTATED FUNDING AGREEMENT

     This AMENDED AND RESTATED FUNDING AGREEMENT (this “Agreement”) dated as of February
22, 2006, is by and between Société des Mines de Taparko, also known as SOMITA, SA, a société
anonyme formed under the laws of the Republic of Burkina Faso (“Somita”), and ROYAL GOLD,
INC., a corporation formed under the laws of Delaware, USA (“Royal Gold”).

Recitals

     A. Somita is developing the Taparko/Bouroum gold mine project in the Republic of Burkina Faso,
which will include construction of a mine, support facilities and CIL plant capable of milling and
processing one million (1,000,000) tonnes of ore per year.

     B. Somita desires to obtain funding in the amount of US $35,000,000 to be used in connection
with development of the Taparko/Bouroum gold mine project and has requested that Royal Gold provide
such funding.

     C. Royal Gold is in the business of acquiring and managing precious metals royalty interests
and providing funding to enterprises in exchange for such interests.

     D. HRG is the indirect owner of 90% of the issued and outstanding shares of Somita, through
its subsidiary, Shareholder. The Government of the Republic of Burkina Faso is the owner of the
remaining 10% of the issued and outstanding shares of Somita.

     E. Somita and Royal Gold entered into a Funding Agreement dated as of December 1, 2005, (the
“Original Funding Agreement”) as amended by First Amendment to Funding Agreement dated as
of February 8, 2006, (the “First Amendment”). Pursuant to the Original Funding Agreement,
Royal Gold agreed to provide funding to Somita in the amount of $35,000,000 to be used in the
development of the Project (defined below) in Burkina Faso.

     F. Prior to the date of this Agreement, Royal Gold has provided Somita the amount of
$9,414,000 under the First Tranche pursuant to the terms and conditions of the Original Funding
Agreement, as amended by the First Amendment.

     G. Due to circumstances beyond the control of Somita, the estimate of the cost to achieve
Project Completion has increased. Somita intends to continue the development of the Project, and
HRG has guaranteed that Somita will have sufficient funds, in addition to the funds to be provided
by Royal Gold pursuant to this Agreement, to achieve Project Completion on schedule.

     H. In connection with the Original Funding Agreement and the initial disbursement of the First
Tranche, HRG executed a guaranty of Somita’s obligation to repay the First Tranche, which was
secured by a pledge of shares of stock of Intrepid Minerals Corporation and Pelangio Mines Inc.
HRG has agreed to pledge those shares to Royal Gold to secure HRG’s obligation to

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provide funding
and to provide additional security for performance by Senet under the Construction Contract with
Somita.

     I. Under the terms of the Original Funding Agreement, as amended by the First Amendment, it is
a condition precedent to Royal Gold’s obligation to fund the Second Tranche that HRG deliver a
guaranty of Somita’s obligation to complete the Project and a pledge executed by HRG and
Shareholder of all of the stock of Shareholder and all of Shareholder’s shares of stock in Somita.
HRG and Shareholder have agreed that such pledge will also secure the obligation of HRG described
in Recital H above.

     J. Royal Gold is agreeable to continuing to provide up to $35,000,000 of funding to Somita on
the terms and conditions set forth herein.

Agreement

     In consideration of the mutual covenants and agreements contained herein, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto do hereby agree as follows:

ARTICLE I

DEFINITIONS AND REFERENCES

     Section 1.1 Defined Terms. As used in this Agreement, each of the following terms has the meaning
given to such term in this Section 1.1 or in the sections and subsections referred to below:

     “Affiliate” means, as to any Person, each other Person that directly or indirectly
(through one or more intermediaries or otherwise) controls, is controlled by, or is under common
control with, such Person. A Person shall be deemed to be “controlled by” any other Person if such
other Person possesses, directly or indirectly, power to:

     (a) vote 5% or more of the securities or other equity interests (on a fully diluted basis)
having ordinary voting power for the election of directors, the managing general partner or
partners or the managing member or members; or

     (b) direct or cause the direction of the management and policies of such Person, whether by
contract or otherwise.

     “Agreement” means this Amended and Restated Funding Agreement.

     “Availability Period” means the period commencing on the Closing Date and ending on
the earliest to occur of (i) June 30, 2007, (ii) the Completion Date (provided, however, that
Somita shall have the right to request disbursement of the full amount of the Funding if the
Completion Date occurs prior to June 30, 2007, and total amount of the Funding has not yet been
disbursed to Somita), or (iii) the date on which Royal Gold has disbursed the total amount of the
Funding to Somita.

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     “Average Gold Price” means, for any calendar month, the average daily P.M. price fixed
for gold by the London Bullion Association as reported in the Wall Street Journal or any
other agreed-upon successor publication for the applicable calendar month.

     “Bouroum Mining Convention” means the mining investment convention to be executed by
HRG and the Minister for Energy and Mines on behalf of the Government, at a date not later than as
set forth in the Project Milestones Schedule.

     “Bouroum Permit” means Decree No. 2005-342/PRES/PM/MCE/MFB issued by the Government on
June 21, 2005, a copy of which is attached hereto as Schedule I.

     “Bouroum Lands” means all of the land included in the Bouroum Permit, being
approximately 11.7 square kilometers, which land is more particularly described in Schedule I
attached hereto.

     “Business Day” means any day, other than a Saturday, Sunday or a legal holiday in
Colorado or Ontario or Ouagadougo or a day on which banking institutions are required or authorized
to close in any of such cities.

     “Canadian GAAP” means those generally accepted accounting principles and practices
which are set out from time to time in the Handbook of the Canadian Institute of Chartered
Accountants (or any generally recognized successor) If any change in any accounting principle or
practice is required by the Canadian Institute of Chartered Accountants (or any such successor) in
order for such principle or practice to continue as a generally accepted accounting principle or
practice, all reports and financial statements required hereunder or in connection herewith may be
prepared in accordance with such change, but all calculations and determinations to be made
hereunder may be made in accordance with such change only after notice of such change is given to
Royal Gold.

     “CAT” means Caterpillar Financial Services Corporation or such other equipment
financier as suggested by Somita and accepted by Royal Gold, acting reasonably.

     “CAT Agreement” means the CAT Agreement entered into or to be entered into between
Somita and CAT, substantially in the form of Exhibit C.

     “Change of Control” means the occurrence of any of the following: (a) the adoption of
a plan relating to the merger, consolidation, liquidation or dissolution of Somita, or (b) HRG
shall cease to own, directly or indirectly, at least 51%, in the aggregate, of the stock or voting
interests of Somita.

     “Closing Date” means December 1, 2005.

     “Completion Date” means the date on which Project Completion occurs.

     “Completion Test” means the requirements described on Schedule III.

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     “Construction Contract” means the Taparko/Bouroum Project Contract Agreement, dated as
of February 3, 2006, between Senet and Somita.

     “Contribution Agreement” means the Contribution Agreement in Support of Somita Funding
Agreement, dated as of the date hereof, between HRG and Royal Gold, in form and substance as set
forth in Exhibit L hereto.

     “Conveyance of Production Payments” means the Conveyance of Production Payments, which
contains the grant of PP1 and PP2 production payments, to be executed by Somita in form and
substance as set forth in Exhibit D-1 hereto.

     “Conveyance of Tail Royalty and Grant of Milling Fee” means the Conveyance of Tail
Royalty and Grant of Milling Fee, which contains the grant of the Tail Royalty and the agreement to
pay the Milling Fee, to be executed by Somita in form and substance as set forth in Exhibit D-2
hereto.

     “Corrupt Practices Laws” means (a) the Foreign Corrupt Practices Act of 1977 (Pub.L.
No. 95-213, Sections 101-104), as amended, and (b) any other law, regulation, order, decree or
directive having the force of law and relating to bribery, kick-backs, or similar business
practices.

     “Default” means any Event of Default and any default, event or condition which would,
with the giving of any requisite notices and the passage of any requisite periods of time,
constitute an Event of Default.

     “Development Plan” or “Plan” means the Bankable Feasibility Study for the
Taparko/Bouroum Gold Project prepared by HRG dated May 2004, which describes, among other things,
details for the completion and installation of the processing plant, equipment and related
infrastructure, together with the updates to the financial projections contained therein as have
been furnished to Royal Gold prior to the date hereof.

     “Distribution” means (a) any dividend or other distribution made by Somita on or in
respect of any stock, partnership interest, membership interest, or other equity interest in Somita
(including any option or warrant to buy such an equity interest) or (b) any payment made by Somita
to purchase, redeem, acquire or retire any stock, partnership interest, membership interest or
other equity interest in Somita (including any such option or warrant).

     “Dollars” or “$” means the lawful money of the United States of America.

     “Environmental Laws” means any and all Laws of the Government of the Republic of
Burkina Faso relating to the environment or to emissions, discharges, releases or threatened
releases of pollutants, contaminants, chemicals, or industrial, toxic or hazardous substances or
wastes into the environment including ambient air, surface water, ground water, or land, 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.

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     “Events of Default” has the meaning given to such term in Section 7.1.

     “Financial Model” means the cash flow model, which shall reflect all relevant pre and
post construction and operating information from the Development Plan.

     “Financial Statements” means, with respect to any Person, such Person’s quarterly or
annual balance sheet and statements of income, retained earnings, and sources and application of
funds for such fiscal period, together with all notes thereto and with comparable figures for the
corresponding period of its previous Fiscal Year, each prepared in Dollars (except those prepared
in respect of HRG, which are prepared in Canadian dollars) in accordance with Canadian GAAP,
provided, however, that any such quarterly balance sheets or statements of income, retained
earnings or sources and application of funds will be unaudited, will be subject to normal year-end
audit adjustments and, to the extent that they will not include footnotes, need not be in
accordance with Canadian GAAP.

     “First Tranche” means the initial Tranche of the Funding in the amount of $9,414,000,
which tranche has been funded by Royal Gold.

     “Fiscal Quarter” means a three-month period ending on March 31, June 30, September 30
or December 31 of any year.

     “Fiscal Year” means a twelve-month period ending on December 31 of any year.

     “Funding” means on any date, the aggregate of the amount of the Tranches disbursed by
Royal Gold.

     “Funding Documents” means this Agreement, the Initial Guaranty, the Initial Pledge,
Guaranty I, Pledge I, Guaranty II, Pledge II, the Contribution Agreement, the Somita Assignments
and all other agreements, certificates, documents, notices, instruments and writings delivered
pursuant to Sections 3.1 through 3.3 and all other writings executed by Somita, HRG, International
or Shareholder and delivered in connection herewith or therewith, including, without limitation,
the Original Funding Agreement, the First Amendment and the Consent of Guarantor, dated as of
February 8, 2006, by HRG in favor of Royal Gold.

     “Funding Request” means a written request, or a telephonic request followed by a
written confirmation, made by Somita which meets the requirements of Section 2.2.

     “Government” means the Government of the Republic of Burkina Faso, including, without
limitation, the executive, legislative and judicial branches thereof, and each and every ministry,
board, bureau, department and commission thereof, including, without limitation, the Ministry for
Energy and Mines.

     “Guaranty I” means the Guarantee Agreement by HRG for the benefit of Royal Gold,
which, among other things, shall provide an additional guarantee of performance by Senet under the
Construction Contract, in form and substance set forth in Exhibit A-1 hereto.

5

 

     “Guaranty II” means the Guaranty by HRG, in form and substance set forth in Exhibit
A-2 hereto.

     “HRG” means High River Gold Mines Ltd., a corporation formed under the federal laws of
Canada.

     “HRG Equity Commitment” means the contribution by HRG, or other arrangement for
funding by third parties, which shall be in a total cumulative amount of at least $33,000,000, of
which the net amount of $22,152,617 has been contributed by HRG as of the date of this Agreement,
as detailed in the Financial Model.

     “ICC” has the meaning set forth in Section 8.12.

     “Indebtedness” of any Person means Liabilities in any of the following categories
(without duplication):

     (a) Liabilities for borrowed money or arising out of any credit facility, including without
limitation, any obligation or credit facility denominated in gold or any other commodity;

     (b) Liabilities constituting an obligation to pay the deferred purchase price of property or
services;

     (c) Liabilities evidenced by a bond, debenture, note or similar instrument;

     (d) Liabilities which (i) would under Canadian GAAP be shown on such Person’s balance sheet as
a liability, and (ii) are payable more than one year from the date of creation or incurrence
thereof (other than reserves for taxes and reserves for contingent obligations);

     (e) Liabilities arising under conditional sales or other title retention agreements with
respect to property acquired by such Person;

     (f) Liabilities owing under direct or indirect guaranties of Liabilities of any other Person
or otherwise constituting obligations to purchase or acquire or to otherwise protect or insure a
creditor against loss in respect of Liabilities of any other Person (such as obligations under
working capital maintenance agreements, agreements to keep-well, or agreements to purchase
Liabilities, assets, goods, securities or services), but excluding endorsements in the ordinary
course of business of negotiable instruments in the course of collection;

     (g) Liabilities consisting of an obligation to purchase or redeem securities or other
property, if such Liabilities arise out of or in connection with the sale or issuance of the same
or similar securities or property (for example, obligations of such type under repurchase
agreements, mandatorily redeemable preferred stock and sale/leaseback agreements);

     (h) Liabilities with respect to letters of credit or applications or reimbursement agreements
therefor;

     (i) Liabilities with respect to banker’s acceptances; or

6

 

     (j) Liabilities with respect to other obligations to deliver goods or services in
consideration of advance payments therefor;

provided, however, that the “Indebtedness” of any Person shall not include Liabilities that were
incurred by such Person on ordinary trade terms to vendors, suppliers, or other Persons providing
goods and services for use by such Person in the ordinary course of its business, unless and until
such Liabilities are outstanding more than 120 days after the date the respective goods are
delivered or the respective services are rendered, other than Liabilities contested in good faith
by appropriate proceedings, if required, and for which adequate reserves are maintained on the
books of such Person in accordance with Canadian GAAP.

     “Initial Guaranty” means the Guarantee Agreement by HRG for the benefit of Royal Gold,
dated as of December 1, 2005.

     “Initial Pledge” means Pledge of Securities by HRG for the benefit of Royal Gold,
dated as of December 1, 2005.

     “International” means High River Gold Mines (International) Ltd., a corporation formed
under the laws of the Cayman Islands.

     “Investment” means any investment, made directly or indirectly, in any Person, whether
by purchase or acquisition of equity interests, indebtedness or other obligations or securities or
by extension of credit, loan, advance, capital contribution or otherwise and whether made in cash,
by the transfer of property, or by any other means.

     “Law” means any statute, law (including Environmental Laws), regulation, ordinance,
rule, treaty, judgment, order, decree, permit, concession, franchise, license, agreement or other
governmental restriction of the Republic of Burkina Faso, the United States, or Canada or any
securities exchange, province, state or political subdivision thereof or of any other foreign
country or any department, province or other political subdivision thereof having jurisdiction.
Any reference to a Law includes any amendment or modification to such Law, and all regulations,
rulings, and other Laws promulgated under such Law.

     “Liabilities” means, as to any Person, all indebtedness, liabilities and obligations
of such Person, whether matured or unmatured, liquidated or unliquidated, primary or secondary,
direct or indirect, absolute, fixed or contingent, and whether or not required to be considered
pursuant to Canadian GAAP.

     “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 “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 o 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

7

 

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, with respect to any property or assets, any right or interest therein of
a creditor to secure Liabilities owed to it or any other arrangement with such creditor which
provides for the payment of such Liabilities out of such property or assets or which allows such
creditor to have such Liabilities satisfied out of such property or assets prior to the general
creditors of any owner thereof, including any lien, mortgage, security interest, pledge, deposit,
production payment, rights of a vendor under any title retention or conditional sale agreement or
lease substantially equivalent thereto, tax lien, mechanic’s or materialman’s lien, or any other
charge or encumbrance for security purposes, whether arising by Law or agreement or otherwise, but
excluding any right of offset which arises without agreement in the ordinary course of business.
“Lien” also means any filed financing statement, any registration of a pledge (such as with an
issuer of uncertificated securities), or any other arrangement or action which would serve to
perfect a Lien described in the preceding sentence, regardless of whether such financing statement
is filed, such registration is made, or such arrangement or action is undertaken before or after
such Lien exists.

     “Material Adverse Effect” means a material and adverse change in (i) the Project, (ii)
the business, operations, prospects, condition (financial or otherwise), or property of Somita or
(until the Completion Date) HRG, (iii) the ability of Somita or any other party to perform in a
timely manner its material obligations under any of the Funding Documents, (iv) the validity or
enforceability of any material provision of any Funding Document, or (v) the rights and remedies of
Royal Gold under any of the Funding Documents.

     “Maximum Amount” means the amount of $35,000,000, or such other amount to which the
parties to the Agreement may agree in writing.

     “Milling Fee” means the mill throughput fee identified as the “Milling Fee” in the
Conveyance of Tail Royalty and Grant of Milling Fee.

     “Mining Law” means, collectively, the Kiti Decree No. AN VIII-0328 of 4/6/91 on land
reform in Burkina Faso as amended by decree 93-252; Act No. 14-93/ADP instituting a mining
investments code; Decree No. 2000-629 relating to operations conducted under mining titles; and Act
No. 031-2003/AN instituting a new mining code.

     “Mining Rights” means all interests in the surface of any lands, the minerals in or
that may be extracted from any lands, all water rights, all easements, rights-of-way, inurements
and other rights and interests used by Somita or necessary or advisable to implement the
Development Plan and operate the Project.

     “Obligations” means all Liabilities from time to time owing by Somita or any
Responsible Party to Royal Gold under or pursuant to any of the Funding Documents, and
“Obligation” means any part of the Obligations.

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     “Parties” means Royal Gold and Somita, together with any other Person that may be a
party to this Agreement from time to time.

     “Permitted Liens” means:

     (a) Liens created pursuant to this Agreement or the other Funding Documents;

     (b) Liens imposed by statute for amounts not yet due and payable;

     (c) Liens imposed by the Taparko Mining Convention or governing law for taxes, assessments or
charges not yet due and payable;

     (d) Carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlord’s, or other
like Liens which do not secure Indebtedness arising in the ordinary course of business for amounts
which are not more than sixty (60) days past due or the validity of which is being contested in
good faith and by appropriate proceedings, if necessary, and for which adequate reserves are
maintained on the books of Somita in accordance with Canadian GAAP;

     (e) Liens in respect of purchase money obligations, operating leases, and equipment financing,
provided that such Indebtedness is permitted under Section 7.1; or

     (f) Liens arising under or pursuant to the CAT Agreement, provided such Liens affect only the
equipment financed thereby.

     “Person” means an individual, corporation, general partnership, limited partnership,
limited liability company, association, joint stock company, trust or trustee thereof, estate or
executor thereof, Tribunal, or any other legally recognizable entity.

     “Pledge I” means the Pledge of Securities by HRG for the benefit of Royal Gold, which
shall secure the obligations of HRG under Guaranty I and Guaranty II and the performance of HRG
with respect to the HRG Equity Commitment with a pledge of shares of Intrepid Minerals Corporation
and Pelangio Mines Inc., in form and substance as set forth in Exhibit B-1 hereto.

     “Pledge II” means the Pledge Agreement to be executed by International, Shareholder
and Royal Gold in form and substance as set forth in Exhibit B-2 hereto.

     “PP1” means the production payment identified as “PP1” in the Conveyance of Production
Payments.

     “PP2” means the production payment identified as “PP2” in the Conveyance of Production
Payments.

     “PP1 and PP2 Obligations” means all obligations and amounts owing under PP1 and PP2.

     “Project” means the development and exploitation of the Taparko Lands and the Bouroum
Lands for production of gold and associated precious metals, including construction of

9

 

a mine,
support facilities and a plant capable of milling and processing 1,000,000 tonnes of ore per year,
all as more particularly set forth in the Development Plan.

     “Project Assets” means all properties, assets or other rights, whether real or
personal, tangible or intangible, now owned or hereafter acquired by or for the benefit of Somita,
which are used or intended for use in or forming part of the Project.

     “Project Completion” means satisfaction of all requirements of the Completion Test.

     “Project Engineer” has the meaning set forth in Section 2.5.

     “Project Milestones Schedule” means the milestones to be completed in the construction
of the Project and the dates therefor set forth in Schedule VI hereto.

     “Properties” means the Taparko Lands and the Bouroum Lands, collectively.

     “Refining Contracts” means, at any time, all agreements then in force pursuant to
which Somita has the right to sell, or to have toll refined, gold, gold dore or gold ore.

     “Request for Arbitration” has the meaning set forth in Section 8.12.

     “Responsible Officer” means, with respect to Persons other than Somita, a Director,
President, Vice President or Chief Financial Officer of such Person, and with respect to Somita, a
Director of Somita.

     “Responsible Party” means in respect of each of the Funding Documents, each of Somita,
HRG, International and Shareholder who is a signatory to such Funding Document, and their
respective successors and assigns.

     “Royal Gold” has the meaning set forth in the Preamble.

     “Rules” has the meaning set forth in Section 8.12.

     “Second Tranche” means the second Tranche of the Funding, the request for which shall
be received by Royal Gold in a Funding Request and shall be disbursed by Royal Gold to Somita
following the satisfaction or waiver by Royal Gold of all of the conditions precedent set forth in
Section 3.2 and Section 3.3, together with any other restriction placed upon the funding of
Tranches in this Agreement.

     “Secretariat” has the meaning set forth in Section 8.12.

     “Senet” means Senet CC, a corporation formed under the laws of the Republic of South
Africa.

     “Shareholder” means High River Gold Mines (West Africa) Ltd., a corporation formed
under the laws of the Cayman Islands.

     “Somita” has the meaning set forth in the Preamble.

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     “Somita Assignments” means, collectively, the Conveyance of Production Payments and
the Conveyance of Tail Royalty and Grant of Milling Fee.

     “Subsidiary” means, with respect to any Person, any corporation, association,
partnership, limited liability company, joint venture, or other business or corporate entity,
enterprise or organization which is directly or indirectly (through one or more intermediaries)
controlled by or owned fifty percent or more by such Person.

     “Tail Royalty” means the royalty identified as the “Tail Royalty” in the Conveyance of
Tail Royalty and Grant of Milling Fee.

     “Taparko Mining Convention” means the mining investment convention signed by HRG and
the Minister for Energy and Mines on behalf of the Government on December 15, 1995, a copy of which
is attached here to as Schedule IV.

     “Taparko Permit” means Decree No. 2004-329/PRES/PM/MCE/MFB/
MEDE/MECV issued by the Government on August 6, 2004, a copy of which is attached hereto as
Schedule II.

     “Taparko Lands” means that portion of the land included in the Taparko Permit that is
more particularly described in Schedule II hereto, being approximately 34.7 square kilometers out
of the total 666.5 square kilometers included in such permit.

     “Tranche” means the amount of each disbursement of the Funding by Royal Gold, as set
forth in the Tranche Funding Schedule, including, without limitation, the First Tranche and the
Second Tranche.

     “Tranche Funding Schedule” means the amounts and the dates on which such amounts are
to be funded, subject to the conditions set forth in this Agreement, set forth on Schedule V
hereto.

     “Tribunal” means any government, any arbitration panel, any court or any governmental
department, commission, board, bureau, agency or instrumentality of the Republic of Burkina Faso,
the United States of America, Canada or any other country having jurisdiction, or any state,
province, commonwealth, nation, territory, possession, county, parish, town, township, village or
municipality thereof, whether now or hereafter constituted or existing.

     Section 1.2 Exhibits and Schedules; Additional Definitions. All Exhibits and Schedules attached to
this Agreement are a part hereof for all purposes.

     Section 1.3 Amendment of Defined Instruments. Unless the context otherwise requires or unless otherwise provided herein the terms defined in
this Agreement which refer to a particular agreement, instrument or document also refer to and
include all renewals, extensions, modifications, amendments and restatements of such agreement,
instrument or document, provided that nothing contained in this section shall be construed to
authorize any such renewal, extension, modification, amendment or restatement.

11

 

     Section 1.4 References and Titles. All references in this Agreement to Exhibits, Schedules, articles,
sections, subsections and other subdivisions refer to the Exhibits, Schedules, articles, sections,
subsections and other subdivisions of this Agreement unless expressly provided otherwise.
References to any document, instrument, or agreement (a) shall include all exhibits, schedules, and
other attachments thereto, and (b) shall include all documents, instruments, or agreements issued
or executed in replacement thereof. Titles appearing at the beginning of any subdivisions are for
convenience only and do not constitute any part of such subdivisions and shall be disregarded in
construing the language contained in such subdivisions. The words “this Agreement,” “this
instrument,” “herein,” “hereof,” “hereby,” “hereunder” and words of similar import refer to this
Agreement as a whole and not to any particular subdivision unless expressly so limited. The
phrases “this section” and “this subsection” and similar phrases refer only to the sections or
subsections hereof in which such phrases occur. The word “or” is not exclusive, and the word
“including” (in its various forms) means “including without limitation.” Pronouns in masculine,
feminine and neuter genders shall be construed to include any other gender, and words in the
singular form shall be construed to include the plural and vice versa, unless the context otherwise
requires. Accounting terms have the meanings assigned to them by Canadian GAAP, as applied by the
accounting entity to which they refer. References to “days” shall mean calendar days, unless the
term “Business Day” is used. Unless otherwise specified, references herein to any particular
Person also refer to its successors and permitted assigns.

     Section 1.5 Joint Preparation; Construction of Indemnities and Releases. This Agreement and the other
Funding Documents have been reviewed and negotiated by sophisticated parties with access to legal
counsel and no rule of construction shall apply hereto or thereto which would require or allow any
Funding Document to be construed against any party because of its role in drafting such Funding
Document. All indemnification and release provisions of this Agreement shall be construed broadly
(and not narrowly) in favor of the Persons receiving indemnification or being released.

     Section 1.6 Currency. All amounts stated herein are in Dollars unless specifically stated otherwise.

ARTICLE II

THE FUNDING

     Section 2.1 Commitment to Fund. Subject to the terms and conditions hereof, Royal Gold shall
disburse Tranches to Somita upon Somita’s request during the Availability Period, up to the Maximum
Amount. As consideration for the Funding, Somita shall deliver to Royal Gold the Somita
Assignments. Notwithstanding anything contained herein to the contrary, in the event that Project
Completion is achieved prior to disbursement of the total amount of the Funding to Somita, and
provided that all conditions precedent to funding of a Tranche have been satisfied, Somita shall be
entitled to request, on or before June 30, 2007, disbursement of the undisbursed amount of the
Funding.

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     Section 2.2 Requests for Tranches. Subject to the conditions set forth in Article III, Somita may
request Tranches to be disbursed in accordance with the Tranche Funding Schedule. To request the
disbursement of a Tranche (other than the First Tranche), Somita shall deliver to Royal Gold a
funding request (a “Funding Request”) in the form set forth as Exhibit E, together with a
Project Engineer Certificate in the form set forth as Exhibit F and a Certificate from a
Responsible Officer of Somita in the form set forth as Exhibit G. Each Funding Request must be
received by Royal Gold not later than 10:00 a.m., Denver, Colorado time, at least five (5) Business
Days prior to the date on which such Tranche is requested to be made. Unless Royal Gold shall have
notified Somita within five (5) Business Days after receipt of such Funding Request of a reason why
such funding should not be made (such as failure of a condition precedent), Royal Gold shall
disburse such Tranche to Somita on the requested funding date by wire transfer to High River’s
Toronto bank account, the details of which shall be provided in the Funding Request. Somita hereby
directs Royal Gold to disburse each Tranche to HRG on behalf of Somita, to be used by Somita as
provided in Section 2.3 below. For greater certainty, in the event that the Project Engineer has
not responded within five (5) Business Days to Somita in respect of any Project Engineer
Certificate submitted to the Project Engineer for approval as part of the request process set forth
herein, the Project Engineer shall be deemed to have approved the form and content of such Project
Engineer Certificate.

     Section 2.3 Use of Funds. Somita shall use each Tranche only for repayment of intercompany loans, as
contemplated by the Tranche Funding Schedule, and development and operation of the Project pursuant
to the Development Plan.

     Section 2.4 Security. As security for the Funding, Somita shall cause Shareholder and International to
execute and deliver Pledge II to Royal Gold on the date of disbursement of the Second Tranche. As
additional security for the completion of the Project, Somita shall cause HRG to execute and
deliver Guaranty I and Pledge I on or before the date of disbursement of the Second Tranche. As
security for the First Tranche, Somita caused HRG to execute and deliver the Initial Guaranty and
Initial Pledge to Royal Gold on the Closing Date.

     Section 2.5 Project Engineer.

     (a) Until the Completion Test shall have been satisfied, Royal Gold, at the expense of HRG,
shall engage Don Beesley as the project engineer (“Project Engineer”); provided that Royal
Gold may engage any other person in replacement of Don Beesley, at the expense of HRG, with the
consent of Somita and HRG, not to be unreasonably withheld, to act on behalf of Royal Gold as the
Project Engineer.

     (b) Royal Gold shall engage the Project Engineer, to do, without limitation, the following:
(i) review the Development Plan, (ii) review requests for disbursement of Tranches, (iii) monitor
the application of proceeds of the Funding, (iv) monitor the pace and quality of construction of
the Project under the construction plan, (v) monitor and provide certification that the terms of
the Completion Test have been passed satisfactorily, (vi) conduct a detailed technical, social and
environmental review of the Project and the completeness and appropriateness of the provisions in
all material Project contracts and any warranty provisions contained therein, (vii) review the
updates to the Development Plan, (viii) certify the

13

 

achievement of items under the Project
Milestones Schedule, and (ix) review all monthly reports produced by Somita and major contractors
for the Project.

     (c) Until the Completion Test shall have been satisfied, the Project Engineer shall conduct
site visits in accordance with Section 5.6.

     (d) Royal Gold shall request that the Project Engineer (i) submit all reports in connection
with the Project simultaneously to HRG and Royal Gold for comment, and (ii) deliver to HRG a copy
of all finalized reports as submitted to Royal Gold.

ARTICLE III

CONDITIONS PRECEDENT AND SUBSEQUENT TO FUNDING

     Section 3.1 Conditions to Disbursement of First Tranche. The agreement of Royal Gold to disburse the
First Tranche, which has been disbursed in accordance with the Tranche Funding Schedule, was
subject to the following conditions precedent and the conditions precedent set forth in Section
3.3, which were satisfied or waived in writing by Royal Gold, or made subject to post-closing
covenants:

     (a) Due Diligence. The results of technical, financial and legal due diligence shall
be acceptable to Royal Gold, including:

          (i) a technical review of the Development Plan by the Project Engineer;

          (ii) Project Engineer confirmation that the Development Plan is designed to meet all
applicable local laws, and is in accordance with acceptable industry practice including maintaining
a minimum of local standards and World Bank environmental guidelines (applicable under, World Bank
and IFC Pollution, Prevention and Abatement Guidelines and the applicable IFC Safeguard Policies),
and where practicable, the International Cyanide Code and the Equator Principles;

          (iii) review by or on behalf of Royal Gold of the Financial Model prior to the Closing Date to
the satisfaction of Royal Gold, acting reasonably, which shall include verification of the
following inputs: capital expenditure, operating costs, working capital and production; and

          (iv) confirmation to the satisfaction of Royal Gold and warranty by HRG that all necessary
authorizations have been obtained for the execution and performance of this Agreement, the Initial
Guaranty and the Initial Pledge, including, without limitation, all authorizations required by each
of Somita’s and HRG’s organizational documents.

     (b) Required Documents. Royal Gold shall have received the following documents, duly
executed and delivered and in form, substance and date satisfactory to Royal Gold:

          (i) this Agreement;

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          (ii) the Initial Guaranty (which shall be released and returned to HRG upon disbursement of
the Second Tranche);

          (iii) the Initial Pledge (which shall be released and returned to HRG upon disbursement of the
Second Tranche); and

          (iv) any other documents to be executed to ensure the effectiveness of (i) – (iii) above.

     (c) Legal Opinions. Royal Gold shall have received the executed legal opinions of
legal counsel to Somita and/or HRG reasonably acceptable to Royal Gold with respect to matters
under the laws of Canada and the Republic of Burkina Faso.

     (d) Additional Certificates. Royal Gold shall have received an “Omnibus Certificate”
of the Responsible Officers of each of Somita and HRG, which shall contain the names and signatures
of the officers of such entity authorized to execute Funding Documents and which shall certify to
the truth, correctness and completeness of the following exhibits attached thereto: (i) a copy of
resolutions duly adopted by the members or board of directors of such entity and in full force and
effect at the Closing Date, authorizing the execution of this Agreement and the other Funding
Documents delivered or to be delivered on the Closing Date in connection herewith and the
consummation of the transactions contemplated herein and therein, and (ii) certified or notarial or
otherwise conformed copies of constituent documents and all amendments thereto, certified by the
appropriate official of such entity’s place of organization.

     (e) Material Adverse Effect. No Material Adverse Effect, nor any event or
circumstance that could have a Material Adverse Effect, shall have occurred with respect to Somita,
HRG, International or Shareholder on or before the Closing Date.

     Section 3.2 Conditions to Disbursement of Second Tranche. The agreement of Royal Gold to disburse the
Second Tranche shall become effective on the date on which the following conditions precedent shall
have been satisfied (unless (i) another time period is specified herein, or (ii) such condition
precedent was satisfied on the Closing Date and the continuing satisfaction of such condition
precedent in connection with the disbursement of the Second Tranche is not required by Royal Gold),
or shall have been waived in writing by Royal Gold:

     (a) Due Diligence. The results of technical, financial and legal due diligence shall
be acceptable to Royal Gold, including:

          (i) a technical review of the Development Plan by the Project Engineer (to the extent of any
changes since the Closing Date);

          (ii) Project Engineer confirmation that the Development Plan is designed to meet all
applicable local laws, and is in accordance with acceptable industry practice including maintaining
a minimum of local standards and World Bank environmental guidelines (applicable under, World Bank
and IFC Pollution, Prevention and Abatement Guidelines and the applicable

15

 

     IFC Safeguard Policies),
and where practicable, the International Cyanide Code and the Equator Principles;

          (iii) evidence that all Tribunal and third party consents, licenses, approvals and
authorizations necessary in connection with the commencement of construction of the Project are in
place, and Somita and, to the best knowledge of Somita, contractors for the Project are in
compliance therewith;

          (iv) review by or on behalf of Royal Gold of the Financial Model prior to the date of
disbursement of the Second Tranche to the satisfaction of Royal Gold, acting reasonably, which
shall include verification of the following inputs: capital expenditure, operating costs, working
capital and production;

          (v) Project Engineer and Royal Gold satisfaction, acting reasonably and without delay, with
the terms and conditions of any proposed construction, materials supply or services contracts for
the Project (but only if available in form being considered by Somita for execution), including,
without limitation, Royal Gold’s approval of the primary contractor and significant subcontractors
to be retained for Project construction, and inclusion of performance and delay liquidated damages
provisions satisfactory to Royal Gold in such contracts; and

          (vi) confirmation to the satisfaction of Royal Gold and warranty by HRG that (A) the Taparko
Mining Convention is valid and in full force and effect, as set forth therein, (B) Somita enjoys
the benefits of the Taparko Mining Convention, which HRG holds for the benefit of HRG and Somita,
with all rights thereunder indirectly through HRG as if Somita were a party
to such agreement, and (C) all necessary authorizations have been obtained for the execution
and performance of Pledge II, including, without limitation, all authorizations required by
Somita’s organizational documents and the Taparko Mining Convention, including, without limitation,
Article 8.2 of the Taparko Mining Convention.

     (b) Required Documents. Royal Gold shall have received the following documents, duly
executed and delivered and in form, substance and date satisfactory to Royal Gold:

          (i) Guaranty I;

          (ii) Pledge I;

          (iii) Guaranty II;

          (iv) Pledge II;

          (v) the Contribution Agreement;

          (vi) the Somita Assignments;

          (vii) any
other documents to be executed to ensure the effectiveness of (i) — (vi) above;

16

 

          (viii) any document related to Project construction requested by Royal Gold;

          (ix) all such other agreements, documents or actions which in the opinion of Royal Gold or
legal counsel to Royal Gold in the Republic of Burkina Faso are necessary or advisable to secure
the payment of all amounts due or to become due hereunder and under the Somita Assignments;

          (x) all other agreements and instruments pursuant to the terms of which Somita has or could in
the future have any obligation or liability, contingent or actual, to HRG or any Affiliate of HRG
(other than agreements or instruments for compensation of officers of Somita for their services as
such at a rate established on an arm’s length basis); and

          (xi) other construction, supply, lease, management or other relevant contracts reasonably
required as conditions of Funding.

     (c) Legal Opinions. Royal Gold shall have received the executed legal opinions of
legal counsel to Somita and/or HRG reasonably acceptable to Royal Gold with respect to matters
under the laws of Canada, the Republic of Burkina Faso and the Cayman Islands, in the forms
attached hereto as Exhibit H.

     (d) Evidence of Insurance. Royal Gold shall have received certificates or binders,
acceptable to Royal Gold in its reasonable discretion, evidencing that insurance as required by
Section 5.10 is in effect on the date of disbursement of the Second Tranche.

     (e) Additional Certificates. Royal Gold shall have received an “Omnibus Certificate”
of the Responsible Officers of each of Somita, HRG, International and Shareholder, which shall
contain the names and signatures of the officers of such entity authorized to execute Funding
Documents and which shall certify to the truth, correctness and completeness of the following
exhibits attached thereto: (i) a copy of resolutions duly adopted by the members or board of
directors of such entity and in full force and effect as of the date of the disbursement of the
Second Tranche, authorizing the execution of the Funding Documents delivered or to be delivered in
connection therewith and the consummation of the transactions contemplated therein, and (ii)
certified or notarial or otherwise conformed copies of constituent documents and all amendments
thereto, certified by the appropriate official of such entity’s place of organization.

     (f) Material Adverse Effect. No Material Adverse Effect, nor any event or
circumstance that could have a Material Adverse Effect, shall have occurred with respect to Somita,
HRG, International or Shareholder on or before the date of disbursement of the Second Tranche.

     (g) Government Approvals. To the extent that Royal Gold shall have requested the
same, and if available, Royal Gold shall have received copies, certified by a Responsible Officer
of Somita as true and complete and in full force and effect, of any registration, declaration,
filing, governmental consent, license, approval, authorization, or permit required by the
Government or,

17

 

in the opinion of legal counsel to Royal Gold in the Republic of Burkina Faso,
necessary or advisable to implement and complete the Development Plan and operate the Project.

     (h) Rights in Project Assets and Mining Rights. Royal Gold shall have received
evidence in form and substance satisfactory to it that Somita has good title to (i) all of the
Project Assets and Mining Rights that it owns or purports to own, free and clear of all liens or
claims (other than Permitted Liens) and (ii) such other surface and other rights as are necessary
for access rights, water rights, plant sites, tailings disposal, waste dumps, ore dumps, abandoned
heaps or ancillary facilities which are required in connection with the development of the Project
substantially in accordance with the Development Plan. All such Project Assets, Mining Rights and
other rights shall be sufficient in scope and substance for the development of the Project as
contemplated by the Development Plan.

     (i) Development Plan. Royal Gold shall have received and approved all updates to the
Development Plan to the extent such updates were not provided on the Closing Date.

     (j) Construction Contractor. Royal Gold shall have received evidence of (i) an
executed agreement with Senet with respect to the Project, and (ii) completion guarantees, bonds
and/or cash deposits to be provided by Senet and major contractors and subcontractors, all of which
shall be satisfactory in form, substance and amount to Royal Gold, and with financial institutions
or other issuers acceptable to Royal Gold.

     Section 3.3 Additional Conditions Precedent. Royal Gold shall have no obligation to disburse any Tranche (including the First Tranche),
unless the following conditions precedent have been satisfied:

     (a) All representations, warranties and covenants made by any Responsible Party in this
Agreement and any other Funding Document shall be true and accurate on and as of the date of
disbursement of such Tranche as if such representations, warranties and covenants had been made as
of the date of disbursement of such Tranche, except to the extent that such representation,
warranty or covenant was made as of a specific date or updated, modified or supplemented as of a
subsequent date with the consent of Royal Gold.

     (b) No Default shall exist at the date of disbursement of such Tranche.

     (c) No Material Adverse Effect, nor any event or circumstance that could have a Material
Adverse Effect, shall have occurred.

     (d) The disbursement of such Tranche shall not be prohibited by any Law and shall not subject
Royal Gold to any penalty or other onerous condition under or pursuant to any such Law.

     (e) A “Compliance Certificate” of a Responsible Officer of Somita, of even date with each
disbursement of a Tranche, in which such officers certify to the satisfaction of the conditions set
out in subsections (a), (b), (c) and (d) of this Section 3.3.

     (f) All requirements of Somita in Section 2.2 shall have been met.

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     (g) Royal Gold shall have received all documents and instruments that it has then reasonably
requested, in addition to those described in Section 3.1 in connection with the First Tranche and
Section 3.2 in connection with the Second Tranche (including opinions of legal counsel for the
Responsible Parties; corporate documents and records; documents evidencing governmental
authorizations, consents, approvals, licenses and exemptions; and certificates of public officials
and of officers and representatives of the Responsible Parties), as to (i) the accuracy and
validity of or compliance with all representations, warranties and covenants made by Responsible
Officers in this Agreement and the other Funding Documents, (ii) the satisfaction of all conditions
contained herein or therein, and (iii) all other matters pertaining hereto and thereto. All such
additional documents and instruments shall be reasonably satisfactory to Royal Gold in form,
substance and date.

For further certainty, disbursements of Tranches after disbursement of the First Tranche and the
Second Tranche shall only be subject to the conditions set forth in this Section 3.3.

     Section 3.4 Condition to Disbursement of Tranches After March, 2006. Royal Gold shall have no
obligation to disburse any Tranche beyond the March, 2006 Tranche listed in the Tranche Funding
Schedule unless and until HRG has fulfilled all of its obligations under the Contribution
Agreement.

     Section 3.5 Condition Subsequent. Somita shall reimburse Royal Gold for all amounts then funded by Royal Gold under the Funding,
together with interest thereon at the annual rate of LIBOR plus 2.00%, unless, by February 28,
2006, or such later date up to 30 days set by Royal Gold in its sole discretion, all conditions
precedent to the funding of the Second Tranche shall have been satisfied. If by such date, all of
(i) the conditions precedent to disbursement of the Second Tranche have not been satisfied, or have
not been waived by Royal Gold, (ii) Somita shall have reimbursed Royal Gold as set forth in this
Section 3.5, (iii) Somita shall have paid all amounts due under Section 8.4(a), and (iv) no Default
shall have occurred and be continuing, this Agreement shall terminate and shall be of no further
force and effect, and neither Party shall have any further obligation to the other hereunder.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

     Somita represents and warrants to Royal Gold, as of the Closing Date and at all times that
this Agreement is in effect, as follows:

     Section 4.1 Organization and Good Standing. Somita is duly organized, validly existing and in good
standing under the Laws of the Republic of Burkina Faso, having all powers required to carry on its
business and enter into and carry out the transactions contemplated hereby. Somita is duly
qualified, in good standing, and authorized to do business in all other jurisdictions wherein the
character of the properties owned or held by it or the nature of the business transacted by it
makes such qualification necessary, except where the failure to so qualify could not have a
Material Adverse Effect.

19

 

     Section 4.2 Power; Authorization. Somita has the requisite power to own and operate its properties, to
carry on its business and the Project, to obtain funding and to create and assign royalties,
production payments and milling fees in connection with its rights, properties and assets as and to
the extent contemplated by the Funding Documents and to execute, deliver, and perform this
Agreement and each of the other Funding Documents to which it is or will be a party. Somita has
duly taken all action necessary to authorize the execution and delivery by it of the Funding
Documents to which it is a party and to authorize the consummation of the transactions contemplated
thereby and the performance of its obligations thereunder.

     Section 4.3 No Conflicts or Consents. The execution and delivery by Somita of the Funding Documents to
which it is a party, the performance of its obligations under such Funding Documents, and the
consummation of the transactions contemplated by the various Funding Documents, do not and will not
(a) conflict with any provision of (i) any Law, (ii) its organizational documents, or (iii) any
material agreement, judgment, license, order or permit applicable to or binding upon it or to which
its assets are subject, (b) result in the acceleration of any Indebtedness owed by it, or (c)
result in or
require the creation of any Lien upon any assets or properties owned by it except as expressly
contemplated or permitted in the Funding Documents. Except as expressly contemplated in the
Funding Documents, no permit, consent, approval, authorization or order of, and no notice to or
filing with, any Tribunal or third party is required (x) in connection with the execution, delivery
or performance of any Funding Document, (y) to consummate any transactions contemplated by the
Funding Documents, or (z) for continuous performance of the Project.

     Section 4.4 Enforceable Obligations. This Agreement is, and the other Funding Documents when duly
executed and delivered will be, legal, valid and binding obligations of Somita, enforceable in
accordance with their terms except as such enforcement may be limited by bankruptcy, insolvency or
similar Laws of general application relating to the enforcement of creditors’ rights.

     Section 4.5 Other Obligations and Restrictions. Somita (a) does not have any outstanding Liabilities
of any kind (including contingent obligations, tax assessments, and unusual forward or long-term
commitments) which are, in the aggregate, material to Somita or material with respect to Somita’s
financial condition, and (b) is not subject to or restricted by any franchise, contract, deed,
charter restriction, or other instrument or restriction which could have a Material Adverse Effect.

     Section 4.6 Financial Condition.

     (a) Somita’s Financial Statements, dated December 31, 2005, which have been furnished to Royal
Gold, are complete and correct and fairly present, in all material respects, its financial
condition and results of its operations for the period then ended. Somita has no contingent
obligation, liability for taxes, material or long-term commitment, or outstanding Indebtedness of
any kind except as disclosed in such Financial Statements other than liabilities not in excess of
$100,000 in the aggregate outstanding at any one time incurred in ordinary course of business which
would not be required to be disclosed in such Financial Statements in accordance with Canadian
GAAP. Since the date of such Financial Statements there has been no

20

 

change in Somita’s financial
condition or prospects that could have a Material Adverse Effect, and as of the date of this
Agreement Somita has not made any Distribution.

     (b) Following the execution of the Funding Documents by Somita and the consummation of the
transactions contemplated hereby, (a) Somita will be solvent (as such term is used in applicable
federal and state bankruptcy, liquidation, receivership, insolvency or similar Laws), (b) the sum
of the absolute and contingent liabilities of Somita, including the Obligations or guarantees
thereof, will not exceed the fair market value of Somita’s assets, and (c) the capital of Somita
will be adequate for the businesses in which Somita is engaged and intends to be engaged. Somita
has not incurred (whether under the Funding Documents or otherwise), does not intend to incur or
believe that it will incur, debts which will be beyond its ability to pay as such debts mature.
Somita, by executing, delivering or performing its obligations under the
Funding Documents or other documents to which it is a party or by taking any action with
respect thereto, does not intend to hinder, delay or defraud either its present or future
creditors.

     Section 4.7 Capitalization of Somita.

     (a) The authorized capital of Somita consists of 1,000 ordinary shares having a par value of
10,000 CFA (Central Franc Afrique) per share of which 1,000 shares are issued and outstanding. All
such issued and outstanding shares have been duly authorized and validly issued and are fully paid
and nonassessable. Ninety percent (90%) of the issued and outstanding shares are owned
beneficially and of record by Shareholder, and ten percent (10%) the issued and outstanding shares
are owned beneficially and of record by the Government. There are no outstanding subscriptions,
options, warrants, calls, agreements, preemptive rights, acquisition rights, redemption rights or
any other rights or claims of any character that restrict the transfer of, require the issuance of,
or otherwise relate to any class of the capital stock of Somita.

     (b) One hundred percent (100%) of the issued and outstanding shares of capital stock of
Shareholder is owned beneficially and of record by International, and all such issued and
outstanding shares of capital stock have been duly authorized and validly issued and are fully paid
and non-assessable. There are no outstanding subscriptions, options, warrants, calls, agreements,
preemptive rights, acquisition rights, redemption rights or any other rights or claims of any
character that restrict the transfer of, require the issuance of, or otherwise relate to any class
of the capital stock of Shareholder.

     Section 4.8 Relationship Between Somita and its Parent Companies. Other than (a) subrogation rights of
the HRG arising from Guaranty I and Guaranty II, (b) arrangements for compensation of officers,
employees or directors of Somita for their services as such at a rate established on an arm’s
length basis, (c) intercompany indebtedness as referred to in the Financial Statements described in
Section 4.6 and (d) fees payable in respect of the Project as per the Financial Model, Somita has
no obligation or liability, contingent or actual, to HRG or any Affiliate of HRG, and there are no
agreements or arrangements in existence pursuant to the terms of which Somita could in the future
have any obligation or liability, contingent or actual, to HRG or any Affiliate of HRG.

21

 

     Section 4.9 Full Disclosure. No certificate, written statement or other written information (taken as
a whole), provided by Somita or HRG, delivered herewith or heretofore by Somita or HRG to Royal
Gold in connection with the negotiation of this Agreement or in connection with any transaction
contemplated hereby, contains any untrue statement of a material fact or omits to state any
material fact known to Somita or HRG necessary to make the statements contained herein or therein,
in light of the circumstances under which they were made and taken together, not materially
misleading as of the date made or deemed made. All certificates, written statements and other
written reports and information provided by an officer of Somita or HRG after the date
hereof by or on behalf of Somita or HRG to Royal Gold in connection with this Agreement and the
other Funding Documents and the transactions contemplated hereby and thereby (taken as a whole)
will be true, complete and accurate in every material respect in light of the circumstances in
which made, or based on reasonable estimates on the date as of which such information is stated or
certified. There is no fact known to Somita or HRG that has not been disclosed to Royal Gold in
writing which could have a Material Adverse Effect.

     Section 4.10 Litigation.

     (a) There are no actions, suits or legal, equitable, arbitrative or administrative proceedings
pending, or to the knowledge of Somita threatened, against Somita or affecting the Properties
(including any which challenge or otherwise pertain to Somita’s ownership of the interests in the
Properties) before any Tribunal.

     (b) There are no outstanding judgments, injunctions, writs, rulings or orders by any such
Tribunal against Somita or affecting any part of the Properties or any of Somita’s assets or
property.

     (c) There is, to the best knowledge of Somita, no remedial work required to comply with any
Law, license or approval.

     Section 4.11 Labor Disputes and Acts of God. Neither the business nor the properties of Somita has been
affected by any fire, explosion, accident, strike, lockout or other labor dispute, drought, storm,
hail, earthquake, embargo, act of God or of the public enemy or other casualty (whether or not
covered by insurance), which could have a Material Adverse Effect.

     Section 4.12 Subsidiaries. Somita does not presently have any Subsidiaries. Somita has no equity
investments in any other Person.

     Section 4.13 Bank Accounts. Somita has no bank accounts except those listed on Schedule 4.13 of the
Disclosure Schedule and the to-be-established Citibank NA account in London, England specified in
the Conveyance of Production Payments.

     Section 4.14 Easements, Property Interests, Permits, Utilities, Etc. All easements, leasehold and other
property interests, permits and authorizations (whether from private third parties or governmental
entities) and all utility and other services, means of transportation, facilities, other materials
and other rights that can reasonably be expected to be necessary for the

22

 

construction, completion
and operation of the Project in accordance with
applicable requirements of Law and the Funding Documents (including, without limitation, gas,
electrical, water and sewage services and facilities) have been procured or are commercially
available for the Project, and, to the extent appropriate, arrangements have been made on
commercially reasonable terms for such easements, interests, services, means of transportation,
facilities, materials and rights. No material licenses, trademarks, patents or other similar
agreements are necessary for the construction, ownership, operation and maintenance of the Project.

     Section 4.15 Environmental Matters. Somita has duly complied, in all material respects, with, and its
business, operations, assets, equipment, property, leaseholds, and other facilities are materially
in compliance with, the provisions of all applicable environmental, health and safety laws, codes,
ordinances and directives, and all rules and regulations promulgated thereunder. Somita (a) has
been issued and will maintain all required permits, licenses, certificates and approvals relating
to, and (b) has received no complaint, order, directive, claim, citation or notice by any
governmental authority with respect to: (i) air emissions, (ii) discharges to surface water or
ground water, (iii) noise emissions, (iv) solid or liquid waste disposal, (v) the use, generation,
storage, transportation or disposal of toxic or hazardous substances or wastes, or (vi) other
environmental, health or safety matters.

     Section 4.16 Project Cost and Project Completion. Somita’s good faith estimate of the total cost of the
Project (including provisions for contingencies) is $73,047,000 and Somita’s good faith estimate of
the date by which it will achieve Project Completion is September 30, 2007.

     Section 4.17 Projections. The projections of the cash flows of Somita set forth in the Financial Model,
a copy of which has been provided to Royal Gold before the date hereof, are Somita’s best good
faith estimates of the cash flows of Somita for the period(s) covered therein.

     Section 4.18 Interest in Land. Somita, either directly or indirectly, has complete rights to use the
land necessary for the Project, subject only to Permitted Liens.

     Section 4.19 Project Documents.

     (a) The Taparko Mining Convention, the Taparko Permit and the Bouroum Permit are valid and
binding obligations of the Government, enforceable in accordance with their terms. Somita has all
rights as a party under each of the Taparko Permit and the Bouroum Permit, and Somita has all
rights in the Taparko Mining Convention indirectly through HRG as a party as if Somita had been a
signatory to agreement. Neither Somita nor, to the best knowledge of Somita,
the Government is in breach of any provision of the Taparko Mining Convention, the Taparko
Permit or the Bouroum Permit.

     (b) Somita has complied with terms of all mining leases and/or licenses and all other
agreements relating to the Properties, and there is no subsisting failure to comply with any term
or condition thereof, except where failure to comply could not have a Material Adverse Effect.

23

 

     (c) True, correct and complete copies of all material documents related to the Project have
been provided to Royal Gold.

     Section 4.20 No Sovereign Immunity. Somita is subject to civil and commercial law with respect to its
obligations under this Agreement and each of the other Funding Documents to which it is a party,
that the making and performance of this Agreement and such other Funding Documents by Somita
pursuant hereto constitute private and commercial acts rather than governmental or public acts and
that neither Somita nor any of its properties or revenues has any right of immunity from suit,
court jurisdiction, attachment prior to judgment, attachment in aid of execution of a judgment,
set-off, execution of a judgment or from any other legal process with respect to its obligations
under this Agreement and such other Funding Documents. To the extent that Somita may hereafter be
entitled, in any jurisdiction in which judicial proceedings may at any time be commenced with
respect to this Agreement or any other Funding Document to which it is a party, to claim for itself
or its revenues or assets any such immunity, and to the extent that in any such jurisdiction there
may be attributed to Somita such an immunity (whether or not claimed), Somita hereby irrevocably
agrees not to claim and hereby irrevocably waives such immunity. The foregoing waiver of immunity
shall have effect under the United States Foreign Sovereign Immunities Act of 1976.

     Section 4.21 Taxes and Reports. All tax returns and reports of Somita required by law to be
filed in the Republic of Burkina Faso, and each governmental subdivision thereof, have been duly
filed for periods ending prior to the date of this Agreement, and all Taxes, assessments, fees and
other governmental charges due or reasonably anticipated to become due in respect of Somita, or any
assets, income, or franchises of Somita, that if not paid could have a Material Adverse Effect,
have been duly paid or have been adequately provided for on the books of Somita.

     Section 4.22 Defaults. No Event of Default, and no event or condition that with the passage of time or
the giving of notice, or both, could constitute an Event of Default, has occurred and is
continuing. Neither Somita nor, to the best knowledge of Somita, any other party is in breach of
any provision of any contract to which Somita is a party, which breach could have a Material
Adverse Effect.

ARTICLE V

AFFIRMATIVE COVENANTS

     To conform with the terms and conditions under which Royal Gold is willing to continue to
provide the Funding to Somita, and to induce Royal Gold to enter into this Agreement and continue
to provide the Funding hereunder, Somita covenants and agrees as follows:

     Section 5.1 Project Completion. Somita shall construct and implement the Project promptly,
shall apply the proceeds of the Funding exclusively to the Project and in accordance with the
Tranche Funding Schedule, and shall use its best efforts to cause Project Completion to be achieved
on or prior to September 30, 2007. If Somita becomes unable to achieve the

24

 

completion undertakings
set out in the preceding sentence, or becomes unable to meet its other obligations prior to Project
Completion, Somita shall promptly so notify Royal Gold.

     Section 5.2 Company Operations; Maintenance of Project.

     (a) Somita shall duly and punctually perform its obligations under this Agreement and each of
the other Funding Documents to which it is a party. Somita shall conduct its operations on the
basis of customary commercial practice and arm’s-length arrangements, with due diligence and
efficiency and under the supervision of qualified and experienced management. Somita shall update
the Financial Model with its updated budget on an annual basis.

     (b) Somita shall maintain, preserve, protect, and keep the Project and all other material
property used or useful in the conduct of its business in good condition (ordinary wear and tear
and obsolescence excepted) in accordance with prudent industry standards, and in compliance with
all applicable Laws, in conformity with all applicable contracts, servitudes, leases and
agreements, and shall from time to time make all repairs, renewals and replacements needed to
enable the business and operations carried on in connection therewith to be promptly and
advantageously conducted at all times, except where failure to do so could not have a Material
Adverse Effect.

     Section 5.3 Payment and Performance. Somita shall pay all amounts due for which Somita is obligated
under the Funding Documents, in accordance with the terms thereof, and will observe, perform and
comply with every covenant, term and condition of each Funding Document.

     Section 5.4 Compliance with Agreements and Law. Somita shall perform all obligations it is required to
perform under the terms of the Funding Documents and each other lease, agreement, contract or other
instrument or obligation to which
it is a party or by which it or any of its properties is bound except where failure to comply could
not have a Material Adverse Effect. Somita shall conduct its business and affairs, including the
Project, (a) in compliance with all Laws applicable thereto except where failure to comply could
not have a Material Adverse Effect; (b) in all material respects in accordance with the Development
Plan; (c) in accordance with acceptable industry practice including maintaining a minimum of local
standards and World Bank environmental guidelines (applicable under, World Bank and IFC Pollution,
Prevention and Abatement Guidelines and the applicable IFC Safeguard Policies), and where
practicable, the International Cyanide Code and the Equator Principles; and (d) in compliance, and
causing its affiliates, subsidiaries, agents, employees, subcontractors, directors and officers to
be in compliance, with the Corrupt Practices Laws. Somita shall obtain and cause all licenses and
permits necessary or appropriate for the conduct of its business and the ownership and operation of
its property used and useful in the conduct of its business to be at all times maintained in good
standing and in full force and effect, except where failure to comply could not have a Material
Adverse Effect.

     Section 5.5 Books, Financial Statements and Reports. Somita shall at all times maintain full and
accurate books of account and records. Somita shall maintain a standard

25

 

system of accounting, will maintain its Fiscal Year, and will furnish the following statements and
reports to Royal Gold at Somita’s expense:

     (a) As soon as available, and in any event within one hundred twenty (120) days after the end
of each Fiscal Year, complete financial statements of Somita together with all notes thereto,
prepared in reasonable detail in accordance with Canadian GAAP, reviewed using generally accepted
standards by an independent certified public accounting firm selected by Somita and reasonably
acceptable to Royal Gold. These financial statements shall contain a balance sheet as of the end
of such Fiscal Year and statements of earnings, of cash flows, and of changes in owners’ equity for
such Fiscal Year, each setting forth in comparative form the corresponding figures for the
preceding Fiscal Year.

     (b) As soon as available, and in any event within forty-five (45) days after the end of each
of the first three Fiscal Quarters of each Fiscal Year, Somita’s balance sheet as of the end of
such Fiscal Quarter and statements of Somita’s earnings and cash flows for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal Quarter, all in reasonable
detail and prepared in accordance with Canadian GAAP, subject to changes resulting from normal
year-end adjustments and without footnotes. In addition Somita shall, together with each such set
of financial statements and each set of financial statements furnished under subsection (a) of this
section, furnish a certificate in the form attached hereto as Exhibit I signed by the chief
financial officer of Somita stating that such financial statements are accurate and complete in all
material respects (subject to normal year-end adjustments), stating that he has reviewed the
Funding Documents, and stating that no Default exists at the end of such Fiscal Quarter or at the
time of such certificate or specifying the nature and period of existence of any such Default.

     (c) Until Somita shall have achieved Project Completion, a report within 20 days after the end
of each month certified by a Responsible Officer setting forth in reasonable detail the progress of
the Project, including (i) expenditures of funds, (ii) estimated future costs, (iii) unexpended
funds available to Somita, (iv) the progress and percentage of completion of the major phases of
Project construction and the total construction work of the Project, (v) the monthly report(s)
provided to Somita by its major contractor(s) on the Project, and (vi) the acquisition of fixtures
and equipment, to be reviewed by the Project Engineer, in the format attached hereto as Exhibit J;

     (d) Until Somita shall have achieved Project Completion, within 45 days after the end of each
Fiscal Year, a report certified by a Responsible Officer setting forth in reasonable detail all
transactions during such Fiscal Year between (i) Somita and (ii) HRG or Affiliates of HRG (other
than arrangements for compensation of officers, employees or directors of Somita for their services
as such at a rate established on an arm’s length basis).

     (e) Within 30 days after Somita is required to make any report to the Government, a copy of
each such report.

     (f) Until satisfaction of the PP1 and PP2 Obligations, not later than 30 days prior to the
beginning of each Fiscal Year, an annual operating forecast for Somita, including its

26

 

projected quarterly Financial Statements for such Fiscal Year, together with a statement of
the assumptions on which such forecast is based.

     (g) Within 90 days after the end of each Fiscal Year, an environmental compliance report
summarizing the environmental performance of the Project during such Fiscal Year and providing
sufficient information for Royal Gold to monitor the performance of the Project with respect to
environmental protection, including, at a minimum, narrative summaries of (i) the results of any
environmental monitoring or sampling activity conducted at the Project, (ii) accidents at the
Project impacting the environment or resulting in the loss of life, and (iii) environmental
deficiencies at the Project identified by the Republic of Burkina Faso environmental regulatory
authorities and any remedial actions taken or proposed to be taken with respect thereto.

     (h) Within 90 days after the date of effectiveness of any amendment to any Mining Law, a copy
of such amendment together with a statement from Somita’s legal counsel in the Republic of Burkina
Faso describing in reasonable detail what effect (if any) such amendment will have on Somita and
the Project.

     (i) Copies of all other annual or interim audit reports and management letters submitted to
the Company by its independent accountants and such other information and data with respect to its
operations (including without limitation supporting information as to compliance with this
Agreement and the other Funding Documents) as Royal Gold may reasonably request from time to time.

     (j) After Project Completion, Somita shall also provide monthly operating reports, to be
reviewed by the Project Engineer, in the format attached hereto as Exhibit K;

     (k) Somita shall provide Royal Gold, quarterly reports on drilling and exploration results,
ore reserve calculations and engineering and economic studies, to the extent such items are
prepared by or on behalf of Somita, within 15 Business Days of Somita’s receipt of same; and

     (l) Somita shall provide Royal Gold with copies of the annual business plan and budget,
operating forecast and mineral reserve and resource report for the Properties.

     Section 5.6 Access and Inspections. Somita shall permit representatives appointed by Royal
Gold (including independent accountants, auditors, agents, attorneys, appraisers and any other
Persons) to visit and inspect during normal business hours any of Somita’s property, including its
books of account, other books and records, and any facilities or other business assets, and to make
extra copies therefrom and photocopies and photographs thereof, and to write down and record any
information such representatives obtain, and Somita shall permit Royal Gold or its representatives
to investigate and verify the accuracy of the information furnished to Royal Gold in connection
with the Funding Documents and to discuss all such matters with its officers and, upon prior notice
to Somita, its employees and representatives (so long as Somita’s officers and other
representatives are entitled to be present), provided that so long as no Event of Default has
occurred that is continuing, Royal Gold shall provide reasonable advance notice to

27

 

Somita. Royal Gold and such representatives shall maintain the confidentiality of all such
information in accordance with Section 8.6. For greater certainty, the fees and expenses of all
professionals appointed by Royal Gold (except the Project Engineer) shall be for the account of
Royal Gold.

     Section 5.7 Notice of Material Events. Somita will promptly notify Royal Gold in writing,
and in no event later than two (2) Business Days after any officer of Somita has knowledge thereof,
stating that such notice is being given pursuant to this Agreement, of:

     (a) any matter that could have a Material Adverse Effect;

     (b) the occurrence of any Default,

     (c) any default by Somita under any Funding Document or any indenture, mortgage, agreement,
contract or other instrument to which it is a party or by which it or any of its properties is
bound;

     (d) any force majeure event affecting the Project;

     (e) the filing of any suit or proceeding, or the assertion in writing of a claim against
Somita or with respect to the Project;

     (f) any decision to accelerate, expand or reduce the level of production beyond the levels
outlined in the Development Plan; and

     (g) any proposed material change in mining or processing methods with respect to the Project.

     Upon the occurrence of any of the foregoing, Somita shall take all necessary or appropriate steps
to remedy promptly any such Material Adverse Effect, Default, acceleration or default, to protect
against any such adverse claim, to defend any such suit or proceeding, and to resolve all
controversies on account of any of the foregoing.

     Section 5.8 Maintenance of Existence and Qualifications. Each of Somita, HRG,
International and Shareholder shall maintain and preserve its existence and its rights and
franchises in full force and effect and will qualify to do business in all states or jurisdictions
where required by applicable Law, except where the failure so to qualify could not have a Material
Adverse Effect.

     Section 5.9 Payment of Trade Liabilities, Taxes, etc. Somita shall (a) timely file all
required tax returns including any extensions; (b) timely pay all taxes, assessments, and other
governmental charges or levies imposed upon it or upon its income, profits or property before the
same become delinquent; (c) pay before the same become delinquent all Liabilities owed by it on
ordinary trade terms to vendors, suppliers and other Persons providing goods and services used by
it in the ordinary course of its business; (d) pay and discharge when due all other Liabilities now
or hereafter owed by it; and (e) maintain appropriate accruals and reserves for all of the
foregoing in accordance with Canadian GAAP. Somita may, however, delay paying or

28

 

discharging any of the foregoing so long as it is in good faith contesting the validity thereof by
appropriate proceedings, if necessary, and has set aside on its books adequate reserves therefor.

     Section 5.10 Insurance.

     (a) Somita shall, at its expense, obtain, maintain or cause to be maintained in effect
insurance with respect to the Project insuring against liability for death of, or loss, injury or
damage to, the person or property of others, and with respect to equipment or other assets being
acquired for use in the Project as to which Somita has an insurable interest, against such hazards
(including, without limitation, fire, lightning, collapse, wind and hail, explosion, smoke,
aircraft and vehicles, riot, civil commotion, terrorism, vandalism, other extended coverage risks,
marine cargo losses, flood and earthquake, environmental impairment liability and environmental
remediation, and any other hazards to the extent that properties of a nature similar to those
included in the Project and in the same or similar localities are usually insured), in such form
(including the form of the loss payable clauses) as is normally considered to be covered under an
“all risks” policy, and with such insurers as shall be selected by Somita and approved by Royal
Gold (such approval not to be withheld unreasonably), such insurance to be in such amount as Somita
would, in the prudent management of its property, maintain, or would be maintained by others
similarly situated in respect of property similar to the Project; provided, however, that (i) the
amount of such insurance with respect to the Project shall not at any time be less than the greater
of the total cost of the construction and acquisition of the Project (other than the cost of the
land underlying the Project) or $35,000,000; and (ii) such insurance shall be on a “no
co-insurance/agreed-amount” basis.

     (b) Somita shall carry workers’ compensation insurance, disability benefits insurance, and
such other form of insurance which Somita is required by law to provide, covering loss resulting
from injury, sickness, disability, or death of the employees of Somita in such amounts as is
customary in Burkina Faso in the gold mining business.

     (c) Somita shall carry business interruption insurance covering risk of loss as a result of
the cessation or material interruption of the business of Somita which insurance shall be in force
once Somita has commenced operations.

     (d) All insurance policies required hereby covering business interruption, loss or damage to
the Project shall name Somita and Royal Gold as additional insureds as their interests may appear
and, prior to achievement of Project Completion, shall provide that any payment thereunder for any
loss or damage shall be made to Royal Gold and HRG jointly. Such proceeds shall be first used to
pay $35,000,000 as advance payments of amounts payable under the Somita Assignments, and the
remainder to Somita.

     (e) All policies shall (i) be primary and non-contributory over any other insurance carried by
or on behalf of Royal Gold; (ii) insure the interests of Royal Gold regardless of any breach or
violation by Somita of warranties, declarations or conditions contained in such policies or any
action or inaction of Somita or others; (iii) expressly provide that all provisions thereof, except
the limits of liability (which shall be applicable to all insureds as a group), shall operate in
the same manner as if there were a separate policy covering each such insured; (iv) waive any

29

 

right of subrogation of the insurers to any rights of Somita or Royal Gold in respect of any
liability of Somita or Royal Gold and any right of the insurers to any setoff or counterclaim or
any other deduction, whether by attachment or otherwise, in respect of any liability of Somita or
Royal Gold; (v) provide that, if such insurance is canceled, terminated or materially changed for
any reason whatsoever (other than non-payment of premium), the insurers will promptly notify Somita
and Royal Gold in writing and any such cancellation, termination or change shall not be effective
as to Somita or Royal Gold for 30 days after receipt of such notice, and appropriate certification
shall be made to Somita and Royal Gold by each insurer with respect thereto; (vi) carry appropriate
loss payee endorsements acceptable to Royal Gold; and (vii) provide, or each insurer shall agree
with Royal Gold, that the insurer shall give Royal Gold 35 days’ prior written notice of the
expiration of insurance under such policy in accordance with its terms if Somita has failed by such
time to pay any premium due in respect of the renewal of insurance under such policy.

     (f) Somita shall cause the insurers with whom it maintains such insurance to agree to advise
Somita and Royal Gold in writing promptly of any default in the payment of any premiums or any
other act or omission on the part of Somita of which they have knowledge and which might invalidate
or render unenforceable, in whole or in part, any such insurance.

     (g) In the event Somita fails to take out or maintain the full insurance coverage required by
this Agreement or fails to keep the Project in good order and repair and in as reasonably safe
condition as its operations permit, Royal Gold, upon 30 days’ written notice (unless the
aforementioned insurance would lapse within such period in which event notice should be given as
soon as reasonably possible) to Somita of any such failure on its part, may (but shall not be
obligated to) take out the required policies of insurance and pay the premiums on the same, pay
such taxes or other charges or complete the Project or make such repairs, renewals and replacements
as may be necessary to maintain the Project in good order and repair and in as reasonably safe
conditions as Somita’s operations permit. All amounts so advanced therefor by Royal Gold shall
become additional obligations of Somita to Royal Gold, and Somita will forthwith pay such amounts
to Royal Gold, together with interest thereon at the annual rate of LIBOR plus 3.00% from the date
so advanced.

     Section 5.11 Studies, Protocols and Action Plans. On or before Project Completion, Somita
shall conclude the existing studies, reports, protocols and action plans, all in form and substance
reasonably satisfactory to Royal Gold, in the following areas:

     (a) Social Action Plan. The Social Action Plan shall (i) address short and long term
plans for meetings, interactions, training, etc. for local and indigenous people, including (A)
meeting plans and logs of minutes of meetings and (B) indigenous sacred sites – impacts, access
enhancement, and preservation; and (ii) plan to address issues identified to date, or evolving from
meetings, including (A) a plan regarding compensation for relocation or removal of lands from
farming and artisanal mining activities.

     (b) Environmental Action Plan. The Environmental Action Plan shall consist of (i)
hydrologic study, ground water chemical characteristics, local water supply impacts, including (A)
dewatering, which shall include (1) water quality and (2) disposition (i.e., Where does this

30

 

water go? What is the storage plan? What are the alternatives if water volume is too great?),
and (B) local water supply impacts, which shall include (1) plans for monitoring and (2) plans for
mitigation; (ii) threatened and endangered species, including (A) a statement of those potentially
present, (B) impacts and (C) an action plan; (iii) chemical inventory action plan, including (A)
transport policy, (B) storage policy and (C) containment facilities, and spill containment and
response plans; (iv) waste rock and tailings characterization (acid-base accounting and kinetic
leach characteristics) and impacts, including (A) a proactive plan to generate sufficient data
(acid-base accounting and kinetic leach characterization) to address waste rock, tailings and
abandoned pit lake issues; and (v) a concurrent reclamation plan.

     (c) Closure Plan. The Closure Plan shall consist of (i) issue identification and
mitigation plan, including (A) waste rock, tailings, pit lake and local water supply issues; and
(ii) a closure cost estimate.

     Section 5.12 Government Approvals and Notices. Somita shall (i) obtain, and shall at all
times maintain in full force and effect, all material registrations, declarations, filings,
governmental consents, licenses, approvals, authorizations, and permits necessary for the
performance by Somita of this Agreement and each of the other Funding Documents to which it is or
will be a party, and (ii) undertake reasonable efforts to arrange for Royal Gold to receive from
the Government and any Tribunal copies of all correspondence, notices, decrees, orders and other
writings issued by the Government or any Tribunal to Somita or HRG regarding the Project or the
Properties, but in any event, Somita shall send copies of such materials to Royal Gold promptly
after receipt thereof.

     Section 5.13 Refining Contracts. Upon Project Completion and during the entire term of the
Somita Assignments, Somita shall maintain in full force and effect Refining Contracts with smelters
and/or refiners reasonably acceptable to Royal Gold. Somita shall use its best efforts to cause
such Refining Contracts to provide for, where possible, payment by the refiner and/or smelter
directly to Royal Gold of amounts due under PP1, PP2, the Tail Royalty and the Milling Fee, in cash
or, at Royal Gold’s request and where possible, in kind.

     Section 5.14 Evidence of Compliance. Each of Somita and HRG shall furnish to Royal Gold,
at Somita’s expense, all evidence that Royal Gold from time to time reasonably requests in writing
as to the accuracy and validity of or compliance with all representations, warranties and covenants
made by each of Somita and HRG in the Funding Documents, the satisfaction of all conditions
contained therein, and all other matters pertaining thereto.

     Section 5.15
HRG Fundings.

     (a) Somita hereby agrees and acknowledges that, pursuant to the terms of the Contribution
Agreement, beginning not later than April 1, 2006, HRG shall make monthly fundings to Somita for
each of April, May, June and July of 2006 in accordance with the timetable set forth in the
Contribution Agreement, in a timely matter and until HRG has met all of its funding obligations
under the Contribution Agreement.

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     (b) Somita hereby irrevocably grants Royal Gold the right to make funding requests to HRG on
behalf of Somita for cost overruns in connection with the Project in the event (i) Somita is unable
to achieve a Project Milestone without additional funding and (ii) Somita fails to make the related
funding request within a reasonable time, as determined by Royal Gold in its reasonable discretion.

     Section 5.16 Further Assurances. Somita shall, and shall cause HRG, International and
Shareholder to, promptly cure any defects, errors or omissions in the execution and delivery of the
Funding Documents and, upon notice, take such other action and immediately execute and deliver to
Royal Gold all such other and further instruments as may be reasonably required or desired by Royal
Gold from time to time in compliance with the covenants and agreements made in this Agreement and
the other Funding Documents.

ARTICLE VI

NEGATIVE COVENANTS

     To conform with the terms and conditions under which Royal Gold is willing to continue to
provide the Funding to Somita, and to induce Royal Gold to enter into this Agreement and continue
to provide the Funding hereunder, Somita covenants and agrees as follows, unless Royal Gold shall
have previously agreed in writing otherwise:

     Section 6.1 Indebtedness. Until Project Completion, Somita shall not in any manner owe or
be liable for Indebtedness except:

     (a) Indebtedness under the CAT Agreement not to exceed 6,200,000 Euros;

     (b) Additional Indebtedness not to exceed one million dollars ($1,000,000), which is incurred
in the ordinary course of business; and

     (c) Refinancings, renewals or extensions of any of the foregoing without any increase in the
principal amount thereof.

     Section 6.2 Limitation on Liens. Except for Permitted Liens, until satisfaction of the PP1
and PP2 Obligations, Somita shall not create, assume or permit to exist any material Lien,
encumbrance or unsatisfied judgment upon any of the properties or assets which it now owns or
hereafter acquires.

     Section 6.3 Project Abandonment. Until satisfaction of the PP1 and PP2
Obligations, Somita shall not abandon the Project, which shall include, without limitation,
suspension of construction, operation or maintenance of the Project, except for cessation of
operations under care and maintenance.

     Section 6.4 Limitation on Mergers, Issuances of Securities. Until satisfaction of the PP1
and PP2 Obligations, Somita shall not (a) enter into any transaction of merger or consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution);
or (b) acquire any business or property from, or capital stock of, or be a party to

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any acquisition of, any Person except for purchases of property to be sold or used in the ordinary
course of business and Investments permitted under Section 6.7 hereof; or (c) issue any additional
shares of its capital stock, membership or partnership interests or other securities or any
options, warrants or other rights to acquire such additional shares, interests or other securities;
provided, however, that with respect to clause (c), Somita may make such issuances after Project
Completion so long as the same could not result in a Change of Control.

     Section 6.5 Limitation on Asset Disposition. Until satisfaction of the PP1 and PP2
Obligations, Somita shall not sell, transfer, lease, exchange, alienate or dispose of any of its
material assets or properties or any material interest therein, including any sale or other
transfer or issuance of any equity interests of Somita (except as permitted pursuant to Section 6.4
above), or discount, sell, pledge or assign any notes payable to it, accounts receivable or future
income, except:

     (a) material assets or properties not to exceed five hundred thousand dollars ($500,000) in
the aggregate in any year, or a greater amount if the Project Engineer has agreed with Somita,
acting reasonably, that such material assets above such $500,000 aggregate are not necessary for
the Project;

     (b) equipment which is worthless or obsolete or no longer necessary or useful to the proper
conduct of its business or which is replaced by equipment of equal suitability and value; and

     (c) assets, lands and permits that are unrelated to the Lands or the Project, in the ordinary
course of business.

     Section 6.6 Limitation on Dividends and Redemptions. Except as expressly provided in this
Section 6.6, Somita will not declare, pay or make, whether in cash or other property, any
Distribution on, or purchase, redeem or otherwise acquire for value, any of its capital stock.
Notwithstanding the foregoing, Somita shall be entitled to make Distributions provided that at the
time of making any such Distribution (i) it is current with respect its obligations under the PP1
and PP2 Obligations and the Conveyance of Tail Royalty and Grant of Milling Fee, (ii) there is no
Default or Event of Default hereunder and (iii) the making of such Distribution will not cause a
Default or Event of Default hereunder.

     Section 6.7 Limitation on Investments and New Businesses. Until Project Completion, Somita
shall not (a) make any expenditure or commitment or incur any obligation or enter into or engage in
any transaction except in the ordinary course of business, (b) engage directly or indirectly in any
business or conduct any operations except in connection with or incidental to the Project or other
business of Somita as of the Closing Date, or (c) make any acquisitions of or capital contributions
to or other Investments in any Person.

     Section 6.8 Transactions with Affiliates. Somita will not engage in any material
transaction with any of its Affiliates on terms which are less favorable to it than those which
would have been obtainable at the time in arm’s-length dealing with Persons other than such
Affiliates.

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     Section 6.9 Contracts. Until satisfaction of the PP1 and PP2 Obligations, Somita shall not
amend or permit any amendment to, or waiver or termination of, any material contract, agreement,
permit or lease without the prior written consent of Royal Gold, which consent shall not be
unreasonably withheld.

     Section 6.10 No Subsidiaries. Until Project Completion, Somita shall neither form nor own
any Subsidiaries.

     Section 6.11 Satisfaction of Conditions Precedent. Somita shall use commercially
reasonable best efforts to cause all of the conditions precedent set forth in Article III to be
satisfied.

ARTICLE VII

EVENTS OF DEFAULT AND REMEDIES

     Section 7.1 Events of Default. Each of the following events constitutes an Event of
Default under this Agreement:

     (a) Somita fails to pay any amounts earned under PP1 or PP2 or any other amount to be paid to
Royal Gold when due and payable;

     (b) The Project is abandoned prior to satisfaction of the Completion Test, the Completion Date
has not occurred by December 31, 2007, or a Material Adverse Effect occurs;

     (c) Any “default” or “event of default” occurs under any Funding Document which defines either
such term, and the same is not remedied within the applicable period of grace (if any) provided in
such Funding Document;

     (d) Somita fails to duly observe, perform or comply with any covenant, agreement or provision
of Article V or Article VI;

     (e) Any of Somita, HRG, International or Shareholder fails (other than as referred to in
subsections (a), (b), (c) or (d) above) to duly observe, perform or comply with any covenant,
agreement, condition or provision of any Funding Document, and such failure remains unremedied for
a period of fifteen (15) days after notice of such failure is given by Royal Gold to Somita;

     (f) Any representation or warranty previously, presently or hereafter made in writing by any
of Somita, HRG, International or Shareholder in connection with any Funding Document shall prove to
have been false or incorrect in any material respect on any date on or as of which made, or any
Funding Document or any material obligation thereunder at any time ceases to be valid, legal,
binding and enforceable for any reason other than its release by Royal Gold, or any material
agreement, concession, mining lease, approval or license relating to the Project is terminated,
expropriated, suspended, revoked or varied;

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     (g) Somita shall default in the payment when due of any principal of or interest on any of its
Indebtedness in excess of $100,000 in the aggregate (other than Indebtedness the validity of which
is being contested in good faith by appropriate proceedings and for which adequate reserves with
respect thereto are maintained on the books of Somita in accordance with Canadian GAAP), or any
event specified in any note, agreement, indenture or other document evidencing or relating to any
such Indebtedness shall occur if the effect of such event is to cause, or (with the giving of any
notice or the lapse of time or both) to permit the holder or holders of such Indebtedness (or a
trustee or agent on behalf of such holder or holders) to cause, such Indebtedness to become due, or
to be prepaid in full (whether by redemption, purchase, offer to purchase or otherwise), prior to
its stated maturity;

     (h) Until satisfaction of the obligations of Somita with respect to payments under PP1 and
PP2, (i) any Change of Control occurs, or (ii) any successor to Somita or HRG fails to assume all
obligations and liabilities of Somita or HRG, as applicable;

     (i) Until Project Completion, HRG or Somita fails to continue to employ Daniel Vanin in his
current or similar position, provided HRG or Somita does not employ an individual to replace Daniel
Vanin who is consented to by Royal Gold, acting reasonably;

     (j) Either Somita or HRG, and, until Project Completion, either International or Shareholder:

          (i) suffers the entry against it of a judgment, decree or order for relief by a Tribunal of
competent jurisdiction in an involuntary proceeding commenced under any applicable bankruptcy,
insolvency or other similar Law of any jurisdiction now or hereafter in effect, including the
Bankruptcy Code of any country, as from time to time amended, or has any such proceeding commenced
against it which remains undismissed for a period of sixty days; or

          (ii) commences a voluntary case under any applicable bankruptcy, insolvency or similar Law now
or hereafter in effect, including the Bankruptcy Code of any country, as from time to time amended;
or applies for or consents to the entry of an order for relief in an involuntary case under any
such Law; or makes a general assignment for the benefit of creditors; or is generally unable to pay
(or admits in writing its inability to pay) its debts as such debts become due; or takes corporate
or other action to authorize any of the foregoing; or

          (iii) suffers the appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of all or a substantial part of its assets or
the Shares in a proceeding brought against or initiated by it, and such appointment or taking
possession is neither made ineffective nor discharged within sixty days after the making thereof,
or such appointment or taking possession is at any time consented to, requested by, or acquiesced
to by it; or

          (iv) suffers the entry against it of a final judgment for the payment of money in excess of
$100,000, unless the same is discharged within thirty days after the date of entry thereof or an
appeal or appropriate proceeding for review thereof is taken within such period and a stay of
execution pending such appeal is obtained; provided, however, that any such judgment

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or order shall not be an Event of Default under this Section 7.1(j)(iv) if and for so long as
the amount of such judgment or order is covered by a valid and binding policy of insurance between
the defendant and the insurer covering payment of such amount (less any portion of any deductible
payable in respect of such judgment or order under such policy), as confirmed by Royal Gold; or

          (v) suffers a writ or warrant of attachment or any similar process to be issued by any
Tribunal against all or any substantial part of its assets or any part of the Project, and such
writ or warrant of attachment or any similar process is not stayed or released within thirty days
after the entry or levy thereof or after any stay is vacated or set aside;

     (k) One of the following events shall occur with respect to, or in connection with, the
Project: (i) confiscation, expropriation, nationalization, (ii) cancellation of concession, (iii)
selective discrimination, (iv) forced divestiture, (v) forced abandonment, (vi) export embargo,
(vii) import embargo, (viii) contingent currency inconvertibility and exchange transfer, and (ix)
political violence including war on land;

     (l) The security interest created granted under the Initial Pledge, Pledge I or Pledge II
shall become invalid in any material respect or any obligation of Somita under any Funding Document
shall become invalid in any material respect and, with respect to both of the foregoing, the same
remains unremedied for 30 days after an executive officer of Somita has knowledge thereof, or the
validity of such security interest or obligation shall be challenged by Somita in writing;

     (m) The Taparko Mining Convention, the Bouroum Mining Convention, the Taparko Permit or the
Bouroum Permit shall be amended or terminated without Royal Gold consent, or Somita shall violate
any term of the Taparko Mining Convention, the Bouroum Mining Convention, the Taparko Permit or the
Bouroum Permit that would result in the termination thereof or give the Government the right to
terminate any thereof; or

     (n) Any governmental authority condemns, nationalizes, seizes or otherwise expropriates any
substantial portion of the assets or the capital stock of Somita or takes any other action that
would prevent Somita from carrying on any material part of its business or operations.

     Section 7.2 Remedies. If any Default shall occur and be continuing, Royal Gold may protect
and enforce its rights under the Funding Documents by any appropriate proceedings, including
proceedings for specific performance of any covenant or agreement contained in any Funding
Document, and Royal Gold may enforce the payment of any amounts due it or enforce any other legal
or equitable right which it may have, including, without limitation, if Project Completion is not
achieved by December 31, 2007, Royal Gold may elect in its sole and absolute discretion (a) to
foreclose on the Shareholder’s shares of Somita, or (b) require Somita to reimburse any and all of
the Funding made by Royal Gold prior to such date. All rights, remedies and powers conferred upon
Royal Gold under the Funding Documents shall be deemed cumulative and not exclusive of any other
rights, remedies or powers available under the Funding Documents or at Law or in equity.

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ARTICLE VIII

MISCELLANEOUS

Section 8.1 Waivers and Amendments; Acknowledgments.

     (a) Waivers and Amendments. No failure or delay (whether by course of conduct or
otherwise) by Royal Gold in exercising any right, power or remedy which Royal Gold may have under
any of the Funding Documents shall operate as a waiver thereof or of any other right, power or
remedy, nor shall any single or partial exercise by Royal Gold of any such right, power or remedy
preclude any other or further exercise thereof or of any other right, power or remedy. No waiver
of any provision of any Funding Document and no consent to any departure therefrom shall ever be
effective unless it is in writing and signed as provided below in this section, and then such
waiver or consent shall be effective only in the specific instances and for the purposes for which
given and to the extent specified in such writing. No notice to or demand on Somita, HRG,
International or Shareholder shall in any case of itself entitle such party to any other or further
notice or demand in similar or other circumstances. This Agreement and the other Funding Documents
set forth the entire understanding between the parties hereto with respect to the transactions
contemplated herein and therein and supersede all prior discussions and understandings with respect
to the subject matter hereof and thereof, and no waiver, consent, release, modification or
amendment of or supplement to this Agreement or the other Funding Documents shall be valid or
effective against any party hereto unless the same is in writing and signed by (i) if such party is
Somita, HRG, International or Shareholder, by such party and (ii) if such party is Royal Gold, by
Royal Gold.

     (b) Acknowledgments and Admissions. Somita hereby represents, warrants, acknowledges
and admits that (i) it has been advised by counsel in the negotiation, execution and delivery of
the Funding Documents, (ii) it has made an independent decision to enter into this Agreement and
the other Funding Documents, without reliance on any representation, warranty, covenant or
undertaking by Royal Gold, whether written, oral or implicit, other than as expressly set out in
this Agreement or in another Funding Document delivered on or after the date hereof, (iii) there
are no representations, warranties, covenants, undertakings or agreements by Royal Gold as to the
Funding Documents except as expressly set out in this Agreement or in another Funding Document
delivered on or after the date hereof, (iv) Royal Gold has no fiduciary obligation toward any of
Somita, HRG, International or Shareholder with respect to any Funding Document or the transactions
contemplated thereby, (v) no partnership or joint venture exists with respect to the Funding
Documents between Somita and Royal Gold, (vi) should an Event of Default or Default occur or exist,
Royal Gold will determine in its sole discretion and for its own reasons what remedies and actions
it will or will not exercise or take at that time, (vii) without limiting any of the foregoing,
Somita is not relying upon any representation or covenant by Royal Gold, or any representative
thereof, and no such representation or covenant has been made, that Royal Gold will, at the time of
an Event of Default or Default, or at any other time, waive, negotiate, discuss, or take or refrain
from taking any action permitted under the Funding Documents with respect to any such Event of
Default or Default or any other provision of the Funding Documents, and (viii) Royal Gold has
relied upon the truthfulness of the

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acknowledgments in this section in deciding to execute and deliver this Agreement and to
become obligated hereunder.

     (c) Joint Acknowledgment. This Agreement and the other Funding Documents
represent the final agreement between the parties and may not be contradicted by evidence of prior,
contemporaneous, or subsequent oral agreements of the parties. There are no unwritten
oral agreements between the parties.

     Section 8.2 Survival of Agreements; Cumulative Nature. All of the various representations,
warranties, covenants and agreements of each of Somita, HRG, International and Shareholder in the
Funding Documents shall survive the execution and delivery of this Agreement and the other Funding
Documents and the performance hereof and thereof. All statements and agreements contained in any
certificate or other instrument delivered by an officer of any of Somita, HRG, International or
Shareholder to Royal Gold under any Funding Document shall be deemed representations and warranties
by such party or agreements and covenants of such party under this Agreement. The representations,
warranties, indemnities, and covenants made by any of Somita, HRG, International or Shareholder in
the Funding Documents, and the rights, powers, and privileges granted to Royal Gold in the Funding
Documents, are cumulative, and, except for expressly specified waivers and consents, no Funding
Document shall be construed in the context of another to diminish, nullify, or otherwise reduce the
benefit to Royal Gold of any such representation, warranty, indemnity, covenant, right, power or
privilege. In particular and without limitation, no exception set out in this Agreement to any
representation, warranty, indemnity, or covenant herein contained shall apply to any similar
representation, warranty, indemnity, or covenant contained in any other Funding Document, and each
such similar representation, warranty, indemnity, or covenant shall be subject only to those
exceptions which are expressly made applicable to it by the terms of the various Funding Documents.

     Section 8.3 Notices. All notices, requests, consents, demands and other communications
required or permitted under any Funding Document shall be in writing, unless otherwise specifically
provided in such Funding Document, and shall be deemed sufficiently given or furnished if delivered
by personal delivery, by facsimile or other electronic transmission, or by delivery service with
proof of delivery, to any of the Parties at the address below (unless changed by similar notice in
writing given by the particular Person whose address is to be changed):

     To Royal Gold:

Royal Gold, Inc.

1660 Wynkoop Street, Suite 1000

Denver, CO 80202

Attention: President

Facsimile: 303-595-9385

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     To Somita:

Somita SA

01 B.P. 2509 OUAGADOUGOU 01

1648 Boulevard Tansoba TAB-KOM,

Secteur 25

Burkina Faso

Attention: Directeur Generale

Facsimile: 226-50-358187

     with a copy to HRG:

High River Gold Mines Ltd.

155 University Avenue

Suite 1700

Toronto, Ontario M5H 3B7

Attention: President

Facsimile: (416) 360-0010

     with a copy to Cassels Brock & Blackwell LLP:

Cassels Brock & Blackwell LLP

2100 Scotia Plaza, 40 King Street W.

Toronto, Ontario M5H 3C2

Attention: David Poynton

Facsimile: (416) 644-9348

Any such notice or communication shall be deemed to have been given (a) in the case of personal
delivery or delivery service, as of the date of first attempted delivery during normal business
hours at the address provided herein, (b) in the case of facsimile, upon receipt, or (c) in the
case of other electronic transmission, upon acknowledgment of receipt by the recipient within
twenty-four (24) hours of first attempted delivery; provided, however, that no Funding Request
shall become effective until actually received by Royal Gold.

     Section 8.4 Payment of Expenses; Indemnity.

     (a) Payment of Expenses. Whether or not the transactions contemplated by this
Agreement are consummated, Somita will promptly (and in any event, within thirty (30) days after
any invoice or other statement or notice) pay: (i) all transfer, stamp, documentary or other
similar taxes, assessments or charges levied by any governmental or revenue authority in respect of
this Agreement or any of the other Funding Documents or any other document or transaction referred
to herein or therein, (ii) all reasonable costs and expenses incurred by or on behalf of Royal Gold
(including reasonable attorneys’ fees, consultants’ fees and engineering fees, travel costs, other
costs related to its due diligence process and miscellaneous expenses) in connection with (A) the
negotiation, preparation, execution and delivery of the Funding Documents, and any and all
consents, waivers or other documents or instruments relating thereto, (B) the filing,

39

 

recording, refiling and re-recording of any Funding Documents and any other documents or
instruments or further assurances required to be filed or recorded or refiled or re-recorded by the
terms of any Funding Document, (C) the due diligence with respect to the Project, (D) monitoring or
confirming (or preparation or negotiation of any document related to) the compliance of any of
Somita, HRG, International or Shareholder with any covenants or conditions contained in this
Agreement or in any Funding Document, and (E) all reasonable costs and expenses incurred by or on
behalf of Royal Gold (including without limitation attorneys’ fees, consultants’ fees and
accounting fees) in connection with the preservation of any rights under the Funding Documents or
the defense or enforcement of any of the Funding Documents (including this section), any attempt to
cure any breach thereunder by Somita, or the defense of Royal Gold’s exercise of its rights
thereunder.

     (b) Indemnity. Somita agrees to indemnify Royal Gold, upon demand, from and against
any and all liabilities, obligations, broker’s fees, claims, losses, damages, penalties, fines,
actions, judgments, suits, settlements, costs, expenses or disbursements (including reasonable fees
of attorneys, accountants, experts and advisors) of any kind or nature whatsoever (in this section
collectively called “liabilities and costs”) which to any extent (in whole or in part) may be
imposed on, incurred by, or asserted against such party arising or resulting from or in any other
way associated with the Project, the Funding Documents and the transactions and events (including
the enforcement or defense thereof) at any time associated therewith or contemplated therein
(whether arising in contract or in tort or otherwise). Among other things, the foregoing
indemnification covers all liabilities and costs incurred by Royal Gold related to any breach of a
Funding Document by any of Somita, HRG, International or Shareholder, any bodily injury to any
Person or damage to any Person’s property.

The foregoing indemnification shall apply whether or not such liabilities and costs are in
any way or to any extent owed, in whole or in part, under any claim or theory of strict liability
or caused, in whole or in part by any negligent act or omission of any kind by Royal Gold,

provided only that Royal Gold shall not be entitled under this section to receive
indemnification for that portion, if any, of any liabilities and costs which is proximately caused
by its own individual gross negligence or willful misconduct, as determined in a final judgment.
If any Person (including any Somita or any Affiliate of Somita) ever alleges such gross negligence
or willful misconduct by Royal Gold, the indemnification provided for in this section shall
nonetheless be paid upon demand, subject to later adjustment or reimbursement, until such time as a
court of competent jurisdiction enters a final judgment as to the extent and effect of the alleged
gross negligence or willful misconduct. As used in this section the term “Royal Gold” shall refer
not only to each Person designated as such in Section 1.1 but also to each director, officer,
agent, trustee, attorney, employee, representative and Affiliate of or for such Person.

     Section 8.5 Parties in Interest; Assignments.

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     (a) All grants, covenants and agreements contained in the Funding Documents shall bind and
inure to the benefit of the parties thereto and their respective successors and assigns; provided,
however, that, prior to Project Completion, neither Somita nor HRG shall assign or transfer any of
its rights or delegate any of its duties or obligations under any Funding Document without the
prior written consent of Royal Gold.

     (b) Until the Maximum Amount under the Funding has been funded, but in no event later than
April 30, 2007, Royal Gold shall not assign or transfer any of its rights or delegate any of its
duties or obligations under any Funding Document without the prior written consent of Somita;
provided, however, that, upon the occurrence of an Event of Default by Somita or High River under
any Funding Document, Royal Gold shall have no restrictions on its assignment or transfer of the
Funding Documents. In addition, Royal Gold agrees to notify Somita in the event Royal Gold decides
to solicit third parties for the purpose of assigning or transferring any of its rights or
delegating any of its duties or obligations under any Funding Document.

     Section 8.6 Confidentiality. Each of the Parties agrees to keep confidential any
information furnished or made available to it by the other Party pursuant to this Agreement;
provided that nothing herein shall prevent a Party from disclosing such information (a) to an
Affiliate, or any officer, director, employee, agent, or advisor of an Affiliate, (b) to any other
Person if reasonably incidental to the administration of the funding provided herein, (c) as
required by any Law, (d) upon the order of any court or administrative agency, (e) upon the request
or demand of any Tribunal, (f) that is or becomes available to the public or that is or becomes
available to such Party other than as a result of a disclosure by such Party prohibited by this
Agreement, (g) in connection with any litigation to which such Party or any of its Affiliates may
be a party, (h) to the extent necessary in connection with the exercise of any right or remedy
under this Agreement or any other Funding Document, and (i) subject to provisions substantially
similar to those contained in this section, to any actual or proposed participant or assignee or
any actual or proposed contractual counterparty (or its advisors) to any securitization, hedge, or
other derivative transaction relating to the parties’ obligations hereunder. Any Person required
to maintain the confidentiality of information described in this section shall be considered to
have complied with its obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such information as such Person would accord to its own
confidential information.

     Section 8.7 Governing Law. Except with respect to any security or title matters, which
shall be governed by the appropriate law and jurisdiction, the Funding Documents shall be deemed
contracts and instruments made under the laws of the State of Colorado and shall be construed and
enforced in accordance with and governed by the laws of the State of Colorado and the laws of the
United States of America, without regard to principles of conflicts of law.

     Section 8.8 Limitation on Interest. Royal Gold and Somita intend to contract in strict
compliance with applicable usury Law from time to time in effect. In furtherance thereof such
persons stipulate and agree that none of the terms and provisions contained in the Funding
Documents shall ever be construed to provide for interest in excess of the maximum amount of
interest permitted to be contracted for, charged, or received by applicable Law from time to time
in effect. Neither Somita nor any present or future guarantors, endorsers, or other Persons

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hereafter becoming liable for payment of any Obligation shall ever be liable for unearned interest
thereon or shall ever be required to pay interest thereon in excess of the maximum amount that may
be lawfully contracted for, charged, or received under applicable Law from time to time in effect,
and the provisions of this section shall control over all other provisions of the Funding Documents
which may be in conflict or apparent conflict herewith.

     Section 8.9 Termination; Limited Survival. Notwithstanding the foregoing or anything
herein to the contrary, any waivers or admissions made by Somita or HRG in any Funding Document,
and any obligations which any Person may have to indemnify or compensate Royal Gold shall survive
any termination of this Agreement or any other Funding Document. At the request and expense of
Somita, Royal Gold shall prepare and execute all necessary instruments to reflect and effect such
termination of the Funding Documents.

     Section 8.10 Severability. If any term or provision of any Funding Document shall be
determined to be illegal or unenforceable all other terms and provisions of the Funding Documents
shall nevertheless remain effective and shall be enforced to the fullest extent permitted by
applicable Law.

     Section 8.11 Counterparts; Facsimile Execution. This Agreement may be separately executed
in any number of counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to constitute one and the same Agreement. This Agreement
and the Funding Documents may be validly executed and delivered by facsimile or other electronic
transmission.

     Section 8.12 Dispute Resolution.

     (a) Arbitration Conducted by International Chamber of Commerce. All disputes between
the Parties (which for purposes of this Section 8.12 includes the Parties and their respective
parents, affiliates and subsidiaries) that arise out of, relate to or are in connection with this
Agreement or any related agreement, will be exclusively, finally and conclusively settled by
binding international arbitration under the Rules of Arbitration of the International Chamber of
Commerce (the “ICC”) then in effect (the “Rules”), except as specifically modified
by this Agreement. The Parties shall continue to perform their respective obligations under this
Agreement pending conclusion of any such arbitration.

     (b) Initiation of Arbitration.

          (i) Prior to initiating an arbitration proceeding with the ICC, the Parties shall negotiate in
good faith to resolve the dispute. To that end, the Party wishing to initiate negotiations shall
notify the other Party in writing about its intention to do so, including a brief summary of the
disputed issue, its estimate of the amount in controversy, and suggesting a date and venue for a
first meeting, at which the Parties shall be represented by officers duly empowered to resolve the
dispute. In the event that the Parties are unable to resolve the dispute within a period of 15
days after commencement of such good faith negotiations, or upon agreement by the Parties to submit
the dispute to arbitration, either Party may commence an arbitration proceeding by delivering a
Request for Arbitration (the “Request for Arbitration”) to

42

 

the Secretariat of the ICC (the “Secretariat”) in accordance with the terms of this
Section 8.12 and the Rules.

          (ii) For all disputes, the arbitration hereunder shall be by three independent and impartial
arbitrators. Royal Gold and Somita shall each appoint one arbitrator within 30 days after the
Request for Arbitration has been delivered to the Secretariat and the two arbitrators so appointed
shall select a third arbitrator within 60 days after the Request for Arbitration has been delivered
to the Secretariat. In the event that the Parties or the arbitrators fail to select arbitrators as
required above, the ICC shall select such arbitrators in accordance with the terms of this Section
8.12.

          (iii) Each of the Parties acknowledges and agrees that the other Party would be damaged
irreparably in the event any of the provisions of this Agreement are not performed in accordance
with their specific terms. Accordingly, notwithstanding the provisions of Section 8.12(b)(i),
pending completion of arbitration pursuant to this Section 8.12, either Royal Gold or Somita shall
have the right to seek a temporary restraining order, injunctive relief or other interim or
provisional relief on the ground that such relief would otherwise be available at law or in equity.
If any such relief is obtained, the arbitration panel will address the continuance, modification
or termination of such relief and their order and any such decision regarding relief shall be
binding on the Parties

     (c) Arbitration Procedures.

          (i) The arbitration shall be conducted in the English language in London, England or at such
other location as the Parties may agree.

          (ii) All disputes arising out of or in connection with this Agreement and relating to the
Parties’ rights and obligations in connection with this Agreement (including without limitation the
validity of the agreement of the Parties to arbitrate, the arbitrability of the issues submitted to
arbitration hereunder, the existence and validity of the Agreement, and any conflict of laws issues
arising in connection with the Agreement or this agreement to arbitrate) shall be finally settled
in accordance with the Rules. In addition, where the Rules are silent, the proceedings before the
“Arbitral Tribunal” (as defined in the Rules) shall be governed by the procedural rules established
by the Arbitral Tribunal.

          (iii) The arbitration panel shall conduct a hearing no later than 90 days after delivery of
the Request for Arbitration, and a decision shall be rendered by the arbitration panel within 30
days after the final hearing.

          (iv) At the hearing, the Parties shall present such evidence and witnesses as they may choose,
with or without counsel. Adherence to formal rules of evidence shall not be required but the
Arbitral Tribunal shall consider any evidence and testimony that it determines to be relevant, in
accordance with procedures that it determines to be appropriate.

43

 

     (d) Arbitral Awards.

          (i) The arbitration award shall be in writing and shall specify the factual and legal bases
for the award.

          (ii) Neither Royal Gold nor Somita shall be entitled to, and no award shall include any amount
for, lost profits or revenues, lost business opportunities, business interruption, or punitive or
exemplary damages for any claim arbitrated pursuant to this Section 8.12.

          (iii) The arbitrators shall be entitled to a fee commensurate with their fees for professional
services requiring similar time and effort. The fees of the arbitrators and other costs of the
arbitration shall be borne equally by the Parties, except when the arbitrators decide to impose the
total cost on the defeated Party.

     (e) Enforcement. All decisions of the Arbitral Tribunal shall be final and binding on
the Parties and may be entered against them in any court of competent jurisdiction. Any judgment
rendered by the Arbitral Tribunal against a Party may be executed against such Party’s assets in
any jurisdiction where the Party has assets. Each of the Parties irrevocably submits to the
non-exclusive jurisdiction of the appropriate courts in the State of Colorado in any legal action
or proceeding relating to such execution of judgment.

     (f) Limitations.

          (i) Any dispute brought pursuant to the terms of this Section 8.12 must be brought within two
years of the date that the Party aggrieved by the event or condition, or notice of such event or
condition giving rise to the dispute becomes aware of the same.

          (ii) This agreement to arbitrate shall survive the rescission or termination of this
Agreement.

     Section 8.13 Service of Process. Service of process in any matter shall be made to Somita
at the following address:

Somita SA

01 B.P. 2509 OUAGADOUGOU 01

1648 Boulevard Tansoba TAB-KOM,

Secteur 25

Burkina Faso

Attention: Directeur Generale

Facsimile: 226-50-358187

     with a copy to Cassels Brock & Blackwell LLP:

Cassels Brock & Blackwell LLP

2100 Scotia Plaza, 40 King Street W.

Toronto, Ontario M5H 3C2

Attention: David Poynton

44

 

Facsimile: (416) 644-9348

Somita agrees that service of process, writ, judgment, or other notice of legal process at the
address above shall be (i) deemed and held in every respect to be effective personal service upon
it, and (ii) deemed sufficiently given or furnished if delivered by personal delivery, by facsimile
or other electronic transmission, or by delivery service with proof of delivery. Somita shall
maintain a presence at the address above (unless changed by similar notice in writing given by
Somita) continuously at all times while Somita is obligated under this Agreement or any of the
other Funding Documents. Nothing herein shall affect Royal Gold’s right to serve process in any
other manner permitted by applicable law.

     Section 8.14 English Language. All documents to be furnished or communications to be
given or made under this Agreement and each of the other Funding Documents to which Somita is a
party shall be in the English language or, if in another language, shall be accompanied by a
translation into English certified by a Responsible Officer of Somita, which translation shall be
the governing version between Royal Gold and Somita; provided, however, that the foregoing shall
not apply to (a) documents with or communications to or from the Government of Burkina Faso or (b)
documents or communications to or with third parties in the ordinary course of Somita’s business.

     Section 8.15 Termination of Agreement. This Agreement shall terminate and be of no further
force and effect upon satisfaction of the PP1 and PP2 Obligations, provided that no Default shall
then be continuing.

     Section 8.16 Good Faith and Fair Dealing. The Parties shall conduct their activities
hereunder with respect to each other in accordance with principles of good faith and fair dealing.

[The remainder of this page is intentionally left blank.]

45

 

     This Agreement is executed as of the date first written above.

	 	 	 	 	 	 	 
	 	 	SOCIÉTÉ DES MINES DE TAPARKO	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David Mosher	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	David Mosher	 	 
	 

	 	 	 	Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Daniel Vanin	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Daniel Vanin

Director	 	 
	 
	 	 	 	 	 	 
	 	 	ROYAL GOLD, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Donald Baker	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	Donald Baker	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	V.P. Corporate Development	 	 
	 

	 	 	 	 	 	 

[EXECUTION PAGE TO AMENDED AND RESTATED FUNDING AGREEMENT]exv10w2

 

Exhibit 10.2

CONVEYANCE OF TAIL ROYALTY

AND GRANT OF MILLING FEE

     This CONVEYANCE OF TAIL ROYALTY AND GRANT OF MILLING FEE (this “Conveyance”), dated as
of February 22, 2006 (the “Effective Date”), is from SOCIÉTÉ DES MINES DE TAPARKO, also
known as SOMITA, SA, a société anonyme formed under the laws of the Republic of Burkina Faso
(“Grantor”) to ROYAL GOLD, INC., a corporation formed under the laws of Delaware, USA
(“Grantee”).

Recitals

     A. Grantor and Grantee entered into a Funding Agreement dated as of December 1, 2005 (the
“Original Funding Agreement”), as amended by First Amendment to Funding Agreement dated as
of February 8, 2006 (the “First Amendment”), and as further amended and restated by Amended
and Restated Funding Agreement dated as of February 22, 2006 (as so amended and restated, the
“Funding Agreement”). Pursuant to the Funding Agreement, Grantee agreed to provide Grantor
funding in the amount of U.S. $35,000,000 to be used in the
development of the Taparko – Bouroum
Project (defined below) in the Republic of Burkina Faso.

     B. Prior to the date of this Conveyance, Grantee has provided Grantor the amount of $9,414,000
under the First Tranche pursuant to the terms and conditions of the Original Funding Agreement, as
amended by the First Amendment.

     C. Originally under the terms of the Original Funding Agreement, and as now included in the
terms and conditions of the Funding Agreement, as consideration for Grantee agreeing to provide
such funding to Grantor, Grantor granted to Grantee, among other things, certain production
payments relating to the Taparko — Bouroum Project, as more specifically described in Conveyance of
Production Payments (PP1 and PP2) dated February 22, 2006, from Grantor to Grantee (the
“Production Payment Conveyance”).

     D. In addition, originally under the terms of the Original Funding Agreement, and as now
included in the terms and conditions of the Funding Agreement, as additional consideration for
Grantee agreeing to provide such funding to Grantor, Grantor agreed to grant to Grantee a tail
royalty interest in all gold in, on and under and produced from the Taparko Lands and the Bouroum
Lands (as each term is defined below), and a milling fee on all gold produced from lands other than
the Taparko Lands and the Bouroum Lands and processed at the Taparko Processing Facility (defined
below), such payments to commence upon satisfaction of the obligations of Grantor under the
Production Payment Conveyance.

     E. As a condition precedent to Grantee’s obligation to fund the Second Tranche under the
Funding Agreement, Grantor must execute and deliver this Agreement to Grantee.

 

 

Agreement

     Therefore, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Grantor and Grantee agree as follows:

ARTICLE I

Definitions and References

     1.1 General Definitions. As used herein the terms “Conveyance,”
“Effective Date,” “First Amendment,” “Funding Agreement,”
“Grantor,” “Grantee,” “Original Funding Agreement” and “Production
Payment Conveyance” shall have the meanings ascribed thereto above, and the following terms
shall have the following meanings:

     “Average Gold Price” means, for any calendar month, the average daily P.M. price
fixing for gold by the London Bullion Association as reported in The Wall Street Journal or
any other agreed upon successor publication for the applicable calendar month.

     “Bouroum Lands” means all of the land included in the Bouroum Permit, being
approximately 11.7 square kilometers, which land is more particularly described in Schedule A
attached hereto.

     “Bouroum Permit” means Decree No. 2005-342/PRES/PM/MCE/MFB issued by the Government of
the Republic of Burkina Faso on June 21, 2005, a copy of which is attached hereto as Schedule A.

     “Government” means the Government of the Republic of Burkina Faso, including, without
limitation, the executive, legislative and judicial branches thereof, including, without
limitation, the Ministry for Energy and Mines.

     “Grantor’s Account” means Grantor’s metals account at Royal Bank of Canada Channel
Islands, or such other metals account as Grantor may hereafter establish.

     “Interests” means the Tail Royalty and the Milling Fee, collectively.

     “Lands” means the Bouroum Lands and the Taparko Lands.

     “Milling Fee” has the meaning set forth in Section 2.2.

     “Month” means a calendar month.

     “Tail Royalty” has the meaning set forth in Section 2.1.

     “Taparko
— Bouroum Project” means development and exploitation of the Taparko Lands
and the Bouroum Lands for production of gold and associated precious metals, including construction
of a mine, support facilities and the Taparko Processing Facility.

2

 

     “Taparko Lands” means that portion of the land included in the Taparko Permit that is
more particularly described in Schedule B hereto, being approximately 34.7 square kilometers out of
the total 666.5 square kilometers included in such permit.

     “Taparko Permit” means Decree No. 2004-329/PRES/PM/MCE/MFB/MEDE/MECV issued by the
Government of the Republic of Burkina Faso on August 6, 2004, a copy of which is attached hereto as
Schedule B.

     “Taparko Processing Facility” means the CIL processing facility to be constructed by
Grantor on or adjacent to the Taparko Lands, capable of milling and processing at least 1,000,000
tonnes of ore per year.

     “Through-Put Production” means all production processed through the Taparko Processing
Facility, whether or not the same was mined from the Taparko Lands or the Bouroum Lands.

     “Year” means a calendar year.

     1.2 Exhibits. All Exhibits attached to this Conveyance are part hereof for all
purposes.

     1.3 References and Titles. All references in this Conveyance to Exhibits, Articles,
Sections, Subsections, and other subdivisions refer to the Exhibits, Articles, Sections,
Subsections and other subdivisions of this Conveyance unless expressly provided otherwise. Titles
and headings appearing at the beginning of any subdivision are for convenience only and do not
constitute any part of any such subdivision and shall be disregarded in construing the language
contained in this Conveyance. The words “this Conveyance,” “herein,” “hereby,” “hereunder” and
words of similar import refer to this Conveyance as a whole and not to any particular subdivision
unless expressly so limited. The phrases “this Section” and “this Subsection” and similar phrases
refer only to the Sections or Subsections hereof in which the phrase occurs. The word “or” is not
exclusive. Pronouns in masculine, feminine and neuter gender shall be construed to include any
other gender. Words in the singular form shall be construed to include the plural and words in the
plural form shall be construed to include the singular, unless the context otherwise requires.

ARTICLE II

Conveyance and Grant

     2.1 Conveyance of Tail Royalty. Subject to the limitations set forth in this Article
II, Grantor hereby grants, bargains, sells, conveys, assigns, sets over and delivers unto Grantee a
two percent (2%) royalty in and to all gold contained in, on and under and produced from the Lands,
such royalty to be calculated as follows: (i) the total troy ounces of gold produced from the
Lands and contained in Through-Put Production that are outturned to Grantor’s Account during a
given Month as reported by the applicable metal refinery, times (ii) the Average Gold Price for
such Month, times (iii) two percent (2%) (the “Tail Royalty”).

3

 

     To have and to hold the Tail Royalty unto Grantee, its successors and assigns forever, subject
to the terms, provisions and conditions contained in this Conveyance.

     2.2 Grant of Milling Fee. Subject to the limitations set forth in this Article II,
Grantor hereby grants, assigns and conveys to Grantee an interest in
the Taparko — Bouroum Project
in the form of a milling fee equal to 0.75% of the total amount of gold passed through the Taparko
Processing Facility that is produced from lands other than the Lands, calculated as follows: (i)
the total troy ounces of gold produced from lands other than the Lands and contained in Through-Put
Production that are outturned to Grantor’s Account during a given Month as reported by the
applicable metal refinery, times (ii) the Average Gold Price for such Month, times (iii) 0.75% (the
“Milling Fee”); provided, however, that the Milling Fee shall only apply to the milling and
processing of the first one million (1,000,000) tonnes of ore per Year from lands other than the
Lands; provided further that such amount shall be reduced by the number of tonnes of ore per Year
from the Lands (e.g., if in a given Year, the Taparko Processing Facility processes 800,000 tonnes
of ore from the Lands and 500,000 tonnes of ore from Lands other than the Lands, then the Milling
Fee would only apply to 200,000 tonnes of ore); provided further that for the Year in which the
first payment of the Milling Fee is made (which is likely to be less than a full calendar year),
the 1,000,000 limit shall be proportionately reduced to the number of days remaining in such year
after commencement of payment of the Milling Fee (e.g., if the payment of the Milling Fee commences
on September 14, the limit of the payment on the Milling Fee
would be 108/ 365 of 1,000,000 — i.e.,
295,890 – tonnes of ore during such year).

     2.3 Calculation and Commencement of Payments. The calculation and payment of amounts
owing under the Tail Royalty and the Milling Fee shall not commence until satisfaction of all
obligations of Grantor under the Production Payment Conveyance.

     2.4 Limitation on Recourse. Grantee shall look solely to the Lands for satisfaction
and discharge of the Tail Royalty, and shall look solely to the Through-Put Production for
satisfaction and discharge of the Milling Fee, and Grantor shall not be personally liable for the
payment and discharge thereof.

     2.5 Non-Operating, Non-Expense-Bearing Interests. The Tail Royalty conveyed hereby is
a non-operating, non-expense-bearing interest in and to production from the Lands. The Milling Fee
conveyed hereby is a non-operating, non-expense bearing limited royalty interest in and to the
Through-Put Production from lands other than the Lands. Each of the Interests is limited as set
forth above, free of all cost and expense of production, operations, milling, smelting, refining
and delivery prior to being outturned at Grantor’s Account. In no event shall Grantee ever be
liable or responsible in any way for payment of any costs, expenses or liabilities attributable to
the Taparko – Bouroum Project (or any part thereof) or incurred in connection with the production,
operations, milling, smelting, refining and delivery of Through-Put Production prior to being
outturned at Grantor’s Account.

     2.5 Free of Royalties and Other Burdens. The Interests shall be free of (and without
deduction therefrom of) any and all royalties and other burdens on production and shall bear no
part of same; and Grantor shall defend, indemnify and hold Grantee harmless from and against any
loss or claim with respect to any such royalties and other burdens on production or any claim by
the owners or holders of such royalties and other burdens on production. For greater

4

 

certainty, all payments made hereunder shall be net of any withholdings or other amounts, if
and to the extent required by applicable law, in respect of applicable taxes thereon.

ARTICLE III

Payment Procedures; Reports

     3.1 Payments of Tail Royalty and Milling Fee. Payments of the Interests shall be made
on a calendar quarter basis, within ten (10) business days after the end of each calendar quarter,
by check or wire transfer, at the election of Grantee, to the address set forth in Section 5.2.
The amount of each payment shall be equal to the sum of the monthly amounts due for each Month
during such calendar quarter. All payments shall be accompanied by statements that describe in
reasonable detail the basis of calculation of the amounts paid under the Interests.

     3.2 Financial Reports. Subject to the confidentiality requirements of Section 4.4,
Grantee shall have the right to be supplied monthly with duplicate settlement sheets from any
refinery, mill, smelter or other purchaser of Through-Put Production, whether or not Through-Put
Production has been sold, and shall contain sufficient information as to the value, pricing and
amounts of intermediate product and final product sold for Grantor’s account so that Grantee will
have access to all information and data that are reasonably necessary and appropriate for it to
determine the amount of the Interests due it under this Conveyance.

     3.3 Objection, Finality of Payments: Grantee, at its sole election and expense, shall
have the right to perform, not more frequently than once annually following the close of each
calendar year, an audit by any authorized representative of Grantee of Grantor’s accounts relating
to the Interests. Any such inspection shall be for a reasonable length of time during regular
business hours, at a mutually convenient time, upon at least ten (10) business days’ prior written
notice by Grantee. All payments under the Interests made in any Year shall be considered final and
in full accord and satisfaction of all obligations of Grantor, unless Grantee gives written notice
describing and setting forth a specific objection to the calculation thereof within one (1) year
following the end of that Year. Grantor shall account for any agreed upon deficit or excess in
payments of the Interests made to Grantee by adjusting the next monthly statement and payment
following completion of such audit to account for such deficit or excess.

     3.4 Copies of Reports to Government. Grantor shall provide Grantee with copies
of any reports that Grantor is required to make to the Government within thirty (30) days after
submitting same to the Government.

     3.5 Annual Environmental Compliance Report. Within ninety (90) days after the
end of each Year, Grantor shall provide to Grantee an environmental compliance report summarizing
the environmental performance of operations at the Taparko-Bouroum Project during that Year and
provide sufficient information for Grantee to monitor the performance of such operations with
respect to environmental protection, including, at a minimum, narrative summaries of (i) the
results of any environmental monitoring or sampling activity, (ii) accidents that impact the
environment or result in the loss of life, and (iii) environmental deficiencies that are identified
by

5

 

environmental regulatory authorities of the Government and any remedial actions taken or
proposed to be taken with respect thereto.

ARTICLE IV

Additional Rights, Obligations and Covenants of the Parties

     4.1 Commingling of Production.

          (a) Subject to the limitations, conditions and requirements of this Section 4.1, Grantor shall
have the right to mix or commingle, either underground, at the surface, or at a processing plant or
any other treatment facilities, any production from the Lands with ores or material derived from
other lands or properties whether or not owned, leased or controlled by Grantor.

          (b) Before commingling, Grantor shall weigh, measure, sample and analyze the respective ores
and materials in accordance with sound mining and metallurgical practices such that the amount of
gold recovered from the Lands can be reasonably and accurately determined. As products are
produced from the commingled ores, Grantor shall calculate from representative samples the average
percentage recovery of products produced from the commingled ores during each month. In obtaining
representative samples and calculating the average grade of commingled ores and average percentage
of recovery, Grantor may use procedures that are in accordance with best practices in the mining
and metallurgical industry. The records relating to commingled ores shall be made available for
inspection by Grantee, at Grantee’s sole expense, at all reasonable times and shall be retained by
Grantor for a period of one (1) year after the calendar year in which the commingling occurred.

          (c) Notwithstanding the foregoing provisions of this Section 4.1, Grantor shall not commingle
production from the Lands with ores or minerals derived from other lands or properties if such
commingling has a reasonable likelihood of reducing the recovery rate of metals from the Lands
below what the recovery rate would have been without commingling. Any disputes concerning
commingling procedures or results or the applicability of the prohibition in the preceding sentence
shall be resolved pursuant to the procedure set forth in Section 5.9.

     4.2 Geological and Other Data and Reports. From and after the date of execution of
this Conveyance, Grantor shall deliver to Grantee not less frequently that quarterly, or otherwise
shall make available, the following data and information relating to operations conducted on or for
the benefit of the Lands and with respect to the Taparko Processing Facility:

     (a) The monthly operations and exploration report prepared by Grantor for operations on the
Lands and with respect the Taparko Processing Facility;

     (b) The annual reserve report for the Lands prepared by Grantor, along with any updates, as
and when any of the same have been finalized and approved by Grantor;

6

 

     (c) Grantor’s
life of mine plan relating to the Taparko — Bouroum Project;

     (d) The
annual plan and budget prepared by Grantor relating to the Taparko — Bouroum Project
and any amendments thereto, as and when any of the same have been finalized and approved by
Grantor; and

     (e) Any additional material engineering or economic studies or analyses prepared by Grantor
and relating to the Lands and the Taparko – Bouroum Project as and when any of the same have been
finalized and approved by Grantor.

     4.3 Inspection. Grantee and its authorized agents who are experienced in mining
operations, at Grantee’s sole risk and expense, shall have the right, exercisable at reasonable
intervals and during regular business hours, at a mutually convenient time, and in a reasonable
manner conforming to Grantor’s safety rules and regulations and so as not to interfere with
Grantor’s operations, to go upon the Lands and the premises of the Taparko Processing Facility for
the purposes of inspecting same. Grantee shall furnish Grantor with prior written notice of the
time and place of any inspection by Grantee pursuant to this Section 4.3. Grantee shall defend,
indemnify and hold Grantor harmless from and against all costs incurred (including reasonable
attorneys’ fees and the costs of defending any such claims) based on claims for damages, including
injury or damage to other persons or property, arising out of any death, personal injury or
property damage sustained by Grantee, its agents or employees, while in or upon the Properties,
unless such death, injury or damage results from Grantor’s gross negligence or willful misconduct.

     4.4 Confidentiality. Grantee shall not, without the prior written consent of Grantor,
disclose to any third party (excluding, however, any representative, affiliate, agent, consultant
or contractor of Grantee who has a bona fide need to be informed) any information concerning
operations, including exploration, on the Properties which is not generally available to the
public; provided, however, that upon not less than five (5) days’ prior written notice to Grantor
setting forth the nature and content of the proposed disclosure, Grantee may disclose information
or data pertaining to the Lands, the Taparko – Bouroum Project and the Taparko Processing Facility
to: (a) any third party to whom Grantee in good faith anticipates selling or assigning all or a
part of its interest hereunder, or (b) any lender or underwriter from whom Grantee is seeking to
obtain funds. Grantee shall require those parties to keep the information so provided
confidential. If either Grantor or Grantee determines in good faith that a disclosure is required
for compliance with applicable laws, rules, regulations or orders of any government agency or stock
exchange having jurisdiction, 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 other party,
as is reasonably possible under the circumstances.

     4.5 Abandonment of Properties. From and after satisfaction of the obligations under
the Production Payment Conveyance, Grantor may elect at any time to terminate or abandon its
interests in the Lands and the Taparko Processing Facility at any time as it may in its sole
discretion deem appropriate, subject only to the provisions of this Section 4.5. In the event that
Grantor wishes to abandon any or all of it interest in the Lands or the Taparko Processing
Facility, except for cessation of operations under care and maintenance, Grantor shall provide

7

 

Grantee with not less than forty-five (45) days prior notice of its intention to do so and offer to
transfer such interests to Grantee. At any time during the forty-five (45) day period, Grantee may
notify Grantor that it elects to accept transfer of such interests. In that event, Grantor shall
transfer those interests to Grantee by quitclaim deed.

     4.6 Processing of Ore from the Lands. Grantor hereby covenants and agrees with
Grantee that all ore produced from the Lands shall be processed in the Taparko Processing Facility.

     4.7 Refining Contracts. Grantor hereby covenants and agrees with Grantee that during
the entire term of this Conveyance, Grantor shall maintain in full force and effect refining
contracts with smelter and/or refiners reasonably acceptable to Grantee, and Grantor shall use its
best efforts to cause such refining contracts to provide for, where possible: (i) payment by the
refiner and/or smelter directly to Grantee of amounts due hereunder in cash or, (ii) upon request
by Grantee, and if not prohibited by law, in kind.

     4.8 Grantor Operations and Maintenance of the Taparko-Bouroum Project. Grantor
shall conduct its operations on the basis of customary commercial practice and arm’s-length
arrangements, with due diligence and efficiency and under the supervision of qualified and
experienced management. Grantor shall maintain, preserve, protect and keep the Taparko-Bouroum
Project, and all of Grantor’s property used or useful in connection therewith, in good condition
(ordinary wear and tear and obsolescence excepted) in accordance with prudent industry standards,
and in compliance with all applicable laws, in conformity with all applicable contracts,
servitudes, leases, permits and agreements, and shall from time to time make all repairs renewals
and replacements needed to enable the business and operations carried on in connection therewith to
be promptly and advantageously conducted at all times, except where failure to do so could not nave
a material adverse effect upon the Taparko-Bouroum Project.

     4.9 Compliance with Agreements and Law. Grantor shall perform all obligations it
is required to perform under each lease, permit, agreement, contract or other instrument or
obligation to which it is a party with respect to the Taparko-Bouroum Project, except where the
failure to do so could not have a material adverse effect upon its ownership or operation of same.
Grantor shall conduct its business and affairs with respect to the Taparko-Bouroum Project, (i) in
material compliance with all laws applicable thereto, (ii) in all material respects in accordance
with the Development Plan, as defined in the Funding Agreement, (iii) in accordance with acceptable
industry practice including maintaining a minimum of local standards and World Bank environmental
guidelines (applicable under, World Bank and IFC Pollution, Prevention and Abatement Guidelines and
the applicable IFC Safeguard Policies), and, where practicable, the International Cyanide Code and
the Equator Principles; and (iv) in compliance, and causing its affiliates, subsidiaries, agents,
employees, subcontractors, directors and officers to be in compliance, with the Foreign Corrupt
Practices Act of 1977 (Pub.L. No. 95-213, Sections 101-104), as amended, and any other law,
regulation, order, decree or directive having the force of law and relating to bribery, kick-backs,
or similar business practices. Grantor shall obtain and cause all licenses and permits necessary or
appropriate for the conduct of its business and the ownership and operation of its property used
and useful in the conduct of its business to be at all times maintained in good standing and in
full force and effect, except where failure to comply could not have a material adverse effect upon
the Taparko-Bouroum Project.

8

 

     4.10 Government Approvals and Notices. Grantor shall (i) obtain, and shall at all
times maintain in full force and effect, all material registrations, declarations, filings,
governmental consents, licenses, approvals, authorizations, and permits necessary for Grantor’s
operation of the Taparko-Bouroum Project, and (ii) undertake reasonable efforts to arrange for
Grantee to receive from the Government copies of all correspondence, notices, decrees, orders and
other writings issued by the Government to Grantor regarding the Taparko-Bouroum Project, but in
any event, Grantor shall send Grantee copies of such materials promptly after receipt thereof.

ARTICLE V

General Provisions

     5.1 Assignment. After Completion (as defined in the Funding Agreement) of the Taparko
— Bouroum Project, either party may assign its interests under this Conveyance freely, in whole or
in part; provided, however, that any transfer or conveyance by either party of any interest in the
Interests or in the Lands or the Taparko Processing Facility shall be expressly made subject to,
and the assignee or transferee shall commit in writing to be bound by, all of the terms and
conditions and covenants of this Conveyance.

     5.2 Notices. Any notice, election, report or other correspondence required or
permitted hereunder shall be in writing and shall be deemed sufficiently given or furnished if
delivered by personal delivery, by facsimile or other electronic transmission, or by delivery
service with proof of delivery, to each of the parties at its address below (unless changed by
similar notice in writing given by the party whose address is to be changed):

If to Grantor:

Somita SA

01 B.P. 2509 OUAGADOUGOU 01

1648 Boulevard Tansoba TAN-KOM,

Secteur 25

Burkina Faso

Attention: Directeur Generale

Facsimile: 226-50-358187

With copies to:

High River Gold Mines Ltd.

155 University Avenue

Suite 1700

Toronto, Ontario M5H 3B7

Attention: President

Facsimile: (416) 360-0010

and

9

 

Cassels Brock & Blackwell LLP

2100 Scotia Plaza, 40 King Street W.

Toronto, Ontario M5H 3C2

Attention: David Poynton

Facsimile: (416) 644-9348

If to Grantee:

Royal Gold, Inc.

1660 Wynkoop St.

Suite 1000

Denver, Colorado 80202-1132

Attention: President

Facsimile Number: 303-595-9385

Any such notice or communication shall be deemed to have been given (a) in the case of personal
delivery or delivery service, as of the date of first attempted delivery during normal business
hours at the address provided herein, (b) in the case of facsimile, upon receipt, or (c) in the
case of other electronic transmission, upon acknowledgment of receipt by the recipient within
twenty-four (24) hours of first attempted delivery.

     5.3 Amendments and Waiver. No modifications or waivers of the terms and conditions of
this Conveyance shall be binding upon either party unless in writing, dated subsequent to the date
of this Conveyance, and executed by an authorized representative of each party. No waiver by
either party of a breach of any of the provisions of this Conveyance shall be construed as a waiver
of any subsequent breach, whether of the same or of a different character.

     5.4 Relationship of the Parties. The relationship of the parties hereto is
contractual only. The Interests shall not grant to Grantee any rights to participate or influence
management or decision-making regarding operations on the Lands,
Taparko — Bouroum Project or the
Taparko Processing Facility, nor shall it obligate the Grantee to assume any responsibilities for
costs of Grantor’s operations on the Lands, Taparko — Bouroum Project or the Taparko Processing
Facility or any liabilities resulting therefrom.

     5.5 Further Instruments. The parties hereto agree that they will execute any and all
instruments as may be necessary or required to carry out and effectuate any and all of the
provisions of this Conveyance.

     5.6 Binding Effect. This Conveyance shall be binding upon, and shall inure to the
benefit of, the parties hereto and their respective successors and assigns.

     5.7 Continuation and Priority. The Tail Royalty and Milling Fee granted to Grantee by
this Conveyance shall continue for so long as Grantor, its successors and assigns retain any
interest in the Lands, Taparko — Bouroum Project or the Taparko Processing Facility. The Interests
shall have priority over, and in no event shall be subordinated to, any project or other financing
that Grantor may obtain with respect to the Lands, Taparko — Bouroum Project or the

10

 

Taparko Processing Facility after the Effective Date of this Conveyance, unless Grantee
specifically so provides in writing. Grantee’s rights to payments under the Interests shall not be
subordinated to any other person or source by Grantor or any related party, except for statutory
liens for amounts not yet due and payable and liens imposed by the Mining Convention applicable to
the Lands or governing law to the extent not yet due and payable.

     5.8 Governing Law. Without regard to principles of conflicts of law, this Conveyance
is made under and shall be interpreted and enforced in accordance with the laws of the State of
Colorado applicable to contracts made and to be performed entirely within such state and the laws
of the United States of America, except that, to the extent that the law of the jurisdiction in
which the real property is located (or which is otherwise applicable to the real property)
necessarily governs with respect to procedural and substantive matters relating to the creation and
enforcement of the interests created herein, the law of such other jurisdiction shall apply.

     5.9 Arbitration Conducted by International Chamber of Commerce. All disputes between
the parties hereto (which for purposes of this Section 5.9 includes Grantor and Grantee and their
respective parents, affiliates and subsidiaries) that arise out of, relate to or are in connection
with this Agreement or any related agreement, will be exclusively, finally and conclusively settled
by binding international arbitration under the Rules of Arbitration of the International Chamber of
Commerce (the “ICC”) then in effect (the “Rules”), except as specifically modified
by this Agreement. The Parties shall continue to perform their respective obligations under this
Agreement pending conclusion of any such arbitration.

(a) Initiation of Arbitration.

          (i) Prior to initiating an arbitration proceeding with the ICC, the parties shall negotiate in
good faith to resolve the dispute. To that end, the party wishing to initiate negotiations shall
notify the other party in writing about its intention to do so, including a brief summary of the
disputed issue, its estimate of the amount in controversy, and suggesting a date and venue for a
first meeting, at which the parties shall be represented by officers duly empowered to resolve the
dispute. In the event that the parties are unable to resolve the dispute within a period of 15
days after commencement of such good faith negotiations, or upon agreement by the parties to submit
the dispute to arbitration, either party may commence an arbitration proceeding by delivering a
Request for Arbitration (the “Request for Arbitration”) to the Secretariat of the ICC (the
“Secretariat”) in accordance with the terms of this Section 5.9 and the Rules.

          (ii) For all disputes, the arbitration hereunder shall be by three independent and impartial
arbitrators. Grantor and Grantee shall each appoint one arbitrator within 30 days after the
Request for Arbitration has been delivered to the Secretariat and the two arbitrators so appointed
shall select a third arbitrator within 60 days after the Request for Arbitration has been delivered
to the Secretariat. In the event that the parties or the arbitrators fail to select arbitrators as
required above, the ICC shall select such arbitrators in accordance with the terms of this Section
5.9.

11

 

          (iii) Each of the parties acknowledges and agrees that the other party would be damaged
irreparably in the event any of the provisions of this Agreement are not performed in accordance
with their specific terms. Accordingly, notwithstanding the provisions of Section 5.9(a)(i),
pending completion of arbitration pursuant to this Section 5.9, either Grantor or Grantee shall
have the right to seek a temporary restraining order, injunctive relief or other interim or
provisional relief on the ground that such relief would otherwise be available at law or in equity.
If any such relief is obtained, the arbitration panel will address the continuance, modification
or termination of such relief and their order and any such decision regarding relief shall be
binding on the parties

     (b) Arbitration Procedures.

          (i) The arbitration shall be conducted in the English language in London, England or at such
other location as the parties may agree.

          (ii) All disputes arising out of or in connection with this Agreement and relating to the
Parties’ rights and obligations in connection with this Agreement (including without limitation the
validity of the agreement of the parties to arbitrate, the arbitrability of the issues submitted to
arbitration hereunder, the existence and validity of the Agreement, and any conflict of laws issues
arising in connection with the Agreement or this agreement to arbitrate) shall be finally settled
in accordance with the Rules. In addition, where the Rules are silent, the proceedings before the
“Arbitral Tribunal” (as defined in the Rules) shall be governed by the procedural rules established
by the Arbitral Tribunal.

          (iii) The arbitration panel shall conduct a hearing no later than 90 days after delivery of
the Request for Arbitration, and a decision shall be rendered by the arbitration panel within 30
days after the final hearing.

          (iv) At the hearing, the parties shall present such evidence and witnesses as they may choose,
with or without counsel. Adherence to formal rules of evidence shall not be required but the
Arbitral Tribunal shall consider any evidence and testimony that it determines to be relevant, in
accordance with procedures that it determines to be appropriate.

     (c) Arbitral Awards.

          (i) The arbitration award shall be in writing and shall specify the factual and legal bases
for the award.

          (ii) Neither Grantor nor Grantee shall be entitled to, and no award shall include any amount
for, lost profits or revenues, lost business opportunities, business interruption, or punitive or
exemplary damages for any claim arbitrated pursuant to this Section 5.9.

          (iii) The arbitrators shall be entitled to a fee commensurate with their fees for professional
services requiring similar time and effort. The fees of the arbitrators and other costs of the
arbitration shall be borne equally by the parties, except when the arbitrators decide to impose the
total cost on the defeated party.

12

 

     (c) Enforcement. All decisions of the Arbitral Tribunal shall be final and binding on the
parties and may be entered against them in any court of competent jurisdiction. Any judgment
rendered by the Arbitral Tribunal against a party may be executed against such party’s assets in
any jurisdiction where the party has assets. Each of the parties irrevocably submits to the
non-exclusive jurisdiction of the appropriate courts in the State of Colorado in any legal action
or proceeding relating to such execution of judgment.

     (d) Limitations.

          (i) Any dispute brought pursuant to the terms of this Section 5.9 must be brought within two
years of the date that the party aggrieved by the event or condition, or notice of such event or
condition giving rise to the dispute becomes aware of the same.

          (ii) This agreement to arbitrate shall survive the rescission or termination of this
Conveyance.

     5.10 Rule Against Perpetuities. Any right or interest granted under this Conveyance
(including but not limited to Grantor’s obligations under Sections 4.5 and 4.6) that would violate
any applicable Rule Against Perpetuities or any similar rule of law, shall terminate twenty-one
(21) years after the death of the last survivor of the children and grandchildren of Robert F.
Kennedy who are alive on the Effective Date.

     5.11 Recordation of Conveyance. Grantor and Grantee shall file and record executed
counterparts of this Conveyance in official records as may be necessary and possible for the
purpose of providing constructive notice to third parties of Grantor’s and Grantee’s respective
rights and obligations hereunder with respect to the matters set forth herein.

Execution Page Follows

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     This Conveyance has been executed on the dates set forth below, to be effective as of the
Effective Date.

	 	 	 	 	 	 	 
	 	 	GRANTOR:	 	 
	 
	 	 	 	 	 	 
	 	 	SOCIÉTÉ DES MINES DE TAPARKO	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David Mosher	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	David Mosher	 	 
	 

	 	 	 	Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Daniel Vanin	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Daniel Vanin	 	 
	 

	 	 	 	Director	 	 
	 
	 	 	 	 	 	 
	 	 	GRANTEE:	 	 
	 
	 	 	 	 	 	 
	 	 	ROYAL GOLD, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Donald Baker	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	Donald Baker	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	V.P. Corporate Development	 	 
	 

	 	 	 	 	 	 

[EXECUTION PAGE TO CONVEYANCE OF TAIL ROYALTY]

 

 

ACKNOWLEDGMENT CERTIFICATIONS

[Notary block language or forms that conform to Burkina Faso law

to be provided by Burkina Faso counsel prior to execution]

[NOTARY PAGE TO CONVEYANCE OF TAIL ROYALTY]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00098-of-00352.parquet"}]]