ROYAL GOLD INC - Proxy Solicitation & Information Statement 2006

DEF 14A 1 d40220ddef14a.htm DEFINITIVE PROXY STATEMENT def14a PAGEBREAK

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant þ Filed by a Party other than the Registrant o

Check the appropriate box:

o Preliminary Proxy Statement o Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) þ Definitive Proxy Statement o Definitive Additional Materials o Soliciting Material Pursuant to §240.14a-12

ROYAL GOLD, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box) þ No fee required. o Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

2) Aggregate number of securities to which transaction applies:

3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and sate how it was determined):

4) Proposed maximum aggregate value of transaction:

5) Total fee paid:

o Fee paid previously with preliminary materials:

o Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

1) Amount Previously paid:

2) Form, Schedule or Registration Statement No.:

3) Filing Party:

4) Date Filed:

SEC 1913 (05-05) Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.

Folio /Folio

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ROYAL GOLD, INC. 1660 Wynkoop Street, Suite 1000 Denver, Colorado 80202 303/573-1660 303/595-9385 (Fax) [email protected] (E-mail) www.royalgold.com (Web site)

NOTICE OF 2006 ANNUAL MEETING OF STOCKHOLDERS

To Be Held November 8, 2006

To the Stockholders of ROYAL GOLD, INC.:

NOTICE IS HEREBY GIVEN that the Annual Meeting of the Stockholders of Royal Gold, Inc. will be held at 9:30 a.m., on Wednesday, November 8, 2006, at the Oxford Hotel, Sage Room, 1600 Seventeenth Street, Denver, Colorado, USA, to:

| 1. | Elect three Class I Directors to serve until the 2009
Annual Meeting of Stockholders or until each such
directors successor is elected and qualified; |
| --- | --- |
| 2. | Ratify the appointment of PricewaterhouseCoopers LLP as
independent registered public accountants of the Company for the
fiscal year ending June 30, 2007; and |
| 3. | Transact any other business that may properly come before the
meeting and any postponements or adjournments thereof. |

All stockholders are cordially invited to attend the meeting; however, only stockholders of record as of the close of business on September 28, 2006 are entitled to vote at the meeting and any postponements or adjournments thereof. It is important that your shares are represented and voted at the Annual Meeting. For that reason, whether or not you expect to attend in person, please mark, sign and date the enclosed proxy and return it promptly in the enclosed envelope. You can also vote over the telephone or the Internet as described on the enclosed voting instruction form. If you do attend the Annual Meeting, you may withdraw your proxy should you wish to vote in person.

BY ORDER OF THE BOARD OF DIRECTORS

Karen P. Gross Vice President & Corporate Secretary

October 16, 2006

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TABLE OF CONTENTS

PROXY STATEMENT
2006 ANNUAL MEETING OF STOCKHOLDERS
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
ELECTION OF CLASS I DIRECTORS
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR EACH OF THE DIRECTOR NOMINEES. DIRECTORS AND OFFICERS
MEETINGS AND COMMITTEES OF THE BOARD
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
AUDIT COMMITTEE AND RELATED MATTERS
RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS OF THE COMPANY.
OTHER MATTERS
APPENDIX A

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ROYAL GOLD, INC. 1660 Wynkoop Street, Suite 1000 Denver, Colorado 80202 303/573-1660 303/595-9385 (Fax) [email protected] (E-mail) www.royalgold.com (Web site)

link1 "PROXY STATEMENT"

PROXY STATEMENT

link1 "2006 ANNUAL MEETING OF STOCKHOLDERS"

2006 ANNUAL MEETING OF STOCKHOLDERS

General Information

This Proxy Statement is furnished to holders of Royal Gold, Inc. (the Company) common stock, in connection with the solicitation of proxies on behalf of the Board of Directors of the Company, to be voted at the Annual Meeting of Stockholders of the Company (the Annual Meeting) to be held on Wednesday, November 8, 2006, at 9:30 a.m. This Proxy Statement and the proxy card were first mailed to Stockholders on or about October 16, 2006.

Stockholders Entitled to Vote

All Stockholders of record of the common stock ($0.01 par value) of the Company (Common Stock) at the close of business on September 28, 2006 (the Record Date), are entitled to vote at the Annual Meeting and at any and all postponements and adjournments thereof. As of the Record Date, there were 23,647,666 shares of Common Stock outstanding and entitled to vote.

Voting Your Shares

Each share of Common Stock that you own entitles you to one vote. Your proxy card shows the number of shares of Common Stock that you own.

You may vote your shares by signing and returning the enclosed proxy. If you vote by proxy, the proxy holders (each or any of the individuals named on the proxy) will vote your shares as you instruct on the proxy. If you sign and return the proxy, but do not give instructions on how to vote your shares, your shares will be voted (1) FOR the election of directors as described herein under Proposal 1 Election of Directors, and (2) FOR ratification of the appointment of the Companys independent registered public accountants described herein under Proposal 2 Ratification of Appointment of Independent Registered Public Accountants.

You may vote by telephone or by the Internet by following the telephone or Internet voting instructions that are included with your proxy card. If you vote by telephone or the Internet, you do not need to return your proxy card.

You may attend the Annual Meeting and vote in person. You will be given a ballot when you arrive. However, if your stock is held in the name of your broker, bank or another nominee, you must get a signed proxy from the broker, bank or other nominee giving you the right to vote your shares. This will be the only way we can be sure that the broker, bank or other nominee has not already voted your shares on your behalf.

Revocation of Proxy or Voting Instruction Form

You may revoke your proxy at any time before the proxy is voted at the Annual Meeting. This can be done by either submitting another properly completed proxy card with a later date, sending a written notice of revocation to the Secretary of the Company with a later date or by attending the Annual Meeting and voting in person. You should be aware that simply attending the Annual Meeting will not automatically revoke your previously submitted proxy; rather you must notify a Company representative at the Annual Meeting of your desire to revoke your proxy and vote in person. Written notice revoking a proxy should be sent to the Corporate Secretary, Royal Gold, Inc., 1660 Wynkoop Street, Suite 1000, Denver, Colorado 80202.

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Votes Required to Approve Proposals

The holders of a majority of the issued and outstanding shares of Common Stock of the Company entitled to vote at the Annual Meeting must be present in person or represented by proxy in order to constitute a quorum for all matters to come before the meeting. Abstentions and broker non-votes will be counted as being present in person for purposes of determining whether there is a quorum. The affirmative vote of sixty percent (60%) of the shares that are represented and entitled to vote at a meeting at which a quorum is present shall be the act of the Stockholders.

All voting rights are vested exclusively in the holders of the Common Stock. As of the Record Date, there were 23,647,666 shares of Common Stock outstanding. Each share of Common Stock entitles the Stockholder to one vote on all matters that may come before the Annual Meeting.

Votes at the Annual Meeting will be tabulated and certified by Computershare Trust, the Companys Transfer Agent. Computershare Trust will treat shares of Common Stock represented by a properly signed and returned proxy as present at the Annual Meeting for purposes of determining a quorum, without regard to whether the proxy is marked as casting a vote or abstaining.

In the election of directors, each Stockholder eligible to vote may vote the number of shares of Common Stock held for each director to be elected, but cumulative voting is not permitted. Under Delaware law, holders of Common Stock are not entitled to appraisal or dissenters rights with respect to the matters to be considered at the Annual Meeting.

Tabulation of Votes

Abstentions will be counted as shares present and entitled to be voted. Thus, abstentions will count the same as a vote AGAINST Proposals 1 or 2. Brokers have discretion to vote shares they hold in street name on certain routine matters. The election of directors and the ratification of the appointment of independent registered public accountants are considered routine matters. Thus, brokers that do not vote your shares with respect to Proposals 1 and 2 will be treated as abstentions and will count the same as a vote AGAINST Proposals 1 and 2.

Solicitation Costs

The enclosed proxy card and voting instruction form is being solicited on behalf of the Board of Directors of the Company. In addition to solicitation of proxies by mail, the Companys directors, officers or employees, without additional compensation, may make solicitations by telephone, facsimile, or personal interview. The Company has not retained any company to aid in the solicitation of brokers, banks, intermediaries and other institutional holders in the United States and Canada. All costs of the solicitation of proxies will be borne by the Company. The Company will also reimburse the banks and brokers for their reasonable out-of-pocket expenses in forwarding proxy materials to beneficial owners of shares of Common Stock.

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BEGIN LOGICAL PAGE link1 "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT"

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table shows the beneficial ownership, as of August 31, 2006, of the Common Stock by each director, by the Chief Executive Officer and by each of the other executive officers whose total annual salary and bonus for the last completed fiscal year exceeded $100,000. These executives are referred to in this Proxy Statement as the named executive officers. Also included in the following table is any person known to the Company to be the beneficial owner of more than 5% of the issued and outstanding shares of Common Stock, and by all of the Companys directors and executive officers as a group.

| Name
and Address | Number of Shares
of — Common
Stock Beneficially Owned | | | Percent |
| --- | --- | --- | --- | --- |
| of Beneficial | | Subject to | | of |
| Owner | Shares (1) | Options (2) | Total | Class |
| Stanley
Dempsey (3) | 684,932 | 81,400 | 766,332 | 3.2 % |
| Executive Chairman | | | | |
| 1660 Wynkoop Street | | | | |
| Suite 1000 | | | | |
| Denver, Colorado 80202 | | | | |
| Tony
Jensen (4) | 47,700 | 31,666 | 79,366 | * |
| President, Chief Executive Officer
and Director | | | | |
| 1660 Wynkoop Street | | | | |
| Suite 1000 | | | | |
| Denver, CO 80202 | | | | |
| John W. Goth | 29,000 | 40,000 | 69,000 | * |
| Director | | | | |
| 4142 Denver West Parkway | | | | |
| Suite 250 | | | | |
| Golden, CO 80401 | | | | |
| S. Oden Howell, Jr. | 510,480 | 45,000 | 555,480 | 2.3 % |
| Director | | | | |
| P.O. Box 36097 | | | | |
| Louisville, KY 40233 | | | | |
| Merritt E. Marcus | 341,743 | 45,000 | 386,743 | 1.6 % |
| Director | | | | |
| 1412 Mockingbird Valley Green | | | | |
| Louisville, KY 40207 | | | | |
| Edwin W.
Peiker, Jr. (5) | 127,080 | 35,000 | 162,080 | * |
| Director | | | | |
| 555 Ord Drive | | | | |
| Boulder, CO 80303 | | | | |
| James W. Stuckert | 1,756,995 | 45,000 | 1,801,995 | 7.6 % |
| Director | | | | |
| P.O. Box 32760 | | | | |
| Louisville, KY 40232 | | | | |
| Donald Worth | 6,500 | 15,000 | 21,500 | * |
| Director | | | | |
| 2679 Bayview Avenue | | | | |
| Willowdale, Ontario M2L 1C1 | | | | |
| Canada | | | | |
| Donald
Baker (6) | 49,878 | 0 | 49,878 | * |
| Vice President, Corporate
Development | | | | |
| 1660 Wynkoop Street | | | | |
| Suite 1000 | | | | |
| Denver, CO 80202 | | | | |

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callerid=999 iwidth=467 length=60

*	Less than 1% ownership of the Companys Common Stock.
(1)	Includes restricted stock awards under the Companys
Omnibus Long-Term Incentive Plan awarded to
Messrs. Dempsey, Jensen, Goth, Howell, Marcus, Peiker,
Stuckert, Worth, Baker, Parcel, Wenger and Ms. Gross in the
following amounts: 0 shares, 27,500 shares,
2,500 shares, 2,500 shares, 2,500 shares,
2,500 shares, 2,500 shares, 2,500 shares,
16,250 shares, 16,250 shares, 16,250 shares, and
7,500 shares, respectively.
(2)	See Compensation of Directors and Executive
Officers Option Grants in Last Fiscal Year and
Aggregated Option Exercises and Fiscal Year-End Option
Values. The options reflected here are exercisable within
60 days of the date of this Proxy Statement.
(3)	Effective July 1, 2006, Mr. Dempsey became Executive
Chairman. Previously, he was Chairman and Chief Executive
Officer. The amount shown in the table includes
145,918 shares beneficially owned by certain members of
Mr. Dempseys immediate family. Mr. Dempsey
disclaims beneficial ownership of these 145,918 shares of
Common Stock.
(4)	Effective July 1, 2006, Mr. Jensen became President
and Chief Executive Officer. Previously, he was President and
Chief Operating Officer.
(5)	The amount shown in the table includes 19,200 shares
beneficially owned by certain members of Mr. Peikers
immediate family. Mr. Peiker disclaims beneficial ownership
of these 19,200 shares of Common Stock.
(6)	Mr. Baker resigned his position as Vice President Corporate
Development with the Company as of June 20, 2006.
Mr. Baker had 24,375 unvested restricted shares and 13,334
unvested options that terminated upon his resignation from the
Company effective June 20, 2006. Mr. Baker exercised
all vested options before his resignation from the Company.
(7)	Excludes amounts beneficially owned by Mr. Baker who,
effective June 20, 2006, is no longer an officer of the
Company.
(8)	As reported by Neuberger Berman Inc. on Schedule 13G filed
with the SEC on February 8, 2006, for the period ended
January 31, 2006.

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PROPOSAL 1.

link1 "ELECTION OF CLASS I DIRECTORS"

ELECTION OF CLASS I DIRECTORS

The Companys Board of Directors consists of three classes of directors, with each class of directors serving for a three-year term ending in a successive year. The Companys current Class I Directors are Messrs. Dempsey, Jensen and Goth; the Class II Directors are Messrs. Stuckert and Marcus; and the Class III Directors are Messrs. Howell, Peiker and Worth.

If the enclosed proxy is properly signed and received in time for the Annual Meeting, and if the proxy does not indicate otherwise, the represented shares will be voted FOR Stanley Dempsey, Tony Jensen, and John W. Goth as Class I Directors of the Company. If any of the nominees for election as a Class I Director should refuse or be unable to serve (an event that is not anticipated), the proxy will be voted for a substitute nominee who is designated by the Board of Directors. Each Class I Director elected shall serve until the 2009 Annual Meeting, or until his successor is elected and qualified.

Information concerning the nominees for election as directors is set forth below under Directors and Officers.

link1 "THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” EACH OF THE DIRECTOR NOMINEES. DIRECTORS AND OFFICERS"

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR EACH OF THE DIRECTOR NOMINEES. DIRECTORS AND OFFICERS

The following is information regarding the directors and officers of the Company related to their names, position with the Company, periods of service and experience. The persons who are nominated for election as directors at the Annual Meeting are indicated with an asterisk.

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| | | Principal Occupation
During Last | Continuously — a Director | Class of — Director/Term |
| --- | --- | --- | --- | --- |
| Name | Age | 5 Years
and Position with Company | Since | Expires |
| Tony Jensen | 44 | Director. President and Chief
Executive Officer of the Company since July 2006. President and
Chief Operating Officer of the Company from August 2003 until
June 2006. Mr. Jensen has over twenty years of mining
industry experience, eighteen with Placer Dome Inc. Before
joining the Company, he was the Mine General Manager of the
Cortez Joint Venture from August 1999 to June 2003 , a
mining joint venture between Barrick (formerly Placer Dome Inc.)
and Kennecott Explorations (Australia) Ltd., a subsidiary of Rio
Tinto. His extensive background in operations was developed both
in the United States and Chile where he occupied several senior
management positions. Mr. Jensen is a Director of the
Industrial Advisory Board of the South Dakota School of Mines
and Technology, and is a member of the board of directors of the
National Mining Association, the Nevada Mining Association, and
the Colorado Mining Association. | August 2004 | I/2006 |
| John W. Goth | 79 | Director. Non-executive Director
of the Denver Gold Group, a mining-related association, since
August 2005. Director of the Denver Gold Group since 1990 and a
director of Behre Dolbear since 1998. Mr. Goth has been a
consultant to the mining industry since 1985. Mr. Goth held
several senior positions at AMAX, Inc., a major international
mining firm, from April 1, 1954 to November 1, 1985.
He is past chairman of the Mineral Information Institute and the
Mining and Metallurgical Society of America. He is a former
director of U.S. Gold, Magma Copper Corporation,
U.S. Zeolites, and Dome Mines Corporation. | August 1988 | I/2006 |
| S. Oden Howell, Jr. | 66 | Director. President of
Howell & Howell Contractors, Inc., a renovation
contractor, and industrial and commercial painting contractor,
since 1988. Owner of Kessinger Service Industries, LLC, an
industrial coatings contractor firm. From 1972 until 1988,
Mr. Howell was Secretary/Treasurer of Howell &
Howell, Inc., an industrial and commercial painting contractor
firm. | December 1993 | III/2008 |

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| | | Principal Occupation
During Last | Continuously — a Director | Class of — Director/Term |
| --- | --- | --- | --- | --- |
| Name | Age | 5 Years
and Position with Company | Since | Expires |
| Merritt E. Marcus | 72 | Director. Former President and
Chief Executive Officer of Marcus Paint Company, a manufacturer
of industrial liquid coatings, and Performance Powders, LLC, a
manufacturer of industrial powder coatings, from 1983 until
2004. Mr. Marcus has served several terms as a director of
the National Paint and Coatings Association. | December 1992 | II/2007 |
| Edwin W. Peiker, Jr. | 75 | Director. President and Chief
Operating Officer of the Company from April 1988 until February
1992, when he retired. Vice President of Engineering of the
Company from May 1987 to April 1988. Principal in Denver Mining
Finance Company, from 1984 until 1986, a firm that provides
financial, management, and advisory services to the mining
industry. From 1983 to 1986, Mr. Peiker was engaged in
mineral consulting activities. During the period from 1966 to
1983, Mr. Peiker served in a variety of positions with the
Climax Molybdenum division of AMAX, Inc., a major international
mining firm involved in exploration activities worldwide. | May 1987 | III/2008 |
| James W. Stuckert | 68 | Director. Senior Executive of
Hilliard, Lyons, Inc., a full service financial asset management
firm since 2004. Mr. Stuckert joined Hilliard, Lyons in
1962 and served in several capacities including Chief Executive
Officer prior to being named Chairman in December 1995. He
served as Chairman from December 1995 to December 2003. | September 1989 | II/2007 |
| Donald Worth | 73 | Director. Mr. Worth is a
director of Sentry Select Capital Corporation, Cornerstone
Capital Resources, Inc., and Tiomin Resources Inc. He is also a
trustee of Labrador Iron Ore Royalty Income Fund. Mr. Worth
has been involved in the mining industry since 1949. He formerly
was a mining specialist and a vice president of Canadian
Imperial Bank of Commerce (Canada) from July 1984 to August
1997, when he retired. He is involved with several professional
associations both in Canada and the United States. | April 1999 | III/2008 |

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| | | Principal Occupation
During Last | Continuously — a Director | Class of — Director/Term |
| --- | --- | --- | --- | --- |
| Name | Age | 5 Years
and Position with Company | Since | Expires |
| Karen Gross | 52 | Vice President of the Company
since June 1994 and Corporate Secretary since 1989. From 1987
until 1989, Ms. Gross was the Assistant Secretary to the
Company. Ms. Gross is in charge of investor relations,
public relations and ensuring the Companys compliance with
various corporate governance standards. Ms. Gross is
involved with the National Investor Relations Institute and the
Society of Corporate Secretaries and Governance Professionals. | | |
| Stefan Wenger | 33 | Chief Financial Officer since July
2006. Treasurer and Chief Accounting Officer of the Company from
April 2003 until June 2006. From June 2002 until March 2003, he
was a manager with PricewaterhouseCoopers LLP. From September
2000 until June 2002, he was a manager with Arthur Andersen LLP.
Mr. Wenger has over eleven years of experience in the
mining and natural resources industry working in various
financial roles. Mr. Wenger is a certified public
accountant. He is a member of the Financial Executives
International, the Colorado Society of Certified Public
Accountants, and the American Institute of Certified Public
Accountants. | | |
| Randy Parcel | 61 | Vice President and General Counsel
since June 2004. Served as the Managing Partner of the Denver
office of Perkins Coie LLP from January 2001 until May 2004.
Prior to forming his own law firm in 1978, which he managed from
1978 to 2001, Mr. Parcel was in-house counsel to the mining
division of Johns-Manville Corporation and was a partner at the
Denver law firm of Holland & Hart. He has over thirty
years experience in mining and natural resources law. | | |

link1 "MEETINGS AND COMMITTEES OF THE BOARD"

MEETINGS AND COMMITTEES OF THE BOARD

During the fiscal year ended June 30, 2006, the Board of Directors held six regular meetings. Each director attended (in person or by telephone) at least 75% of the aggregate number of meetings of the Board of Directors and of the Committee(s) of the Board of Directors on which he served. It is the Companys policy that each member of the Board of Directors is expected to attend each Annual Meeting of Stockholders. All directors attended last years Annual Meeting of Stockholders.

Independence of Directors

The independent members of the Board of Directors have determined that each director, except for Messrs. Dempsey and Jensen, who are officers of the Company, is independent under Rule 4200(a)(15) of the NASD listing standards. The Board of Directors considers Mr. Peiker independent since he has not

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been involved with the day to day management of the Company since February 1992. The Board of Directors has determined that the directors designated as independent have no relationship with the Company that may interfere with the exercise of their independent judgment.

Lead Director

The Board of Directors has elected a lead, independent director who presides over executive sessions of the independent directors scheduled at each regular meeting of the Board of Directors. This lead director position is a rotating position on a yearly basis. The lead director serves as liaison between the Executive Chairman and the other independent directors. Mr. Donald Worth currently serves as lead director.

Audit Committee

The Board of Directors has a standing Audit Committee. The Audit Committee consists of James W. Stuckert, John W. Goth, and Donald Worth. All members of the Audit Committee are independent under Rule 4200(a)(15) of the NASD listing standards and Section 10A(m)(3) of the Securities Exchange Act of 1934, as amended. The Audit Committee held six meetings during the fiscal year. The Board of Directors recently reviewed and amended the Charter for the Audit Committee, which is attached as Appendix A. The Charter is available through the Companys web site at www.royalgold.com.

The Audit Committee assists the Board of Directors in its oversight of the integrity of the Companys financial statements and compliance with legal and regulatory requirements and corporate policies and controls. The Audit Committee has the sole authority to retain and terminate the Companys independent registered public accountants, approve all auditing services and related fees and the terms of any agreements and to pre approve any non-audit services to be rendered by the Companys independent registered public accountants. The Audit Committee is responsible for confirming the independence and objectivity of the independent registered public accountants. The Audit Committee is also responsible for preparation of the annual report of the Audit Committee for public disclosure in the Companys Proxy Statement. The Board of Directors has determined that James Stuckert is an audit committee financial expert as that term is defined in Item 401(h) of Regulation S-K. As an audit committee financial expert, Mr. Stuckert satisfies the NASDAQ financial literacy and sophistication requirements.

Compensation, Nominating and Corporate Governance Committee

The Board of Directors has a standing Compensation, Nominating and Corporate Governance Committee. The Compensation, Nominating and Corporate Governance Committee consists of John W. Goth, James W. Stuckert and Edwin W. Peiker, Jr. All members of the Compensation, Nominating and Corporate Governance Committee are considered independent directors under Rule 4200(a)(15) of the NASD listing standards. The Committee held four meetings during the fiscal year. The Board of Directors has adopted a Charter for the Compensation, Nominating and Corporate Governance Committee, which was reviewed in August 2006. Minor amendments were made to the Charter. The Charter is available through the Companys web site at www.royalgold.com. The Compensation, Nominating and Corporate Governance Committee assumes the role of implementing compensation plans for top executives, as well as directors. The Committees function is to review new or modified programs in the areas of executive salary, incentive compensation, and stock plans and review and make recommendations to the Companys Board of Directors concerning the levels and forms of compensation paid to the officers and key employees of the Company. It also is responsible for preparation of the Annual Report on Executive Compensation for public disclosure in the Companys Proxy Statement.

The Compensation, Nominating and Corporate Governance Committee advises the Board of Directors on various corporate governance issues, in addition to compensation matters as discussed above. Additionally, it proposes to the Board of Directors slates of directors to be recommended for election at the Annual Meeting of Stockholders (and any directors to be elected by the Board of Directors to fill vacancies). In selecting director nominees, the Committee assesses the nominees independence, as well as considers his or her experience, areas of expertise, diversity, perspective, broad business judgment and leadership, all in the context of an assessment of the perceived needs of the Board of Directors at that time. Further, the Committee will consider director candidates recommended by Stockholders using the same criteria outlined

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above, provided such written recommendations are submitted to the Secretary of the Company in accordance with the advance notice and other provisions of the Companys Bylaws.

Communication with Stockholders

Any Stockholder who desires to contact the Companys Board of Directors may do so by writing to the Vice President and Corporate Secretary, Royal Gold, Inc., 1660 Wynkoop Street, Suite 1000, Denver, Colorado 80202. Any such communication should state the number of shares beneficially owned by the Stockholder making the communication. The Secretary will forward any such communication to the Chairman of the Compensation, Nominating and Corporate Governance Committee, and will forward such communication to other members of the Board of Directors, as appropriate, provided that such communication addresses a legitimate business issue. For any communication relating to accounting, auditing or fraud, such communication will be forwarded immediately to the Chairman of the Audit Committee.

Code of Business Ethics and Conduct

The Company has adopted a Code of Business Ethics and Conduct applicable to all of its directors, officers and employees, including the Chief Executive Officer, the Chief Financial Officer, and other persons performing financial reporting functions. The Code is reviewed on a yearly basis. The Code is available through the Companys web site at www.royalgold.com. The Code is designed to deter wrongdoing and promote (a) honest and ethical conduct; (b) full, fair, accurate, timely and understandable disclosures; (c) compliance with laws, rules and regulations; (d) prompt internal reporting of Code violations; and (e) accountability for adherence to the Code. The Company will post on its web site any amendments to the Code.

link1 "SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE"

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Companys officers and directors, and persons who own more than 10% of a registered class of the Companys equity securities, to file reports of ownership and changes in ownership to the Securities and Exchange Commission. Officers, directors and greater than 10% Stockholders are required by the regulations of the Securities and Exchange Commission to furnish the Company with copies of all Section 16(a) reports they file. Based solely on its review of copies of such reports received and written representations from certain persons that no other reports were required for those persons, the Company believes that, other than as described, all filing requirements applicable to its officers, directors and greater than 10% Stockholders were met for the fiscal year ended June 30, 2006, and all transactions are reflected in this Proxy Statement. Mr. Marcus filed all required Form 4 filings, but filed one Form 4 after the filing deadline, which reported one transaction pursuant to Mr. Marcus 10b5-1 trading plan.

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link1 "COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS"

COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS

Summary Compensation Table

The following table reflects all compensation awarded or paid to or earned by the named executive officers of the Company, for the fiscal year ended June 30, 2006.

| | | | | Long-Term
Compensation | | | | |
| --- | --- | --- | --- | --- | --- | --- | --- | --- |
| | | | | Awards | | | | |
| | Year | Annual | | Restricted | | All Other | | |
| Name
and | Ended | Compensation | | Stock | | Compensation | | |
| Principal Position | June 30 | Salary($) | Bonus($) | Awards($) (1) | Options(#) | ($) | | |
| Stanley Dempsey | 2006 | 290,000 | 200,000 | | | 27,500 | 31,043 | (2) |
| Executive Chairman | 2005 | 275,000 | 150,000 | 260,700 | (3) | 35,000 | 26,742 | |
| | 2004 | 275,500 | 150,000 | | | 2,500 | 31,362 | |
| Tony Jensen | 2006 | 240,000 | 170,000 | 444,400 | (4) | 15,000 | 27,883 | (5) |
| President and Chief | 2005 | 225,000 | 125,000 | 434,500 | (3) | 25,000 | 24,581 | |
| Executive Officer | 2004 | 192,250 | 135,000 | | | 60,000 | 16,933 | |
| Karen P. Gross | 2006 | 142,500 | 100,000 | 222,200 | (4) | 15,000 | 20,218 | (6) |
| Vice President and | 2005 | 133,500 | 70,000 | 173,800 | (3) | 15,000 | 22,411 | |
| Corporate Secretary | 2004 | 133,500 | 60,000 | | | 2,500 | 16,527 | |
| Donald
Baker (7) | 2006 | 128,423 | 70,000 | 333,300 | (4) | 5,000 | 20,214 | (8) |
| Vice President of | 2005 | 125,000 | 60,000 | 217,250 | (3) | 12,500 | 18,553 | |
| Corporate Development | 2004 | 125,000 | 50,000 | | | 1,500 | 16,304 | |
| Stefan Wenger | 2006 | 122,500 | 67,000 | 277,750 | (4) | 10,000 | 14,470 | (9) |
| Chief Financial Officer | 2005 | 115,000 | 60,000 | 217,250 | (3) | 12,500 | 13,455 | |
| | 2004 | 95,000 | 30,000 | | | 2,500 | 9,524 | |
| Randy
Parcel (10) | 2006 | 182,500 | 90,000 | 277,750 | (4) | 10,000 | 20,481 | (11) |
| Vice President and | 2005 | 175,000 | 35,000 | 217,250 | (3) | 22,500 | 14,499 | |
| General Counsel | 2004 | 14,583 | 25,000 | | | | | |

callerid=999 iwidth=684 length=90

| (1) | Messrs. Dempsey, Jensen,
Baker, Wenger, Parcel and Ms. Gross own, as of
June 30, 2006, in the aggregate 0, 27,500, 0, 16,250,
16,250 and 7,500 shares of restricted stock, respectively,
that vest subject to continued service as described below, and
7,500, 11,250, 0, 5,625, 5,625 and 7,500 shares of
restricted stock, respectively, that vest subject to performance
conditions as described below for an aggregate value of
$208,650, $312,975, $0, $156,488, $156,488 and $208,650,
respectively, based on the closing sale price of the
Companys Common Stock on the last trading day of the
fiscal year ended June 30, 2006. |
| --- | --- |
| (2) | The Companys payments under
the Salary Reduction/Simplified Employee Pension Plan, or
SARSEP, made to Mr. Dempsey in fiscal 2006,
2005, and 2004 were $28,511, $24,210, and $25,500, respectively,
and the Companys payment of group term life insurance and
long-term disability insurance premiums paid in fiscal 2006,
2005, and 2004 were $2,532, $2,532, and $5,862. |
| (3) | The values of the restricted stock
are based on the closing sale price of the Companys Common
Stock on the date of grant, November 10, 2004, which was
$17.38. The restricted stock vests subject to either continued
service or performance conditions. Sixty-four percent (64%) of
the restricted stock vests in three equal installments on
November 10, 2008, November 10, 2009, and
November 10, 2010. The other 36% vests based on performance
criteria, which can be satisfied at any time during a five year
period. The performance criteria for the 2004 grants were based
on achievement of stated increases in free cash flow per share,
stated increases of royalty ounces in reserve per share and
stated increase in market capitalization. |

END LOGICAL PAGE PAGEBREAK

Table of Contents

| (4) | The values of restricted stock are
based on the closing sale price of the Companys Common
Stock on the date of the grant, November 8, 2005, which was
$22.22. The restricted stock vests subject to either continued
service or performance conditions. Sixty percent (60%) of the
restricted stock vests in three equal installments on
November 8, 2009, November 8, 2010, and
November 8, 2011. The other 40% vests based on performance
criteria, which can be satisfied at any time during a five year
period. The performance criteria for the 2005 grants were based
on achievement of stated increases of free cash flow per share
and the stated increases of royalty ounces in reserve per share. |
| --- | --- |
| (5) | The Companys SARSEP payments
made to Mr. Jensen fiscal 2006, 2005, and 2004, were
$26,410, $23,108, and $15,558, respectively, and the
Companys payment of group term life insurance and
long-term disability insurance premiums paid in fiscal 2006,
2005, and 2004 were $1,473, $1,473, and $1,375, respectively. |
| (6) | The Companys SARSEP payments
made to Ms. Gross in fiscal 2006, 2005, and 2004, were
$16,975, $19,245, and $13,545, respectively, and the
Companys payment of group term life insurance and
long-term disability insurance premiums paid in fiscal 2006,
2005, and 2004, were $3,243, $3,166, and $2,982, respectively. |
| (7) | Includes 24,375 shares of
restricted stock and 13,334 options that were not vested at the
time Mr. Baker resigned on June 20, 2006. These shares
were forfeited and options terminated upon his resignation.
Mr. Baker exercised all vested options before his
resignation from the Company. |
| (8) | The Companys SARSEP payments
made to Mr. Baker in fiscal 2006, 2005, and 2004 were
$16,375, $14,452, and $12,250, respectively, and the
Companys payment of group term life insurance and
long-term disability premiums paid in fiscal 2006, 2005, and
2004 were $3,839, $4,101, and $4,054, respectively.
Mr. Baker resigned his position from the Company on
June 20, 2006. |
| (9) | The Companys SARSEP payments
made to Mr. Wenger in fiscal 2006, 2005, and 2004 were
$13,265, $12,250, and $8,750, respectively, and the
Companys payment of group term life insurance and
long-term disability insurance premiums paid in fiscal 2006,
2005, and 2004 were $1,205, $1,205, and $774, respectively. |
| (10) | Mr. Parcel joined the Company
as Vice President and General Counsel as of June 1, 2004. |
| (11) | The Companys SARSEP payments
made to Mr. Parcel in fiscal 2006 and 2005 were $19,125 and
$12,950, respectively, and the Companys payment of group
term life insurance and long-term disability insurance premiums
paid in fiscal 2006 and 2005, were $1,356 and $1,549,
respectively. Mr. Parcel joined the Company on June 1,
2004. |

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Option Grants in Last Fiscal Year

During the fiscal year ended June 30, 2006, the named executive officers of the Company were awarded a total of 82,500 stock options. No stock appreciation rights were awarded to any of the officers of the Company, and no existing options held by any of the officers of the Company were repriced.

The following table sets forth certain information on option grants in fiscal 2006 to the named executive officers.

| | Individual Grants — Number of | % of Total | | | Potential Realizable
Value — at Assumed Annual
Rates | |
| --- | --- | --- | --- | --- | --- | --- |
| | Securities | Options | | | of Stock Price | |
| | Underlying | Granted to | Exercise | | Appreciation for
Option | |
| | Options | Employees in | Price | | Term
($) (1) | |
| Name | Granted
(#) (2) | Fiscal
Year | ($/share) (3) | Expiration
Date | 5% | 10% |
| Stanley Dempsey | 27,500 | 30 % | 22.22 | 11/08/2015 | 384,286 | 973,856 |
| Tony Jensen | 15,000 | 16 % | 22.22 | 11/08/2015 | 209,611 | 531,194 |
| Karen P. Gross | 15,000 | 16 % | 22.22 | 11/08/2015 | 209,611 | 531,194 |
| Donald
Baker (4) | 5,000 | 5 % | 22.22 | 11/08/2015 | 69,870 | 177,065 |
| Stefan Wenger | 10,000 | 11 % | 22.22 | 11/08/2015 | 139,740 | 354,130 |
| Randy Parcel | 10,000 | 11 % | 22.22 | 11/08/2015 | 139,740 | 354,130 |

callerid=999 iwidth=684 length=90

| (1) | The potential realizable values are stated for all options
outstanding for each employee and are based on hypothetical
rates of appreciation of the market price of the Companys
Common Stock on the date of the grant, which was $22.22, set by
the SEC. Actual gains, if any, on stock option exercises are
dependent on the future performance of the Common Stock (as well
as the option holders continued employment through the
vesting period). The amounts reflected in this table may not
necessarily be achieved. |
| --- | --- |
| (2) | Incentive and non-statutory stock options granted under the
Companys Omnibus Long-Term Incentive Plan to
Messrs. Jensen, Baker, Wenger and Parcel vest as to
one-third on the anniversary of the grant date for years one,
two and three, and the options granted to Mr. Dempsey and
Ms. Gross vested on the anniversary of the grant date. |
| (3) | The exercise price for all options listed was the fair market
value of the Companys Common Stock on the date of grant
and may be paid with cash, shares owned at least six months by
the optionee valued at fair market value on the date of
exercise, or any other legal consideration that the Board of
Directors may deem appropriate. |
| (4) | Upon Mr. Bakers resignation effective June 20,
2006, the 5,000 options granted to him in fiscal 2006 that had
not vested and were terminated. |

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Aggregated Option Exercises and Fiscal Year-End Option Values

The table below sets forth information regarding the actual value of options exercised by the named executive officers during the fiscal year ended June 30, 2006, and the deemed value of options held by such persons at June 30, 2006.

			Number of — Securities	Value of — Unexercised
			Underlying	In-the-Money
			Unexercised
Options	Options
	Shares		at FY-End(#)	at
FY-End($) (2)
	Acquired on	Value	Exercisable/	Exercisable/
Name	Exercise(#)	Realized($) (1)	Unexercisable	Unexercisable
Stanley Dempsey	58,600	1,254,000	53,900/27,500	427,716/154,000
Tony Jensen	50,000	584,000	18,333/31,667	239,697/258,003
Karen P. Gross	55,744	1,728,096	98,000/15,000	1,549,348/84,000
Donald
Baker (3)	40,466	683,993	0/0	0/0
Stefan Wenger	5,367	111,714	6,280/18,333	52,117/142,997
Randy Parcel	14,100	285,925	67/18,333	696/142,997

callerid=999 iwidth=467 length=90

| (1) | Based on the difference between exercise price and closing sale
price as reported on NASDAQ, on the dates of exercise. |
| --- | --- |
| (2) | Value calculated based on the difference between the exercise
price and the closing sale price as reported on NASDAQ, on the
last day of the fiscal year ended June 30, 2006, of
$27.82 per share. |
| (3) | Mr. Baker resigned his position as Vice President Corporate
Development with the Company effective June 20, 2006. |

Certain Relationships and Related Transactions

Mr. Baker resigned as Vice President Corporate Development of the Company in June 2006. On July 1, 2006, the Company entered into a Consulting and Confidentiality Agreement (the Agreement) with Mr. Baker to provide consulting services in connection with projects being considered by the Company, on a project-by-project basis when it is deemed that Mr. Bakers services are needed. The rate for Mr. Bakers services is $90.00 per hour, plus costs for all reasonable and actual out-of-pocket expenses. The term of the Agreement is effective until June 30, 2008, but may be extended by mutual agreement of both parties and confirmed by letter executed by both parties, on a successive basis. Either the Company or Mr. Baker may cancel the Agreement, at any time, by providing 30 days notice.

In November 2005, the Company entered into a strategic exploration alliance with Taranis Resources to pursue exploration opportunities in Finland, for which it has provided $500,000 in funding for a 2% net smelter return royalty and future earn-in rights. In January 2006 and in support of the strategic exploration alliance, Mr. Dempsey, Executive Chairman of the Company, became a director of Taranis Resources, Inc., a Colorado-based resource company, listed on the Toronto Stock Exchange (Taranis Resources). As a director of Taranis Resources, Mr. Dempsey is awarded stock options under Taranis Resources stock option plan. In January 2006, Mr. Dempsey was awarded 100,000 incentive stock options, exercisable for a period of five years from the date of grant, at a price of Cdn$0.35 per share.

In July 2006, the Company entered into an agreement with Mr. Dempsey under which any director fees, consulting fees and other remuneration (whether in cash, securities or otherwise) paid to Mr. Dempsey by Taranis Resources will be remitted to the Company (the Agreement). Pursuant to the Agreement, the Company may require Mr. Dempsey to exercise the stock options granted to him by Taranis Resources at any time or from time to time during the exercise period and under the terms of the Taranis Resources stock option agreement. If the Company requires Mr. Dempsey to exercise the stock options, it will pay Mr. Dempsey the amount necessary to exercise the stock options. The securities gained upon exercise will be transferred to the Company. The Company will reimburse Mr. Dempsey for incurred tax liability, if any.

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The Company is considered to control the stock options granted to Mr. Dempsey by Taranis Resources, exercisable for 100,000 shares of common stock, because it has the right to require Mr. Dempsey to exercise the stock options pursuant the Agreement and will acquire the shares upon the exercise. The Company currently owns 1,037,500 shares of common stock and has the direct or indirect right to acquire a total of 618,750 shares of common stock , including the shares acquired upon exercise of Mr. Dempseys stock options, such that, if the Company exercised its rights and there was no other dilution, its holdings would represent 13.10% beneficial ownership of the Taranis Resources common stock. The Company does not have any intention to acquire control of Taranis Resources.

Equity Compensation Plan Information

The following table sets forth information concerning shares of Common Stock that are authorized and available for issuance under the Companys equity compensation plans as of June 30, 2006.

| | | | | Number of
Securities |
| --- | --- | --- | --- | --- |
| | | | | Remaining
Available |
| | | | | for Future
Issuance |
| | Number of
Securities | | | Under Equity |
| | to be Issued Upon | | Weighted-Average | Compensation
Plans |
| | Exercise of | | Exercise Price of | (Excluding |
| | Outstanding
Options, | | Outstanding
Options, | Securities
Reflected |
| Plan
Category | Warrants
and Rights | | Warrants
and Rights | in
Column (a)) |
| | (a) | | (b) | (c) |
| Equity compensation plans approved
by
Stockholders (1) | 528,414 | (2) | $ 14.87 | 489,584 |
| Equity compensation plans not
approved by
Stockholders (3) | | | | |
| Total | 528,414 | | $ 14.87 | 489,584 |

callerid=999 iwidth=467 length=90

| (1) | Includes shares available for future issuance under the
Companys Omnibus Long-Term Incentive Plan. |
| --- | --- |
| (2) | Does not include 118,750 shares of restricted stock
outstanding pursuant to the equity compensation plan. |
| (3) | The Company does not maintain equity compensation plans that
have not been approved by its Stockholders. |

Employment Contracts

Four of the five officers of the Company are employed pursuant to an employment contract providing for salary at current salary levels. Each of the employment contracts is renewable, for a term of 12 months, every February. Pursuant to each of the employment contracts, salary and benefits are to be continued for 12 months following the employees involuntary termination, or following the employees voluntary termination for good reason after a change in control event. A change in control event, as defined in the employment contracts, will occur upon: (1) the acquisition, directly or indirectly, by any person or related group of persons, of beneficial ownership of securities possessing more than 30% of the total combined voting power of the Companys outstanding securities; (2) a change in the composition of the Board of Directors over a period of 18 consecutive months or less such that 50% or more of the members of the Board of Directors members cease to be directors who either (A) have been directors continuously since the beginning of such period, or (B) have been unanimously elected or nominated by the Board of Directors for election as directors during such period; (3) a stockholder-approved merger or consolidation to which the Company is a party and, in which, (A) the Company is not the surviving entity, or (B) securities possessing more than 30% of the total combined voting power of the Companys outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction; or (4) the sale, transfer or other disposition of all or substantially all of the Companys assets in complete liquidation or dissolution of the Company.

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Pension Plans

In fiscal 1994, the Company established a variation of a Simplified Employee Pension Plan, known as a Salary Reduction/Simplified Employee Pension Plan (SARSEP Plan). Management chose this SARSEP Plan because of regulatory compliance simplicity, avoidance of significant administrative expense, availability of substantial tax-advantaged investment opportunities, and relative freedom from significant vesting or other limitations. Under this SARSEP Plan, the Company may contribute to a designated IRA account, on an annual basis, up to 15% of each employee-participants base compensation. Each such contribution would, within limits, be a deductible expense to the Company; would be free of federal income taxation as to the employee; and would be subject to continuing investment, on a tax-deferred basis, until assets are actually distributed to the employee. All Company employees are eligible to participate in the SARSEP Plan.

Compensation Committee Interlocks and Insider Participation

The Companys Compensation, Nominating and Corporate Governance Committee during the 2006 fiscal year consisted of Mr. Goth, who served as Chairman, Mr. Stuckert and Mr. Peiker. No member of the Committee was, at any time during the 2006 fiscal year or at any other time, an officer or employee of the Company, other than Mr. Peiker, who served as President and Chief Operating Officer from 1988 to 1992. No executive officer of the Company served on the compensation committee of another entity, or any other committee of the Board of Directors of another entity performing similar functions during the Companys past fiscal year.

Report of the Compensation, Nominating and Corporate Governance Committee on Executive Compensation

The information contained in the following Report on Executive Compensation shall not be deemed soliciting material or filed with the SEC, nor shall such information be incorporated by reference into a future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this Report by reference therein.

The Compensation, Nominating and Corporate Governance Committee of the Board of Directors is composed entirely of directors who are independent under Rule 4200(a)(15) of the NASD Listing Standards. The members of the Compensation, Nominating and Corporate Governance Committee were for the fiscal year ended June 30, 2006, and are expected to be for the fiscal year ending June 30, 2007, John W. Goth, Edwin W. Peiker, Jr., and James W. Stuckert. The Committee is responsible for, among other things, setting and administering the policies that govern the compensation for the executive officers of the Company. The Committee evaluates the performance of management and recommends to the full Board of Directors the compensation level for all officers and key employees. The Committee also administers the Companys Omnibus Long-Term Incentive Plan and determines the amount of stock options and restricted stock granted to officers and key employees.

The primary objectives of the Companys executive compensation program are: to attract and retain key executives who are critical to the long-term success of the Company by offering compensation packages believed to be appropriate in light of compensation in the industry; to evaluate executive performance in light of the Companys performance; to provide an economic framework that will motivate executives to achieve goals consistent with the Companys business strategy; to reward performance that benefits all Stockholders; and to provide a compensation package that recognizes individual results and contributions to the overall success of the Company.

The Compensation, Nominating and Corporate Governance Committees policy objectives are to provide total compensation that is comparable with that paid by the mining industry. Due to the Companys small staff, compensation practices are flexible and entrepreneurial, with compensation geared to meeting the requirements of the Company and the individual. Bonus payments are paid when individual performance and significant achievements for the Companys future revenue growth or other circumstances warrant special recognition. Bonuses are based upon the contribution of each individual and are usually paid on an annual basis. Long-term incentives, in the form of stock options and restricted stock, are another component of executive compensation and are granted to ensure an incentive exists to maximize shareholder wealth by

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tying executive compensation to share price performance, and to reward those executives making a long-term commitment to the Company.

The Committee evaluates a variety of information when reviewing salary levels and when making recommendations to the full Board of Directors. The Committee also reviews individual executive compensation, individual performance, corporate performance, stock price appreciation, and total return to stockholders of the Company When reviewing individual performance of officers of the Company, the Committee also takes into account the views of the Companys Executive Chairman and its President and Chief Executive Officer. Before or at the end of each year, the Committee evaluates each individual officers performance in order to determine whether to recommend the payment of bonuses and/or options or restricted stock and, if so, the amount of each such bonus and/or options or restricted stock. The Board of Directors usually establishes the salary levels of the Companys executives and officers at its May meeting.

Frederic W. Cook & Co., an independent compensation consulting firm, was retained to conduct a salary survey using a benchmark peer group of 15 mining companies. The survey found the fiscal 2006 base salaries for corporate officers among the benchmark peer group ranked in the 15 th percentile and the combination of both salary and bonus payments ranked in the 25th percentile among the benchmark peer group.

The Committee also reviews and approves stock option and restricted stock awards, under the Companys Omnibus Long-Term Incentive Plan. The purpose of stock option and restricted stock awards is to provide key employees with an incentive to continue as employees of the Company over the long-term and to align such employees long-range interests with those of the stockholders by providing the opportunity of having an equity interest in the Company. The Committee grants stock option and restricted stock awards based on salary, level of responsibility, and performance. Frederic W. Cook & Co. was also retained to conduct a competitive review of total compensation. The review was based on the same benchmark peer group used for the base salary review. The review found that total direct compensation (salary, bonus and long-term incentives) is at the median (50 th percentile). The Committee also considers the size of the Company in terms of the number of employees, noting that losing a key employee could have a material adverse effect on the Companys operations.

All stock options are granted with an exercise price equal to the market price of the Common Stock on the date of grant. Under the Companys Omnibus Long-Term Incentive Plan, incentive stock options and non-statutory stock options typically vest as to one-third in years one, two and three and have a 10-year term. Restricted stock granted under the Plan vest either subject to continued service or subject to performance conditions. Those shares issued subject to continued service vest as to one-third in years four, five and six.

During the fiscal year ended June 30, 2006, there were 82,500 stock options and 87,500 restricted shares that were awarded to officers of the Company.

Chief Executive Officer . In evaluating the performance and setting the compensation of the Chief Executive Officer, the Committee took into account the base salaries of chief executive officers of other mining companies, including some of the companies that are referenced in the XAU Gold Index which are listed in the Cumulative Five Year Total Return Chart. The Committee also assessed Mr. Dempseys individual performance, including his leadership with respect to the development of long-term business strategies for the Company to improve its economic value. The Committee also evaluates the performance of the Company when making compensation decisions regarding the Chief Executive Officer.

The Committee believes that Mr. Dempsey, who served as Chief Executive Officer for the fiscal year ended June 30, 2006, and is currently serving as Executive Chairman, and Mr. Jensen who served as President and Chief Operating Officer during the fiscal year ended June 30, 2006, and is currently servicing as President and Chief Executive Officer, as well as the other officers of the Company, are strongly motivated and are dedicated to the growth of the Company and to increasing stockholder value. The Committee noted the substantial progress of the Company in fiscal 2006, including the completion of a public offering, the acquisition or financing of three new royalties, and the completion of a strategic alliance. Because of the leadership provided by Messrs. Dempsey and Jensen and other officers of the Company, the Committee felt that bonuses should be awarded to Messrs. Dempsey and Jensen as well as the other officers of the

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Company. Therefore, in fiscal 2006, a bonus of $200,000 was awarded to Mr. Dempsey and a bonus of $170,000 was awarded to Mr. Jensen. Salary increases of $15,000 were given to both Messrs. Dempsey and Jensen. Mr. Dempsey was granted 27,500 stock options, and Mr. Jensen was granted 15,000 stock options, and 25,000 shares of restricted stock, of which 10,000 shares will vest subject to performance conditions, and 15,000 shares will vest subject to continued service.

This Report has been submitted by the following members of the Compensation, Nominating and Corporate Governance Committee of the Board of Directors:

John W. Goth, Chairman James W. Stuckert Edwin W. Peiker, Jr.

Directors Compensation

Each non-employee director of the Company receives an annual fee of $15,000 for service as a director, and an additional $700 for each Board of Directors meeting attended, either in person or via telephone. The Chairman of the Audit Committee and the Chairman of the Compensation, Nominating and Corporate Governance Committee each receive an annual fee of $2,000 for their service as chairman of their respective committees, and each member of the Audit Committee and Compensation, Nominating and Corporate Governance Committee receives $500 for each meeting attended, either in person or via telephone.

Pursuant to the Companys Omnibus Long-Term Incentive Plan, each non-employee director also is granted annually a Non-Statutory Option (NSO) to purchase 2,500 shares of Common Stock, at an exercise price equal to the fair market value of the Companys Common Stock on the date of grant. Accordingly, on November 9, 2005, each non-employee director of the Company was granted 2,500 NSOs, at an exercise price of $23.61 per share. These options have a ten-year term and are exercisable immediately with respect to 1,250 shares and after 12 months with respect to the other 1,250 shares. The Omnibus Long-Term Incentive Plan also allows each non-employee director to be granted restricted stock annually. Accordingly, on November 9, 2005, each non-employee director of the Company was granted 1,250 restricted shares. Half of these restricted shares vested immediately and the other half vest after 12 months.

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Price Performance Graph

The material under the heading Price Performance Graph shall not be deemed soliciting material, or filed with the SEC, nor shall such information be incorporated by reference into a future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this Price Performance Graph by reference therein.

The following graph compares the cumulative total return on the Companys Common Stock with the cumulative total return of two other stock market indices: Standard and Poors 500 Index and the Philadelphia Stock Exchanges XAU Gold Index as of June 30, 2006. The Company believes that the XAU Gold Index is more representative of the gold mining industry whereas the Standard and Poors 500 Index reflects only one gold mining company.

COMPARISON OF CUMULATIVE FIVE YEAR TOTAL RETURN

| (1) | S & P 500 Index . Represents the
return an investor would have secured (assuming reinvestment of
all dividends) on the basis of an investment of $100 in the 500
equity issues that make up the Standard and Poors 500
Index. |
| --- | --- |
| (2) | XAU Gold Index . Represents the return an
investor would have secured (assuming reinvestment of all
dividends) on the basis of an investment of $100 in the 16
equity issues that made up the XAU Gold Index as of
June 30, 2006 (Agnico Eagle Mines Ltd., AngloGold Ashanti
Ltd. (ADR), Barrick Gold Corporation, Bema Gold Corporation,
Coeur dAlene Mines Corporation, Freeport McMoran
Copper & Gold, Glamis Gold Ltd., Gold Fields Ltd.
(ADR), Goldcorp Inc., Harmony Gold Mining Ltd. (ADR), Kinross
Gold Corporation, Meridian Gold Inc., Newmont Mining
Corporation, Pan American Silver Corporation, Randgold Resources
Ltd. (ADR) and Royal Gold, Inc.). |

link1 "AUDIT COMMITTEE AND RELATED MATTERS"

AUDIT COMMITTEE AND RELATED MATTERS

The information contained in the following Audit Committee Report shall not be deemed soliciting material or filed with the SEC, nor shall such information be incorporated by reference into a future filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent the Company specifically incorporates this Report by reference therein.

Audit Committee Report

The Companys Audit Committee is comprised of three members who are independent within the meaning of such term under Rule 4200(a)(15) of the NASD listing standards and the meaning of such

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term under the Sarbanes-Oxley Act of 2002 and regulations promulgated under the Act. Each member of the Audit Committee is able to read and understand fundamental financial statements and at least one member has past employment experience in finance or accounting or other comparable experience. The Committee actively oversees the Companys financial condition and results of operations. The main function of the Audit Committee is to ensure that effective accounting policies are implemented and that internal controls are put in place in order to deter fraud, anticipate financial risks and promote accurate, high quality and timely disclosure of financial and other material information to the public markets, the Board of Directors and the Stockholders. The Audit Committee also reviews and recommends to the Board of Directors the approval of the annual financial statements and provides a forum, independent of management, where the Companys auditors can communicate any issues of concern.

The independent members of the Audit Committee believe that the present composition of the Committee accomplishes all of the necessary goals and functions of an audit committee as recommended by the Blue Ribbon Committee on Improving the Effectiveness of Corporate Audit Committees and adopted by the U.S. stock exchanges and the Securities and Exchange Commission. The Board of Directors has adopted an amended and restated charter for the Audit Committee. The Audit Committee Charter, as amended, is attached as Appendix A. The amended Charter specifies the scope of the Audit Committees responsibilities and how it should carry out those responsibilities.

The Audit Committee has reviewed and discussed the audited financial statements of the Company for the fiscal year ended June 30, 2006, with the Companys management. The Audit Committee has discussed with PricewaterhouseCoopers LLP, the Companys independent registered public accountants, the matters required to be discussed by Statement on Auditing Standards No. 61 (Communications with Audit Committees), as amended by Statement on Auditing Standards No. 90 (Audit Committee Communications). The Audit Committee has also received the written disclosures and the letter from PricewaterhouseCoopers LLP required by Independence Standards Board Standard No. 1 (Independence Discussion with Audit Committees) and the Audit Committee has discussed the independence of PricewaterhouseCoopers LLP with that firm.

Based on the review and discussions with the Companys auditors, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Companys Annual Report on Form 10-K for the fiscal year ended June 30, 2006, for filing with the U.S. Securities and Exchange Commission.

This Report has been submitted by the following members of the Audit Committee of the Board of Directors:

James W. Stuckert, Chairman John W. Goth Donald Worth

Independent Registered Public Accountants

The Audit Committee has selected PricewaterhouseCoopers LLP to continue as the Companys independent registered public accountants to audit financial statements of the Company for the fiscal year ending June 30, 2007. Fees for services rendered by PwC for the fiscal years ended June 30, 2006 and June 30, 2005 are as follows:

Audit Fees . Fees were $312,121 and $329,564 for the fiscal years ended June 30, 2006 and 2005, respectively. Included in this category are fees associated with the audit of the Companys annual financial statements and review of quarterly statements. Audit fees also include fees associated with the audit of managements assessment and operating effectiveness of the Sarbanes Oxley Act, Section 404, internal control reporting requirements.

Audit-Related Fees . Fees were $36,800 and $12,500 for the fiscal years ended June 30, 2006 and 2005, respectively. Audit-related services, for the fiscal year ended June 30, 2006, include comfort letter procedures and accounting consultations. Audit-related services for the fiscal year ended June 30, 2005, included accounting consultations.

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Tax Fees . Fees were $0 and $0 for the years ended June 30, 2006 and 2005, respectively. Fees for tax services include tax compliance, tax advice and tax planning.

All Other Fees . Fees were $0 and $0 for the years ended June 30, 2006 and 2005, respectively.

Pre-Approval Policies and Procedures

The Audit Committee has adopted a policy that requires advance approval for all audit, audit-related, tax services, and other services performed by the independent auditor. The policy provides for pre-approval by the Audit Committee of specifically defined audit and non-audit services. Unless the specific service has been previously pre-approved with respect to that year, the Audit Committee must approve the permitted service before the independent auditor is engaged to perform it. The Audit Committee has delegated to the Chairman of the Audit Committee authority to approve certain permitted services, provided that the Chairman reports any such decisions to the Audit Committee at its next scheduled meeting. The Audit Committee pre-approved all of the services described above for the Companys 2006 fiscal year.

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PROPOSAL 2.

link1 "RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS"

RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS

The Audit Committee and the Board of Directors is seeking Stockholder ratification of its appointment of PricewaterhouseCoopers LLP, an independent registered public accounting firm, to audit the consolidated financial statements of the Company for the fiscal year ending June 30, 2007.

The ratification of the appointment of PricewaterhouseCoopers LLP is being submitted to the Stockholders because the Audit Committee and the Board of Directors believes this to be good corporate practice. Should the Stockholders fail to ratify this appointment, the Audit Committee will review the matter.

Representatives of PricewaterhouseCoopers LLP are expected to attend the Annual Meeting. They will have an opportunity to make a statement, if they so desire, and will have an opportunity to respond to appropriate questions from the Stockholders.

link1 "THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS OF THE COMPANY."

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS OF THE COMPANY. link1 "OTHER MATTERS" OTHER MATTERS

The Board of Directors knows of no other matters to be brought before the Annual Meeting. However, if other matters should come before the Annual Meeting, it is the intention of each person named in the proxy to vote such proxy in accordance with his own judgment on such matters.

Stockholder Proposals

Stockholder proposals intended to be presented at the 2007 Annual Meeting of Stockholders and to be included in the Companys proxy materials for the 2007 Annual Meeting of Stockholders must be received by the Company at its principal executive office in Denver, Colorado, by June 19, 2007, if such proposals are to be considered timely and included in the proxy materials for the 2007 Annual Meeting of Stockholders. The inclusion of any Stockholder proposal in the proxy materials for the 2007 Annual Meeting of Stockholders will be subject to applicable rules of the Securities and Exchange Commission.

Stockholders may present proposals that are proper subjects for consideration at the annual meeting even if the proposal is not submitted by the deadline for inclusion in the proxy materials. To do so, the proposal must be received not less than 30 but no more than 50 days prior to the date of the 2007 Annual Meeting of Stockholders; provided, however, that if notice of the date of the 2007 Annual Meeting of Stockholders is not made at least 40 days prior to the date of the meeting, notice by the stockholder must be received no later than the close of business on the tenth day following the date of notice of the 2006 Annual Meeting of Stockholders was mailed or made public.

Proxies for the 2007 Annual Meeting of Stockholders will confer discretionary authority to vote with respect to all proposals of which the Company does not receive proper notice by September 1, 2007.

BY ORDER OF THE BOARD OF DIRECTORS

Karen P. Gross

Vice President & Corporate Secretary

Denver, Colorado

October 16, 2006

Upon the written request of any record holder or beneficial owner of Common Stock entitled to vote at the Annual Meeting, the Company will provide, without charge, a copy of its Annual Report on Form 10-K including financial statements and any required financial statement schedules, as filed with the Securities and Exchange Commission for the fiscal year ended June 30, 2006. Requests for a copy of the Annual Report should be mailed, faxed, or sent via e-mail to Karen P. Gross, Vice President & Corporate Secretary, Royal Gold, Inc., 1660 Wynkoop Street, Suite 1000, Denver, Colorado 80202-1132, 303-595-9385 (fax), or [email protected].

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APPENDIX A

ROYAL GOLD, INC.

AUDIT COMMITTEE CHARTER

Organization

There shall be a committee of the board of directors to be known as the audit committee. The audit committee shall be composed of at least three (3) directors, each of whom in the opinion of the board of directors is independent in accordance with applicable rules and regulations of the Securities and Exchange Commission (the SEC) and the listing requirements of NASDAQ Stock Market, Inc. (NASDAQ), the Toronto Stock Exchange (TSX) and any other applicable securities market. All members of the audit committee shall meet the financial literacy requirements of the rules and regulations of the SEC and the listing requirements of NASDAQ and any other applicable securities market, as such qualification is interpreted by the board of directors in its business judgment, or must become financially literate as so interpreted within a reasonable period of time after his or her appointment to the audit committee. No member of the audit committee shall have participated in the preparation of the financial statements of the corporation or any current subsidiary of the corporation at any time during the past three (3) years. In addition, at least one member of the audit committee, as determined by the board of directors in its business judgment, shall have past employment experience in finance or accounting, requisite professional certification in accounting or other comparable experience or background which results in the individuals financial sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities.

Compensation of Members

Compensation for service on the audit committee shall be limited to fees and compensation permitted in accordance with all applicable statutes, rules and regulations, including those of applicable exchanges.

Statement of Policy

The audit committee shall provide assistance to the board of directors in fulfilling its oversight responsibilities to the shareholders relating to the accounting, audit and financial reporting practices of the corporation, and the quality and integrity of the financial reports of the corporation. In so doing, it is the responsibility of the audit committee to maintain free and open means of communication between the board of directors, the independent auditors, and the financial management of the corporation.

Responsibilities

In carrying out its responsibilities, the audit committee believes its policies and procedures should remain flexible, in order to best react to changing conditions and to ensure to the directors and shareholders that the corporate accounting, audit and reporting practices of the corporation are in accordance with all requirements and are of the highest quality. While the audit committee has the responsibilities and duties set forth in this Charter, it is not the responsibility of the committee to plan and conduct the audits itself or to determine that the corporations financial statements are complete and accurate and are in accordance with generally accepted accounting principles. The audit committees responsibility in this regard is one of oversight and review.

The audit committee shall:

| 1. | Hold regular meetings at least quarterly and such special
meetings as may be called by the Chairman of the audit
committee, or senior management, or at the request of the
independent auditors of the corporation. |
| --- | --- |
| 2. | Be directly responsible for the appointment, determination of
compensation, oversight (including the resolution of
disagreements between management and the independent auditors
regarding |

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financial reporting), and, where appropriate, replacement of the independent auditors engaged to audit the financial statements of the corporation and its divisions and subsidiaries or to perform other audit, review or attest services to the corporation. The independent auditors shall report directly to the audit committee.

| 3. | In connection with the appointment, determination of
compensation, retention and oversight of the independent
auditors, meet with members of senior management and the
financial management of the corporation who work with the
independent auditors to review the scope of the proposed audit
for the current year and the adequacy of the audit procedures to
be utilized, and the appropriateness of the fees proposed to be
charged for such services. The audit committee shall also
solicit on a regular basis the views of management concerning
the quality and timeliness of the independent auditors
services. |
| --- | --- |
| 4. | Meet with the independent auditors, senior management and
financial management of the corporation to review the scope of
the proposed audit for the current year and the audit procedures
to be utilized, and to review and approve in advance all audit
and non-audit related services to be performed by the
independent auditors. The audit committee may delegate its
authority to pre-approve non-audit services to one or more
members of the committee to the extent permitted by applicable
rules and regulations of the SEC and the listing requirement of
NASDAQ and any other applicable securities market. |
| 5. | Upon conclusion of the annual audit, review and discuss with the
independent auditors, senior management and financial management
of the corporation: |

| a. | The corporations financial statements and related notes
and disclosures, including the MD&A portion of the
corporations filings; |
| --- | --- |
| b. | The independent auditors report on the financial
statements; |
| c. | The management letter issued by the independent auditors, and
any other material written communications between the
independent auditors and management; |
| d. | Any disagreements that occurred during the audit between the
independent auditors and management of the corporation; |
| e. | Whether the independent auditors are satisfied with the quality
of disclosure and content of the financial statements to be
presented to the shareholders; |

f. The conclusions of the independent auditors of the quality and acceptability of the corporations critical accounting principles and judgments used in preparing the financial statements, including the consistent application of such accounting principles, alternative accounting principles that have been discussed with management and the independent auditors preferred treatment;

| g. | Any other matters required to be communicated to the independent
auditors under Statements on Auditing Standards Nos. 61 and 90
(Communications with Audit Committees); and |
| --- | --- |
| h. | Based upon its reviews and discussions, determine whether to
recommend to the board of directors that the audited financial
statements be included in the corporations annual report
on Form 10-K. |

Review the interim financial statements and the quarterly report on Form 10-Q with senior management and the financial management of the corporation and the independent auditors prior to filing the report with the SEC to determine that the independent auditors are satisfied with the disclosure and content of the financial statements and other information contained in the report.

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| 7. | Provide for inclusion in the corporations proxy statement
a report to shareholders as required by the rules and
regulations of the SEC and the listing requirements of NASDAQ
and any other applicable securities market. |
| --- | --- |
| 8. | Review with the independent auditors and the corporations
senior management and its financial and accounting personnel: |

| a. | The process and schedule for evaluating the corporations
internal controls; |
| --- | --- |
| b. | Managements evaluation of the adequacy and effectiveness
of the internal controls of the corporation, including any
material changes to such controls, and the independent
auditors report on managements evaluation of the
internal controls; |
| c. | Any actions being taken to correct any material weaknesses in
such controls; |
| d. | The process to maintain and update internal control
documentation and to address weaknesses in controls as they may
occur. |

Elicit any recommendations for the improvement of such internal control procedures or particular areas where new or more detailed controls or procedures are desirable. Particular emphasis shall be given to the adequacy of such internal controls to expose any payments, transactions, or procedures that might be deemed illegal or otherwise improper.

| 10. | Ensure the receipt from the independent auditors of a formal
written statement delineating all relationships between the
auditor and the corporation, consistent with Independence
Standards Board Standard 1; actively engage in a dialogue with
the independent auditor with respect to any disclosed
relationships or services that may impact the objectivity and
independence of the auditor; and take appropriate action to
ensure the independence of the independent auditor. |
| --- | --- |
| 11. | Review the internal financial function of the corporation
including the independence and authority of its reporting
obligations, the proposed audit plans for the coming year, and
the coordination of such plans with the independent auditors. |
| 12. | Provide sufficient opportunity for the independent auditors to
meet with the members of the audit committee without members of
management present. Among the items to be discussed in these
meetings are the independent auditors evaluation of the
corporations financial, accounting, and auditing
personnel, and the cooperation that the independent auditors
received during the course of the audit. |
| 13. | Review accounting and financial planning within the corporation,
and set hiring policies for employees or former employees of the
independent auditors. |
| 14. | Review and approve any related-party business transactions,
preferably in advance, in which the corporations officers
or directors have an interest and that would be required to be
reported by the corporation in its periodic reports pursuant to
the rules and regulations of the SEC. |

15 Review earnings press release, as well as the corporations policies with respect to earnings press releases.

| 16. | Establish procedures for the receipt, retention and treatment of
whistleblower or other complaints regarding accounting matters,
internal accounting controls or audit matters. Such procedures
shall allow for the confidential, anonymous submission of
concerns from employees of the corporation regarding any
questionable accounting or auditing matters. |
| --- | --- |
| 17. | Review the adequacy of the charter of the audit committee
annually or more often if needed and submit any recommended
changes to the board of directors for approval. |
| 18. | Submit the minutes of all meetings of the audit committee to, or
discuss the matters discussed at each committee meeting with,
the board of directors. |

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Investigate any matter brought to its attention within the scope of its duties, with the power to retain outside counsel, accountants, experts and other advisors as the audit committee determines necessary to carry out its duties.

Funding

The corporation shall provide appropriate funding, as determined by the audit committee, for the payment of:

| 1. | Compensation to any registered public accounting firm engaged
for the purpose of preparing or issuing an audit report or
performing other audit, review or attest services for the
corporation. |
| --- | --- |
| 2. | Compensation to any advisers, including outside counsel,
retained by the audit committee. |
| 3. | Ordinary administrative expenses of the audit committee that are
necessary or appropriate for the carrying out of the audit
committees duties. |

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PROXY PROXY

ROYAL GOLD, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Donald Worth and Edwin W. Peiker, Jr., or either of them, as attorneys, agents and proxies each with full power of substitution to vote, as designated below, all the shares of Common Stock of Royal Gold, Inc. held of record by the undersigned on September 28, 2006, at the Annual Meeting of Stockholders of Royal Gold, Inc. (the Meeting) which will be held on November 8, 2006, at the Oxford Hotel, Sage Room, 1600 Seventeenth Street, Denver, Colorado, at 9:30 A.M., Mountain Standard Time, or at any postponement or adjournment thereof.

The Board of Directors recommends a vote IN FAVOR OF proposals 1 and 2.

1.
FOR ALL NOMINEES LISTED (except as marked to the contrary)
WITHHOLD AUTHORITY to vote for all nominees listed
Stanley Dempsey Tony Jensen John W. Goth

INSTRUCTION: To withhold authority to vote for any single nominee, draw a line through the nominees name above.

| 2. |
| --- |
| FOR AGAINST ABSTAIN |
| In their discretion, the Proxies are also authorized to vote all of the shares of the
undersigned upon such other business as may properly come before the Meeting. Management
and Directors are not currently aware of any other matters to be presented at the Meeting. |

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2.

The undersigned acknowledges receipt of this Proxy and a copy of the Notice of Annual Meeting and Proxy Statement, dated October 16, 2006.

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Dated
(Signature)
(Signature if Held Jointly)

| Please sign exactly as name appears on this Proxy. When shares are held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other
authorized officer. If a partnership, please sign in partnership name by
authorized person. |
| --- |
| Please sign, date and return this Proxy promptly . |

Folio /Folio

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ROYAL GOLD INC Proxy Solicitation & Information Statement 2006