ROYAL GOLD INC
GUARANTEE AGREEMENT
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<FILENAME>d32742exv10w2.txt
<DESCRIPTION>GUARANTEE AGREEMENT
<TEXT>
<PAGE>
                                                                    Exhibit 10.2

                               GUARANTEE AGREEMENT

WHEREAS SOCIETE DES MINES DE TAPARKO (the "DEBTOR") may hereafter become
indebted or liable to ROYAL GOLD, INC. (the "CREDITOR") pursuant to certain
discussions of that certain Funding Agreement, dated December 1, 2005 (the
"Funding Agreement") between Debtor and the Creditor;

AND WHEREAS HIGH RIVER GOLD MINES LTD. (the "GUARANTOR") has agreed to guarantee
the Obligations (as hereinafter defined) of the Debtor to the Creditor;

NOW THEREFORE for good and valuable consideration including payment to the
Guarantor of the sum of ten dollars, the receipt and sufficiency of which are
hereby acknowledged, the Guarantor hereby agrees with the Creditor as follows:

GUARANTEE

1.   The Guarantor hereby unconditionally guarantees payment and performance to
     the Creditor, forthwith on demand by the Creditor, of the reimbursement of
     the First Tranche (as defined in the Funding Agreement) and interest
     thereon, if same becomes due pursuant to Section 3.4 of the Funding
     Agreement (the "Obligations"). This guarantee shall be a continuing
     guarantee and shall guarantee the Obligations and any ultimate balance
     thereof, notwithstanding that the Debtor may from time to time satisfy the
     Obligations in whole or in part and thereafter incur further Obligations.

DEBTOR'S STATUS AND AUTHORITY

2.   All monies obtained from the Creditor by the Debtor or by persons
     purporting to act on behalf of the Debtor pursuant to the First Tranche
     under the Funding Agreement shall be deemed to form part of the
     Obligations, notwithstanding any lack or limitation of status, power, or
     authorization, any incapacity or disability of the Debtor or its directors,
     officers, employees or agents, or that the Debtor may not be a legal entity
     or that such borrowing or obtaining of monies, advances, renewals or
     credits or the execution and delivery of any agreement or document by or on
     behalf of the Debtor is in excess of the powers of the Debtor or any of its
     directors, officers, employees or agents or is in any way irregular,
     defective, fraudulent or informal. The Creditor has no obligation to
     enquire into the powers or authority of the Debtor or any of its directors,
     officers, employees or agents acting or purporting to act on its behalf,
     and shall be entitled to rely on this provision notwithstanding any actual
     or imputed knowledge regarding any of the foregoing matters.

LIABILITY UNAFFECTED BY CERTAIN MATTERS

3.   The liability of the Guarantor hereunder shall be absolute and
     unconditional irrespective of, and shall not be released, discharged,
     limited or otherwise affected by:

<PAGE>

                                                                              2.


     (a)  the lack of validity or enforceability of the Obligations in whole or
          in part for any reason whatsoever, including without limitation by
          reason of prescription, by operation of law or as a result of any
          applicable statute, law or regulation;

     (b)  any prohibition or restriction imposed in respect of any rights or
          remedies of the Creditor in respect of any Obligations, including
          without limitation any court order which purports to prohibit or
          suspend the acceleration of the time for payment of any Obligations,
          the payment by the Debtor of any Obligations or the rights or remedies
          of the Creditor against the Debtor in respect of any Obligations;

     (c)  the lack of validity or enforceability in whole or in part of:

          (i)  the Funding Agreement or any other agreement made from time to
               time between the Debtor and the Creditor in connection with any
               Obligations;

          (ii) any security given by the Debtor in favour of the Creditor from
               time to time in connection with any Obligations;

          (iii) any guarantee given by any person in favour of the Creditor from
               time to time in connection with or relating to any Obligations;
               or

          (iv) any security given by any such guarantor in favour of the
               Creditor from time to time in connection with any of its
               obligations to the Creditor,

          (collectively, the "CREDIT DOCUMENTS");

     (d)  any change in the corporate existence, structure, ownership or control
          of the Debtor (including any of the foregoing arising from any merger,
          consolidation, amalgamation, reorganization or similar transaction);
          any change in the name, objects, capital stock, constating documents
          or by-laws of the Debtor; or the dissolution, winding-up, liquidation
          or other distribution of the assets of the Debtor, whether voluntary
          or otherwise;

     (e)  the Debtor's becoming insolvent or bankrupt or subject to any
          proceeding under the provisions of the Bankruptcy and Insolvency Act
          (Canada), the Companies' Creditors Arrangement Act (Canada), or any
          similar law in Burkina Faso, the arrangement provisions of applicable
          corporate legislation, any legislation similar to the foregoing in any
          other jurisdiction, or any legislation enacted substantially in
          replacement of any of the foregoing, or the Creditor's voting in
          favour of any proposal, arrangement or compromise in connection with
          any of the foregoing;

     (f)  the failure or neglect of the Creditor to demand payment of
          Obligations by the Debtor, any guarantor of Obligations or any other
          person;

     (g)  the valuation by the Creditor of any security held in respect of the
          Obligations, which shall not be considered as a purchase of such
          security or as payment on account of the Obligations;

<PAGE>

                                                                              3.


     (h)  any right or alleged right of set-off, combination of accounts,
          counterclaim, appropriation or application or any claim or demand that
          the Debtor or the Guarantor may have or may allege to have against the
          Creditor; or

     (i)  any other circumstances which might otherwise constitute a legal or
          equitable defence available to, or complete or partial discharge of,
          the Debtor in respect of the Obligations or of the Guarantor in
          respect of this agreement.

LIABILITY UNAFFECTED BY ACTIONS OF CREDITOR

4.   The liability of the Guarantor hereunder shall be absolute and
     unconditional irrespective of, and shall not be released, discharged,
     limited or otherwise affected by anything done, suffered or permitted by
     the Creditor in connection with the Debtor, or any Obligations. For greater
     certainty and without limiting the generality of the foregoing, without
     releasing, discharging, limiting or otherwise affecting in whole or in part
     the liability of the Guarantor under this agreement, and without notice to
     or the consent of the Guarantor, the Creditor may from time to time:

     (a)  make advances and extend credit to the Debtor (including new loans and
          credit facilities, whether in addition to or in replacement for other
          loans and credit facilities previously established by the Creditor for
          the Debtor), convert revolving lines of credit to non-revolving lines
          of credit, increase or decrease the amount of credit available to the
          Debtor and receive payments in respect of the Obligations;

     (b)  increase the interest rates, fees and charges applicable to all or any
          portion of the Obligations from time to time;

     (c)  amend, renew, waive, release or terminate any Credit Document or any
          provisions thereof in whole or in part from time to time (including,
          without limitation, any provisions relating to interest rates, fees,
          margin requirements, conditions for the extension of credit and the
          determination of the amount of credit available, positive and negative
          covenants, payment provisions, the application of payments received by
          or on behalf of the Debtor, and events of default);

     (d)  extend, renew, settle, compromise, waive, release or terminate the
          Obligations in whole or in part from time to time;

     (e)  grant time, renewals, extensions, indulgences, releases and discharges
          to the Debtor;

     (f)  take, refrain from taking or release guarantees from other persons in
          respect of Obligations;

     (g)  accept compromises or arrangements from the Debtor, any guarantor of
          Obligations or any other person;

     (h)  refrain from demanding payment from or exercising any rights or
          remedies in respect of the Debtor or any guarantor of Obligations;

<PAGE>

                                                                              4.


     (i)  apply all monies received from the Debtor, any guarantor of the Debtor
          or any other person or from the proceeds of any security to pay such
          part of the Obligations as the Creditor may see fit, or change any
          such application in whole or in part from time to time,
          notwithstanding any direction which may be given regarding application
          of such monies by the Debtor, any guarantor of the Debtor or any other
          person; and

     (j)  otherwise deal with the Debtor, any guarantor of Obligations or any
          other person and any security held by the Creditor in respect of
          Obligations, as the Creditor may see fit in its absolute discretion.

LIABILITY UNAFFECTED BY FAILURE OF CREDITOR TO TAKE, HOLD OR ENFORCE SECURITY

5.   The Guarantor agrees that the Guarantor has provided this agreement to the
     Creditor on the express understanding that the Creditor has no obligation
     to obtain any security from the Debtor or from others to secure payment or
     performance of any Obligations; and if the Creditor in its absolute
     discretion obtains any such security from the Debtor or others, the
     Creditor shall have no obligation to continue to hold such security or to
     enforce such security. The Guarantor shall not be entitled to rely on or
     benefit from, directly or indirectly, any such security which the Creditor
     may obtain. In furtherance of the foregoing, the liability of the Guarantor
     hereunder shall be absolute and unconditional irrespective of, and shall
     not be released, discharged, limited or otherwise affected by:

     (a)  the loss of or failure by the Creditor to register, perfect or
          maintain any security given by the Debtor or by other persons in
          respect of Obligations, whether intentionally or through failure,
          neglect or otherwise;

     (b)  the failure or neglect of the Creditor to enforce any security held in
          respect of the Debtor or in respect of any guarantor of Obligations;

     (c)  the Creditor's having released, discharged, compromised or otherwise
          dealt with any such security in any manner whatsoever (and for greater
          certainty the Creditor shall not be bound to exhaust its recourse
          against the Debtor, guarantors of the Debtor or other persons or
          enforce any security held in respect of Obligations or take any other
          action or legal proceeding before being entitled to payment from the
          Guarantor under this agreement, and the Guarantor hereby waives all
          benefits of discussion and division); or

     (d)  the enforcement by the Creditor of any such security in an improvident
          or commercially unreasonable manner (including the sale or other
          disposition of any assets encumbered by such security at less than the
          fair market value thereof) whether as a result of negligence,
          recklessness or wilful action or inaction on the part of the Creditor
          or otherwise, and regardless of any duty which the Creditor might have
          to the Debtor under applicable law (including applicable personal
          property security legislation) in respect of the enforcement of any
          such security.

WAIVERS

6.   No delay on the part of the Creditor in exercising any of its options,
     powers, rights or remedies, or any partial or single exercise thereof,
     shall constitute a waiver thereof. No

<PAGE>

                                                                              5.


     waiver, modification or amendment of this agreement or of any such options,
     powers, rights or remedies shall be deemed to have been made unless made in
     writing and signed by an authorized officer of the Creditor, and any such
     waiver shall apply only with respect to the specific instance involved, and
     shall not impair the rights of the Creditor or the liability of the
     Guarantor hereunder in any other respect or at any other time.

FOREIGN CURRENCY OBLIGATIONS

7.   The Guarantor shall make payment to the Creditor hereunder in the same
     currency as is required to be paid by the Debtor to the Creditor in respect
     of the Obligations (the "REQUIRED CURRENCY"). If the Guarantor makes
     payment to the Creditor hereunder in any other currency (the "PAYMENT
     CURRENCY"), such payment shall constitute satisfaction of the said
     liability of the Guarantor hereunder only to the extent that the Creditor
     is able to purchase Required Currency with the amount of the Payment
     Currency received from the Guarantor on the date of receipt, in accordance
     with the Creditor's normal practice; and the Guarantor shall remain liable
     to the Creditor for any deficiency.

WITHHOLDING TAXES

8.   Except as otherwise required by law, each payment by the Guarantor
     hereunder shall be made without withholding for or on account of any
     present or future tax imposed by or within the jurisdiction in which the
     Guarantor is domiciled, any jurisdiction from which the Guarantor makes any
     payment or any other jurisdiction, or (in each case) any political
     subdivision or taxing authority thereof or therein. If any such withholding
     is required by law, the Guarantor shall make the withholding, pay the
     amount withheld to the appropriate governmental authority before penalties
     attach thereto or interest accrues thereon and forthwith pay to the
     Creditor such additional amount as may be necessary to ensure that the net
     amount actually received by the Creditor (after payment of such taxes
     including any taxes on such additional amount paid) is equivalent to the
     amount which the Creditor would have received if no amounts had been
     withheld.

REPRESENTATIONS AND WARRANTIES

9.   The Guarantor represents and warrants to the Creditor as follows, and
     acknowledges that the Creditor is relying on such representations and
     warranties as a basis for extending and maintaining the extension of credit
     to the Debtor:

     (a)  the Guarantor is duly incorporated, existing and in good standing
          under the laws of its jurisdiction of incorporation; it has full
          corporate power, authority and capacity to enter into and perform its
          obligations hereunder; all necessary action has been taken by its
          directors or shareholders and otherwise to authorize the execution and
          delivery of this agreement and the performance of its obligations
          hereunder; the Guarantor has, to the extent required by law, disclosed
          to its shareholders all information required with respect to the
          delivery of this agreement; there is no provision in any unanimous
          shareholder agreement which restricts or limits its powers to enter
          into or perform its obligations under this agreement; and none of the
          execution or delivery of this agreement, or compliance with the
          provisions of this agreement conflicts with, or results in a breach of
          its charter documents or by-laws; and

<PAGE>

                                                                              6.


     (b)  none of the execution or delivery of this agreement, or compliance by
          the Guarantor with the provisions of this agreement conflicts with or
          results in a breach of any agreement or instrument to which the
          Guarantor is a party or by which the Guarantor or any of the
          Guarantor's assets are bound or affected, or requires the consent of
          any other person (other than any consents which have been obtained).

REVIVAL OF INDEBTEDNESS AND LIABILITY

10.  If at any time all or any part of any payment previously applied by the
     Creditor to any portion of the Obligations is rescinded or returned by the
     Creditor for any reason whatsoever, whether voluntarily or involuntarily
     (including, without limitation, as a result of or in connection with the
     insolvency, bankruptcy or reorganization of the Debtor or the Guarantor, or
     any allegation that the Creditor received a payment in the nature of a
     preference), then to the extent that such payment is rescinded or returned,
     such portion of the Obligations shall be deemed to have continued in
     existence notwithstanding such initial application, and this agreement
     shall continue to be effective or be reinstated, as the case may be, as to
     such portion of the Obligations as though such payment had not been made.

RESTRICTIONS ON RIGHT OF SUBROGATION

11.  The Guarantor agrees not to exercise or enforce any right of indemnity,
     exoneration, contribution, reimbursement, recourse or subrogation against
     the Debtor or any other guarantor of Obligations, or as to any security
     therefor, unless and until all Obligations have been paid and satisfied in
     full and the Creditor has no further obligation to extend credit to the
     Debtor. The Guarantor shall have no right to be subrogated hereunder
     unless:

     (a)  the Guarantor has paid to the Creditor an amount equivalent to all
          Obligations together with all interest, expenses and other amounts due
          hereunder;

     (b)  any other person having a potential right of subrogation has waived
          such right and consented to the assignment by the Creditor to the
          Guarantor of the Obligations and any security held by the Creditor;

     (c)  the Creditor has received from the Debtor a release of all claims
          which the Debtor may have against the Creditor, including any
          obligation to grant additional credit to the Debtor;

     (d)  the Guarantor has executed and delivered to the Creditor a release of
          any claims which the Guarantor may have against the Creditor in
          respect of the Obligations or this agreement; and

     (e)  if required by the Creditor, three months shall have elapsed from the
          time of the last payment made by the Debtor to the Creditor and the
          last payment made by the Guarantor to the Creditor hereunder.

     The Guarantor shall cause all such documents to be in form and substance
     satisfactory to the Creditor. Any such assignment of loans and security by
     the Creditor to the Guarantor

<PAGE>

                                                                              7.


     shall be on an "AS IS, WHERE IS" basis without representations, warranties
     or conditions, and without recourse to the Creditor.

EXPENSES

12.  The Guarantor agrees to pay to the Creditor, forthwith on demand by the
     Creditor, all expenses (including legal fees on a solicitor and his own
     client basis) incurred by the Creditor in connection with the preservation
     or enforcement of any of the Creditor's rights and remedies hereunder.

NOTICE

13.  Without prejudice to any other method of giving notice, all communications
     provided for or permitted hereunder shall be in writing and delivered in
     the same manner as provided for notices under the Funding Agreement.

SEVERABILITY

14.  If any provision of this agreement shall be invalid or unenforceable, all
     other provisions hereof shall remain in full force and effect and all
     changes rendered necessary by the context shall be deemed to have been
     made.

INTERPRETATION

15.  This agreement shall be construed as if all changes in grammar, number and
     gender rendered necessary by the context have been made. As used in this
     agreement, "PERSON" includes an individual, corporation, partnership, joint
     venture, trust, unincorporated association or any government, crown
     corporation or governmental agency or authority or any combination of the
     foregoing.

MERGER OF DEBTOR

16.  In this agreement, "MERGER" in respect of two or more corporations means an
     amalgamation of such corporations, the transfer of the assets of one
     corporation to another in connection the dissolution of the first-mentioned
     corporation, the transfer of substantially all of the businesses and assets
     of one corporation to another pursuant to plan of arrangement or court
     order, or any other corporate reorganization or transaction with similar
     effect to any of the foregoing; the corporations involved in a Merger are
     herein referred to as the "MERGING ENTITIES"; and the corporation resulting
     from a Merger is herein referred to as the "MERGED ENTITY". If the Debtor
     effects a Merger with any other corporation or corporations, the Guarantor
     agrees that the Obligations shall include:

     (a)  all obligations of each Merging Entity to the Creditor in existence at
          the time of such Merger; and

     (b)  all obligations of the Merged Entity to the Creditor at the time of
          such merger or incurred or arising from time to time after such
          Merger.

<PAGE>

                                                                              8.


     After such Merger, all references herein to the "DEBTOR" shall mean the
     Merged Entity, and all other provisions of this agreement shall be deemed
     to have been amended to the extent required by the context in order to
     reflect such Merger.

FURTHER ASSURANCES

17.  The Guarantor agrees, at the Guarantor's own expense, to promptly execute
     and deliver or cause to be executed and delivered to the Creditor, upon the
     Creditor's request from time to time, all such other and further documents,
     agreements, opinions, certificates and instruments as are required under
     this agreement or as may be reasonably requested by the Creditor if
     necessary or desirable to more fully record or evidence the obligations
     intended to be entered into herein and pursuant to the Pledge of Securities
     of even date (the "Pledge") between Creditor and Guarantor.

ENTIRE AGREEMENT; AMENDMENTS; CONCLUSIVE DELIVERY

18.  This agreement and the Pledge constitute the entire agreement between the
     Guarantor and the Creditor relating to the subject matter hereof, and no
     amendment of this agreement shall be effective unless made in writing and
     executed by the Guarantor and the Creditor. Possession by the Creditor of
     an original executed copy of this agreement shall constitute conclusive
     evidence that:

     (a)  this agreement was executed and delivered by the Guarantor to the
          Creditor free of all conditions;

     (b)  there is no agreement or understanding between the Creditor and the
          Guarantor that this agreement was delivered in escrow or is not
          intended to be effective until the occurrence of any event or the
          satisfaction of any condition;

     (c)  the Creditor has not made any representation, warranty, statement or
          promise to the Guarantor regarding the Debtor, the Creditor's
          intention to obtain any security in respect of Obligations or
          guarantees from other persons in respect of Obligations, the
          circumstances under which the Creditor may enforce this agreement, the
          manner in which the Creditor might enforce this agreement or any other
          matter which might conflict with any provision expressly set out
          herein; and

     (d)  there is no representation, warranty, statement, promise,
          understanding, condition or collateral agreement between the Creditor
          and the Guarantor relating to this agreement or the subject matter of
          this agreement, other than as expressly set out herein.

GOVERNING LAW

19.  This agreement shall be governed by and construed in accordance with the
     laws of the Province of Ontario and the laws of Canada applicable therein.
     Without prejudice to the right of the Creditor to commence any proceedings
     with respect to this agreement in any other proper jurisdiction, the
     Guarantor hereby irrevocably attorns and submits to the non-exclusive
     jurisdiction of the courts of the Province of Ontario.

<PAGE>

                                                                              9.


SUCCESSORS AND ASSIGNS

20.  This agreement shall enure to the benefit of the Creditor and its
     successors and assigns, and shall be binding on the Guarantor and its
     successors and assigns; "SUCCESSORS" includes any Merged Entity resulting
     from the Merger of a corporation with any other corporation. Without
     limiting the generality of the foregoing, if the Creditor assigns or
     transfers all or any portion of the Obligations and this agreement or any
     interest therein to any other person, such person shall thereafter be
     entitled to the benefit of this agreement to the extent of the interest so
     transferred or assigned, and the Obligations or portion thereof or interest
     therein so transferred or assigned shall be and shall remain part of the
     "OBLIGATIONS" hereunder.

LEGAL ADVICE

21.  The Guarantor acknowledges that the Guarantor has had ample opportunity to
     review and consider this agreement, fully understands the provisions hereof
     and has received legal advice from the Guarantor's solicitors in connection
     with this agreement.

RECEIPT OF COPY OF AGREEMENT

22.  The Guarantor hereby acknowledges receipt of a copy of this agreement.

         [The remainder of this page has been intentionally left blank.]

<PAGE>

                                                                             10.


     IN WITNESS WHEREOF this agreement has been executed and delivered by the
Guarantor as of the 1st day of December, 2005.

                                        HIGH RIVER GOLD MINES LTD.


                                        By: /s/ D.A. Whalen
                                            ------------------------------------
                                        Name: D.A. Whalen
                                              ----------------------------------
                                        Title: Executive Chairman
                                               ---------------------------------


                                        By: /s/ Steven Poad
                                            ------------------------------------
                                        Name: Steven Poad
                                              ----------------------------------
                                        Title: Chief Financial Officer
                                               ---------------------------------

                                        Guarantor's Address for Service:

                                        1200 - 155 University Avenue
                                        Toronto, Ontario
                                        M5H 3B7
                                        Fax no. 416-360-0010

                                        with a copy to:

                                        Cassels Brock & Blackwell LLP
                                        2100 Scotia Plaza, 40 King Street W.
                                        Toronto, Ontario M5H 3C2
                                        Attention: David Poynton
                                        Fax no. 416-644-9348

                                        Creditor's Address for Service:

                                        1600 Wynkoop Street
                                        Suite 1000
                                        Denver, Colorado
                                        USA 80202-1132
                                        Attention: President
                                        Fax no. 303-595-9385
</TEXT>
</DOCUMENT>
