ROYALTY PORTFOLIO RESTRUCTURING GAIN

12 Months Ended

Jun. 30, 2011

ROYALTY PORTFOLIO RESTRUCTURING GAIN

ROYALTY PORTFOLIO RESTRUCTURING GAIN

10. ROYALTY PORTFOLIO RESTRUCTURING GAIN

        As part of the royalty restructuring as part of the Barrick acquisition, which is discussed in Note 4, the Company recognized a gain of $31.5 million during the fiscal quarter ended December 31, 2008. The restructured royalties were a nonmonetary exchange and the fair value of the restructured royalties was determined based on expected future cash flows. The Company's basis in the restructured royalties was zero thus giving rise to the $31.5 million gain.

        In May 2009, Golden Star Resources Ltd. ("Golden Star") exercised its right of repurchase on the Benso 1.5% NSR royalty held by the Company for $3.4 million. The Company acquired the Benso royalty in December 2007 for approximately $1.9 million. The Company's net book value for the Benso royalty on the date of exercise by Golden Star was approximately $1.2 million. As such, the Company recognized a gain of approximately $2.2 million upon exercise.