Investment in the Joint Venture Company

The Company recorded its investment at the historical book value of the assets contributed to the Joint Venture Company which was approximately

$1.4

million. As of

March 31, 2019,

Royal Gold has contributed approximately

$33.9

million to the Joint Venture Company, and earned a cumulative economic interest of

40.0%.

As of

March 31, 2019,

the Company held a

0.0%

economic interest in the Joint Venture Company.

The following table is a roll-forward of our investment in the Joint Venture Company from

January 8, 2015 (

inception) to

March 31, 2019:

	Investment
	in Peak Gold, LLC
Investment balance at June 30, 2014	$	—
Investment in Peak Gold, LLC, at inception January 8, 2015		1,433,886
Loss from equity investment in Peak Gold, LLC		(1,433,886	)
Investment balance at June 30, 2015	$	—
Investment in Peak Gold, LLC		—
Loss from equity investment in Peak Gold, LLC		—
Investment balance at June 30, 2016	$	—
Investment in Peak Gold, LLC		—
Loss from equity investment in Peak Gold, LLC		—
Investment balance at June 30, 2017	$	—
Investment in Peak Gold, LLC		2,580,000
Loss from equity investment in Peak Gold, LLC		(2,580,000	)
Investment balance as June 30, 2018	$	—
Investment in Peak Gold, LLC		3,210,000
Loss from equity investment in Peak Gold, LLC		(3,210,000	)
Investment balance at March 31, 2019	$	—

The following table presents the condensed balance sheet for the Joint Venture Company as of

March 31, 2019

and

June 30, 2018:

	March 31, 2019		June 30, 2018
ASSETS
Cash and cash equivalents	$	134,158	$	2,628,195
Mineral properties		1,433,886		1,433,886
TOTAL ASSETS	$	1,568,044	$	4,062,081

LIABILITIES AND MEMBERS’ EQUITY
Accounts payable and other liabilities	$	375,773	$	2,403,257
TOTAL LIABILITIES		375,773		2,403,257
MEMBERS’ EQUITY		1,192,271		1,658,824
TOTAL LIABILITIES AND MEMBERS’ EQUITY	$	1,568,044	$	4,062,081

The Company’s share of the Joint Venture Company’s results of operations for the

three

and

nine

months ended

March 31, 2019

was a loss of approximately

$0.2

million and

$3.5

million, respectively.

The Company’s share in the results of operations for the

three

and

nine

months ended March

, 2018

was a loss of approximately

$0.3

million. and

$3.4

million, respectively.

The Joint Venture Company loss does

not

include any provisions related to income taxes as the Joint Venture Company is treated as a partnership for income tax purposes. As of

March 31, 2019

and

June 30, 2018,

the Company’s share of the Joint Venture Company’s inception-to-date cumulative loss of approximately

$30.4

million and

$27.0

million, respectively, exceeded the historical book value of our investment in the Joint Venture Company, of

$1.4

million. Therefore, the investment in the Joint Venture Company had a balance of

zero

as of

March 31, 2019

and

June 30, 2018.

The Company is currently obligated to make additional capital contributions to the Joint Venture Company in proportion to its percentage interest in the Joint Venture Company. Failure to make such additional capital contributions would cause the Company's ownership in the Joint Venture Company to be diluted. Therefore, the Company only records losses up to the point of its cumulative investment which was approximately

$7.2

million as of December

31,

2018.

The portion of the cumulative loss that exceeds the Company’s investment will be suspended and recognized against earnings, if any, from the Company’s investment in the Joint Venture Company in future periods.

The suspended losses for the period from inception to

March 31, 2019

are approximately

$23.2

million. The following table presents the condensed results of operations for Joint Venture Company for the

three

and

nine

month periods ended

March 31, 2019

and

2017:

	Three Months Ended		Three Months Ended			Nine Months Ended		Nine Months Ended	Period from Inception January 8, 2015 to
	March 31, 2019		March 31, 2018			March 31, 2019		March 31, 2018	March 31, 2019
EXPENSES:
Exploration expense	$	215,930	$	356,092	$	4,403,170	$	4,450,614	$	32,956,779
General and administrative		130,625		207,352		1,413,383		902,178		6,948,726
Total expenses		346,555		563,444		5,816,553		5,352,792		39,905,505
NET LOSS	$	346,555	$	563,444	$	5,816,553	$	5,352,792	$	39,905,505