Gold Royalty Corp. Canadian Tax Election Website
Gold Royalty Corp. (“GROY”) (NYSE American: GROY) and Ely Gold Royalties Inc. (“ELY”) (TSX-V: ELY, OTCQX: ELYGF) are pleased to announce that they have entered into a definitive agreement (the “Agreement”), dated June 21, 2021, pursuant to which GROY acquired all of the issued and outstanding common shares of ELY (the “ELY Shares”) by way of a statutory plan of arrangement (the “Arrangement”) under the Business Corporations Act (British Columbia). Under the terms of the Agreement, which was negotiated at arms-length, each holder of ELY Shares had the option to receive consideration per ELY Share of either:(i) C$1.46 in cash, or (ii) 0.2450 of a GROY common share (“GROY Share”), subject to pro-ration based on a maximum aggregate cash consideration of C$84 million and a maximum aggregate number of GROY Shares issued of approximately 41.5 million.
The Agreement may have tax consequences for shareholders of ELY ("Former ELY Shareholders"). Former ELY Shareholders should seek independent taxation advice on the taxation consequences of the Agreement. Any Eligible Plan of Arrangement Participant (A) who is (i) a resident of Canada for the purposes of the Income Tax Act (Canada) (the "Canadian Tax Act") and not exempt from tax under Part I of the Canadian Tax Act; (ii) a partnership, any member of which is a resident of Canada for the purposes of the Canadian Tax Act (other than a partnership all members of which are residents of Canada that are exempt from tax under Part I of the Canadian Tax Act); or (iii) a non-resident of Canada, or a partnership with one or more non-resident members, whose shares of ELY were "taxable Canadian property" for purposes of the Canadian Tax Act, (B) who held its shares of ELY as capital property or inventory, and (C) who received shares of GROY as Plan of Arrangement Consideration (taken together, defined as the "Eligible Holder") should note that, in order to obtain a full or partial deferral of a gain for tax purposes otherwise arising on the disposition of its shares of ELY, such Eligible Plan of Arrangement Participant will need to make a valid joint election with GROY pursuant to subsection 85(1) of the Canadian Tax Act (or, in the case of a partnership, pursuant to subsection 85(2) of the Canadian Tax Act) in respect of such shares of ELY (a "Joint Tax Election") and, where applicable, a separate joint tax election for provincial or territorial tax purposes. GROY has established this special purpose web portal (the "Joint Tax Election Website" or "Website") and process to provide assistance to Former ELY Shareholders in taking the necessary steps to file the tax-deferred rollover joint election. Therefore, this Website is only relevant to Former ELY Shareholders who:
are subject to tax in Canada with respect to the disposition of their shares of ELY;
are partnerships the members of which include, either directly or indirectly through one or more partnerships, a person that is subject to tax in Canada with respect to the disposition of their shares of ELY; or
are non-residents of Canada, or who are partnerships with one or more non-resident members, whose shares of ELY were "taxable Canadian property" for purposes of the Canadian Tax Act;
and, in each case, who held their shares of ELY as capital property or inventory and received shares of GROY as consideration for their shares of ELY.
This Website is not relevant to Former ELY Shareholders who do not fall into the categories above.