Gold Royalty Corp 6-K, filed Feb 14, 2022

Gold Royalty Corp. (GROY)

6-K 2022-02-14 For: 2022-02-14

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Added on April 10, 2026

About this 6-K

Gold Royalty Corp filed this 6-K on February 14, 2022.

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	GOLD ROYALTY CORP.

Date: February 14, 2022	By:	/s/ Josephine Man
	Name:	Josephine Man
	Title:	Chief Financial Officer

Exhibit		Description of Exhibit

99.1		Condensed interim consolidated financial statements for the three months ended December 31, 2021
99.2		Management’s discussion and analysis for the three months ended December 31, 2021
99.3		Certification of Chief Executive Officer
99.4		Certification of Chief Financial Officer

			As at December 31,			As at September 30,
	Notes		2021			2021
			($)			($)
Assets
Current assets
Cash and cash equivalents		4		13,826			9,905
Restricted cash		5		609			-
Short-term investments		6		25,057			1,118
Accounts receivable				364			412
Prepaids and other receivables		7		4,465			1,866
				44,321			13,301
Non-current assets
Royalties		8		622,291			256,833
Exploration and evaluation assets		9		7,891			7,712
Long-term investments		10		1,587			1,587
Investment in associates		11		1,217			-
Other long-term assets				57			66
				633,043			266,198

				677,364			279,499

Liabilities
Current Liabilities
Accounts payable and accrued liabilities				9,682			6,885
Current portion of lease obligation				36			36
				9,718			6,921
Non-current liabilities
Lease obligation				-			11
Derivative liabilities		12		5,027			4,549
Long-term loan				46			-
Deferred income tax liability				136,377			42,700
				151,168			54,181
Equity
Issued Capital		13		527,132			228,620
Reserves		13		20,611			11,404
Accumulated deficit				(21,988	)		(15,147	)
Accumulated other comprehensive income				441			441
				526,196			225,318
				677,364			279,499

			For the			For the
	Notes		three months ended			three months ended
			December 31, 2021			December 31, 2020
			($)			($)
Revenue
Royalty income				533			-

Cost of sales
Depletion		8 , 9		(287	)		-
Gross profit				246			-

Expenses
Consulting fees				(3,242	)		-
Depreciation				(9	)		-
Management and directors’ fees		15		(217	)		(35	)
Salaries, wages and benefits				(214	)		(6	)
Investor, communications and marketing expenses				(339	)		-
Office and technology expenses				(215	)		(26	)
Transfer agent and regulatory fees				(82	)		(2	)
Insurance fees				(578	)		-
Professional fees				(1,816	)		(283	)
Share-based compensation		13		(901	)		(79	)
Exploration and evaluation expenses				(64	)		-
Share of loss in associates				(143	)		-
Operating loss for the period				(7,574	)		(431	)

Other items
Change in fair value of derivative liabilities		12		90			-
Change in fair value of short-term investments		6		542			-
Foreign exchange gain/(loss)				23			(69	)
Other income				245			-
Net loss before income taxes for the period				(6,674	)		(500	)
Deferred tax expense				(167	)		-
Net loss after income taxes for the period				(6,841	)		(500	)

Other comprehensive income
Item that may be reclassified subsequently to net income:
Foreign currency translation differences				-			333
Total comprehensive loss for the period				(6,841	)		(167	)

Net loss per share, basic and diluted				(0.06	)		(0.04	)

Weighted average number of common shares
outstanding, basic and diluted				109,907,519			11,252,989

											Accumulated
	Number of										Other
	Common			Issued				Accumulated			Comprehensive
	Shares			Capital		Reserves		Deficit			Income		Total
				($)		($)		($)			($)		($)
Balance at September 30, 2020		1			-		-		(140	)		-		(140	)
Cancellation of common share issued upon incorporation		(1	)		-		-		-			-		-
Common shares issued to former parent company for cash		5,000,000			50		-		-			-		50
Performance based restricted shares issued		1,500,000			-		-		-			-		-
Common shares issued to acquire royalties		15,000,000			13,076		-		-			-		13,076
Private placement of common shares for cash		1,325,000			2,849		-		-			-		2,849
Share-based compensation - performance based restricted shares		-			71		-		-			-		71
Share-based compensation - share options		-			-		7		-			-		7
Net loss for the period		-			-		-		(500	)		-		(500	)
Total other comprehensive income		-			-		-		-			332		332
Balance at December 31, 2020		22,825,000			16,046		7		(640	)		332		15,745

	For the three months			For the three months
	ended December 31			ended December 31
	2021			2020
	($)			($)
Operating activities
Net loss before tax for the period		(6,841	)		(500	)
Items not involving cash:
Depreciation		9			-
Depletion		287			-
Interest income		(2	)		-
Share-based compensation		901			79
Change in fair value of short-term investments		(542	)		-
Change in fair value of derivative liability		(90	)		-
Share of loss in associates		143			-
Deferred tax expense		167			-
Unrealized foreign exchange loss		74			-
Net changes in non-cash working capital items:
Accounts receivables		48			-
Prepaids and other receivables		565			(18	)
Accounts payable and accrued liabilities		(2,779	)		101
Due to former parent company		-			(83	)
Cash used in operating activities		(8,060	)		(421	)

Investing activities
Restricted cash released		1,206			-
Cash acquired through business combination with Abitibi Royalties Inc. and Golden Valley Mines and Royalties Ltd.		10,393			-
Investment in exploration and evaluation assets		(307	)		-
Proceeds from option agreement		436			-
Purchase of equipment		-			(2	)
Transaction costs on purchase of royalties		-			(26	)
Interest received		2			-
Cash provided by investing activities		11,730			(28	)

Financing activities
Proceeds from common shares issued to former parent company		-			50
Proceeds from private placement of common shares		-			2,849
Proceeds from exercise of common share purchase warrants		280			-
Payment of lease obligations		(10	)		-
Repayment of cash advance from parent company		-			(38	)
Cash provided by financing activities		270			2,861

Effect of exchange rate changes on cash		(19	)		60

Net increase in cash		3,921			2,472
Cash and cash equivalents
Beginning of period		9,905			38
End of period		13,826			2,510

	●	GRC issued 2.1417 GRC shares to Golden Valley shareholders for each Golden Valley common share; and
	●	GRC issued 4.6119 GRC shares to Abitibi shareholders for each Abitibi common share.

	●	Four royalties (1.5% net smelter return (“NSR”), 2% NSR, 3% NSR, 15% Net Profit Interest (“NPI”)) on portions of the Canadian Malartic Property; and
	●	A royalty (2.5% to 4.0% NSR) on Cheechoo, proximate to Newmont Corporation’s Éléonore Mine in Québec.

	($)
Consideration paid
GRC shares issued to Abitibi and Golden Valley Shareholders		296,966
1,166,389 Golden Valley share options deemed to be exchanged for GRC share options		8,991
Total consideration		305,957

Allocation of consideration
Cash and cash equivalents		10,393
Restricted cash		1,815
Short-term investments		23,360
Prepaid and other receivables		2,756
Royalties		365,709
Exploration and evaluation assets		393
Investment in associate		1,360
Accounts payable and accrued liabilities		(5,561	)
Derivative liabilities		(691	)
Long-term loan		(48	)
Deferred income tax liability		(93,529	)
Net assets acquired		305,957

	December 31, 2021		September 30, 2021
	($)		($)
Cash and cash equivalents consist of:
Cash at bank		10,826		5,905
Guaranteed Investment Certificates		3,000		4,000
		13,826		9,905

	($)
Balance at September 30, 2020		-
Acquisition of Ely		1,291
Fair value change due to price change		(168	)
Fair value change due to foreign exchange		(5	)
Balance at September 30, 2021		1,118
Acquisition of Golden Valley and Abitibi		23,360
Addition		48
Fair value change due to price change		542
Fair value change due to foreign exchange		(11	)
Balance at December 31, 2021		25,057

	As at December 31, 2021		As at September 30, 2021
	($)		($)
Prepaids and other receivables consist of:
Income tax and GST receivables		2,569		304
Prepaids		1,705		1,562
Other accounts receivables		191		-
		4,465		1,866

	($)
Balance at September 30, 2020		-
Additions		25,445
Acquisition of Ely		231,173
Depletion		(164	)
Functional currency translation		379
Balance at September 30, 2021		256,833
Acquisition of Golden Valley & Abitibi (Note 3)		365,709
Depletion		(251	)
Balance at December 31, 2021		622,291

	Cost						Accumulated Depletion						Carrying
	Opening		Additions		Ending		Opening		Depletion		Ending		Amount
December 31, 2021	($)		($)		($)		($)		($)		($)		($)

Depletable Royalties
Isabella Pearl		2,821		-		2,821		6		26		32		2,789
Jerritt Canyon		8,921		-		8,921		74		191		265		8,656
Malartic (in production)		-		276,045		276,045		-		34		34		276,011
Marigold		1,261		-		1,261		84		-		84		1,177
Subtotal		13,003		276,045		289,048		164		251		415		288,633

Non-depletable Royalties
Beaufor		1,235		-		1,235		-		-		-		1,235
Cheechoo		-		12,640		12,640		-		-		-		12,640
Croinor		5,330		-		5,330		-		-		-		5,330
Fenelon		41,553		-		41,553		-		-		-		41,553
Gold Rock		3,275		-		3,275		-		-		-		3,275
Hog Ranch		12,879		-		12,879		-		-		-		12,879
Lincoln Hill		5,289		-		5,289		-		-		-		5,289
Malartic (in development)		-		55,198		55,198		-		-		-		55,198
McKenzie Break		4,010		-		4,010		-		-		-		4,010
New Alger		-		21,826		21,826		-		-		-		21,826
Railroad-Pinion		3,032		-		3,032		-		-		-		3,032
Rawhide		3,821		-		3,821		-		-		-		3,821
REN (Net Profit Interest)		21,017		-		21,017		-		-		-		21,017
REN (Net Smelter Return)		42,365		-		42,365		-		-		-		42,365
São Jorge		2,274		-		2,274		-		-		-		2,274
Titiribi		3,010		-		3,010		-		-		-		3,010
Whistler		2,575		-		2,575		-		-		-		2,575
Yellowknife		1,870		-		1,870		-		-		-		1,870
Others		90,459		-		90,459		-		-		-		90,459
Subtotal		243,994		89,664		333,658		-		-		-		333,658
Total		256,997		365,709		622,706		164		251		415		622,291

Asset	Interest	Jurisdiction
*Producing*
Canadian Malartic Property (open pit)⁽¹⁾	3.0% NSR	Québec, Canada
Jerritt Canyon Mine	0.5% NSR Per Ton Royalty (“PTR”) (sliding scale)	Nevada, USA
Marigold Mine⁽¹⁾	0.75% NSR	Nevada, USA
Rawhide Mine	15% NPI	Nevada, USA
Isabella Pearl Mine	0.375% Gross Revenue Royalty	Nevada, USA
*Key Developing*
Railroad-Pinion Project⁽¹⁾	0.44% NSR	Nevada, USA
Beaufor Project	1.0% NSR PTR (C$2.50)	Québec, Canada
Lincoln Hill Project	2.0% NSR	Nevada, USA
Rodeo Creek	2.0% NSR	Nevada, USA
REN Project	1.5% NSR 3.5% NPI	Nevada, USA
Gold Rock Project	0.5% NSR	Nevada, USA
Odyssey Project⁽¹⁾ (underground)	3.0% NSR	Québec, Canada
São Jorge Project	1.0% NSR	Brazil
La Mina Project	2.0% NSR	Colombia
Fenelon Gold Property	2.0% NSR	Québec, Canada
Hog Ranch Project	2.25% NSR	Nevada, USA
Cheechoo Project	2.5% to 4.0% NSR	Québec, Canada
Croinor Gold Project	2.5% NSR	Québec, Canada
McKenzie Break	2.5% NSR	Québec, Canada
Swanson	2.5% NSR	Québec, Canada
Tonopah West	3.0% NSR	Nevada, USA
Whistler Project	1.0% NSR	Alaska, USA

(1)	with respect to one-third of the Restricted Shares awarded to the holder, if the Company’s initial public offering or any liquidity event (being any liquidation, dissolution or winding-up of the Company or distribution of all or substantially all of the Company’s assets among shareholders or a change of control transaction) occurs that values the Company at a minimum of $50,000,000 (condition met);

(2)	with respect to one-third of the Restricted Shares awarded to the holder, if the Company receives $1,000,000 of royalty payments under any of the Company’s royalty interests prior to October 19, 2023 (condition partially met); and

(3)	with respect to one-third of the Restricted Shares awarded to the holder, if the holder continues to be a director, officer, employee or consultant of the Company or an entity that is under common control with the Company for a period of one year after the initial public offering is completed (condition partially met).

	($)
Balance at September 30, 2020		-
Acquisition of Ely		7,692
Addition		50
Option payments received		(30	)
Balance at September 30, 2021		7,712
Acquisition of Golden Valley and Abitibi (Note 3)		393
Additions		307
Depletion		(36	)
Receipt of shares as option payments		(49	)
Option payments received		(436	)
Balance at December 31, 2021		7,891

	($)
Balance at September 30, 2021		-
Acquisition of Golden Valley (Note 3)		1,360
Share of loss in associate		(143	)
Balance at December 31, 2021		1,217

	($)
Balance at September 30, 2020		-
Acquisition of Ely		3,038
Change in fair value during the period		1,511
Balance at September 30, 2021		4,549
Acquisition of Abitibi (Note 3)		691
Exercise of Ely warrants		(123	)
Change in fair value during the period		(90	)
Balance at December 31, 2021		5,027

	Reserves
	Warrants			Share Options		Total
	($)			($)		($)
Balance at December 31, 2020		-			7		7
Initial public offering:
Common share purchase warrants issued to for cash		7,045			-		7,045
Underwriters’ fees and issuance costs		(416	)		-		(416	)
Ely Warrants recognized in equity		2,603			-		2,603
Exercise of Ely Warrants		(27	)		-		(27	)
Share-based compensation - share options		-			2,192		2,192
Balance at September 30, 2021		9,205			2,199		11,404
Exercise of Ely Warrants		(230	)		-		(230	)
Share options in exchange of options of Golden Valley Mine and Royalties Ltd.		-			8,991		8,991
Share-based compensation - share options		-			446		446
Balance at December 31, 2021		8,975			11,636		20,611

	Number of options		Weighted average exercise price per share ($)
Balance at September 30, 2021		3,016,200		4.97
Golden Valley share options exchange for GRC share options (Note 3)		2,498,045		1.32
Balance at December 31, 2021		5,514,245		3.32

	Options Outstanding			Options Exercisable
Exercise price ($)	Number of options outstanding	Weighted average exercise price per share ($)	Weighted average remaining contractual life (years)	Number of options exercisable	Weighted average exercise price per share ($)	Weighted average remaining contractual life (years)
1.04	475,457	0.09	0.13	475,457	0.12	0.18
1.28	62,108	0.01	0.03	62,108	0.02	0.04
1.32	1,749,583	0.42	1.51	1,749,583	0.58	2.10
1.88	163,781	0.06	0.09	163,781	0.08	0.13
2.55	47,116	0.02	0.03	47,116	0.03	0.04
4.78	305,000	0.26	0.24	152,500	0.18	0.17
4.85	206,200	0.18	0.17	51,550	0.06	0.06
5.00	2,505,000	2.27	1.90	1,252,500	1.58	1.33
	5,514,245	3.32	4.10	3,954,595	2.67	4.05

	●	Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
	●	Level 2: other techniques for which all inputs have a significant effect on the recorded fair value which are observable, either directly or indirectly.
	●	Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

	For the thee months ended		For the thee months ended
	December 31, 2021		December 31, 2020
	($)		($)
Management salaries		181		35
Directors’ fees		36		-
Share-based compensation		440		78
		657		113

	●	$125 on or before January 14, 2023;
	●	$400 on or before January 14, 2024 and January 14, 2025 and;
	●	$500 on or before January 14, 2026 and January 14, 2027.

●	the Company’s plans and objectives, including its acquisition and growth strategy;
●	the proposed offer (the “Elemental Offer”) to acquire all of the common shares (the “Elemental Shares”) of Elemental Royalties Corp. (“Elemental”);
●	the Company’s future financial and operational performance, including expectations regarding royalty revenues and other income;
●	royalty and other payments to be made to the Company by the owners and operators of the projects underlying the Company’s royalties and other interests;
●	expectations regarding the royalty and other interests of the Company;
●	the plans of the operators of properties where the Company owns royalty interests;
●	estimates of Mineral Reserves and Mineral Resources on the projects in which the Company has royalty interests;
●	estimates regarding future revenue, expenses and needs for additional financing;
●	adequacy of capital and financing needs; and
●	expectations regarding the impacts of COVID-19 on the operators of the properties underlying the Company’s interests.

●	the public disclosures of the operators regarding the properties underlying the Company’s interests are accurate, including that such operators will meet their disclosed production targets and expectations;
●	the ability to satisfy the conditions to the Elemental Offer;
●	current gold, base metal and other commodity prices will be sustained, or will improve;
●	the proposed development of the Company’s royalty projects will be viable operationally and economically and will proceed as expected;
●	any additional financing required by the Company will be available on reasonable terms; and
●	operators of the properties where the Company holds royalty interests will not experience any material accident, labor dispute or failure of equipment.

●	dependence on third-party operators;
●	a substantial majority of the Company’s current royalty interests are exploration, advanced-exploration and development stage properties, which are non-producing and are subject to the risk that they may never achieve production;
●	volatility in gold and other commodity prices;
●	the Company has limited or no access to data or the operations underlying its interests;
●	a significant portion of the Company’s revenues is derived from a small number of operating properties;
●	the Company is subject to many of the risks faced by owners and operators of the properties underlying the Company’s interests;
●	the conditions to the Elemental Offer may not be satisfied or the Company may fail to realize the expected benefits of such proposed acquisition;
●	the Company may enter into acquisitions and other material transactions at any time;
●	the Company’s future growth is to a large extent dependent on its acquisition strategy;
●	as a royalty holder, the Company may become subject to potential disputes with operators regarding the existence, enforceability or terms of its interests;
●	certain of the Company’s royalty interests are subject to buy-back or other rights of third-parties;
●	risks related to epidemics, pandemics or other public health crises, including COVID-19, and the potential impact thereof on the Company and the operators of the properties underlying its interests;
●	risks related to Mineral Reserve estimates and Mineral Resource estimates completed by third-party owners and operators on the projects underlying the Company’s interests, including that such estimates may be subject to significant revision;
●	title, permit or licensing disputes related to any of the properties in which the Company holds or may hold royalties, streams or similar interests;
●	potential conflicts of interests;
●	regulations and political or economic developments in any of the jurisdictions where properties in which the Company holds or may hold royalties, streams or similar interests are located;
●	the availability of any necessary financing in the future on acceptable terms or at all;
●	litigation risks;
●	the Company holds investments in a concentrated number of equity securities and the fair values thereof are subject to loss in value; and
●	the other factors discussed under “Item 3. Key Information – D. Risk Factors” in the Company’s Annual Report and other disclosure documents, which are available under the Company’s profile at www.sedar.com and www.sec.gov.

	●	GRC issued 2.1417 GRC common shares (“GRC Shares”) to Golden Valley shareholders for each Golden Valley common share; and
	●	GRC issued 4.6119 GRC Shares to Abitibi shareholders for each Abitibi common share.

	●	$0.12 million on or before January 14, 2023;
	●	$0.4 million on or before January 14, 2024 and January 14, 2025 and;
	●	$0.5 million on or before January 14, 2026 and January 14, 2027.

	●	Produced 23,795 ounces of gold, representing a 10% decrease compared to the prior quarter. The decrease was primarily due to harsh winter weather in December 2021 which significantly reduced production for two weeks. The mill processed a total of 256,374 tonnes of ore with an average gold grade and recovery of 3.41 g/t and 84%, respectively. Increased ore development rates and processing of lower ore grade from surface material continued during the quarter which resulted in higher tonnage with lower average grades processed in the plant.

	●	During the quarter, the tailings lift at TSF2 and the underground connection drift between the SSX and Smith mines were both completed on-time and under budget.

	●	On the exploration front, a total of nine drill rigs, consisting of four surface rigs and five underground rigs, were active at Jerritt Canyon at the end of the quarter.

	●	First Majestic provided 2022 production guidance for Jerritt Canyon as follows: 116 - 129 koz of gold; cash cost of $1,259 - $1,334 per ounce of gold; all-in sustaining costs (AISC) of $1,503 - $1,607 per ounce of gold. The 2022 underground capital expenditures include 4,950 meters of development and 135,100 meter of exploration drilling (mixture of both underground and surface; including infill, step-out and exploratory holes) for Jerritt Canyon.

	●	Fortitude Gold Corp. (“Fortitude”) disclosed in its news release dated January 18, 2022, its December 31, 2021 year end record production of 46,459 gold ounces from the Isabella Pearl Mine, which exceeded both the original 2021 guidance of 40,000 gold ounces and the subsequent reforecast in July of 45,000 gold ounces. During the year, mining operations encountered several high-grade pockets of gold mineralization in the Pearl Zone, with some exceeding 100 grams per tonne of gold. Fortitude has set 2022 guidance from the Isabella Pearl Mine to range between 36,000 to 40,000 gold ounces. The Company holds a 0.375% gross revenue royalty over the Isabella Pearl Mine in Nevada.

	●	Gold Standard Ventures Corp. (“GSV”) disclosed in its news release dated January 18, 2022, that it is continuing to advance the South Railroad Project, part of its Railroad-Pinion Project, towards a production decision through a feasibility study. Based on its press release dated November 10, 2021, GSV anticipates the feasibility study to be completed in the first calendar quarter of 2022. The Company holds a 0.44% NSR royalty over portions of the Railroad-Pinion Project in Nevada.

	●	Calibre Mining Corp. (“Calibre”) announced on January 12, 2022 in a news release, that its acquisition of Fiore Gold Ltd. was successfully completed. Calibre subsequently disclosed on January 18, 2022 results from nine drillholes of an exploration drill program at the Gold Rock Project. The Company holds a 0.5% NSR royalty over the Gold Rock Project in Nevada.

	●	In its press release dated February 3, 2022, Monarch Mining Corporation (“Monarch”) reiterated its expectations to restart operations at the Beaufor Project by June 2022. In its January 20, 2022 news release, Monarch disclosed final drill results from its 2021 surface drill program, which included positive results for potentially mineable stopes near surface in the area of the W and 350 zones. Exploration and development drilling is continuing on the property with five underground drills. The Company holds a 1.0% NSR royalty and a C$2.50 per tonne royalty over the Beaufor Project in Québec.

	Recurring expenses		Non-recurring expenses		Total
(in thousands of dollars)	($)		($)		($)
Consulting fees		242		3,000		3,242
Depreciation		9		-		9
Management and directors’ fees		217		-		217
Salaries, wages and benefits		214		-		214
Investor communications and marketing expenses		339		-		339
Office and technology expenses		215		-		215
Transfer agent and regulatory fees		82		-		82
Insurance expenses		578		-		578
Professional fees		758		1,058		1,816
Share-based compensation		901		-		901
		3,555		4,058		7,613

(in thousands of dollars, except	Revenues		Net loss			Net loss per share, basic and diluted			Dividends
figures for amounts per share)	($)		($)			($)			($)
From incorporation June 23, 2020 to June 30, 2020		-		(4	)		(3,794	)		-
September 30, 2020		-		(137	)		(136,837	)		-
December 31, 2020		-		(500	)		(0.04	)		-
March 31, 2021		-		(2,256	)		(0.08	)		-
June 30, 2021		-		(3,035	)		(0.07	)		-
September 30, 2021		192		(9,216	)		(0.17	)		-
December 31, 2021		533		(6,841	)		(0.06	)		-

	As at December 31,		As at September 30,
	2021		2021
(in thousands of dollars)	($)		($)
Cash and cash equivalents		13,826		9,905
Working capital (deficit)		34,603		6,380
Total assets		677,364		279,499
Total current liabilities		9,718		6,921
Accounts payable and accrued liabilities		9,682		6,885
Total non-current liabilities		141,450		47,260
Shareholders’ equity (deficit)		526,196		225,318

	Payments Due by Period
(in thousands of dollars)	Total		Less than 1 year		1 – 3 years		4 – 5 years		After 5 years
Acquisition of royalty ⁽¹⁾	$	2,967	$	2,967		-		-		-
Lease obligation	$	36	$	36		-		-		-
Long-term loan	$	46		-	$	46		-		-
Total	$	3,049	$	3,003	$	46		-		-