Deferred Consideration - Gold Payments

6 Months Ended

Jun. 30, 2023

9. Deferred Consideration—Gold Payments

Deferred

consideration—gold payments represented an obligation the Company assumed in connection with its acquisition of the European exchange-traded commodity, currency and

leveraged-and-inverse

business of ETFS Capital Limited (“ETFS Capital”) which occurred on April 11, 2018. The obligation was for fixed payments to ETFS Capital of physical gold bullion equating to 9,500 ounces of gold per year through March 31, 2058 and then subsequently reduced to 6,333

ounces of gold per year continuing into perpetuity (“contractual gold payments”). ETFS Capital continued to pass through the payments to other parties to meet its payment obligations under prior royalty agreements, including to Gold Bullion Holdings

(Jersey) Limited (“GBH”), a subsidiary of the World Gold Council (“WGC”), Graham Tuckwell (“GT”), and Rodber Investments Limited (“RIL”), an entity controlled by GT, who is also the Chairman of ETFS Capital.

May 10, 2023, the Company terminated its contractual gold payments obligation for aggregate consideration totaling $136,903 pursuant to a Sale, Purchase and Assignment Deed (the “SPA Agreement”) with WisdomTree International Holdings Ltd, Electra Target HoldCo Limited, ETFS Capital, WGC, GBH, GT and RIL. Under the terms of the transaction, GBH received approximately $4,371 in cash and 13,087 shares of Series C

Non-Voting

Convertible Preferred Stock of the Company, $0.01

par value per share, convertible into

13,087,000 shares of the Company’s common stock, and RIL received approximately $45,634 in cash.

e Company determined the present value of the deferred consideration—gold payments of $0 and $200,290 at June 30, 2023 and December 31, 2022 using the following assumptions:


		June 30, 2023				December 31, 2022




Forward-looking gold price (low)—per ounce	n/a	$	1,858
Forward-looking gold price (high)—per ounce	n/a	$	3,126
Forward-looking gold price (weighted average)—per ounce	n/a	$	2,237
Discount rate	n/a		11.0%
Perpetual growth rate	n/a		1.3%

During the three and six months ended June 30, 2023 and 2022, the Company recognized the following in respect of deferred consideration—gold payments:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Contractual gold payments	$	1,583	$	4,446	$	6,069	$	8,896
Contractual gold payments—gold ounces paid		792		2,375		3167		4,750
Gain/(loss) on revaluation/termination of deferred consideration—gold payments	$	41,361	$	2,311	$	61,953	$	(14,707	)