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Acquisitions
 3 Months Ended
Sep. 30, 2016
Business Combinations [Abstract]  
Acquisitions

Note 3. Acquisitions

On July 7, 2016, the Company completed the acquisition of Calico, which held mining claims and the Grassy Mountain Gold Project in Oregon, USA. Upon closing, Calico became a wholly-owned subsidiary of the Company, and each issued and outstanding share of Calico common stock was converted into 0.07 shares of Paramount common stock.

The transaction was accounted for as an asset acquisition, as Calico is an exploration stage project, which requires that the total purchase price be allocated to the assets acquired and liabilities assumed based on their relative fair values.  Transaction advisory fees and other acquisition costs incurred prior to the closing of the transaction were recorded as Other Assets on the Balance Sheet. The purchase price and acquired assets and liabilities were as follows:

 

Common shares issued (7,171,163 at $2.12)

 

$

15,202,866

 

Transaction advisory fees and other acquisition costs

 

 

795,925

 

Total purchase price

 

 

15,998,791

 

Assets:

 

 

 

 

Cash

 

 

4,363

 

Receivables and other current assets

 

 

28,093

 

Mineral properties

 

 

20,785,728

 

 

 

 

20,818,184

 

Liabilities:

 

 

 

 

Accounts payable and accrued liabilities

 

 

1,603,975

 

Deferred income taxes

 

 

3,215,418

 

 

 

 

4,819,393

 

Net assets acquired

 

$

15,998,791

 

  

The promissory note issued to Calico as at June 30, 2016 of $808,187 has been eliminated in consolidation as at September 30, 2016.

Pursuant to the acquisition of Calico, the Company recorded a deferred tax liability of $3,215,418.  The Company determined that it would be able to utilize the benefit of its tax operating loss carryforwards and adjusted its valuation allowance to recognize the benefit of these previously unrecognized deferred tax assets in order to offset the deferred tax liability.  Accordingly, the Company recognized a deferred tax recovery of $3,215,418.