This is the FIRPTA Certification referenced and defined in the proxy statement of Midas Gold, Inc.
delivered in connection with the special meeting of shareholders of Midas Gold, Inc. to be held on
April 1, 2011 and accompanying this FIRPTA Certification.
This FIRPTA Certification is for use only by registered securityholders. Securityholders whose
securities are registered in the name of a broker, investment dealer, bank, trust company, trustee or
other nominee should contact that nominee and their own tax advisors for assistance in completing this.
FIRPTA CERTIFICATION
This FIRPTA Certification is for use by registered holders ("Securityholders") of shares of
common stock ("Midas Shares") or options to acquire Midas Shares ("Midas Options" and, together
with the Midas Shares, the "Midas Securities") of Midas Gold, Inc. ("Midas") in connection with the
proposed plan of share exchange (the "Plan") involving Midas and Midas Gold Corp. ("Midas Canada"),
pursuant to which, subject to receiving all required approvals and the satisfaction of certain closing
conditions, all of the issued and outstanding Midas Shares will be acquired by Midas Canada. Pursuant to
the Plan, each Midas Share will be transferred by the holder thereof in exchange for one (1) common
share (a "Midas Canada Share") in the capital of Midas Canada, and each outstanding Midas Option
shall be exchanged for one (1) option (a "Midas Canada Option") to acquire a Midas Canada Share (the
"Exchange"). The Plan forms part of a series of transactions contemplated under the combination
agreement dated February 22, 2011 among Vista Gold U.S. Inc., Idaho Gold Resources, LLC ("Idaho
Gold"), Midas and Midas Canada whereby Midas' and Idaho Gold's respective assets, namely their
mineral properties located in the Stibnite-Yellow Pine mining district located in Valley County, Idaho,
would be combined (the "Combination").
Securityholders are strongly urged to read the proxy statement of Midas (the "Proxy Statement")
accompanying this FIRPTA Certification, delivered in connection with the special meeting of
Shareholders to be held on April 1, 2011 (the "Meeting"). Capitalized terms used but not defined in this
FIRPTA Certification that are defined in the Proxy Statement have the meanings set out in the Proxy
Statement.
It is anticipated that the Combination and the Exchange will be completed on or about April 6, 2011 (the
"Effective Date"). If the Combination and Exchange are completed, then, at the Effective Time,
Shareholders (other than Dissenting Shareholders) will be entitled to receive, in exchange for each Midas
Share held, one Midas Canada Share.
2
Instructions for Completing this FIRPTA Certification
1. Securityholders may be subject to U.S. federal income tax under Section 897 of the U.S. Internal
Revenue Code (the "Code"), and will be subject to withholding tax under Section 1445 of the Code
as a result of the Combination if they do not complete either (1) a certificate of non-foreign status
fulfilling the requirements of U.S. Treasury Regulation §1.1445-2(b) or (2) a notice of nonrecognition statement fulfilling the requirements of Treasury Regulation §1.1445-2(d)(2).
2. In this regard, Securityholders are requested to return to Midas Canada a duly completed certification
in the form of one of the following:
(a) a certificate of non-foreign status for individual U.S. Securityholders (attached as page A-1 to
Schedule "A" hereto);
(b) a certificate of non-foreign status for Securityholders that are U.S. entities (attached as page A2 to Schedule "A" hereto); OR
(c) a notice of non-recognition to be completed by non-U.S. Securityholders (non-resident aliens or
foreign entities) that qualify for a non-recognition exception to the Section 897 tax and
withholding under Section 1445,
on or before April 6, 2011, being the anticipated Effective Date.
3. Dissenting Shareholders are not eligible for a non-recognition exception under the Code, and
therefore should not provide a notice of non-recognition (as discussed in paragraph (c) above).
Dissenting Shareholders must either provide a certificate of non-foreign status (as discussed in
paragraphs (a) and (b) above) or, if they are unable to do so (because they are non-U.S. persons), will
be subject to withholding tax.
4. The information contained in this FIRPTA Certification (including the forms attached hereto) is not
intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to
any Shareholder. Securityholders are urged to consult their own tax advisors with respect to the U.S.
federal, state, and local tax consequences of the Combination, and are solely responsible for the
content of any certificate of non-foreign status or certificate of non-recognition provided to Midas
Canada in connection with the Combination.
5. All completed FIRPTA Certifications should be delivered to Midas Canada as follows:
Midas Gold Corp.
15920 East lndiana Ave., Suite 101
Spokane Valley, WA 99216
Attention: Heather Ennis
Tel: 509-927-4653
Fax: 509-924-1582
E-mail: ennis@midasgoldinc.com
6. Any questions and requests for assistance may be directed by Securityholders to Midas Canada at the
telephone number, e-mail address and location set out above.
3
IMPORTANT NOTICE
It is anticipated that the Effective Date will be on or about April 6, 2011. If Midas Canada does not
receive from a Securityholder either:
i.
a certification of non-foreign status (in the form of either page A-1 or A-2 attached as
Schedule "A" hereto); OR
ii. a notice of non-recognition (attached as Schedule "B" hereto)
on or before the Effective Date, Midas Canada shall be permitted to withhold all of the Midas
Canada Shares and Midas Canada Options that would otherwise be transferred to such
Securityholder pursuant to the Exchange on the basis that the Securityholder will be deemed to
have granted Midas and Midas Canada a lien and security interest in such Midas Canada Shares
and Midas Canada Options and will be deemed to have granted Midas and Midas Canada a right
to sell such Midas Canada Shares and Midas Canada Options as provided below in order to perfect
such lien and security interest.
In such event, such Midas Canada Shares and Midas Canada Options will only be released when such
Securityholder either (i) provides a certification of non-foreign status as described above, or (ii) pays the
amount of the withholding tax, as determined by Midas Canada pursuant to the Treasury Regulations
under Section 1445 of the Code. In addition, in the event that a Securityholder does not comply with the
requirement to provide a FIRPTA Certification in accordance with the terms of the Plan, and the Midas
Canada Shares become listed on an established securities market, Midas Canada shall have the right to
sell an amount of Midas Canada Shares to reimburse itself for the withholding taxes under Section 1445
plus reasonable fees and expenses and thereafter shall release the remaining Midas Canada Shares or
Midas Canada Options that would otherwise be transferred to such holder pursuant to the Exchange.
A-1
SCHEDULE "A"
CERTIFICATE OF NON-FOREIGN STATUS
(FOR U.S. INDIVIDUALS)
Section 1445 of the Internal Revenue Code (the "Code") provides that a transferee of a U.S. real
property interest must withhold tax if the transferor is a foreign person. To inform the transferee, Midas
Gold Corp. ("Transferee"), that withholding of tax is not required upon my disposition of a U.S. real
property interest, I certify the following:
1.
I am not a non-resident alien for purposes of U.S. income taxation (as defined in the Code
and Income Tax Regulations).
2.
My U.S. Social Security number is _________________________________.
3.
My home address is:
I understand that this certification may be disclosed to the Internal Revenue Service by the
transferee and that any false statement I have made here could be punished by fine, imprisonment, or
both.
UNDER PENALTIES OF PERJURY, I DECLARE THAT I HAVE EXAMINED THIS
CERTIFICATION AND TO THE BEST OF MY KNOWLEDGE IT IS TRUE, CORRECT, AND
COMPLETE.
_______________________________
Signature
__________________________________
Name (please print)
_______________________________
Date
A-2
CERTIFICATE OF NON-FOREIGN STATUS
(FOR U.S. ENTITIES)
Section 1445 of the Internal Revenue Code (the "Code") provides that a transferee of a U.S. real
property interest must withhold tax if the transferor is a foreign person. For U.S. tax purposes, the owner
of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the
transferor of the property and not the disregarded entity. To inform the transferee, Midas Gold Corp.
("Transferee"), that withholding of tax is not required upon the disposition of a U.S. real property interest,
at the request of the Transferee, the undersigned shareholder (the "Transferor") of Midas Gold, Inc.
hereby states and certifies on behalf of the Transferor that, as of the date of this Certificate,
1.
Transferor is not a foreign corporation, foreign partnership, foreign trust, or foreign estate
(as those terms are defined in the Code and Income Tax Regulations);
2.
Transferor is not a disregarded entity as defined in Treas. Reg. 1.1445-2(b)(2)(iii);
3.
Transferor’s U.S. employer identification number is: __________________________;
and
4.
Transferor’s office address is:
Transferor understands that this certification may be disclosed to the Internal Revenue Service by
the transferee and that any false statement contained herein could be punished by fine, imprisonment, or
both.
Under penalties of perjury I declare that I have examined this certification and to the best of my
knowledge and belief it is true, correct, and complete, and I further declare that I have authority to sign
this document on behalf of the Transferor.
Dated:______________________
Signature
Name (please print)
Title
B-1
SCHEDULE "B"
NOTICE OF NON-RECOGNITION TRANSFER
(FOR NON-U.S. PERSONS AND ENTITIES)
Sec. 1445 of the Code provides that a transferee of a U.S. real property interest must withhold tax
if the transferor is a foreign person, unless an exception applies. Treas. Reg. § 1.1445-2(d)(2) provides an
exception to such withholding if certain requirements are met. To inform the transferee, Midas Gold
Corp., a corporation governed under the laws of the Canadian Province of British Columbia
("Transferee"), that withholding of tax is not required upon the disposition by the transferor
("Transferor") of a U.S. real property interest, at the request of the Transferee, the undersigned Transferor
(or representative of Transferor), hereby states and certifies that, as of the date of this statement,
(A)
This document is a Notice of Non-recognition Transfer pursuant to the requirements of
Treas. Reg. § 1.1445-2(d)(2).
(B)
The following information concerns the Transferor submitting this Notice:
__________________________________________
(Name)
__________________________________________
(Street Address and Number)
__________________________________________
(City and State or Province)
__________________________________________
(Country and Zip (Postal) Code)
__________________________________________
(U.S. Social Security or Taxpayer Identification Number)
(C)
The Transferor is not required to recognize any gain or loss with respect to the transfer to
which this notice pertains.
(D)
The following is a brief description of the transfer:
The Transferor holds an equity interest in Midas Gold, Inc. ("Midas"). Although no
formal determination has been made, Midas is likely a United States real property
holding corporation (a "USRPHC"), and its stock therefore is likely a "United States real
property interest" under Section 897 of the Code (a "USRPI"). On the date of the
transfer, the Transferor and other securityholders of the Transferor will contribute all of
B-2
the stock of Midas to the Transferee in exchange for common stock of the Transferee (the
"Contribution").
(E)
The following is a brief statement of the law and facts supporting the claim that
recognition of gain or loss is not required with respect to the transfer:
The Contribution described above should qualify as both (1) a contribution to a
controlled corporation under the meaning of Section 351(a) of the Code and (2) a
reorganization within the meaning of Section 368(a)(1)(B) of the Code.
After the Contribution, by virtue of Section 7874(b) of the Code, the Transferee will be
treated as a U.S. domestic corporation for all purposes under the Code, despite being
incorporated in Canada.
Treasury Regulation § 1.897-6T(a)(1) provides that a non-recognition provision shall
apply to a transfer by a foreign person of a USRPI on which gain is realized only to the
extent that the transferred U.S. real property interest is exchanged for a USRPI which,
immediately following the exchange, would be subject to U.S. taxation upon its
disposition, and the transferor complies with the filing requirements of Treasury
Regulation §1.897-5T(d)(1)(iii).
With respect to the Contribution, the following requirements we be fulfilled:
(1) the Transferor will receive a USRPI (an equity interest in the Transferee) in
exchange for the USRPI transferred;
(2) the Transferor would be subject to U.S. tax upon its disposition of the USRPI
received under Section 897 of the Code; and
(3) the filing requirement of Treas. Reg. § 1.897-5T(d)(iii), as modified by Notice
89-57, will be fulfilled by the Transferor.
Accordingly, the requirements of Reg. § 1.897-6T(a)(1) should be met in connection with
the Contribution, and the transfer of the U.S. real property interest to the Transferee by
Transferor should not be subject to tax under Section 897 of the Code or withholding
under Section 1445 of the Code.
Transferor understands that this notice may be disclosed to the IRS by the transferee and that any
false statement contained herein could be punished by fine, imprisonment, or both.
The undersigned person declares, under penalties of perjury, that such person has examined this
notice and, to the best of such person’s knowledge and belief, this notice is true, correct and complete
(and, if applicable, the undersigned officer further declares that such officer has authority to sign this
notice on behalf of the Transferor).
By:
________________________________
Name ________________________________
Title
________________________________