Precision’s Transfer Agent can help you with a variety of shareholder related services, including:
Change of address
Lost share certificates
Transfer of shares to another person
You can contact Precision’s Transfer Agent at:
Computershare Trust Company of Canada
100 University Avenue,
9th Floor, North Tower
Toronto, Ontario, Canada
1-800-564-6253 (toll free in Canada and the United States)
1-514-982-7555 (international direct dialing)
Email: [email protected]
CWC Shareholder Information
CWC Energy Services Corp. Acquisition – Section 85(1) Tax Election
Section 85 Election Instructions for Former CWC Energy Services Corp. Shareholders
The deadline to submit the Election Forms to Precision Drilling Corporation is March 6, 2024.
Acquisition of CWC Energy Services Corp.
Precision Drilling Corporation (“Precision”) completed its acquisition of CWC Energy Services Corp. (“CWC”) on November 7, 2023 pursuant to a Plan of Arrangement (the “Arrangement”). Holders of common shares of CWC received Precision common shares (“Precision Shares”), cash, or a combination of Precision common shares and cash for their CWC common shares.
For more information please refer to CWC’s Management Information Circular filed on SEDAR+ at www.sedarplus.ca.
Eligibility for Election
A former shareholder of CWC who received Precision common shares may be entitled to make a joint election with Precision pursuant to section 85 (a “Section 85 Election”) of the Income Tax Act (Canada) (“ITA”), and may thereby defer all or a portion of the capital gain (or capital loss) that would otherwise be recognized for purposes of the ITA in respect of the exchange of CWC common shares for Precision Shares under the Arrangement, depending on the Elected Amount (as defined below), the CWC shareholder’s adjusted cost base of the CWC common shares at the time of the exchange, and subject to the Section 85 Election requirements being met under the ITA.
For more information concerning the Section 85 Election, please refer to the Management Information Circular that was prepared and provided to CWC shareholders in connection with the Arrangement (particularly, under the heading “Certain Canadian Federal Income Tax Considerations”).
All former CWC shareholders who wish to make a Section 85 Election should give immediate attention to this matter and in particular should consult their own tax advisors without delay. The summary information on this website with respect to such elections are provided for general assistance only. The law in this area is complex and contains numerous technical requirements not addressed in this summary.
A Section 85 Election, if validly made, may allow a former CWC shareholder (or where the former CWC shareholder is a partnership, the partners thereof) to defer all or a portion of the capital gain that may otherwise be recognized for Canadian income tax purposes on the transfer of CWC common shares to Precision.
A former CWC shareholder making a Section 85 Election will be required to designate an amount (the “Elected Amount”) in the Election Form that will be deemed to be the proceeds of disposition of the CWC shareholder’s CWC common shares. In general, the Elected Amount may not be:
• less than the amount of cash received by the CWC shareholder on the exchange;
• less than the lesser of (i) the CWC shareholder’s adjusted cost base of the CWC common shares, and (ii) the fair market value of the CWC common shares, in each case determined at the time of the exchange; and
• greater than the fair market value of the CWC common shares at the time of the exchange.
An Elected Amount specified by a CWC shareholder that does not comply with these limitations will automatically be adjusted under the ITA so that it is in compliance, and the amount so adjusted will be deemed to be the Elected Amount for purposes of such Section 85 Election.
Timing and Process for Making a Section 85 Election
The relevant federal tax election form is CRA form T2057 (or, if the former CWC shareholder is a partnership, CRA form T2058). A partially completed T2057 and T2058 form with Precision’s information can be obtained here:
Certain provincial jurisdictions require that a separate joint election be filed for provincial income tax purposes. Former CWC shareholders should consult their own tax advisors to determine whether they must file separate election forms with any provincial taxing jurisdiction. It is the responsibility of each CWC shareholder who wishes to make an election for provincial income tax purposes to obtain any necessary provincial election forms. In addition, special compliance rules apply where the CWC common shares are held in joint ownership or are held as partnership property, and affected CWC shareholders should consult their own tax advisors to determine all relevant filing requirements and procedures (including under provincial legislation) applicable in their particular circumstances.
A former CWC shareholder who intends to make a Section 85 Election should provide two signed copies of the necessary election forms to Precision by March 6, 2024, duly completed with the details of the number of CWC common shares transferred and the Elected Amount. Please send the completed and executed election forms to Precision by email at [email protected] on or before March 6, 2024.
The election form or forms will be signed by Precision and returned to such CWC shareholder within 45 days after the receipt thereof by Precision for filing by the former CWC shareholder with the Canada Revenue Agency (or the applicable provincial or territorial taxing authority). None of CWC, Precision or any successor corporation, will be responsible for the proper completion of any election form or for the payment of any late filing penalty. Except for the obligation of Precision to so sign and return duly completed election forms which are received by Precision by March 6, 2024, Precision will not be responsible for any taxes, interest or penalties resulting from the failure by a CWC shareholder to properly complete or file the election forms in the form and manner and within the time prescribed by the ITA (or any applicable provincial or territorial legislation). In its sole discretion, Precision may choose to sign and return an election form received by it after March 6, 2024, but Precision will have no obligation to do so. With the exception of the execution and delivery of completed Section 85 Election forms by Precision within forty-five (45) days of receiving the necessary information from a CWC shareholder, compliance with the requirements for making a valid Section 85 Election (including any applicable provincial elections) will be the sole responsibility of the CWC shareholder making the election.
Each former CWC shareholder should consult its own advisors as soon as possible with respect to the Section 85 Election, including the advisability of making such election, the eligibility requirements for making a Section 85 Election and the process and deadline for completing and filing the election, in each case having regard to its particular circumstances. Former CWC shareholders may be required to forward their tax election forms to Precision earlier than March 6, 2024 in order to avoid late filing penalties. All former CWC shareholders who wish to make a Section 85 Election should give immediate attention to this matter and in particular should consult their own tax advisors without delay.