Ann: Trading Halt, page-101

For those unfamiliar with Flow Through Funding, it would be worth going through the ASX releases for Winsome Resources(WR1). They raised twice around the end of last year/start of this year using Quebec jurisdiction rules. Basically, the Canadian Government(or Provincial Government), provides a rebate for new equity raised for the express purpose of exploration for critical minerals to be undertaken within 18months of the new equity issue. That rebate is available only to a particular class of Canadian investors. In Quebec I think the rebate was 38.5%.

So those investors get an immediate reimbursement from Government and the shares are usually on-sold to Australian investors as that is the home of the company. Assumably the Canadian investor benefits and the company issues significantly less new shares to raise the same amount of capital due to the rebate premium. Less dilution...better for all.

The experience with WR1 was that the share price tended to escalate to a level closer to the Flow Through Price rather than the pre-rebate price. Even if the price does not immediately go up, we still benefit from the company having more cash for less shares issued thanks to the Canadian Governments.

regards
DF