Go Metals Corp. C.GOCO

RE:Discussion about Go Metals FTS financing at $1.254

[Goldy63]

lifegoeson wrote:

Several investors have been asking me, "is it some kinda trick that GO Metals (GOCO) is conducting a Flow Through (FTS) financing at $1.254 when the average day trading price is less than $0.70?"  The simple answer is NO.  For Go Metals, 1) it allows them to raise capital with less share dilution which is very good for shareholders and 2) it shows that investors see value and are willing to pay a higher price for their shares, not knowing if the price will ever go higher again, thus reducing their tax benefit if they have to sell their shares at lower prices.

This isn't a trick or some hidden agenda done by Go Metals, flow-through share financing contributes over 65% of the funds raised on Canadian stock exchanges. Many Canadian companies have properties not located in Canada that don't qualify, so they can't do FTS financings and must raise money at market pricing.

Junior resource companies like GO Metals are generally in non-taxable positions and do not need to deduct their resource expenses, so the FTS mechanism allows them to transfer the resource expenses to the investor, thus allowing Go Metals to benefit greatly from FTS financing by raising capital and controlling their share dilution.

The purchaser is allowed to claim a tax deduction equal to the amount invested and is 100% tax-deductible against the person's income. This can get complicated for the investor as they need to take into account their current tax rate and eventually the capital gain, but in all cases, it is generally beneficial to the investor.  Thus an investor is willing to receive less shares since it is done at higher prices in contrast to a Non-FTS financing done at lower prices without tax benefits.

Now let's examine the GO Metals financing. It is very, very encouraging to see the financing was raised to $2.2 M from $1.5 M on the same day the financing was announced. Clearly investors are seeing value and are willing to risk this higher financing for a lesser number of shares. Secondly, they are issuing a 1/2 warrant at $1 (which is not considered FT for tax purposes) thus great for Go Metals as it reduces the share dilution considerably. Go Metals only has 23.7 M shares outstanding, after this financing there will only be 25.7 M shares outstanding, and since early warrants are being exercised through a declared facility with IBK Capital, there won't be many warrants, and the ones from this financing are at higher pricing of $1 per share, which again there will be less share dilution. And don't forget, GOCO has traded about 50 M shares, so likely fully consolidated with new shareholders aboard.

Now all we need is for Go Metals to announce the closing of the financing (perhaps this week given the last day action on Friday), and then shortly after release the first 2 or 3 cores. It is important to note that an AirTEM survey was conducted back in 2019 that identified several key underground targets, then during the 2021 field program  sulphides were confirmed at the surface above several of the larger targets identified underground by the AirTEM survey, which has now led to drilling in 2022 with subsequent visual confirmation of sulphides in drill cores within these targets.  Is everyone getting excited?

Well said . In laymans terms we get the PP closed then pop the rush assays period and if people are paying $1.25 what do you think assays look like lol . Holding hard cheers.