RE: Why a financing at this point?Horsey7, in the previous press release they said they had 13mil in cash so in theory they don't need the money. Here's the low down on flow through just in case you don't understand it. Flow throughs are a tax write off . The money can only be used for exploration in Canada. This includes most non-development stages of mining including ground sampling, geophysics, drilling, etc. The money has to be used this year.
Flow-through Shares are 100% tax-deductible investments in Canadian mining companies - for example, if you have a taxable income of $100,000 and you invest $10,000 in Flow-Through Shares, you reduce your taxable income to $90,000 (for both federal and provincial taxes). In addition, investors get a 15% federal tax credit that further reduces your taxes. that wants to avoid taxes.
So here's the
Negative - Share dilution.
Positives - as Mudcreeker has posted they bought shares on the cheapo and now issued shares @50 cents which is also a premium to the current share price.
In markets like this if you can raise money above the current share price then those investors believe in your company. I know they get a tax write off but these markets are crappy for juniors. It's tough to get financing and at a premium to boot. This is impressive in my books. Or else this could be an indication that maybe the markets are turning around for the juniors.
They've got two drill programs gearing up so this money can go into those programs. They can save the 13 mil for other purpose other than Canadian exploration if they want to.
Overall I like the financing but then again I'm a half full glass kind of person. This fall is shaping up to be very interesting.
MM