Wavefront Technology Solutions Inc V.WEE.H

TFSA Transfers

[mikhal]

Hi Folks; Being a semi retired CA and calling myself Tax Pro I would be remiss if I did noy correct prior error in posting from Island Brook. You will trigger a capital gain on a transfer to any account but capital losses are denied if transfer is to a related party. The artifical loss rules come into efffect as there has been no actual disposal. The loss is there but not allowed in computing your personal tax. I have nothing except WEE in my and my wife's TFSA. I have had many losses in these transfers that I have done and am happy to have had them. the lower price has enabled me over the years to get more shares sheltered. I have on more than one occasion made contributions early before I had room in the TFSA. This past November I elected to transfer 30,000 shares at .165 for a 5000 dollar over contribution this event trigerred a smaller capital gain than had I waited until Jan 2, 2018 BUT I am subject to a penalty of 1% per month of my over contribution ; thus I owe CRA 100 dollars for this transaction as an overcontribution. The saving of aadditional capital gain of 1800 hundred more than offsets my 100 penalty and I was able to contribute approximately 8000 more shares.
Should the shares exceeed 10 dollars in the future that represents 80,000 more capital in my TFSA for my future tax free accumulations. I fully expect the shares to exceed 10 dollars within three years providing a takeover isn't approved by the majority of shareholders.

How do we prevent a takeover ? My suggestion is to have management agree to a policy after two successive quarters of profit to become a dividend paying corporation.By my elementary calculations the policy could be to pay out 75% of " free cash flow " ( a defined term) . I believe after achieving profit there will be considerable free cash flow. This policy would encourage large current holders to retain their shares and other income oriented institutions ( pension funds or mutual funds with an income need) to acquire from those who have a capital gain orientation and want to invest elsewhere.
Yesterday within the last couple of hours I observed several large orders appear on the buy side at 25 cents and above approximately 300,000 shares. I have not seen in my eight years of closely following the depth such a build of orders on the buy side. There has been a least one seller of size from BMO over the last 10 months and they are presently sitting on orders of aprox 275K  . One order is 200K at 30 cents . This order was moved up from 29 yesterday; does this mean they are for sale or just blocking. Since Jan 1, 2017 BMO has purchased 295K and sold 2,208,000 ( this sell volume is 19,03% of total volume over this time frame. The only other net sellers of quantity over the same time are #1 anon for 374K  and #2 RBC for 275K.
The net buyers of size have been # 14 ITG for 981K and #22 Fidelity for 789K.
The most of the flipping volume has benn for a couple of cents ( mind you if successfu that is 10% per week perhaps) nice if you can make it happen in such a thinly traded stock.

Good investment decisions all. As Atlanticpro suggests read carefully the guidance that has been showing up consistently in news eleases and MD&A. As a point of interest the insiders are in blackout until the Nov quarter is released within a couple of weeks then they are open to buy until end of February unless material news has not been disclosed. With the current quarter of announced deals we might even eke out a profit in this Feb Quarter depending upon timing of accounting recognition of contract revenue.

Peace Mikhal