Flow-through Share Spending Timelines Extended By 12 Months

On July 10, 2020, the Department of Finance Canada announced a proposal to extend the time that issuers of "flow-through shares" have to incur eligible expenditures by 12 months. This extension applies to issuers with operations that have been impacted by COVID-19 and should provide relief to mining companies that have had to change or halt their operations due to the pandemic.

Many mining companies issue "flow-through shares" to help finance their exploration and project development activities. "Flow-through shares" are shares issued by a principal-business corporation (the "Issuer") to a person (the "Investor") under an agreement in writing between the Investor and the Issuer under which the Issuer agrees to incur eligible exploration expenses within a certain period of time in an amount up to the consideration paid by the Investor for the issued shares. These expenses are then renounced by the Issuer to the Investor and are deductible by the Investor. If the