Glossary of Terms

Flow-through shares and super flow-through shares.

Flow-through shares are a special class of shares issued by Canadian resource companies (mining and gas) which include special tax benefits to the explorations expenditures that the companies undertake. The tax benefits "flow-through" to the investor.

Flow-through shares are like other common shares, except that the proceeds from the issue of the shares must be spend on "qualified exploration activities". Regular flow-through shares are specific to oil and gas exploration and have a 100% tax deduction. Super flow-through shares are specific to mining exploration and have the same 100% tax deduction, plus a further 15% federal tax credit and a provincial tax credit for the following provincial tax payers: Ontario (5%), Manitoba (10%) and British Columbia (20%). Flow-through shares and RRSPs are the only government-sanctioned tax shelters.