FAQS

FREQUENTYL ASKED QUESTIONS

The Corporation intends to generate income and produce positive returns for its shareholders while preserving capital by investing proceeds into a variety of individual mortgages secured by real property to earn interest, fees and in some circumstances capital gains.

The Corporation intends to invest in a portfolio of residential mortgages with a focus on unconventional mortgages. This includes investments that may not typically qualify for funding from large financial institutions such as shorter term mortgages that are required by individuals, builders and developers of real estate, among others as well as borrowers that require more timely closings. In doing so, the Corporation expects to earn a higher rate of interest and fees than what would otherwise be earned by way of conventional mortgage lending activities.

It is anticipated that the Corporation’s portfolio of residential mortgages will be comprised of a mix of first, second and third mortgages. Most mortgages will likely have a term of 1 year. The Corporation will not acquire mortgages in the secondary market, rather the Corporation will lend funds directly to borrowers.

The Corporation expects that most, if not all, of the underlying properties that are collateral to its mortgage investments will be located in Ontario, with a focus on the greater Toronto area.

At all times, the Corporation intends to qualify as a MIC, as the term is defined in the Tax Act. As a MIC, the Corporation will act as a “flow- through” entity that distributes all net profits to its investors on an annual basis without paying income taxes thereon, pursuant to the Tax Act. Instead, distributions received by each investor are taxed on an individual basis as income to that investor. For more details, see “ITEM 6 – of the offering Memorandum.

The Unanimous Shareholders’ Agreement prohibits the transfer of Preferred Shares without the consent of the majority of the directors of the Corporation, expressed by a resolution passed by the Board. A tender of Preferred Shares to the Corporation for redemption or retraction is not considered a transfer for purposes of the Articles.

Eligible accounts means any one of RESP, RRIF, TFSA, RDSP and RRSP.

If dividends are declared, they will be systematically paid to shareholders of record during the period as at the first Business Day in each month (the “Record Date”) though the date of payment may be deferred at the discretion of the Board. Unless the investor elects otherwise, all declared dividends will be paid to each shareholder as at the Record Date in cash. Dividend rates shall be set monthly and may be fixed or varied at any time at the discretion of the board of directors.

The Board of Directors reserves the right to change the Class A Target Yield and/or the Class B Target Yield at any time and from time to time in its sole discretion.

If dividends are declared, they will be systematically paid to shareholders of record during the period as at the first Business Day in each month (the “Record Date”) though the date of payment may be deferred at the discretion of the Board. Unless the investor elects otherwise, all declared dividends will ied at any time at the discretion of the board of directors.

You have 2 Business Days to cancel your agreement to purchase these securities.

Investment Risks: No guarantee in delivering Target Yields and dividends in general
Resale Restrictions: You will be restricted from selling your securities for an indefinite period.
Non-Voting: Pursuant to the Articles, and except as provided for under the Act, holders of Preferred Shares are not entitled to vote on matters to be voted on at meetings of Shareholders. | Review Page 31 of the Offering Memorandum to review all the Risk Factors listed under ITEM 8.

Each holder of Preferred Shares shall have the option to sell all or a portion of such holder’s Preferred Shares to the Corporation (the “Retraction Right”) at the Redemption Price less an early redemption charge if the Retraction Right is exercised within a certain number of years after the date that the Preferred Shares were issued to the holder (the “Issuance Date”). The early redemption charges will be prescribed according to the schedule of page 25 of Offering memorandum.

In order to exercise a Retraction Right, the holder of Preferred Shares must provide the Corporation with written notice and attach the certificate(s) for the Preferred Shares in respect of which the holder thereof wishes to exercise the Retraction Right. Subject to applicable laws, the Corporation shall pay or cause to be paid the Redemption Price, less any applicable early redemption charge, and provide any required share certificate(s) within six (6) months of receiving the notice.

Scroll to Top