A prospectus exemption permits a securities distribution without a
prospectus when its conditions are satisfied. It does not remove
all securities-law obligations or represent regulatory approval of
the investment.
The issuer
The company or fund issuing the security. Read its documents
to understand how your money will be used.
The dealer
The registered firm through which you may purchase. Ask which
services it provides and which investments it offers.
Private securities can be difficult to sell and may provide less
ongoing information than public-market investments. Neither
registration nor a filed document guarantees performance.
The exemption must fit the transaction. The following are
educational examples, not a complete list or confirmation that a
particular offering is available to you.
Accredited investor exemption
Common individual tests include:
Financial assets exceeding $1 million, alone or with a spouse,
before tax and net of related liabilities.
Net income before tax exceeding $200,000 individually, or
$300,000 with a spouse, in each of the two most recent
calendar years, with a reasonable expectation of exceeding
that level this year.
Net assets of at least $5 million, alone or with a spouse.
Financial assets and net assets are different tests. A home is
not a financial asset. The full definitions and documentation
requirements matter.
Offering memorandum exemption
This route requires prescribed disclosure and a risk
acknowledgement. Investor categories, investment limits and
issuer restrictions vary by province. Receiving an offering
memorandum does not itself establish that this exemption is
being used.
Other exemptions
Private issuer and family, friends and business associates
exemptions have specific conditions. A new introduction or a
social-media connection does not, by itself, establish the
required relationship.
Your province matters.
Ask your representative to identify the exact exemption, confirm
the current local rules and explain any investment limits across
relevant purchases. Do not treat a limit as a recommended
investment amount.
Does this investment fit your circumstances, goals, risk
capacity and liquidity needs?
A representative needs to understand both you and the product.
Costs, concentration and the effect on your portfolio matter. A
suitability determination must put your interests first.
ILLUSTRATIVE EXAMPLE
An eligible investor with a near-term goal
Alex qualifies under an exemption but needs the money for a home
purchase in six months. An investment with uncertain redemptions
may be unsuitable, even though Alex qualifies to buy it.
Why am I being asked for financial information?
Know-your-client information helps the representative assess
your objectives, investment knowledge, financial circumstances,
risk tolerance and ability to withstand losses. Tell your
representative when your circumstances change.
A mortgage investment corporation pools investor capital to invest
in mortgages. You own a security in the corporation, rather than a
direct interest in each underlying property.
Borrower risk
Missed payments and defaults can reduce income and cause
losses.
Security & priority
Property security does not guarantee repayment. Prior-ranking
claims can reduce recovery for junior mortgages.
Liquidity
Mortgages cannot always be converted quickly to cash.
Redemption rights may have limits or suspensions.
Portfolio concentration
Repeated exposure to one borrower, region or property type can
amplify a downturn.
ILLUSTRATIVE EXAMPLE · NOT AN INDIGOBLUE LOAN
How a fall in value changes the cushion
A property valued at $1,000,000 has $700,000 in total mortgage
debt: a 70% combined loan-to-value ratio. If its value falls to
$800,000, the same debt represents 87.5%.
70%Initial combined LTV
→
87.5%After a 20% value decline
Only $100,000 remains above the debt before selling costs,
enforcement costs and other claims. This simplified example
ignores accrued interest and does not estimate actual
recoveries.
A MIC investment is not a bank deposit and is not CDIC-insured.
Income and capital are not guaranteed.
IB Capital, IB MIC and IB Management share ownership and
management through Harry Singh and Sanjay Ramwani. Ask for the
current relationship disclosure, compensation details and
explanation of how material conflicts are addressed.
Material conflicts must be addressed in your best interest.
Disclosure alone does not resolve a conflict.
Check the firm and representative
Check registration before investing, including the category,
jurisdiction and any terms or conditions. Registration is not an
endorsement of an investment.
Depending on the exemption and province, you may have
cancellation rights or remedies if an offering document contains
a misrepresentation. These are different from ordinary
redemption rights. Ask which rights apply, when the deadline
starts and how notice must be delivered. Seek independent legal
advice promptly if you may need to act.
Raise a concern
Contact compliance@indigoblue.ca and keep a record of the
concern, relevant documents and response. The firm’s complaint
procedure explains the next steps. Ask about applicable external
complaint-resolution options and deadlines.
