The purchase of Units pursuant to this Offering should only be made after consulting with independent and qualified sources of investment and tax advice. An investment in Units at this time is highly speculative due to the stage of the Trust’s development and requirement to raise financing to carry out any long-term business plan of the Trust.

An investment in Units is appropriate only for investors who are prepared to invest money for a long period of time and who have the capacity to absorb a loss of some or all of their investment.

Subscribers must rely on the ability, expertise, judgement, discretion, integrity and good faith of the management of the Trust. This Offering is suitable for investors who are willing to rely solely upon the management of the Trust and who could afford a total loss of their investment.

In addition to the risks of purchasing the Units in the Trust found elsewhere within this Offering Memorandum, potential Investors should carefully consider the following factors, many of which are inherent to the ownership of Trust Units. The following risk factors include risk factors that are inherent to the Offering as a result of the Class A Partnership’s business. Such risks may not only affect the Class A Partnership, but also, the Trust because the Trust’s primary asset is the direct investment in the Class A Partnership and the Class A Partnership’s primary asset will be a debt investment. Prospective Investors should review the risks with their financial, legal and tax advisors.

Investment Risk

No Guaranteed Return

There is no guarantee that an investment in the Trust Units will earn any positive return in the short or long-term or that the targeted returns to Investors will be achieved. While the Trust may, in the future, make distributions to its Unitholders out of distributable cash (if any), no assurance can be given that such distributions will ever be made to Unitholders. A return on, or of, investment in the Trust Units is dependent upon the success of the Class A Partnership (in which the Trust is to invest) in generating sufficient capital appreciation and income on assets of the Class A Partnership. Both the Class A Partnership and the Trust could realize losses rather than gains. Actual returns are based on many factors that are not within the control of the Trustee and General Partner A. Actual returns may differ materially from the targeted returns that are stated in this Offering Memorandum. As a result, there is no assurance or guarantee that the Trust and, correspondingly, the purchasers of Trust Units pursuant to the Offering will earn a return on, or of, their investment. An investment in the Trust Units should be considered as speculative and Investors must be able to bear the risk of a complete loss of their investment.

Redemption Price

The Redemption Price of Trust Units is the Net Asset Value of that particular Class of Trust Units, as determined by the Trustee as of the day on which a redemption notice required by the Trust Deed is delivered, having reference to financial statements and such other information as the Trustee may consider appropriate. There is a risk that the determination of the Net Asset Value of that particular Class of Trust Units may be less than the purchase price of the Trust Unit.

Redemption Right

Redemption rights under the Trust Deed are restricted and provide only a limited opportunity for Investors to liquidate their investment in Trust Units. In accordance with the terms of the Trust Deed, the entitlement of a Unitholder to receive cash upon the redemption of such holder’s Trust Units is subject to limitations.

The redemption price for Trust Units paid by the Trust may not be paid in cash in certain circumstances but instead may be paid through the issue of Redemption Notes by the Trust. Redemption Notes issued by the Trust will be unsecured debt obligations of the Trust and may be subordinated to other financing obtained by the Trust. Notwithstanding the foregoing, circumstances may arise resulting in the Trust not having Trusts available to pay on maturity the principal balance and accrued unpaid interest owing on any Redemption Notes issued. Redemption Notes, if issued by the Trust, may, in certain circumstances, have priority over Trust Units in the event of the liquidation of the assets of the Trust. There are various considerations with respect to creditor rights and bankruptcy law that will need to be considered both at the time Redemptions Notes are issued and at the time of any liquidation of the assets of the Trust in order to determine if such a priority exists.

Limitation on Payment of Redemption Price in Cash

The total cash amount available for the payment of the redemption price of Trust Units by the Trust is limited to $25,000 during any calendar month provided that the Trustee may, in its sole discretion, waive such limitation in respect of all Trust Units tendered for redemption in any calendar month.

Illiquidity of Units

There is currently no market through which the Trust Units may be sold, and none is expected to develop. Units are only transferable subject to the terms of the Trust Deed and Canadian securities law restrictions. In general, under applicable securities laws, the Trust Units can be lawfully traded or resold by an Investor only if one of the following conditions is satisfied: (i) a statutory exemption, under the applicable securities legislation, from the prospectus and registration requirements is available for the Investor to rely upon in order to effect the trade being contemplated; or (ii) an appropriate discretionary order is obtained by the Investor, under the applicable securities laws, to permit the trade being contemplated.

The Trust is not a reporting issuer (as defined in applicable securities legislation) in any jurisdiction. Therefore, unless and until the Trust becomes a reporting issuer, where no statutory exemption may be relied upon and no discretionary order is obtained in order to affect a future disposition of the Trust Units, an Investor might be required to hold the Trust Units indefinitely. Under certain conditions, redemptions of Trust Units may not be payable in cash but rather satisfied through the distribution of other property of the Trust or Redemption Notes, in respect of each of which there will not be a market for such securities. Considering the foregoing, an investment in the Trust Units is only suitable for investors who do not need liquidity with respect to their investment. The principal assets of the Trust will be the Class A Partnership Units, which are illiquid. There is currently no market through which the LP Units may be sold and none is expected to develop.

Loss of Investment in the Event of a Unitholder Default

In the event that certain representations and warranties of a Unitholder as set forth in the Trust Deed should prove to be untrue, or a Unitholder fails to provide the Trust with requested information, or a Unitholder otherwise is in breach of its obligations under the Trust Deed (and fails to remedy same), the Trust has the right to sell or repurchase the Trust Units of such Unitholder.

Legal Rights Normally Associated with the Ownership of Shares of a Corporation

Holders of the Trust Units do not have the statutory rights normally associated with ownership of shares of a company including, for example, the right to bring “oppression” or “derivative” actions against the Trust. The Trust Units are not “deposits” within the meaning of the Canada Deposit Insurance Corporation Act (Canada) and are not insured under the provisions of that statute or any other legislation. Furthermore, neither the Trust nor any of the Trustees is a trust company and, accordingly, is not registered under any trust and loan company legislation as it does not carry on or intend to carry on the business of a trust company. Neither is the Trust a legally recognized entity within the relevant definitions of the Bankruptcy and Insolvency Act (Canada) or, The Companies’ Creditors Arrangement Act (Canada). As a result, if a restructuring of the Trust were necessary, the Trust would not be able to access the remedies available under these statutes.

Mutual Trust Fund Status

Should the Trust fail or cease to qualify as a mutual fund trust, the income tax considerations respecting the Trust would be materially different from those described in the summary Certain Canadian Federal Income Tax Considerations and Exempt Plan Eligibility, and in particular the following adverse income tax consequences may result:
(a) The Trust Units would not be qualified investments for Exempt Plans with the result that an Exempt Plan may become subject to a penalty tax, the beneficiary of such Exempt Plan may be deemed to have received income therefrom or, in the case of an RESP, the RESP may have its tax exempt status revoked.
(b) The Trust will be required to pay a tax under Part XII.2 of the Tax Act.
(c) The Trust will cease to be eligible for the capital gains refund mechanism available to mutual fund trusts.
(d) The Trust will be subject to alternative minimum tax under the Tax Act.

Limited Voting Rights and Statutory Remedies

The Trust is not generally regulated by established corporate law and Unitholders’ rights are governed primarily by the specific provisions of the Trust Deed.

Unitholders are not shareholders and do not enjoy the rights and privileges generally offered to shareholders of a corporation incorporated under the Business Corporations Act of any provincial or federal government. Although the Trust Deed confers upon Unitholders some of the same protections, rights and remedies that an Investor would have as a non-voting shareholder of a corporation governed by the Business Corporations Act of a provincial or federal government, significant differences do exist.

However, unlike a corporation, the Trustee(s) will not be elected by Unitholders but rather shall be appointed, removed and replaced by the Initial Trustee. Any Trustee may only be removed from office for cause by resolution passed by not less than two- thirds of the remaining Trustees. Further, unlike a corporation, Unitholders do not have the right to appoint the Trust’s auditor; rather such right is held by the Trustees. In addition, the matters in respect of which Unitholder approval is required under the Trust Deed are generally less extensive than the rights conferred on the shareholders of a corporation.

The Trust Units will not generally vote, except in cases where a fundamental change to the Trust (such as an amendment to the Trust Deed) is required. Where the general nature of the business to be transacted at a Unitholder meeting concerns an issue relevant to all Unitholders of the Trust, all classes will be voted together. Where an issue may affect the Unitholders of a particular class in a manner that is materially different from another class, only Unitholders of those classes to which such business is relevant will be entitled to vote and such Trust Units will be voted separately as a class.

Other than as described in the Trust Deed, Unitholders do not have recourse to a dissent right under which shareholders of a corporation are entitled to receive the fair value of their shares where certain fundamental changes affecting the corporation are undertaken, such as an amalgamation, a continuance under the laws of another jurisdiction, the sale of all or substantially all of its property, a going private transaction or the addition, change or removal of provisions restricting: (a) the business or businesses that the corporation can carry on, or (b) the issue, transfer or ownership of shares.

Unitholders similarly do not have recourse to the statutory oppression remedy that is available to shareholders of a corporation where the corporation undertakes actions that are oppressive, unfairly prejudicial or disregard the interests of security holders and certain other parties. Shareholders of a corporation may also apply to a court to order the liquidation and dissolution of the corporation in those circumstances, whereas Unitholders could rely only on the general provisions of the Trust Deed, which permit the termination of the Trust with the approval by Special Resolution. The Trust Deed does not include a comparable right of Unitholders to commence or participate in legal proceedings with respect to the Trust.

In the event of an insolvency or restructuring of the Trust, the rights of Unitholders will be different from those of shareholders of an insolvent or restructuring corporation.

Liability of Unitholders

There is a risk that a party may seek to assert that Unitholders be held personally liable for the obligations of the Trust or in respect of claims against the Trust. Such risks are expected to be limited since the Trust intends to limit its investments to indirect investment in Partnership Units and the Trust does not intend to carry on any active business. However, there is no assurance that Unitholders will not be personally liable for the obligations of the Trust.

Pursuant to the Trust Deed, if any Unitholder is held personally liable as such to any other person in respect of any debt, liability or obligation incurred by or on behalf of the Trust, or any action taken on behalf of the Trust, such Unitholder is entitled to indemnity and reimbursement out of the Trust assets to the full extent of such liability for all costs of any litigation or other proceedings in which such liability has been determined, including all fees and disbursements of counsel. The rights accruing to a Unitholder do not exclude any other rights to which such Unitholders may be lawfully entitled, nor does anything contained in the Trust Deed restrict the right of the Trustees to indemnify or reimburse a Unitholder out of the Trust’s assets in any appropriate situation not specially provided herein but, for greater certainty, the Trustees have no liability to reimburse a Unitholder for taxes assessed against them by reason of or arising out of his ownership of Trust Units.

Nature of the Trust Units and Trust Units are Not Direct Investments

The Trust Units do not represent a direct investment in real property or other similar assets and should not be viewed by Unitholders as a direct interest in properties, but instead as an investment in equity securities, namely the Trust Units. The Trust will not be investing in real estate or other similar assets but will be subscribing for Partnership Units. The Trust will not have a direct interest in any properties.

Tax Risks

Canadian federal and provincial tax aspects and local tax aspects should be considered prior to purchasing the Trust Units under the Offering. Unitholders are urged to consult their own tax advisors, prior to purchasing the Trust Units, with respect to the specific tax consequences to them. No advance income tax ruling has been applied for or received with respect to the income tax consequences described in this Offering Memorandum. The Trust has not received a legal opinion with respect to the income tax consequences described in this Offering Memorandum.

There can be no assurance that Canadian federal income tax laws or the judicial interpretation thereof or the administrative or assessing practices of the CRA respecting the treatment of trusts or limited partnerships will not be changed in a manner that adversely affects Unitholders or fundamentally alters the income tax consequences of investing in, holding or disposing of the Trust Units. There is also a risk that the CRA may reassess the returns of Unitholders relating to their investments in the Trust Units. Any successful tax reassessment by the CRA may adversely impact the value of the Trust Units.

The taxation of corporations, trusts and limited partnerships is complex. In the ordinary course of its activities, the Trust may be subject to ongoing audits by tax authorities. In addition, tax legislation may change periodically.

While the Trust believes that its tax filing position is appropriate and supportable, and that the Trust is not subject to the SIFT Rules, it is possible that tax matters, including the calculation and determination of revenue, expenditures, deductions, credits and other tax attributes, taxable income and taxes payable, may be reviewed and challenged by the tax authorities. If such challenge were to succeed, it could have a material adverse effect on the Trust’s tax position. Further, the interpretation of and changes in tax laws, whether by legislative or judicial action or decision, and the administrative policies and assessing practices of taxation authorities, could materially adversely affect the Trust’s tax position. As a consequence, the Trust is unable to predict with certainty the effect of the foregoing on its effective tax rate and earnings. The Trust will review the adequacy of its tax provisions and believes that it has adequately provided for those matters. Should the ultimate outcomes differ materially from the provisions, the Trust’s effective tax rate and earnings may be affected positively or negatively in the period in which the matters are resolved.

Unitholders should consult their own professional advisors as to the tax consequences to them of making an investment in, and of holding, the Trust Units.

Although the Trust is of the view that all expenses to be claimed by it in the determination of its income under the Tax Act will be reasonable and deductible in accordance with the applicable provisions of the Tax Act and that the allocations of income and losses to be made for purposes of the Tax Act will be reasonable, there can be no assurance that the Tax Act or the interpretation of the Tax Act will not change, or that the CRA will agree with the expenses claimed. If the CRA successfully challenges the deductibility of expenses or the allocation of income and losses, the Trust’s allocation of taxable income and losses to the Unitholders may change.

The possibility exists that a Unitholder will receive allocations of income without receiving cash distributions from the Trust in the year sufficient to satisfy the Unitholder’s tax liability for the year arising from its status as a Unitholder.

Eligibility for Investment by Exempt Plans

In order for the Trust Units to be eligible for investment by Exempt Plans the Trust must qualify as a “mutual fund trust” under the Tax Act. As at the time of this offering the trust does not so qualify.

Securities Regulatory Risks

In the ordinary course of business, the Trust may be subject to ongoing reviews by the securities regulators, who have broad powers to pass, interpret, amend and change the interpretation of securities laws from time to time and broad powers to protect the public interest and to impose terms, conditions, restrictions or requirements regarding registration under securities laws. Further, the securities regulators have the authority to retroactively deny the benefit of an exemption from prospectus or registration requirements otherwise provided for in the securities laws where the regulator considers it necessary to do so to protect investors or the public interest.

While the Trust believes that its position regarding compliance with securities laws is appropriate and supportable, it is possible that securities matters may be reviewed and challenged by the securities authorities. If such challenge were to succeed, it could have a material adverse effect on the Trust. There can be no assurance that applicable securities laws or the securities regulators interpretation thereof or the practices of the securities regulators will not be changed or re-interpreted in a manner that adversely affects the Trust.

Dilution/Concentration

The Trust is authorized to issue an unlimited number of each Class of Trust Units. Any issuance of additional Trust Units may have a dilutive or concentrative effect on the value of Trust Units. Unitholders who invest after a particular property is acquired will be entitled to receive the same distributions as a Unitholder who invested before such property was acquired and will therefore be entitled to the equivalent benefits or disadvantages as each other Unitholder.

No Review of Offering Memorandum by Regulatory Authorities

Investors will not have the benefit of a prior review of this Offering Memorandum, the Trust Deed, the Holding Trust Deed, the Class A Partnership Agreement, the Management Agreement or any other documents in relation to the Offering by any regulatory authorities.

No Independent Counsel for Unitholders

No independent counsel was retained on behalf of the Unitholders. There has been no review by independent counsel on behalf of the Unitholders of this Offering Memorandum, the Trust Deed or any other documentation in relation to the Offering. No due diligence has been conducted on behalf of Unitholders by counsel. Each prospective Investor should consult his or her own legal, tax and financial advisors regarding the desirability of purchasing the Trust Units and the suitability of investing in the Trust.

Disclosure of Personal Information

Investors are advised that their names and other specified information, including the number and aggregate value of the Trust Units owned: (a) will be disclosed to the relevant Canadian securities regulatory authorities and may become available to the public in accordance with the requirements of applicable securities and freedom of information laws and the Investor consents to the disclosure of such information; (b) is being collected indirectly by the applicable Canadian securities regulatory authority under the authority granted to it in securities legislation; and (c) is being collected for the purposes of the administration and enforcement of the applicable Canadian securities legislation.

Legislative Changes

Legal, tax and regulatory changes may occur that can adversely affect the Trust or the Trust Units. There can be no assurance that income tax, securities and other laws will not be changed in a manner that adversely affects the Trust, the Trust Units or the Class A Partnership Units.

Blind Pool and Limited History

This Offering is a “blind pool” offering in that management team of the Trust has not yet finalized the long-term business of the Trust and as a result there are a number of risks that arise: (i) the Trust’s long-term objectives may not be achieved by the management team, (ii) there can be no assurance that any additional Trusting, if needed, will be available on terms attractive to the Trust, or at all, (iii) there is no assurance or guarantee that Subscribers pursuant to this Offering will earn a return on their investment, (iv) the Trust was only recently formed, has not commenced commercial operations, has no significant assets and has no history of earnings.

Issuer Risk

The Trust has no operational history and no history of earnings. Accordingly, there is a limited operating history upon which to base an evaluation of the Trust and its business and prospects. The Trust is in the early stages of its business and therefore is subject to the risks associated with early stage companies, including start-up losses, uncertainty of revenues, markets and profitability, the need to raise additional Trusting, the evolving and unpredictable nature of the Trust’s business and the ability to identify, attract and retain qualified personnel. The Trust’s business prospects must be considered in light of the risks, expenses and difficulties frequently encountered by entities in the early stage of development. There can be no assurance that the Trust will be successful in doing what it is required to do to overcome these risks. No assurance can be given that the Trust’s business activities will be successful.