Gentai shall have the right to act as non-exclusive agent to the Company in connection with the sale of Preferred Shares to qualified purchasers in British Columbia, Alberta and Ontario. Gentai will market the Preferred Shares on a best efforts basis in reliance on exemptions from the prospectus requirements of applicable securities laws.

Distribution of Profits: Each financial year, the Company distributes to the holders of the Preferred Classes all of the Company’s net profits and half of the net capital gains for that financial year. The distributions may be made by the issuance of further Preferred Classes or by way of cash, or a combination of both, as elected by the shareholder.

The Tax Act requires that a MIC have no fewer than 20 shareholders and no one shareholder (including the shareholder’s spouse and children under 18, and companies controlled by any of them and the shareholder) to hold more than 25% of its issued shares.”

Redemption of Shares: Preferred Shares will be eligible for redemption commencing 12 months after issuance at the request of the Preferred Shareholders by way of an irrevocable notice of redemption specifying the shares to be redeemed, or at the option of the Company, subject to applicable laws and certain other conditions.

Transferability: a Preferred Class shareholder cannot transfer any of their Preferred Shares without the consent of the Company’s Board of Directors.

The net proceeds of the Offering (also referred to herein as “Net Subscription Proceeds”) will be invested primarily in loans secured by mortgages on real estate in Canada. Subject to any restrictions under the Tax Act that are applicable to mortgage investment corporations, the Company may make other permitted investments over time.