The information below and on this website is provided in summary form and should not be relied on as advice for investment purposes. This page provides basic facts about the share structure of EquityLine Mortgage Investment Corporation and, in particular, the Series B preferred shares and Series H preferred shares of EquityLine.

DIVIDENDS

Monthly Dividend Payments

We intend to pay dividends to holders of Series B preferred shares and Series H preferred shares every month with an average annual rate of $0.80. The record date will be set as the last business day of every month, and the dividend to be paid on the 15th of the following month. When a dividend payment date falls on a day during the weekend or on a holiday, the payment will be made on the following business day. If you own shares on the record date, you will receive the dividend. There is no guarantee that the Corporation will be able to declare any dividends in any period or at all. (See “Risk factors” under the main heading “Corporate”.)

Taxation of Dividend Payments

You should consult your tax advisor for advice with respect to the income tax consequences of receiving dividends. Further information regarding the taxation of dividends is also available from the Canada Revenue Agency.

Under Section 130.1 of the Income Tax Act (Canada), mortgage investment corporations (“MIC”) such as EquityLine do not pay income tax as long as 100% of the profits/dividends they earn are given to their shareholders. Normally, these dividends are taxed in the shareholders’ hands as interest. This tax treatment of MICs by the Canada Revenue Agency avoids the double tax that corporations pay on interest income.

You will have to pay income tax on any money you earned from an investment. How much you need to pay depends on the tax rates where you live and whether or not you hold investment in a registered plan. Keep in mind that if you hold your investment in a non-registered account, distributions are included in your taxable income, whether you choose to receive them in cash or have them reinvested. Distributions are considered as interest income and you will receive a T5 at the end of the year from the registered dealer through which you purchased the preferred shares of the Corporation. If you have not received your T5 tax slip, please contact your dealer representative or the Custodian if you hold your preferred shares directly as EquityLine is not involved in sending these out.

Please Note: For non-resident shareholders, dividend income may be subject to withholding tax. For further information, please discuss this with your investment advisor.

Deferred Income Plans Eligibility

Our Series B Preferred Shares and Series H Preferred Shares are considered qualified investments under the Income Tax Act (Canada) for a trust governed by a registered retirement savings plan (“RRSP”), a registered retirement income fund (“RRIF”), a deferred profit sharing plan, a registered disability savings plan (“RDSP”), a tax-free savings account (“TFSA”) and a registered education savings plan (“RESP”) (collectively, “Plans”), provided that the Corporation qualifies as an MIC throughout the taxation year and further provided that, at any time in the relevant calendar year, the Corporation does not hold any indebtedness, whether by way of mortgage or otherwise, of a person who is an annuitant, a beneficiary, an employer or a subscriber under (or a holder of) the Plan or of any other person who does not deal at arm’s length with that person.

Investing in an MIC like EquityLine can be attractive for these kinds of Plans because MICs are not subject to taxation and Plans do not pay any tax on the interest they are estimated to receive. It is important, however, to speak with your financial and tax advisors before investing in an MIC to determine if it is a suitable investment for you and your Plan.

FLEXIBLE REDEMPTION

Our Series B preferred shares and Series H preferred shares redemption policy was developed to offer investors a clear path to redemption of capital with only such restrictions as we believe are required to maintain liquidity.

The policy provides for investor redemptions:

  • After a minimum six-month hold
  • Without penalty
  • For 100 percent of invested capital
  • 30 to 60 days after a written redemption request

Cash redemptions are limited to a monthly cap of $500,000 or 3% (whichever is greater) of the total capital in the pertinent share class after a hold period of 6 months.

Should there be requests for redemptions in excess of monthly caps, the Corporation has a resale mortgage network in place that will help provide a timely sale of the required portion of the mortgage portfolio. To the extent the Corporation is unable to satisfy all notices of redemption, the Corporation will satisfy all such notices on a proportionate basis with respect to the aggregate number of preferred shares represented by redemption notices. Any redemption notices (or portions thereof) which are not honoured shall be honoured on the following monthly redemption date (as defined in the Articles of the Corporation and the Corporation’s Offering Memorandum) with the Corporation redeeming any unsatisfied notices of redemption from the oldest to the newest before redeeming any preferred shares for the current month, subject in all cases to the Corporation’s right to suspend redemptions and the preferred share redemption limit described above.

OTHER KEY INFORMATION

We encourage you to learn more about EquityLine through the materials on this website. General background of the Corporation, our team, our investment strategy and risk factors can be found under the main headings “EquityLine MIC” and “Corporate”. Our corporate governance committees, charters and polices are provided under the subheading “Corporate Governance” under the main heading “EquityLine MIC”. Copies of other key documents including our unaudited quarterly financial statements and audited annual financial statements can be found under the subheading “Documents” under the main heading “Intelligence”. Under the main heading “Intelligence” you can also find our current news releases, videos and industry news and resources.

HOW YOU CAN BECOME A SHAREHOLDER

Our Series B Preferred Shares and Series H Preferred Shares are only available through Canadian registered dealers. We have engaged several exempt market dealers as selling agents. Eligibility to purchase is restricted to individuals who are either Accredited Investors or Qualified Investors under the Offering Memorandum Exemption, as those terms are defined by National Instrument 45-106 – Prospectus Exemptions in Canada. A registered dealing representative can help you determine whether investing in EquityLine is suitable for you. Please check with your financial advisor or dealing representative or connect to a dealing representative through one of our engaged exempt market dealers to obtain and discuss the documents below:

  • Offering Memorandum
  • Subscription Agreement
  • Distribution Reinvestment Form
  • Redemption Form

Potential investors should carefully review the underlying risks and tax implications of any securities they want to add to their portfolio before investing.