Alberta Offering Memorandum for Trust Units (Real Estate Investment)

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Alberta Offering Memorandum for Trust Units (Real Estate Investment) Powered By Docstoc
					This Offering is not made to, nor will subscriptions be accepted from, any non-resident of Canada or any
person in the United States.

                              CONFIDENTIAL OFFERING MEMORANDUM

Dated: _____________________________

                                               THE ISSUER

Name:                          _______________________________ TRUST [the “Trust”]

Address:                       _________________________________
                               _________________________________

Telephone Number:              _________________________________
Fax Number:                    _________________________________
E-mail address:                _________________________________

Currently Listed or Quoted:    No. These securities do not trade on any exchange or market.
Reporting Issuer:              No.
SEDAR Filer:                   No.

                                             THE OFFERING

Securities Offered:            Series A Trust Units

Price per Security:            The issue price for each Series A Trust Unit is ____________________.

Minimum       Subscription     ____________________________ Dollars ($___________), equating to
Amount:                        ____________________________ (__________) Series A Trust Units

Maximum Offering:              ____________________________ Dollars ($___________)

Minimum Offering:              There is no minimum. You may be the only purchaser. Funds available
                               under the Offering may not be sufficient to accomplish our proposed
                               objectives.

Payment Terms:                 Cheque or bank draft for the total dollar amount subscribed for by the
                               purchaser (number of Series A Trust Units subscribed for x price per Unit),
                               payable to ______________________________ to be submitted together
                               with an executed copy of the Subscription Agreement provided to the
                               purchaser with this Offering Memorandum.

Proposed Closing:              It is anticipated that the Offering will close in stages from time to time as
                               sufficient Series A Trust Units have been sold to warrant a Closing.

Tax Consequences:              There are important tax consequences to the ownership of these securities.
                               See “Item 6 ─ Certain Canadian Income Tax Consequences”.

Selling Agent:                 No selling agent commissions or fees will be paid to sellers of the Series A
                               Trust Units under this offering. See “Item 7 – Compensation Paid to Sellers
                               and Finders”.

Purpose:                       The Trust is offering up to __________________ (___________) Series A
                               Trust Units for the purpose of investing in __________________ Limited
                               Partnership, which is raising capital to enable the acquisition and
                               consolidation of raw land containing ___________ acres more or less
                               located in ______________________________, Alberta and the subsequent
                               planning, servicing, subdivision and marketing of the resulting [light
                               industrial, commercial, retail and residential properties]. See “Item 2 –
                               Business of Trust”.
                                                         ii



                                            RESALE RESTRICTIONS
You will be restricted from selling your Trust Units for an indefinite period. See “Item 10 ─ Resale
Restrictions”.

                                            SUBSCRIBER’S RIGHTS
You have two (2) Business Days to cancel your agreement to purchase the Series A Trust Units. If there is
a misrepresentation in this Offering Memorandum, you have the right to sue for damages or to cancel the
agreement. See “Item 11 ─ Purchasers’ Rights”.

No securities regulatory authority or regulator has assessed the merits of these securities or
reviewed this Offering Memorandum. Any representation to the contrary is an offence. This is a risky
investment. See “Item 8 – Risk Factors”.

The information contained in this Offering Memorandum is intended only for the persons to whom it
is transmitted for the purposes of evaluating the securities offered hereby. Prospective investors
should only rely on the information in this Offering Memorandum. No persons are authorized to give
any information or make any representation in respect of the Trust or the securities offered herein
and any such information or representation must not be relied upon.

                                        ELIGIBILITY FOR INVESTMENT
The Trust qualifies as a “mutual fund trust” and a “unit trust” for the purpose of the Tax Act. Accordingly, the
Series A Trust Units, when issued, will be qualified investments under the Tax Act for trusts governed by
registered retirement savings plans, registered retirement income trusts, deferred profit sharing plans and
registered education savings plans. The Trust has qualified as a mutual trust fund and a unit trust since the
date of the Trust Deed.

                                           INVESTMENT NOT LIQUID
The Series A Trust Units offered hereunder will be subject to a number of resale restrictions, including a
restriction on trading. Until the restriction on trading expires, if ever, a Unitholder will not be able to trade the
Series A Trust Units unless it complies with very limited exemptions from the prospectus and registration
requirements under applicable securities legislation. As the Trust has no intention of becoming a reporting
issuer in any jurisdiction in Canada, these trading restrictions will not expire. Consequently, Unitholders may
not be able to liquidate their Series A Trust Units in a timely manner, if at all, or pledge their Series A Trust
Units as collateral for loans. See “Item 10 – Resale Restrictions” in this Offering Memorandum.

                                     FORWARD-LOOKING INFORMATION
Certain statements in this Offering Memorandum or incorporated by reference herein as they relate to the
Trust and its operations are “forward-looking statements”. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or
future events or performance (often, but not always, using words or phrases such as “expects”, “does not
expect”, “is expected”, “anticipates”, “does not anticipate”, “plans”, “estimates”, “believes”, “does not believe”
or “intends”, or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be
taken, occur or achieved) are not statements of historical fact and may be “forward-looking statements”.
Forward-looking statements are based on expectations, estimates and projections at the time the
statements are made that involve a number of risks and uncertainties which would cause actual results or
events to differ materially from those presently anticipated. These include, but are not limited to, the risks of
the investment activities of the Trust as well as of the activities of the Partnership. The Trust does not
undertake any obligations to publicly update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise.
                                                                                         iii



                                                                         TABLE OF CONTENTS
RESALE RESTRICTIONS .................................................................................................................................................. ii
SUBSCRIBER’S RIGHTS ................................................................................................................................................... ii
ELIGIBILITY FOR INVESTMENT ....................................................................................................................................... ii
INVESTMENT NOT LIQUID ............................................................................................................................................... ii
FORWARD-LOOKING INFORMATION .............................................................................................................................. ii

GLOSSARY OF TERMS ....................................................................................................................................................1

SUMMARY .........................................................................................................................................................................4

Offering Details .................................................................................................................................................................4

ITEM 1 USE OF AVAILABLE FUNDS ................................................................................................................................6
1.1       Funds.......................................................................................................................................................................6
1.2       Use of Available Funds ............................................................................................................................................6
1.3       Reallocation .............................................................................................................................................................6

ITEM 2 BUSINESS OF _______________________________ TRUST .............................................................................7
2.1        Structure .................................................................................................................................................................7
2.2        Business of The Trust .............................................................................................................................................7
2.3       Development of Investments....................................................................................................................................9
2.4       Long Term Objectives of the Trust ...........................................................................................................................9
2.5       Short Term Objectives of the Trust and How the Trust Intends to Achieve Them ....................................................9
2.6       Insufficient Funds.....................................................................................................................................................9
2.7       Material Agreements ................................................................................................................................................9

ITEM 3 TRUSTEE, MANAGEMENT, PROMOTERS AND PRINCIPAL HOLDERS ..........................................................14
3.1       Compensation and Securities Held .......................................................................................................................14
3.2       Management Experience ......................................................................................................................................14
3.3       Penalties, Sanctions and Bankruptcy .....................................................................................................................14

ITEM 4 CAPITAL STRUCTURE .......................................................................................................................................14
4.1        Capital ..................................................................................................................................................................14
4.2.       Long Term Debt ....................................................................................................................................................15
4.3        Prior Sales ............................................................................................................................................................15

ITEM 5 DESCRIPTION OF SECURITIES OFFERED .......................................................................................................15
5.1       Terms of Securities ................................................................................................................................................15
5.2       Subscription Procedure ..........................................................................................................................................15

ITEM 6 CERTAIN CANADIAN INCOME TAX CONSEQUENCES ....................................................................................16

ITEM 7 COMPENSATION PAID TO SELLERS AND FINDERS .......................................................................................18

ITEM 8 RISK FACTORS ..................................................................................................................................................18
Investment Risks ..............................................................................................................................................................18
Issuer Risk........................................................................................................................................................................19
Industry Risk .....................................................................................................................................................................20

ITEM 9 REPORTING OBLIGATIONS ..............................................................................................................................20

ITEM 10 RESALE RESTRICTIONS .................................................................................................................................20

ITEM 11 PURCHASERS’ RIGHTS ...................................................................................................................................21
Rights for Investors Resident in British Columbia, Alberta and Manitoba ..........................................................................21
Saskatchewan ..................................................................................................................................................................21
Ontario .........................................................................................................................................................................21

ITEM 12 FINANCIAL STATEMENTS ...............................................................................................................................23

ITEM 13 DATE AND CERTIFICATE .................................................................................................................................24
                                              GLOSSARY OF TERMS

In this Offering Memorandum (including in the face pages hereof), unless the context otherwise requires, the
following words and terms shall have the indicated meanings and grammatical variations of such words and terms
shall have corresponding meanings:

“ABCA” means the Business Corporations Act (Alberta) and the regulations thereunder, as amended from time to
time;

“Affiliate” means a person who is affiliated or associated with the person who is the object of the description for the
purposes of the ABCA;

“Auditors” means such firm of chartered accountants as may be appointed by the Trust from time to time as the
auditors for the Trust;

“Available Funds” means, at any time, such amounts as indicated in the table under “Item 1 – Use of Available
Funds”;

“Business Day” means a day which is not a Saturday, Sunday or a legal holiday in the City of _____________, in
the Province of Alberta;

“Development Project” means the raw land assembly of the Subject Lands and the subsequent development and
subdivision thereof in order to create and sell commercial, light industrial, retail and residential lots;

“[Name of Partnership] LP” means __________________ Limited Partnership the limited partnership duly formed
under the laws of the Province of Alberta, which will initiate and undertake the Development Project;

“[Name of Partnership] LP Agreement” means the limited partnership agreement                           governing   the
__________________ Limited Partnership dated the ____ day of _____________, 20___;

“[Name of Partnership] LP Management Agreement” means the agreement between the [Name of Partnership]
LP and the Manager to manage the [Name of Partnership] LP dated ___________________;

“[Name of Partnership] LP Units” means the limited partnership units issued by the [Name of Partnership] LP
pursuant to the [Name of Partnership] LP Agreement;

“Closing” means a closing of the Offering or any portion thereof;

“Distribution Reinvestment Plan” means the distribution reinvestment plan adopted by the Trust for Unitholders of
the Trust whereby Unitholders are entitled to elect to have cash distributions in respect of their Trust Units
automatically reinvested in additional Trust Units in the same Series as their Trust Units;

“Exempt Plans under the Tax Act” shall have the meaning ascribed to “Exempt Plans” under the Tax Act and shall
include registered retirement savings plans, registered retirement income funds, registered educational savings
plans, tax free savings accounts, registered disability savings plans and deferred profit sharing plans;

“General Partner” means the General Partner of the [Name of Partnership] LP, _________________________
(name of general partner), a corporation incorporated under the ABCA;

“Gross Proceeds” means, at any time, the aggregate subscription amounts raised under this Offering;

“Limited Partners” means each of those parties who is accepted as and becomes a limited partner of the [Name of
Partnership] LP in accordance with the terms and conditions of the [Name of Partnership] LP Agreement;

“Manager” means _____________________ (name of Manager), a corporation incorporated under the ABCA and
which corporation is the manager of the Trust pursuant to the terms of the Trust Management Agreement, and is
also the manager of the [Name of Partnership] LP pursuant to the terms of the [Name of Partnership] LP
Management Agreement;

“Maximum Offering” means the maximum Offering hereunder of __________________ (___________) Series A
Trust Units for Gross Proceeds of ______________________________ ($________________) Dollars;

“Net Asset Value” means the Total Asset Value less the aggregate amount of the liabilities of the Trust;
                                                        - 2 -




“Offering” means the offering of the Series A Trust Units described herein or in any amendment hereto;

“Offering Memorandum” means this confidential offering memorandum, including any amendment;

“Person” means any individual, company, corporation, limited partnership, general partnership, firm, joint venture,
syndicate, trust, joint stock company, limited liability corporation, association, bank, pension trust, business trust or
other organization, whether or not a legal entity, and any government agency or political subdivision thereof or any
other form of entity or organization;

“Promoters” means the Trustee and the Manager;

“Proportionate Share” when used to describe a Unitholder’s interest in any amount, means the portion of such
amount obtained by multiplying that amount by a fraction, the numerator of which is the number of Series A Trust
Units registered in the name of that Unitholder and the denominator of which is the total number of Series A Trust
Units then outstanding;

“Securities Act” means the Securities Act (Alberta), including the rules and regulations thereunder, as may be
amended from time to time;

“Series” means and refers to any series of Trust Units issued or to be issued by the Trust;

“Series A Trust Units” means the Trust Units denominated as “Series A Trust Units” pursuant to the Trust Deed;

“Series A Unit Certificate” means a certificate in the form approved by the Trustee of the Trust evidencing one or
more Series A Trust Units, issued and certified in accordance with the Trust Deed and registered in the name of a
Series A Unitholder representing the Series A Trust Units held by the Series A Unitholder;

“Series A Unitholder” or “Series A Unitholders” means at any time the Persons who, at that time, are the
Unitholders of record holding one or more Series A Trust Units, as shown on the registers of Unitholders maintained
by the Trust or by the Transfer Agent on behalf of the;

“Series Net Asset Value” means, in respect of Trust Units of any particular Series of Trust Units of the Trust on any
Valuation Date, the portion of the Net Asset Value of the Trust attributed to the Trust Units of such Series on that
Valuation Date as determined in accordance with the provisions of the Trust Deed;

“Series Net Asset Value per Trust Unit” means, in respect of the Trust Units of any particular Series of Trust Units
of the Trust on any particular Valuation Date, the portion of the Series Net Asset Value of the Trust attributed to each
of the Trust Units of such Series of the Trust on that Valuation Date as determined in accordance with the provisions
of the Trust Deed;

“Special Resolution” has the meaning ascribed thereto in the Trust Deed;

“Subject Lands” means the ______________ parcels of land located in the ___________________________,
Alberta, containing a total of ___________ acres, more or less, and legally described as: (give legal descriptions of
all parcels)




“Subscriber” or “Subscribers” mean those Persons subscribing for Series A Trust Units pursuant to this Offering;

“Subscription Agreement “ means a subscription agreement to be executed by the Subscriber providing for the
purchase by Subscribers of Series A Trust Units in the form provided by the Trust;

“Tax Act” means the Income Tax Act (Canada) and the regulations thereunder, as amended from time to time;

“Total Asset Value” means the aggregate value of the assets of the Trust as determined in accordance with the
provisions of the Trust Deed;
                                                         - 3 -



“Transfer Agent” means such Person as may from time to time be appointed by the Trust to act as registrar and
transfer agent for the Series A Trust Units together with any sub-transfer agent duly appointed by the Transfer Agent;

“Trust” means _______________________________ Trust, the trust established by the Trust Deed.

“Trust Assets” means all monies, property and other assets as are held by the Trustee on behalf of the Trust as
further described in the Trust Deed;

“Trust Deed” means the Trust Deed dated the _____ day of ______________, 20_____, pursuant to which the Trust
was established, as the same may be amended, supplemented or restated from time to time;

“Trust Management Agreement” means the agreement between the Trust and the Manager to manage the Trust
dated the _____ day of ______________, 20_____;

“Trust Units” means the units of the Trust and represent, generally, an equal and undivided interest in the Trust
entitling the holder of record thereto to the rights, restrictions, privileges and obligations provided in the Trust Deed;

“Trustee” means _____________________ (name of Trustee), a corporation incorporated under the laws of Alberta
and which corporation is the Trustee of the Trust pursuant to the terms of the Trust Deed;

“Unit Certificate” means a certificate in the form approved by the Trustee of the Trust evidencing one or more Trust
Units of a Series, issued and certified in accordance with the Trust Deed and registered in the name of a Unitholder
representing the Trust Units held by the Unitholder;

“Unitholder” or “Unitholders” means at any time the Persons who, at that time, are the holders of record of one or
more Series of Trust Units, as shown on the registers of Unitholders maintained by the Trust or by the Transfer
Agent on behalf of the Trust; and

“Valuation Date” means the last day of each of the months of March, June, September and December in each
calendar year throughout the term of the Trust Deed.
                                                         - 4 -



_______________________________ TRUST
                                                      SUMMARY

This summary does not constitute an offering of securities, and cannot be relied upon for making your investment
decision. It is qualified in its entirety by the Offering Memorandum. Please read the Offering Memorandum
thoroughly before making any investment decision and investing. This investment is not guaranteed, or insured, and
its value changes depending, among other things, on economic factors and market trends.

Highlights of the Offering

The _______________________________ TRUST (the “Trust”) qualifies as a “mutual fund trust” and a “unit trust”
under the Tax Act. The Trust will issue Series A Trust Units in order to finance investment in the Development
Project. The Trustee of the Trust is _____________________ (name of Trustee), an Alberta corporation. The
directors and officers of the Trustee are: _______________________________________________.

The Trust has qualified as a mutual fund trust and a unit trust under the Tax Act since the date of the Trust Deed,
and accordingly, Series A Units when issued will be qualified investments under the Tax Act, eligible registered
retirement savings plans, registered retirement income funds, registered education savings plans and deferred profit
sharing plans.

The [Name of Partnership] LP is an Alberta registered limited partnership which has entered into all agreements
required in order to acquire the Development Project. The Trust will invest in the Development Project by acquiring
limited partnership units of the [Name of Partnership] LP.

_____________________ (name of Manager) is the manager of both the Trust and the [Name of Partnership] LP
and as such, is responsible for all aspects of managing and administering each of them. The directors and officers of
_____________________ (name of Manager) are _____________________________.

Profits, if any, realized from investments in the Development Project will form the basis of cash distributions to Series
A Unitholders. The ability of the Trust to make distributions will depend on a number of factors. See “Offering Details
– Risk Factors”.

Subject to the proviso hereinafter set forth, Series A Unitholders have a right to redeem their Series A Trust Units
and are entitled to a cash redemption price equal to the Series Net Asset Value per Series A Trust Unit effective as
of the last Valuation Date preceding the exercise of the right of redemption less any redemption charges imposed by
the Trustee provided that in the event total cash redemptions by all Unitholders exceeds Ten Thousand ($10,000)
Dollars in any given month, payment will be made in lieu of cash by delivery of the Trust’s promissory note for one
hundred per cent (100%) of each such redemption price plus interest thereon at the rate of six per cent (6%) per
annum payable after five (5) years.
                                                   Offering Details

Offering:                      Series A Trust Units - ______________________ ($_____) per Series A Trust Unit
                               Maximum Offering of ______________________________ ($_______________)
                               Dollars (__________________ Series A Trust Units)

Proposed Closing:              It is anticipated that the Offering will close in stages from time to time as sufficient
                               Series A Trust Units have been sold to warrant a Closing.

Final Dates:                   Continuous Offering. The Trust will complete the sale of Trust Units on each Closing
                               from time to time as subscriptions are received and as determined by the Trustee.

Trust Objectives:              The Trust was created to act as the investment vehicle for investors to pool their
                               funds to indirectly invest in various long-term capital real estate and real estate
                               related projects. Each investment will be funded from the proceeds of issuing a
                               particular Series of Trust Units. The Available Funds realized by issuing the Series A
                               Trust Units will be invested in the Development Project indirectly through the [Name
                               of Partnership] LP in a potentially tax efficient manner. See “Item 2 – Business of
                               _______________________________ Trust”

Payment Terms:                 The subscription price for Series A Trust Units is due and payable at the time of
                               delivery of a prospective purchaser’s subscription by certified cheque, bank draft or
                               such other manner as may be acceptable to the Trustee in its sole discretion.
                                                 - 5 -



Tax Consequences:      There are important tax considerations relating to these securities. This Offering
                       Memorandum contains a general description of certain of the tax consequences for
                       information purposes but it does not purport to be a complete analysis of all potential
                       tax considerations that apply to the purchase of Series A Trust Units. Prospective
                       purchasers should seek independent professional advice based on their own
                       circumstances. See “Item 6 – Certain Canadian Income Tax Consequences”.

Risk Factors:          Investment in Series A Trust Units is highly speculative. A potential Subscriber
                       should purchase Series A Trust Units only if it is able to bear the risk of the loss of its
                       entire investment and has no need for immediate liquidity. An investment in the
                       Series A Trust Units should not constitute a significant portion of a Subscriber’s
                       portfolio.

                       Series A Unitholders must be prepared to rely on the Manager as manager of both
                       the Trust and of the [Name of Partnership] LP. The success of the Trust and of its
                       investment in the [Name of Partnership] LP will depend on the efforts and abilities of
                       the Manager to successfully initiate, undertake and complete the Development
                       Project. Subscribers who purchase Series A Trust Units are investing in the ability of
                       the Manager to implement the investment strategy and achieve the investment
                       objectives.

                       The ability of the Trust to earn and distribute distributable income depends on
                       numerous factors including the cost of undertaking the Development Project, the
                       timing and amount of capital expenditures in connection therewith, the timing of and
                       amounts to be realized upon sales of the developed lands as well as other factors
                       beyond the control of the Trust. The Development Project will not generate income
                       until there are sufficient sales of the developed lands as will ensure recovery of
                       costs. Therefore there can be no assurance as to the level of cash distributions to be
                       paid by the Trust and when they will commence.

                       If the Trust ceases to qualify as a mutual fund trust, then Series A Trust Units may
                       cease to be qualified investments for trusts governed by Exempt Plans (registered
                       retirement savings plans, registered retirement income trusts, registered educational
                       savings plans, tax free savings plans, registered disability savings plans and
                       deferred profit sharing plans) under the Tax Act. There can be no assurance that
                       income tax laws and the treatment of mutual fund trusts will not be changed in a
                       manner that adversely affects Unitholders.

                       The Series A Trust Units will be subject to a hold period that may never expire which
                       will restrict the transfer of Trust Units except in very limited circumstances. There is
                       no market over which the Trust Units can be transferred and none is expected to
                       develop.

                       Unitholders are entitled to vote and pass resolutions that bind the Trustee only with
                       respect to a limited number of matters under the Trust Deed.

                       The Trust’s operations are subject to all the risks inherent in the establishment of a
                       new enterprise, including a lack of operating history.

                       Real estate investments are generally subject to varying degrees of risk depending
                       on the nature of the property.

                       Certain transactions contemplated in the Offering such as the [Name of Partnership]
                       LP Agreement and the Trust Management Agreement are among related parties. As
                       such, certain contractual terms one would see in documentation that is negotiated
                       with an unrelated party are not necessarily included in the [Name of Partnership] LP
                       Agreement and the Trust Management Agreement.

                       Other material risks applicable to an investment in the Series A Trust Units are
                       set out elsewhere in this Offering Memorandum. See “Item 8 - Risk Factors”.

Trustee of the Fund:   The Trustee of the Trust is _____________________ (name of Trustee), a B.C.
                       corporation.
                                                                        - 6 -



Manager:                                The Manager of the Trust and of the [Name of Partnership] LP is
                                        _____________________ (name of Manager). The following persons are directors
                                        and officers of the Manager:

                                        (list directors and officers, including their titles)



Limited Partnership:                    The     general    partner    of     the    [Name       of   Partnership] LP is
                                        __________________________ (name of General Partner), an Alberta corporation.
                                        The following persons are directors and officers of the general partner:

                                        (list directors and officers, including their titles)



Commissions to Sellers                  The Series A Trust Units will be offered directly to potential investors or, where
and Finders:                            permitted by applicable law, through agents or other parties. Any commissions or
                                        trailer fees paid to a selling agent will be determined by contract between the
                                        Manager and the selling agent. There will be no additional fees paid by investors.


                                                   ITEM 1 USE OF AVAILABLE FUNDS

1.1        Funds
The funds available as a result of the sale of Series A Trust Units pursuant to this Offering, are as follows:

                                                                                   Assuming Minimum                    Assuming Maximum
                                                                                      Offering ($)                             Offering ($)
A.         Amount to be Raised by this Offering                                       No minimum                      $______________
                                                                                                                           (1)
B.         Selling Commissions and fees                                               No minimum                      $Nil
                                                                                                                           (2)
C.         Estimated Offering Costs (including                       legal,           No minimum                      $Nil
                                    (
           accounting, audit, etc.)
D.         Available Funds: D = A – (B + C)                                             No minimum                    $______________
E.         Additional Sources of funding required                                       No minimum                    $Nil
F.         Working capital deficiency                                                   No minimum                    $Nil
G.         Total: G = (D + E) - F                                                       No minimum                    $______________
(1)   Commission of up to ten per cent (10%) of the Gross Proceeds payable to selling agents or as finder’s fees, to be paid by the [Name of
      Partnership] LP

(2)   The offering costs include legal expenses (i.e. associated with preparing the Trust Deed, preparing this Offering Memorandum, preparing the forms
      of Subscription Agreement, preparing the other material agreements described in this Offering Memorandum, and organizing the subscription
      process and issuance of Trust Units), and accounting expenses (i.e. associated with preparing the financial statements attached to this Offering
      Memorandum), to be paid by [Name of Partnership] LP.

1.2        Use of Available Funds
The Trust will use the total Available Funds, as noted above, as follows:

 Description of Intended Use of Available Funds                               Assuming Minimum                       Assuming Maximum
             Listed in Order of Priority                                         Offering ($)                            Offering ($)
Investment by Trust in [Name of Partnership] LP                                  No Minimum                           $______________
      (1)
Units
Total: Equal to G in the Funds table above                                        No Minimum                           $______________

(1)    The Available Funds of the Offering will be used by the Trust to subscribe for [Name of Partnership] LP Units. The Trust will invest the proceeds
       from the issuance of such securities as a capital contribution to the [Name of Partnership] LP for the acquisition of the Development Project. The
       [Name of Partnership] LP is a related party.

1.3        Reallocation
The Trust intends to spend the Available Funds as stated and will not reallocate the funds to any other investment
whatsoever.
                                                         - 7 -



                        ITEM 2 BUSINESS OF _______________________________ TRUST

2.1      Structure
The Trust is an unincorporated open-ended, limited purpose investment fund formed and governed by the Trust
Deed that was made under the laws of ____________________, as amended from time to time.

The beneficial interest in the Trust is divided into the Trust Units that will be issued in multiple Series. There is no
limit to the number of Series of Trust Units that may be issued and similarly, there is no limit to the number of Trust
Units that may be issued in any particular Series, all of which shall be determined by the Trustee in its sole
discretion.

By the provisions of the Trust Deed there are presently ______ Series of Trust Units, “the Series A Trust Units”
through “Series ____ Trust Units”, inclusive.

Each Series of Trust Units will be issued with respect to specific investments. Each Trust Unit within a particular
Series of Trust Units will be of equal value, however, the value of a Trust Unit in one Series may differ from the value
of a Trust Unit in another Series.

This Offering relates only to __________________ (___________) Series A Trust Units to be issued by the Trust,
the Available Funds of which will be invested in acquiring [Name of Partnership] LP Units in the [Name of
Partnership] LP but will have no application to any further Series A Trust Units which may be issued in the future.

This Offering Memorandum will also have no application to any other Series of Trust Units issued by the Trustee in
the future or to any other Series of Trust Units that may hereinafter be created by the Trustee.

The Trust Deed sets out the rights, duties and obligations of the Trustee relating to the investment management and
administration of the Trust and provides that these functions may be delegated to the Manager.

The Trustee has determined to delegate its investment management and administration functions to the Manager
pursuant to the Trust Management Agreement that was entered into on the ____ day of _____________, 20___.
The Manager is wholly owned by ___________________________.

2.2      Business of The Trust
(Edit this section to correctly reflect your situation.)
The principals of ___________________________ are experienced real estate developers in Alberta. They have
taken the initiative to organize, create and structure the Trust for the principal purpose of facilitating investment in
long term real estate projects in Western Canada. The Trust will issue a separate Series of Trust Units to enable
separate investment in each such project.

The Trustee is one of the Promoters of the Offering.

The principals of ___________________ have planned and initiated the Development Project, a land acquisition,
land development and marketing project that is anticipated to be completed over the next several years.

The Trust will issue the Series A Trust Units comprising this Offering in order to acquire [Name of Partnership] LP
Units, which in turn will undertake the Development Project. Funds raised by issuing Series A Trust Units will only be
invested in the [Name of Partnership] LP.

Other Series of Trust Units will be issued to raise funds to invest in other long-term real estate projects.

The [Name of Partnership] LP

The [Name of Partnership] LP was organized in order to initiate, undertake and complete the Development Project.
The [Name of Partnership] LP is governed by the [Name of Partnership] LP Agreement. The [Name of Partnership]
LP will be managed by the Manager.

The Trust will not be the exclusive owner of the limited partnership units of the [Name of Partnership] LP. The limited
partnership units of the [Name of Partnership] LP acquired by the Trust will rank equally with all other partnership
units thereof, whether those which are presently issued or which may be issued to the Trust in the future.

Allocations of net income and net losses to the Limited Partners including allocations for tax purposes will be made
in accordance with the terms of the [Name of Partnership] LP Agreement.
                                                         - 8 -



The General Partner

The General Partner is _______________________ (name of General Partner), a wholly owned subsidiary of the
Trust. The directors and officers of the General Partner are _______________________________.

Under the [Name of Partnership] LP Agreement, the General Partner will have the general power and authority to
manage the business and affairs of the [Name of Partnership] LP, which will include the ability to enter into
agreements with third parties to provide services to the partnership.

The General Partner has unlimited liability for the obligations of the [Name of Partnership] LP. The [Name of
Partnership] LP will reimburse the General Partner for all direct costs and expenses incurred in the performance of
its duties under the [Name of Partnership] LP Agreement. The General Partner is obligated to operate the [Name of
Partnership] LP in a manner so as to ensure the limited liability of the Limited Partners.

Management of the [Name of Partnership] LP

The Manager has entered into an agreement with the General Partner to provide management and administration
services to the [Name of Partnership] LP.


Investment Objectives

The Trust’s principal investment objective is to provide Series A Unitholders with a higher rate of return on their
investment with the nature of a raw land assembly, development and subdivision project designed to create and sell
the resulting [light industrial, commercial, retail and residential] properties together with a return of their capital.
There is no guarantee that any income will be earned or capital returned.

Investment Strategy

Management services for the Trust will be provided by _____________________ (name of Manager) who will also
act as the manager of the [Name of Partnership] LP. The directors and officers of the Manager are
_______________________________. Their combined experience and expertise in the identification and
development of commercial and residential real estate projects provides the foundation for the Trust attaining its
investment objectives.

Investment Guidelines

No investment will be made that would result in the Trust no longer qualifying as a mutual fund trust.

Manager

The Manager was incorporated under the ABCA on ______________________ (date of incorporation). The
registered and business office of the Manager is __________________________________. The Manager is
controlled by _______________________________, and each is a director and officer of the Manager.

The Manager incorporates the past                 real   estate    development     experience     of     its   principals,
_______________________________.

The Manager is one of the Promoters of the Trust.

The Manager will provide all management services required by the Trust and will be responsible for carrying out the
investment strategy, including the identification and selection of investment opportunities, related due diligence,
negotiation, documentation, approval and ongoing services related to each project development.

The Manager will also manage the Development Project from the date of acquisition of the Subject Lands, which is
anticipated to be effective approximately ___________________________ (date).

Management and Advisory Team

(Give brief CV’s of each member of the Management and Advisory Team.)
                                                         - 9 -



2.3      Development of Investments
The Trust is newly created. The Trust intends to immediately invest in the Development Project through acquisition
of limited partnership units of the [Name of Partnership] LP, which has entered into an agreement to acquire the
Subject Lands.

It is the intention of the Manager and the Trustee that acquisition and development of the Subject Lands and the
subsequent sale of the developed [light industrial, commercial, retail and residential] lots can be accomplished
through aggressive and competent co-management of the Trust and the [Name of Partnership] LP by the Manager.

This pattern of co-management of the Trust and its investments will be followed in making future investments.

The Trust will not undertake any activity, take any action, or make or retain any investment that would result in the
Trust not being considered a “unit trust” or a “mutual fund trust” under the Tax Act. In connection with this duty, the
Trustee has broad authority and is entitled to take such action as it considers necessary or appropriate in
accordance with the Trust Deed to preserve the mutual trust fund status of the Trust, including the limits on
ownership of the Trust Units as described under “Limitation on Non-Resident Ownership” in the Trust Deed.

2.4      Long Term Objectives of the Trust
The Trust’s long-term objective is to preserve investors capital while providing a profitable return thereon through
acquisitions and competent management of real estate investment projects. The Trust intends to and will continue to
invest in long-term real estate investment projects in Western Canada similar to the Development Project by issuing
other Series of Trust Units.

2.5      Short Term Objectives of the Trust and How the Trust Intends to Achieve Them
The Trust’s short-term objective is to invest in [Name of Partnership] LP Units and to thereby enable participation in
the said project from acquisition through planning, servicing, subdivision and marketing and to thereby enable
participation in relatively higher rates of return on investment.

2.6      Insufficient Funds
There may not be sufficient proceeds of the offering to accomplish all of the Trust’s proposed objectives and there is
no assurance that alternative financing will be available.

2.7      Material Agreements
The following is a description of each entity in the structure, a summary of material agreements governing each
entity in the structure and a summary of the key terms of each material agreement. Material agreements are
available and may be reviewed at the offices of the Trust.

_______________________________ TRUST - TRUST DEED made as of ___________________, 20___

The Trust is an unincorporated open-ended, limited purpose mutual fund trust governed by the laws of the Province
of British Columbia and was created by the Trust Deed. The Trust qualifies as a “unit fund” and as a “mutual fund
trust” for the purpose of the Tax Act, but the Trust is not a “mutual fund” under applicable securities laws.

The following is a summary description of the key provisions of the Trust Deed. This summary is qualified in its
entirety by reference to the full text of the Trust Deed.

         Purpose of the Trust

The Trust was created primarily for the purpose of providing investors with an opportunity to achieve long-term
capital appreciation and income through an investment in a diversified portfolio of real estate holdings.

Other ancillary purposes include:

(a)      lending, investing and reinvesting indirectly through one or more limited partnerships, in interests in office,
         retail, commercial, multi-unit residential and industrial real property and raw land in Canada with the
         purpose of assembling a portfolio of revenue-producing lands, properties, developments and
         redevelopment opportunities to be held as capital property;

(b)      holding all or part of the Trust Assets and disposing of all or any part of the Trust Assets;
                                                         - 10 -



(c)      issuing debt securities as provided in the Trust Deed;

(d)      issuing additional Trust Units for the purpose of implementing the Distribution Reinvestment Plan;

(e)      temporarily holding cash in interest bearing accounts with Canadian financial institutions and in short term
         investments for the purposes stated in the Trust Deed;

(f)      repurchasing, redeeming or otherwise acquiring securities of the Trust.

         Trust Units

The Trust Deed creates Trust Units, which shall be issued in Series. The funds raised by issuing each Series of
Trust Units shall be utilized for investment in specific Trust Assets, the beneficial ownership of which, net of liabilities
of the Trust reasonably allocable thereto shall appertain to the Unitholders of such Series. All revenue generated by
each Trust Asset net of deduction of all of the Trust’s expenses reasonably allocable thereto shall accrue to the
Unitholders of the Series of Trust Units, the proceeds of which were used to acquire it.

Each Trust Unit is transferable subject to restrictions on foreign ownership in the Trust Deed and subject to all resale
restrictions under applicable securities legislation. See “Item 10 – Resale Restrictions”. Trust Units of each Series
rank equally and rateably without discrimination, preference or priority. Each Trust Unit entitles the holder to one vote
at all meetings of Unitholders and to one vote for each written resolution of Unitholders.

         Issuance of Trust Units

The Trust may issue an unlimited number of Trust Units at any time to any Persons for the consideration and on the
terms that the Trustee determines. Trust Units may also be distributed under a Distribution Reinvestment Plan
established by the Trust in which case all Trust Units distributed shall be of the same Series as the Series on which
they are being distributed. Trust Units of a particular Series may be issued in lieu of cash distributions of the Trust to
the Unitholders of that Series, on a pro rata basis and may at the option of the Trustee be consolidated so that each
Unitholder will hold the same number of Trust Units of the same Series as it held before the distribution of additional
Trust Units.

         Trust Unit Certificates

Trust Unit Certificates will be issued to Unitholders and a register of Unitholders will be kept at the head office of the
Trust or the Transfer Agent setting out particulars of the Trust Unit Certificates. Only Unitholders with recorded Trust
Unit Certificates on the register are entitled to receive distributions or exercise rights of a Unitholder.

         The Trustee

The Trustee shall hold office in perpetuity in accordance with the Trust Deed.

The Trustee has authority and control over the Trust Assets and the affairs of the Trust. Subject to limitations set out
in the Trust Deed, the Trustee is responsible for (i) supervising the activities and managing the investments and the
affairs of the Trust, (ii) managing the Trust Assets, (iii) maintaining records and providing reports to Unitholders, (iv)
eff
				
DOCUMENT INFO
Description: Prepare a Confidential Offering Memorandum for trust units to fund a real estate investment with this Alberta template. - The offering is a private placement of trust units issued by a mutual fund trust (or unit trust), for the purpose of investing in a limited partnership which will acquire land to develop as commercial and/or residential real estate properties, and develop, subdivide and market the properties. - The trust was created to act as the investment vehicle for investors to pool their funds to indirectly invest in various long-term capital real estate and real estate related projects. - The trust's long-term objective is to preserve investors capital while providing a profitable return thereon through acquisitions and competent management of real estate investment projects. - Because the trust qualifies as a mutual fund trust, the units being sold are qualified investments under the Income Tax Act (Canada) and are eligible for investments through RRSPs, RRIFs, deferred profit sharing plans, and RESPs. - The investment is subject to resale restrictions, and there are certain tax considerations which the investor must take into account. - The offering is being made to Canadian residents only. - The securities are not listed or traded on any stock exchange or other public market. This Alberta Offering Memorandum for Trust Units (Real Estate Investment) is provided in MS Word format. Updated 2011.
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