How To Invest With Lexxco

Investors in Ontario are governed by regulations under the Ontario Securities Commission (OSC). Eligible investors are divided into several categories, among them are:

1. Accredited Investors
2. $150,000. Plus Investors

The OSC utilizes a number of criteria to define Accredited Investors, including net worth ($1 million +, excluding real estate) and/or net income ($200,000 + annually) tests. Investors holding their shares in a managed account maintained by an investment dealer registered under the Ontario Securities Act, would also be considered accredited. Investors need only satisfy one of the Accredited Investor criteria.

Accredited Investors may subscribe for any of the classes of shares offered by Lexxco as outlined below.

OSC rules permit any investor purchasing not less than $150,000. in shares, to invest in Mortgage Investment Corporation.

Residents of other Canadian jurisdictions and the United States may also subscribe for shares, subject to prevailing securities laws in those jurisdictions.

Shares may be held directly, or in an Self-Directed RRSP or RRIF.

Directly held shares may be held individually, jointly, in trust, or by a corporation.

Shares purchased directly or within a registered plan and/or by spouses, may be combined for the purpose of satisfying the minimum and incremental subscriptions rules.

Accredited Investors, as defined by the OSC, may subscribe for shares at any time. Minimum initial share subscription is $50,000. Existing shareholders may subscribe for additional shares at any time, in amounts of not less than $25,000.Shares will be issued on the first business day of the month following receipt of an executed subscription agreement and the investor's cheque. The shares have a value of $1.00 each. A cash investment may be made either at Lexxco's office, or by mail or courier. The investor executes a Subscription Agreement, and tenders a cheque payable to Lexxco Mortgage Investment Corporation. Upon receipt of the cheque, the Company issues a Share Certificate, and provides a copy of the accepted Subscription Agreement. Dividend record date is the first business day of the month following the month in which the shares are issued, meaning that shares earn a pro rata share of the annual dividend from this date.

The annual dividend is determined and declared annually on the basis of the audited financial statements. The investor would have the option of receiving dividend in the form of cash, or additional stock, or any combination thereof. Dividend cheques are issued at the conclusion of the annual audit, normally occurring by June 30th. Shares issued by way of stock dividends, are allotted on June 1st, and accordingly are fully eligible for dividends for the entire fiscal year, commencing on that date.

Both cash and stock dividends are considered as interest income for taxation purposes.

The minimum holding period for the shares is one year. The minimum holding period may be shortened in the event of the shareholder's death or disability.

The shares are subject to the Management Fee applicable to all Lexxco Shares.

RRSP/RRIF Investment

Mortgage Investment Corporation (MIC) shares are qualified RRSP and RRIF investments, as prescribed within the Income Tax Act.

Any class of Lexxco Shares may be held in registered plans.

A Self-Directed RRSP or RRIF is required to hold the shares. The investor is only required to execute the Subscription Agreement, and supplementary documentation prescribed by the Trustee, to complete the transaction. Alternatively, Lexxco can assist investors in establishing a Self-Directed RRSP or RRIF with the trustee it normally deals with. A registered plan share transaction may take a variety of forms, as follows:

RRSP Contribution

Contribution In Kind
An investor may wish to utilize some or all of their current years RRSP contribution room, to make a new investment in Lexxco. The shares would be purchased directly from Lexxco, but registered in the name of the RRSP trustee. The duly registered share certificate would be delivered directly to the RRSP trustee as a contribution in kind. For example, 25,000 Lexxco Shares, worth $1.00 each, contributed in kind to an RRSP, would represent a contribution of $25,000, and the trustee would issue a contribution receipt in this amount.

Cash Contribution
Alternatively, the investor could make a cash contribution directly to their RRSP, and then utilize the cash, conceivably supplemented by cash already in the plan, to purchase shares. In this instance, a share certificate registered in the name of the RRSP trustee, would be delivered to the trustee. Upon receipt, the Trustee would forward payment directly to Lexxco.

The contribution in kind method ensures that the shares are eligible for dividend payment for the maximum period possible. For dividend calculation purposes, the shares are not considered issued until payment in full is received. If payment from the trustee is not received until after the first day of the month, the dividend record date, then the shares will not be eligible for dividends until the following month.

RRSP Contribution Loans

Investors may arrange loans from their trustees, wherein the proceeds are credited directly to their plans as a new RRSP contribution. The resulting cash in the plan can then be used to fund any qualified RRSP investment. Investors may also elect to utilize other types of loans or mortgages to fund RRSP contributions.

RRSP/RRIF Purchase From Cash on Hand

Investors may use existing RRSP and RRIF assets to purchase shares. In this instance, the trustee would be directed to liquidate existing investments so as to generate the requisite amount of cash required to complete the share purchase. Lexxco would deliver the share certificate, registered in the name of the RRSP/RRIF Trustee, to the Trustee, and the Trustee would in turn effect payment directly to Lexxco.

RRSP/RRIF Swap

Investors already holding Lexxco shares outside of their RRSP or RRIF, can exchange these shares for cash in their registered plans. In this instance, Lexxco would re-register the directly held shares in the name of the RRSP or RRIF Trustee, and deliver the new share certificate to the Trustee. The Trustee would forward payment directly to the investor. As in the case of contributions in kind, the direct purchase of shares from Lexxco, and subsequent re-registration in the name of the RRSP or RRIF Trustee, has the advantage of maximization of the dividend eligibility period. Investors may elect to utilize both new RRSP contributions, and existing assets within their RRSPs, to fund Lexxco share purchases. Investors should be mindful of the minimum share subscription amounts, specified above. Please contact us concerning any aspect of either Direct Cash or RRSP/RRIF share issuance, or to obtain a Subscription Agreement.

LexxCo Disclaimer

Investment returns will fluctuate and are not guaranteed.
Historic returns are not an indication of future earnings.
The information in this website does not constitute an offer to sell or a solicitation to invest in Lexxco.
Lexxco advises potential investors to read all informational material carefully before investing.

Contact Us

LexxCo Corporation
924 The East Mall Suite 300
Toronto,Ontario,Canada
M9B 6K1
Phone: 1.877.879.6753
Fax: 416.621.3092
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