Next Edge Private Debt: Overview

 

The Case For Private Debt

The Next Edge Private Debt Fund (the ‘Fund’) aims to provide consistent risk-adjusted returns with minimal volatility and low correlation to traditional asset classes by investing primarily in a diversified portfolio of trade finance and factoring investments.

To achieve its investment objective the Fund will allocate capital to a select number of loan originators and credit managers who are recognized leaders in the North American direct lending marketplace.

REASONS FOR INVESTING

Attractive Yield

  • The Fund will pay out a distribution of 8% per annum to investors on a quarterly basis.

Portfolio Diversification

  • The Strategy exhibits low correlation to core asset classes

Capital Preservation

  • The Fund focuses on low duration investments which are most often credit insured

Unique Strategy

  • Through our credit advisors, the Fund provides access to a diversified portfolio of private loans and short term secured receivables in a format not typically available to investors.

Managed by Industry Experts

  • The Credit Advisor has extensive experience in managing portfolios of secured, insured trade receivables.

Ongoing Monitoring

  • Additional layer of due diligence and oversight by the Manager and Credit Committee

 

The Compelling Benefits of Including Trade Finance in Investment Portfolios

The key tenet of successful long-term portfolio performance is the inclusion of high- quality, non-correlated assets. Fixed income investments that complement core bond portfolios in both terms of attractive yield and diversification have become progressively difficult to identify.

Accounts Receivables Financing, commonly referred to as Factoring, is a key component of trade finance as has existed in developed economies for centuries. Simply stated, factoring allows a company to improve its cash flow cycle through the sale of its accounts receivables to an outside party. By converting account receivables into cash, a company increases both its productivity and financial health. The lifeblood of a small-to-medium sized company is its cash flow and the Fund offers investors an opportunity to achieve an attractive income stream by participating in this unique sector.

The Fund is advised by Liquid Capital Corporation, a factoring specialist founded in 1999 by its three principals whose notable factoring expertise is the result of individual trade finance careers spanning 30+ years.  As one of North America’s largest factoring specialist with over 87 offices throughout Canada, Mexico the US and Asia, Liquid Capital has financed in excess of $2 billion* of accounts receivables and continues to grow its platform – providing tremendous deal flow.

The Fund’s mandate to participate and finance factoring opportunities within Liquid Capital’s extensive network, coupled with rigorous diligence and oversight on every investment, offers investors a distinct stream of attractive yield coupled with an unparalleled level of diversification.

 

 

 

 

 

*Source: Liquid Capital, As of December 31st, 2015

Accredited Investor Disclaimer

If you meet the definition “accredited investor” (see below), you may invest a minimum of $25,000. Please consult the Offering Memorandum to determine your qualification status. Investment Advisors should consult their company’s internal policies.

The Subscriber, or one or more beneficial purchasers for whom the Subscriber is acting, is (i) a resident of, or the purchase and sale of securities to the Subscriber is otherwise subject to the securities legislation of one of the following: British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Québec, Newfoundland and Labrador, Nova Scotia, New Brunswick, Prince Edward Island, North West Territories, or Nunavut, and the Subscriber is (and will at the time of acceptance of the Subscription be) an accredited investor within the meaning of National Instrument 45-106 Prospectus and Registration Exemptions (“NI 45-106″) because the Subscriber is one of the following:

(a) except in Ontario, a Canadian financial institution, or a Schedule III bank;

(b) except in Ontario, the Business Development Bank of Canada incorporated under the Business Development Bank of Canada Act (Canada);

(c) except in Ontario, a subsidiary of any person referred to in paragraphs (a) or (b), if the person owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary;

(d) except in Ontario, a person registered under the securities legislation of a jurisdiction of Canada as an adviser or dealer;

(e) an individual registered under the securities legislation of a jurisdiction of Canada as a representative of a person referred to in paragraph (d);

e.1 an individual formerly registered under the securities legislation of a jurisdiction of Canada, other than an individual formerly registered solely as a representative of a limited market dealer under one or both of the Securities Act (Ontario) or the Securities Act (Newfoundland and Labrador);

(f) except in Ontario, the Government of Canada or a jurisdiction of Canada, or any crown corporation, agency or wholly owned entity of the Government of Canada or a jurisdiction of Canada;

(g) except in Ontario, a municipality, public board or commission in Canada and a metropolitan community, school board, the Comité de gestion de la taxe scolaire de l’île de Montréal or an intermunicipal management board in Québec;

(h) except in Ontario, any national, federal, state, provincial, territorial or municipal government of or in any foreign jurisdiction, or any agency of that government;

(i) except in Ontario, a pension fund that is regulated by the Office of the Superintendent of Financial Institutions (Canada), a pension commission or similar regulatory authority of a jurisdiction of Canada

(j) an individual who, either alone or with a spouse, beneficially owns, directly or indirectly, financial assets, having an aggregate realizable value that before taxes, but net of any related liabilities, exceeds $1,000,000;

(j.1) an individual who beneficially owns financial assets having an aggregate realizable value that, before taxes but net of any related liabilities, exceeds $5 000 000.;

(k) an individual whose net income before taxes exceeded $200,000 in each of the two most recent calendar years or whose net income before taxes combined with that of a spouse exceeded $300,000 in each of the two most recent calendar years and who, in either case, reasonably expects to exceed that net income level in the current calendar year;

(l) an individual who, either alone or with a spouse, has net assets of at least $5,000,000;

(m) a person, other than an individual or investment fund, that has net assets of at least $5,000,000 as shown on its most recently prepared financial statements;

(n) an investment fund that distributes or has distributed its securities only to: (i) a person that is or was an accredited investor at the time of the distribution; (ii) a person that acquires or acquired securities in the circumstances referred to in sections 2.10 [Minimum Amount Investment ] and 2.19 [ Additional Investment in investment funds ] of National Instrument 45-106; or (iii) a person described in paragraph (i) or (ii) that acquires or acquired securities under section 2.18 [Investment fund reinvestment] of National Instrument 45-106;

(o) an investment fund that distributes or has distributed securities under a prospectus in a jurisdiction of Canada for which the regulator or, in Québec, the securities regulatory authority, has issued a receipt;

(p) a trust company or trust corporation registered or authorized to carry on business under the Trust and Loan Companies Act (Canada) or under comparable legislation in a jurisdiction of Canada or a foreign jurisdiction, acting on behalf of a fully managed account, managed by the trust company or trust corporation, as the case may be;

(q) a person acting on behalf of a fully managed account managed by that person, if that person is registered or authorized to carry on business as an adviser or the equivalent under the securities legislation of a jurisdiction of Canada or a foreign jurisdiction, and

(r) a registered charity under the Income Tax Act (Canada) that, in regard to the trade, has obtained advice from an eligibility advisor, or an advisor registered under the securities legislation of the jurisdiction of the registered charity to give advice on the securities being traded;

(s) an entity organized in a foreign jurisdiction that is analogous to any of the entities referred to in paragraphs (a) to (d) or paragraph (i) in form and function;

(t) a person in respect of which all of the owners of interests, direct, indirect or beneficial, except the voting securities required by law to be owned by directors, are persons that are accredited investors;

(u) an investment fund that is advised by a person registered as an advisor or a person that is exempt from registration as an advisor;

(v) a person that is recognized or designated by the securities regulatory authority or, except in Ontario and Québec, theregulator as: (i) an accredited investor; or (ii) an exempt purchaser in Alberta or British Columbia after September 14,2005; or

(w) a trust established by an accredited investor for the benefit of the accredited investor’s family members of which a majority of the trustees are accredited investors and all of the beneficiaries are the accredited investor’s spouse, a former spouse of the accredited investor or a parent, grandparent, brother, sister, child or grandchild of that accredited investor, of that accredited investor’s spouse or of that accredited investor’s former spouse.

 

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