Investor Bulletin Board

March 27, 2020
Robert Mitchell and Murray Dell have composed the attached letter to review the current status of HMIC. There are a number of investors who support their conclusions, and others who might not. We have no idea of real numbers, although the claim does linger that only a very few disgruntled investors are speaking on behalf of themselves only, with no consultation to the wider audience of investors.
Today we would ask you to please review this attachment carefully and then send back comments and questions. We would like to present this to all shareholders but, as you are aware, we do not have access to a complete list of investor emails or addresses.
We will be sending this letter to Mr. Dunn and Mr. Dwyer after we have had a chance to hear from you.
As things stand now, management has stated that they will maintain the status quo with redemptions frozen and no further activity.

For the current Investors the only fair and equal solution is the pro-rata distribution of the proceeds from mortgage maturities and real estate assets selling as follows:

• Sell the HRAC properties over the next 2 – 4 years and distribute the proceeds pro-rata to the current Investors, similar to what HMIC intended to do with Class B shares
• As the current mortgages mature, distribute the proceeds pro-rata to the current Investors, subject only to honouring current commitments. There would be no New Investors, so there is no need for a NAV that changes quarterly

If HarbourEdge wish to move forward with the two share plan, they will have to hold another vote as was done in November 2019.

We hope to hear from as many investors as possible so we have a better idea of the number of investors would be supportive of what Mr. Mitchell and Mr. Dell have laid out in their letter.


March 4, 2020
The reorganization standoff is tormenting the Investors. Adding up to this the fear of being the victim of fraud makes things even worst. HarbourEdge should be the first interested to address this explosive situation and instead of blaming and threatening Investors, the Executive Directors should show leadership and terminate the standoff by accepting the Investors proposal to orderly wind-up the fund.

Many Investors repeatedly objected to HarbourEdge converting the MIC into a real estate development/management business based on the fact that this type of investment is not suitable for them and insisted that HRAC assets be expeditiously disposed at the best possible market price and the proceeds flowed back in MIC as most properties are finished, some rented out and could have been sold long time ago.

Recent discoveries, based on public documents/resources, suggest that HRAC business is intermingled with outside corporations where Executive Directors have ownership/interests, exposing our investment to hidden uses and generating the concern that the Directors might benefit personally from maintaining HRAC.

After all, the complicated schemes discovered recently are linked to HRAC: using the HRAC registration as builder/vendor outside of its purview for businesses in which Directors have ownership/interests or transferring HMIC assets to corporations that belong to Directors.

None of these transactions/schemes was disclosed to shareholders. It was only after occurrences were discovered in public documents/resources and Investors asked repeatedly for clarifications that HMIC provided some unsatisfactory, sometimes naive explanations.

How are these transactions recorded in books? Are funds flowing from HRAC to these schemes? We don't know! We don’t even know the HMIC assets and we need first to identify those assets and then determine their real value.

The level of distrust between Investors and HE is now explosive. Both sides need the regulator to step in and help them out.


February 24, 2020
The Ombudsmen for Banking Services and Investments is the best way for individual investors to get compensated for an investment loss or for another issue related to their shares, such as suitability of investments or in our case suspending the right at redemption.


HarbourEdge Investors have countless reasons to complain starting with non disclosure of the real risks and misrepresentation of the investment objective at investing time, then suspending indefinitely the redemption and forcing us to invest in real estate development business that is totally unsuitable for some investors.

More recently it was revealed that HarbourEdge conducts business outside the purview of HMIC, mixing outside corporations in which Director(s) have ownership / interests.

A good place to start is here: Ombudsmen for Banking Services and Investments 
Make sure to make the complaint related to the arm of HE that sells investment, that is HarbourEdge Asset Management Corporation.
Send me a message if you need help with your complaints.



January 24, 2020

SUMMARY: TWO MIC PROPOSAL by Investors - sent to HE on January 6

• HMIC would be closed to new investors and wound down
• New MIC would accept elections from those investors who wish to stay with HE, including DRIPs, and accept money from new investors
• This is a simple, inexpensive (win-win-win) solution that best suits those who want to redeem and those who want to stay with HE, including new investors and HE’s stated desire to continue in business
• All HarbourEdge needs to do is to incorporate a new company (they have the template with HMIC) for a minimal cost and do the required registrations for it to be a MIC. As it will be for their ongoing business, they should pay this cost
• We could even agree to let them use the HMIC name for the new MIC for “continuity” and they could rename HMIC as, say, the C(ollingwood)MIC
• Retaining the current MIC allows redemptions to occur when mortgages mature. As mortgages mature, all proceeds are paid out to all investors on a pro-rata basis. Those who want to stay with HE, simply transfer their payment to the new MIC – even by automatic deposit . For the redeemers the payment counts toward their redemption total. It also avoids any hint of preferential treatment for those already in the mortgage queue. There is no preference for anyone
• There is the probable need to honour and fund existing mortgage commitments from mortgage proceeds and cash available. This could potentially delay the start of redemption payments but we can only determine to what degree after reviewing the pro-forma cash flow projections which we have requested
• There are some upsides for HarbourEdge:

        i. HE continues to have a fund and can charge full fees on new fund
        ii. the new fund won’t have the ‘baggage’ of the existing non performing loans and foreclosed properties
        iii. If they move the redemptions forward expeditiously, they will have more new money to manage sooner.
        iv. a friendly settlement will allow them to optimize their reputation,
        v. they won’t encounter the prospect of losing another shareholders vote and having to start over again,
        vi. any residual “securities issues” they may have will probably ‘go away’,

This would be true democratic capitalism where each investor will get to choose what each considers is best for them.


January 22, 2020: Moderator Statement

Everyone made their arguments on this forum in a respectful manner, now we have to vote (informally): support or oppose the “improved Plan”; this will give HarbourEdge enough information to assess the investor intentions.

The way everyone will vote comes down to their confidence in HE management and employees.

For some of us it is hard to believe that somebody can still have faith in the team that drove us in the abyss and destroyed part of our investment, parking it in illiquid assets that are hard or impossible to sell. And it is even harder to comprehend how HE asks us to support the "improved Plan" that is nothing than a Plan without a plan: not a single word about the timeline of selling the HRAC properties (anything between now and 50 years?), no rules for distributing the proceeds from selling properties to the shareholders (are the proceeds distributed or used for maintenance/construction/development?).
The lack of real estate properties disposition plan affects dramatically the most vulnerable category, the older investors that are running out of time. These investors need a clear exit path in short term, not just vague promises that could take more years than they have left.
This category has the legal option of oppression remedy that protects minorities in situations where oppressive conduct violates the reasonable expectations of that minority. Please, send me a message if you are interested to be part of the investor group filing for legal action.

And yet, some of our fellow investors have faith in HE; none of the arguments made on these forum shattered their confidence in HE directors / team. We respect their opinion as they are respecting ours.

The time came to let the ball rolling, to stop making arguments and VOTE 

Good luck to ALL


January 21,2020

HarbourEdge did it again: is trying to sell us a Plan without a Plan! 

It gives us a glimpse of the redemptions from the mortgage maturities, but there is not a single word about selling the HRAC properties or the timeline (anything between now and 50 years?).
Did they just call the Plan without a plan the "improved Plan" and ask us for support?  

January 19, 2020

As Shareholders, we all have an ownership interest in HarbourEdge, hence we all want the best solution to solve the fund problems in a way that considers and aligns the interests of All Shareholders and provides a clear and fair solution for each shareholder; here it is Alternative Solution to the Plan of Arrangement

January 18, 2020

While waiting for a detailed update to ALL investors that HE promised to deliver by no later than Tuesday January 21st, this is a Must Read

January 16, 2020[/font]

1. Update from our fellow investor, Robert G. Mitchell

Fellow Investors:
There have been questions on the lack of communication with investors since the Vote was adjourned on November 22.
A small group of 6 investors did meet with management in Toronto at a neutral location on November 28 and we have been negotiating around what was discussed at the meeting since that time.
Right or wrong, I agreed to a moratorium on communicating with investors until we achieved some mutual understanding. After several attempts we are still not there and one of the major obstacles is that HarbourEdge has not provided us with information we consider critical to understanding where the fund stands and the implications of their proposals.
I apologize for this long pause in communicating with you but I think I can share with you the information we have requested from Harbour Edge in emails dated December 20, again on January 6 and a third time on January 13:
Information Requirements:

• The schedule of mortgage maturities you provided is based on contractual maturities and does not reflect extensions and additions. Please provide data on experience-based expected repayment dates as requested to substantiate your projections of redemptions
• Please also show a schedule of cash flow from mortgage repayments over the last 4 years and separately for cash flow from property sales
• We are asking again for the sum of commitment fees paid to Harbour Edge and a detailed list of all defaulted loans where the commitment fee was not collected from the borrower
• Please add to the spreadsheet for the HRAC properties columns showing the debt owed by the borrower to HMIC at the time HMIC or HRAC took possession of the property and the value each property was recorded on the HRAC balance sheet at the time of foreclosure . We must know the amount of capital invested in each property
• Over the 2 months between April 30, 2019 and June 2019 two properties were revalued upward by an amount more than sufficient to offset 7 properties that were marked down in value. The two properties in question are Perth and the Minas NS property. The notes to the audited statements say that “assets are carried at the lower of cost and NAV”. Please explain how the upward revaluations of these properties can be justified?
• It seems that you are capitalizing “carrying/developments costs”: $5.3 million between June 2018 and April 2019 and a further $3.5 million between April 2019 and June 30 2019. Please explain how a dollar spent on carrying and development automatically increases the value to the property by a dollar?
• Management has frequently made claims that they have significant capital invested in the fund. After studying the shareholder list carefully we can find only small amounts of capital invested by the Dwyer and Turbitt families though the Dunns, Prests and Harrops are invested. In fact it is our observation that one of our investors, Dave Hyma, has more invested than the combined management group. Please show us where we may be mistaken in our reading of the shareholder list. In our experience in these kind of funds management typically is invested to the extent of 5% to 10% of the capital.

In the same December 20 note we tabled these four points:

• No further commitments to real estate construction or site plan approvals beyond those already underway (Brockville, Kentville, Kingston Dome, Moncton Midrise 2, Sudbury, Perth) and future expenditures to be subject to approval
• Need proformas now for Moncton Midrise 3 and all other properties in Category 4 before we can sign off on a plan
• Harbour Edge to cease spending investor money on lawyers fighting against the investors. Harbour Edge must pay its own legal fees and please advise how much you have spent to date
• Harbour Edge to advise investors of a succession plan to replace Larry and Tim in next communication and reasons for this plan.

In the meantime, while we continue to wait for the requested information and updated financials (unaudited) to December 31, ongoing investor communications are taking place in the HarbourEdge Investors’ Forum. If you have not registered and visited the forum, I encourage you to do so now. The address is: InvestorsHarbourEdge Forum

2. Take immediate action if you believe that HMIC shares do not meet your suitability requirements

First, send a priority formal request - letter or email -  to HE Directors letting them know that you believe the HMIC shares do not meet your suitability requirements and you want your KYC (Know Your Client) redone
The most powerful protection we have as investors is provided by suitability requirements. According to the Canadian Securities Administrators (CSA) your KYC should include your age, objectives financial assets, liquidity needs, time horizon and risk tolerance and should be updated regularly. HE should also update its own KYP (Know Your Product) as their investment product changed and it is now high risk, low dividend, diversified for growth in real estate development, locking-up investors’ funds indefinitely. The most basic suitability test is that KYC and KYP match, i.e. a High risk investment is not suitable for an investor with Medium or Low risk tolerance.
Many fellow investors did not have a proper suitability test done when they purchased the investment or they feel the HE investment is not suitable for them anymore or even has devastating effects on their life.

Today worried posted an action plan for those concerned by the suitability of HE investment for their needs investorsharbouredge.freeforums.net/post/200