A US company with which I have an affiliation (I'm not an employee; I don't think the specifics of our relationship are relevant here) is preparing an IPO and there is a directed share program for a group of people that includes me. The prospectus includes this:

The Class A common stock may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations.

Searching for that just produces all kinds of other prospectuses. So, what's the deal? How can I be an "accredited investor"? Do I just assert something? Fill out a form? Time is of the essence here, I have a matter of days to be part of this.

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    I assume this is for Canada? In the US there are income and/or net worth requirements, probably a similar case for Canada. – lmn123 May 7 '18 at 20:13
  • Yes, it's for Canada, that's why I tagged it as such – Kate Gregory May 7 '18 at 20:13

In short, they should have a form in which you will indicate your qualifications as an accredited investor.

The most common qualifications are a net worth of $1 million or $200K income for the last two years ($300K if you are married). You select the criterion under which you qualify and sign the contract when you purchase the securities.

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    These are the Canadian requirements? – Kate Gregory May 7 '18 at 20:47
  • It is an IPO. The IPO prospectus includes the directed share program so that 5% of the shares goes to the group. – Kate Gregory May 7 '18 at 20:52
  • I can't speak authoritatively about what they might do to verify that you are an accredited investor in Canada. In the US, it's pretty hands off. If you indicate you are, they don't bother too closely with follow-up questions. – NL - Apologize to Monica May 7 '18 at 20:57
  • Back in the day for IPOs, I was an accredited U.S. investor long before I was one ;->) . I provided the information verbally and no one asked for proof. I don't know if they are more diligent with verification now. – Bob Baerker May 7 '18 at 21:35
  • From the footnotes of the Wikipedia article, this may be of interest, if the province is applicable: business.financialpost.com/personal-finance/managing-wealth/… – Chris W. Rea May 7 '18 at 23:54

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