As filed with the Securities and Exchange Commission on June 19, 2018
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Mogo Finance Technology Inc.
(Exact name of registrant as specified in its charter)
| British Columbia | Not applicable | |
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(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.)
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2100-401 West Georgia St. Vancouver, British Columbia Canada |
V6B 5A1 | |
| (Address of Principal Executive Offices) | (Zip Code) | |
Stock Option Plan
Restricted Share Unit Plan
(Full title of the plan)
C T Corporation System
111 Eighth Avenue
New York, NY 10011
(Name and address of agent for service)
(212) 894-8800
(Telephone number, including area code, of agent for service)
Copy to:
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Gregory Feller Mogo Finance Technology Inc. 2100-401 West Georgia St. Vancouver, British Columbia V6B 5A1, Canada (604) 659-4380 |
Thomas M. Rose Troutman Sanders LLP 401 9 th Street, NW Suite 1000 Washington, DC 20004 (757) 687-7715
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
CALCULATION OF REGISTRATION FEE
|
Title of securities
to be registered (1)
|
Amount to be
registered (2) |
Proposed
maximum offering price per share |
Proposed
maximum
aggregate offering price |
Amount of
registration fee |
| Common shares, no par value | 4,300,000 shares | $3.08 (3) | $13,244,000 | $1,649 |
| (1) | Common shares, no par value, offered by Mogo Finance Technology Inc. (the “ Registrant ”), with (i) 3,800,000 common shares offered pursuant to its Stock Option Plan (effective November 15, 2013, as amended) (the “ Stock Option Plan ”) and (ii) 500,000 common shares offered pursuant to its Restricted Share Unit Plan (effective June 25, 2015, as amended) (the “ RSU Plan ”). |
| (2) | Pursuant to Rule 416(a) under the Securities Act of 1933, as amended (the “ Securities Act ”), this registration statement also covers an indeterminate number of additional shares that may be offered and issued to prevent dilution resulting from stock splits, stock dividends or similar transactions as provided in the Stock Option Plan and the RSU Plan. |
| (3) | Calculated in accordance with Rule 457(c) and (h) based on the average of the high and low prices for the Registrant’s common shares reported on The Nasdaq Stock Market LLC on June 14, 2018, which was US$3.08 per share. |
| PART I. | INFORMATION REQUIRED IN THE SECTION 10( a) PROSPECTUS |
| Item 1. | Plan Information.* |
| Item 2. | Registrant Information and Employee Plan Annual Information.* |
* The information required by Part I to be contained in the Section 10(a) prospectus is omitted from this registration statement in accordance with the Note to Part I of Form S-8 and Rule 428, and will be sent or given to participants as specified by Rule 428(b)(1) under the Securities Act.
| PAR T II. | INFORMATION REQUIRED IN THE REGISTRATION STATEMENT |
| Item 3. | Incorporation of Documents by Reference. |
The following documents, which have been filed with the Commission, are incorporated herein by reference:
| (a) | The Registrant’s Registration Statement on Form 40-F filed with the Commission on March 2, 2018, and amended on March 8, 2018 and April 11, 2018 (File No. 001-38409). |
| (b) | All other reports filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), since the end of the fiscal year covered by the Registration Statement on Form 40-F filed with the Commission on March 2, 2018, and amended on March 8, 2018 and April 11, 2018, incorporated by reference herein pursuant to (a) above. |
| (c) | The description of the Registrant’s common shares contained in the Registration Statement on Form 40-F filed with the Commission on March 2, 2018, and amended on March 8, 2018 and April 11, 2018, incorporated by reference herein pursuant to (a) above, including any amendment or report filed for the purposes of updating such description. |
In addition, unless otherwise stated herein, all documents subsequently filed with the Commission by the Registrant pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the filing of a post-effective amendment to this registration statement which indicates that all securities offered hereby have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part hereof from the date of filing of such documents. In addition, any report furnished by the Registrant on Form 6-K shall be deemed to be incorporated by reference in the registration statement if and to the extent that such report on Form 6-K so provides.
Any statement contained in a document incorporated or deemed to be incorporated by reference or deemed to be part of the registration statement shall be deemed to be modified or superseded for purposes of the registration statement to the extent that a statement contained in the registration statement or in any other subsequently filed document that also is, or is deemed to be, incorporated by reference or deemed to be part of the registration statement modifies or replaces such statement. Any statement contained in a document that is deemed to be incorporated by reference or deemed to be part of the registration statement after the most recent effective date may modify or replace existing statements contained in the registration statement. Any such statement so modified or replaced shall not be deemed, except as so modified or replaced, to constitute a part of the registration statement.
| Item 4. | Description of Securities. |
Not applicable.
| Item 5. | Interests of Named Experts and Counsel. |
None.
| Item 6. | Indemnification of Directors and Officers. |
Section 160 of the Business Corporations Act (British Columbia) (the “ BCBCA ”) authorizes a company to indemnify past and present directors and officers of the company and past and present directors and officers of a corporation of which the company is or was a shareholder, against liabilities incurred in connection with the provision of their services as such if the director or officer acted honestly and in good faith with a view to the best interests of the company and, in the case of a criminal or administrative proceeding, if he or she had reasonable grounds for believing that his or her conduct was lawful. Section 165 of the BCBCA provides that a company may purchase and maintain liability insurance for the benefit of such directors and officers.
Under the Registrant’s articles and subject to the provisions of the BCBCA, the Registrant shall indemnify a director, former director or alternate director of the Registrant and his or her heirs and legal personal representatives against all judgments, penalties or fines awarded or imposed in, or an amount paid in settlement of, a legal proceeding or investigative action, whether current, threatened, pending or completed, in which such director, former director or alternate director of the Registrant, or any of his or her heirs and legal personal representatives, by reason of having been a director or alternate director of the Registrant, is or may be joined as a party, or is or may be liable for or in respect of a judgment, penalty or fine in, or expenses related to, the proceeding.
Under the Registrant’s articles and subject to any restrictions in the BCBCA, the Registrant may indemnify any other person, including the officers, former officers and alternate officers of the Registrant.
A policy of directors’ and officers’ liability insurance is maintained by the Registrant which insures directors and officers against losses incurred as a result of claims against the directors and officers of the Registrant in the indemnity provisions under the articles and the BCBCA.
Insofar as the indemnification for liabilities arising under the United States Securities Act of 1933, as amended (the “ Securities Act ”), may be permitted to directors, officers or persons controlling the Registrant pursuant to the foregoing provisions, the Registrant has been informed that in the opinion of the United States Securities and Exchange Commission (the “ SEC ”), such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
| Item 7. | Exemption from Registration Claimed. |
Not Applicable.
| Item 8. | Exhibits |
The following exhibits are filed as part of this registration statement:
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in the volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Vancouver, Province of British Columbia, Canada, on June 19, 2018.
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MOGO FINANCE TECHNOLOGY INC. |
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| (Registrant) | |||
| By: | /s/ David Feller | ||
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David Feller Chief Executive Officer |
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KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints David Feller and Gregory Feller, and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments to the registration statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all said attorneys-in-fact and agents of them or their substitute or substitutes, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities indicated on June 19, 2018.
| Signature |
Title |
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/s/ David Feller
David Feller
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Chief Executive Officer, Chair and Director (Principal Executive Officer) |
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/s/ Gregory Feller
Gregory Feller
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President, Chief Financial Officer and Director (Principal Financial and Accounting Officer) |
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Minhas Mohamed
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Director | |
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/s/ Matthew Bosrock
Matthew Bosrock
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Director
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/s/ Praveen Varshney
Praveen Varshney
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Director | |
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Thomas Liston
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Director
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AUTHORIZED REPRESENTATIVE
Pursuant to the requirements of Section 6(a) of the Securities Act of 1933, as amended, the undersigned has signed this registration statement, solely in the capacity of the duly authorized representative of Mogo Finance Technology Inc. in the United States, on June 19, 2018.
| /s/ Gregory Feller | |||
| Name: | Gregory Feller | ||
| Title: | President and Chief Financial Officer | ||
Exhibit 4.1
AMENDED STOCK OPTION PLAN
MOGO FINANCE TECHNOLOGY INC.
| 1. | Purpose |
The purpose of the stock option plan (the “ Plan ”) is to advance the interests of Mogo Finance Technology Inc. (the “ Corporation ”) and its shareholders by providing to the directors, officers, employees and consultants of the Corporation and its affiliates a performance incentive for continued and improved services with the Corporation and its affiliates. The terms of the Plan shall govern each option issued hereunder.
| 2. | Term of Plan |
The Plan is effective on November 15, 2013. Options may be granted under the Plan until the earlier of (i) the 10 th anniversary of the effective date of the Plan, or (ii) the date on which the Board terminates the Plan.
| 3. | Shares |
| (a) | The shares (“ Shares ”) that may be issued pursuant to the exercise of options (“ Options ”) granted under the Plan are common shares (the “ Common Shares ”) of the Corporation. |
| (b) | The aggregate number of Shares reserved for issuance under the Plan shall not exceed the greater of (i) 15% of the issued and outstanding Common Shares of the Corporation as at the date of grant (on a non-diluted basis), and (ii) 3,800,000. Any issuance of Shares from treasury pursuant to the exercise of Options shall automatically replenish the number of Shares available for Option grants under the Plan. No Option may be granted if such grant would have the effect of causing the total number of Shares subject to Options to exceed the above-noted total percentage of Shares reserved for issuance pursuant to the exercise of Options. |
| (c) | Subject to the rules of the Toronto Stock Exchange (the “ TSX ”), if Options granted under this Plan expire, terminate or cease to be exercisable without having been exercised in full, the Shares which were reserved for issue pursuant to such Options but which were not issued become available for issue pursuant to the exercise of other Options under the Plan. |
| 4. | Administration |
| (a) | The Plan shall be administered by the board of directors of the Corporation (the “ Board ”) or any committee of directors of the Corporation designated by the Board (such designated directors being the “ Administrators ”). The Board or the Administrators, as the case may be, shall have full and complete authority to interpret the Plan and to prescribe such rules and regulations and make such other determinations as it or they deem necessary or desirable for the administration of the Plan, including without limitation the full power and authority to: |
| (i) | adopt rules and regulations for implementing the Plan; |
| (ii) | determine the eligibility of persons to participate in the Plan, the number of Shares subject to Options, the fair market value of such Shares, and the vesting period of the Options; |
| (iii) | determine when Options shall be granted, which eligible persons will be granted Options, the number of Shares subject to each Option granted to a Participant and the vesting for each Option; |
| (iv) | interpret and construe the provisions of the Plan; |
| (v) | restrict or limit the Shares and the nature of such restrictions and limitations, if any; |
| (vi) | accelerate the exercisability or waive the termination of any Options, based on such factors as the Board or the Administrators may determine; |
| (vii) | make exceptions to the Plan in circumstances which it or they determine to be exceptional; and |
| (viii) | take such other steps as it or they determine to be necessary or desirable to give effect to the Plan. |
| (b) | Decisions of the Board or the Administrators shall be recorded in writing and shall be binding on the Corporation and on all persons eligible to participate in the Plan. |
| (c) | The Board or the Administrators may make changes to the terms of any granted Options or the Plan to the extent necessary or desirable to comply with any rules, regulations or policies of the TSX, provided that the value of previously granted Options and the rights of Participants are not materially adversely affected by any such changes. |
| (d) | The Board or the Administrators may also require that any participant in the Plan provide certain representations, warranties and certifications to the Corporation to satisfy the requirements of applicable securities laws, including without limitation exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “ U.S. Securities Act ”), and applicable state securities laws. |
| 5. | Granting of Options to Participants |
The only persons to whom Options may be granted (“ Participants ”) shall be directors, officers, employees and consultants (as that term is defined in National Instrument 45-106) of the Corporation or its subsidiaries designated from time to time by the Board or the Administrators.
The Board or the Administrators may, from time to time, subject to the provisions of this Plan and such other terms and conditions as the Board or the Administrators may prescribe, grant Options to any Participant.
Notwithstanding the foregoing, the number of Common Shares:
| (a) | issued to Insiders of the Corporation within any one year period, and |
| (b) | issuable to Insiders of the Corporation, at any time, |
under the Plan, when combined with all of the Corporation’s other security-based compensation arrangements, must not exceed 10% of the Corporation’s total issued and outstanding Common Shares as at the applicable date of grant. For the purposes of this Plan the term “ Insider ” shall have the meaning given to such term in the TSX Company Manual.
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| 6. | Exercise Price |
Subject to the rules of the TSX, the Board or the Administrators shall determine the exercise price (the “ Exercise Price ”) for an Option but in any event the Exercise Price will be no less than the last closing price of the Shares on the TSX prior to the date of grant of such Option.
| 7. | Term and Vesting |
| (a) | Subject to any accelerated termination under this Plan, unless otherwise determined by the Board or Administrators at the time of grant, each Option shall be exercisable until the eighth anniversary of the date on which it is granted. Each Option that has not been exercised pursuant thereto on or before the close of business on its date of expiry shall forthwith expire and terminate and be of no further force or effect whatsoever. |
| (b) | Unless otherwise specified by the Board at the time of granting Options or subsequent to such grant, and except as otherwise provided in this Plan, each Option will vest and be exercisable as follows: |
| (c) | Once a portion of an Option that has vested becomes exercisable, it remains exercisable until expiration or termination of the Option, unless otherwise specified by the Board in connection with the grant of such Option or pursuant to Section 16. Each Option or portion of an Option that has vested may be exercised at any time or from time to time, in whole or in part, for up to the total number of Shares with respect to which it is then exercisable. The Board or the Administrators has/have the right to accelerate the date upon which any portion of an Option that has vested becomes exercisable. |
| (d) | In the event that the expiry date of any Option occurs during, or within ten (10) business days following, a period when the Participant is prohibited by the blackout policies of the Corporation or the TSX from trading in Common Shares (a “ Blackout Period ”), the expiry date of the Option shall be automatically extended to the date which is ten (10) business days immediately following the end of the Blackout Period. |
| 8. | Termination of Employment |
Unless otherwise specified by the Board at the time of granting Options:
| (a) | If, at any time, a Participant ceases to be a full-time employee of the Corporation or a subsidiary as a result of the Participant’s retirement, either with the concurrence of the Board or the Administrators at any time or after the person reaches the age of 65 years, any Options granted to such Participant and vested as of the Termination Date (as defined below) shall remain exercisable by such Participant until the earlier of: (i) 90 days following the Termination Date, and (ii) the expiration of such vested Options in accordance with their terms. As of the Termination Date, all unvested Options of such Participant shall expire and such Participant shall no longer be eligible for a grant of Options. |
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| (b) | If, at any time, a Participant ceases to be a full-time employee of the Corporation or a subsidiary as a result of the Participant’s death or physical or psychological Incapacity (as defined directly below), any Options granted to such Participant and vested as of the Termination Date shall remain exercisable by such Participant (or, in accordance with clause 14(b)(ii), the Participant’s legal representative) until the earlier of: (i) 120 days following the date of death or the date on which the Board or the Administrators determine(s) that the Incapacity will prevent the employee from fulfilling his or her full-time duties with the Corporation, and (ii) the expiration of such vested Options in accordance with their terms. As of the Termination Date, all unvested Options of such Participant shall expire. “Incapacity” means the permanent and total incapacity of a Participant as determined in accordance with procedures established by the Board or the Administrators for purposes of this Plan. |
| (c) | If, at any time, a Participant ceases to be a full-time employee of the Corporation or a subsidiary as a result of the Participant’s termination for cause, then, as of the Termination Date, the vested and unvested Options granted to such Participant shall expire and be of no further force or effect whatsoever and such Participant shall no longer be eligible for a grant of Options. |
| (d) | If, at any time, a Participant ceases to be a full-time employee of the Corporation or a subsidiary as a result of the Participant’s resignation, then any Options granted to such Participant and vested as of the Termination Date shall remain exercisable by such Participant until the earlier of: (i) 30 days following the Termination Date, and (ii) the expiration of such Vested Options in accordance with their terms. As of the Termination Date, all unvested Options granted to such Participant shall expire and be of no further force or effect whatsoever and such Participant shall no longer be eligible for a grant of Options. |
| (e) | If, at any time, a Participant ceases to be a full-time employee of the Corporation or a subsidiary as a result of the Participant’s dismissal without cause, any Options granted to such Participant and vested as of the Termination Date shall remain exercisable by such Participant until the earlier of: (i) 90 days following the Termination Date, and (ii) the expiration of such vested Options in accordance with their terms. As of the Termination Date, all unvested Options of such Participant shall expire and such Participant shall no longer be eligible for a grant of Options. |
| (f) | Where, in the case of a consultant, the Participant’s consulting agreement or arrangement terminates by reason of: (i) termination by the Corporation or an affiliated corporation for any reason whatsoever other than for material breach of the consulting agreement or arrangement (whether or not such termination is effected in compliance with any termination provisions contained in the Participant’s consulting agreement or arrangement); or (ii) voluntary termination by the Participant; or (iii) the death or incapacity of the Participant, then any Options held by the Participant that are exercisable at the Termination Date, or at the date of the death or incapacity of the Participant, as the case may be, continue to be exercisable by the Participant until the earlier of: (A) the date that is 90 days from the Termination Date, or from the date of the death or incapacity of the Participant, as the case may be; and (B) the date on which the particular Options expire in accordance with their terms. Any Options held by the Participant that are not exercisable at the Termination Date, or at the date of the death or incapacity of the Participant, as the case may be, immediately expire and are cancelled on such date. |
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| (g) | Where, in the case of a consultant, the Participant’s consulting agreement or arrangement is terminated by the Corporation or an affiliated corporation for material breach of the consulting agreement or arrangement (whether or not such termination is effected in compliance with any termination provisions contained in the Participant’s consulting agreement or arrangement), then any Options held by the Participant, whether or not such Options are exercisable at the Termination Date, immediately expire and are cancelled on the Termination Date at a time determined by the Board, in its discretion. |
| (h) | If, at any time, a Participant ceases to be a director or officer of the Corporation or a subsidiary (and is not or does not continue as a full-time employee of the Corporation or a subsidiary), the Options granted to such Participant and vested as of the Termination Date may be exercised by such Participant until the earlier of: (i) 90 days following the Termination Date, and (ii) the expiration of such vested Options in accordance with their terms. As of the Termination Date, all unvested Options granted to such Participant shall cease and terminate and be of no further force or effect whatsoever. |
| (i) | Notwithstanding any other provisions of this Section 8 but subject to the rules of the TSX, the Board or the Administrators may extend the expiration date of vested and unvested Options of a Participant who ceases to be a full-time employee, consultant, officer or director of the Corporation or a subsidiary beyond the expiry dates set out above, provided that such extended dates are not later than the assigned expiry date of any such Option. |
“ Termination Date ” means:
| (i) | in the case of a Participant whose employment or term of office with the Corporation or a subsidiary terminates in the circumstances set out in Section 8, the date that is designated by the Corporation or a subsidiary, as the case may be, as the last day of the Participant’s active employment or term of office with the Corporation or a subsidiary, as the case may be, provided that in the case of termination of employment by voluntary resignation by the Participant, such date shall not be earlier than the date notice of resignation was given, and “Termination Date” specifically does not mean the date on which any period of non-working reasonable notice that the Corporation or a subsidiary, as the case may be, may be required at law to provide to the Participant, would expire; and |
| (ii) | in the case of a Participant who is a consultant and whose consulting agreement or arrangement with the Corporation or a subsidiary, as the case may be, terminates in the circumstances set out in Section 8, the date that is designated by the Corporation or a subsidiary, as the case may be, as the date on which the Participant’s consulting agreement or arrangement is terminated, provided that in the case of voluntary termination by the Participant, such date shall not be earlier than the date notice of voluntary termination was received by the Corporation, and “Termination Date” specifically does not mean the date on which any non-working period of notice of termination that the Corporation or a subsidiary, as the case may be, may be required to provide to the Participant under the terms of the consulting agreement or arrangement, would expire. |
| 9. | Stock Option Plan Agreement |
The Corporation shall enter into an agreement with each Participant on the date of grant of Options substantially in the form of Schedule 1 (or such other form as may be acceptable to the Board or the Administrators) evidencing the Participant’s right to acquire Shares in accordance with the Plan. Each agreement will specify the number of Shares that are subject to the Options and will provide for the adjustment of that number in accordance with Section 15. The Participant acknowledges that such agreement will include a provision that, in certain circumstances as set out in the agreement, will require the Participant to sell its Shares to a party making an offer to purchase all of the Shares of the Corporation.
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| 10. | Right to Employment |
Nothing contained in this Plan or in any Option granted under this Plan shall confer upon any person any right to continued employment with the Corporation or a subsidiary or interfere in any way with the rights of the Corporation or a subsidiary in connection with the employment or termination of any such person.
| 11. | Status as Shareholder |
The Participant or the Participant’s legal representative shall not, by reason of the grant of any Option, be considered to be a stockholder of the Corporation until an Option has been duly exercised. No person shall enjoy any of the rights or privileges of a holder of Shares subject to Options until that person becomes the holder of record of those Shares.
| 12. | Exercise of Option |
| (a) | Subject to Subsection 12(b), the vested portion of an Option may be exercised at any time, or from time to time, during its term. A person electing to exercise an Option shall give written notice of the election to the Secretary of the Corporation substantially in the form of Exhibit A to Schedule 1 , or such other form acceptable to the Board or the Administrators. A cash payment equal to the Exercise Price for each Share to be acquired pursuant to the exercise of Options shall accompany the written notice. |
| (b) | The exercise of any Option shall be subject to the condition that if at any time the Corporation shall determine in its sole discretion that it is necessary or desirable to comply with any legal requirement or the requirements of the TSX or other regulatory authority as a condition of, or in connection with, such exercise or the issue of Shares as a result thereof, then in any such event such exercise shall not be effective unless such compliance shall have been effected on conditions satisfactory to the Corporation. |
| (c) | Upon actual receipt by the Corporation of written notice addressed to the Secretary of the Corporation and payment for the Shares to be purchased, the person exercising the Option shall be registered in the books of the Corporation as the holder of the appropriate number of Shares and a share certificate shall be issued to such person. |
| (d) | The exercise of any Option may be made conditional on the Participant becoming a party to an escrow agreement as required by the rules of the TSX and will otherwise be subject to the rules of the TSX. |
| (e) | Any exercise of an Option issued pursuant to the Plan must be exempt or not subject to registration under applicable United States federal and state securities laws. Any Options exercised by or on behalf of a person in the United States (as such term is defined in Regulation S promulgated under the U.S. Securities Act) will result in the certificate representing the Common Shares bearing a United States restrictive legend restricting transfer of the Common Shares under United States federal and state securities laws, in substantially the following form: |
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“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE CORPORATION THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE CORPORATION; (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT; (C) IN ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION PROVIDED BY (1) RULE 144 OF THE U.S. SECURITIES ACT, IF AVAILABLE, OR (2) RULE 144a THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS; OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS, AND, IN THE CASE OF PARAGRAPH (C)(1) OR (D), THE SELLER FURNISHES TO THE CORPORATION AN OPINION OF COUNSEL OF RECOGNIZED STANDING IN FORM AND SUBSTANCE OR OTHER EVIDENCE SATISFACTORY TO THE CORPORATION TO SUCH EFFECT. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE GOOD DELIVERY IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”
| 13. | Intentionally Left Blank |
| 14. | Transferability |
| (a) | Except as set forth in Subsection 14(b), Options are not transferable. |
| (b) | Options may be exercised only by: |
| (i) | the Participant to whom the Options were granted; or |
| (ii) | (A) | upon the Participant’s death, by the legal representative of the Participant’s estate; or |
| (B) | upon the Participant becoming mentally incapable, the legal representative having authority to deal with the property of the Participant; |
provided that any such legal representative shall first deliver evidence satisfactory to the Corporation of entitlement to exercise any Option.
| (c) | A person exercising an Option may subscribe for Shares only in the person’s own name or in the person’s capacity as a legal representative. |
| 15. | Adjustment of Options |
| (a) | The existence of any Options does not affect in any way the right or power of the Corporation or its shareholders to make, authorize or determine any adjustment, recapitalization, reorganization or any other change in the Corporation’s capital structure or its business, or any amalgamation, combination, merger or consolidation involving the Corporation, to create or issue any bonds, debentures, shares or other securities of the Corporation or to determine the rights and conditions attaching thereto, to effect the dissolution or liquidation of the Corporation or any sale or transfer of all or any part of its assets or business, or to effect any other corporate act or proceeding, whether of a similar character or otherwise, whether or not any such action referred to in this section would have an adverse effect on this Plan or any Option granted hereunder. |
| (b) | In the event of any subdivision, redivision or other similar change in the Shares at any time prior to the termination of an Option into a greater number of Shares, the Corporation shall deliver at the time of any exercise thereafter of an Option such additional number of Shares as would have resulted from such subdivision, redivision or change if such exercise of an Option had taken place prior to the date of such subdivision, redivision or change and the Exercise Price for such Shares shall be adjusted accordingly. |
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| (c) | In the event of any merger, consolidation, recapitalization or other similar corporate change affecting the Shares at any time prior to the termination of an Option, the Board shall make such adjustments as each deems equitable to the number and kind of shares or other property to be delivered by the Corporation on any exercise thereafter of an Option, the Exercise Price of an Option and any other term of the Option as it deems necessary to prevent the dilution or enlargement of the rights of Participants thereunder. |
| (d) | No fractional Shares shall be issued upon the exercise of an Option. If, as a result of any adjustment under this Section 15 a Participant would be entitled to a fractional Share, the Participant shall have the right to acquire only the adjusted number of full Shares and no payment or other adjustment shall be made with respect to the fractional Shares so disregarded. |
| 16. | Change in Control |
| (a) | Notwithstanding anything else in this Plan or any Stock Option Plan Agreement, the Board has the right to provide for the conversion or exchange of any outstanding Options into or for options, rights or other securities in any entity participating in or resulting from a Change in Control (as defined below). |
| (b) | Upon the Corporation entering into a binding agreement relating to a transaction which, if completed, would result in a Change in Control, the Corporation shall give written notice of the proposed Change in Control to the Participants, together with a description of the effect of such Change in Control on outstanding Options, not less than 10 days prior to the closing of the transaction resulting in the Change in Control. |
| (c) | In the event of and in connection with a transaction that would constitute a Change in Control, notwithstanding anything else in this Plan but subject to the specific terms of any Stock Option Plan Agreement to the contrary, the Board shall have the right, in its discretion, to deal with any or all Options (or any portion thereof) issued under this Plan in the manner it deems fair and reasonable in the circumstances of the Change in Control. Without limiting the generality of the foregoing, in connection with a Change in Control, the Board, without any action or consent required on the part of any Participant, shall have the right to: |
| (i) | determine that the Options, in whole or in part and whether vested or unvested, shall remain in full force and effect in accordance with their terms after the Change in Control; |
| (ii) | provide for the conversion or exchange of any or all Options (or any portion thereof, whether vested or unvested) into or for options, rights or other securities in any entity participating in or resulting from a Change in Control; |
| (iii) | cancel any unvested Options (or any portions thereof) without payment of any kind to any Participant; |
| (iv) | accelerate the vesting of outstanding Options; |
| (v) | provide for outstanding Options to be purchased; |
| 8 |
| (vi) | accelerate the date by which any or all Options or any portion thereof, whether vested or unvested, must be exercised either in whole or in part; |
| (vii) | deem any or all Options or any portion thereof, whether vested or unvested (including those accelerated pursuant to this Plan) to have been exercised in whole or in part, tender, on behalf of the Participant, the underlying Shares that would have been issued pursuant to the exercise of such Options to any third party purchaser in connection with the Change in Control, and pay to the Participant on behalf of such third party purchaser an amount per underlying Share equal to the positive difference between the Change in Control price of the Shares and the applicable Exercise Price; |
| (viii) | cancel any or all outstanding Options (including those accelerated under pursuant to this Plan) either in whole or in part and pay to the Participant an amount per underlying Share equal to the positive difference between the Change in Control price of the Shares and the applicable Exercise Price; or |
| (ix) | take such other actions, and combinations of the foregoing actions or any other actions permitted under this Section 16(c), as it deems fair and reasonable under the circumstances. |
| (d) | For purposes of this Agreement, a “Change in Control” means the happening of any of the following events: (i) any transaction pursuant to which (A) the Corporation goes out of existence, or (B) any person, or any associate or affiliated corporation of such person (as those terms are defined in the Business Corporations Act (British Columbia) (the “BCBCA” )), (other than the Corporation, a subsidiary of the Corporation or an employee benefit plan of the Corporation (including any trustee of such plan acting as trustee)) hereafter acquires the direct or indirect “beneficial ownership” (as defined in the BCBCA) of securities of the Corporation representing 50% or more of the aggregate voting power of all of the Corporation’s then issued and outstanding securities; (ii) the sale of all or substantially all of the Corporation’s assets to a person other than a person that was an affiliated corporation of the Corporation; (iii) the dissolution or liquidation of the Corporation except in connection with the distribution of assets of the Corporation to one or more persons which were affiliated corporations prior to such event; or (iv) the occurrence of a transaction requiring approval of the Corporation’s shareholders involving the acquisition of the Corporation by an entity through purchase of assets, by amalgamation or otherwise. |
| 17. | Alterations in Plan |
| (a) | Subject to Section 17(b), the Board or the Administrators may at any time or from time to time without shareholder approval alter, amend, vary, suspend, terminate or cancel the Plan or amend any Options issued pursuant to the Plan. The foregoing ability to alter, amend, vary, suspend, terminate or cancel the Plan or amend ay Options issued pursuant to the Plan shall be subject to the rules of the TSX. |
| (b) | Subject to any additional requirements of the rules of the TSX, the following amendments to the Plan or to Options issued pursuant to the Plan shall not be made without prior approval of the TSX and approval of the shareholders of the Corporation: |
| i) | a reduction in the Exercise Price of an Option held by an Insider of the Corporation; |
| ii) | an extension of the term of an Option held by an Insider of the Corporation; |
| iii) | any amendment to remove the Insider participation limits set out in Section 5; |
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| iv) | an increase in the maximum number of Common Shares issuable pursuant to Options granted under this Plan; and |
| v) | amendments to this Section 17. |
| 18. | Termination of Plan |
The Board may terminate the Plan at any time in its discretion. If the Plan is so terminated, no further Options shall be granted but the Options then outstanding shall continue in full force and effect in accordance with the provisions set out above.
| 19. | Compliance with Statutes and Regulations |
The granting of Options and the sale of Shares under the Plan shall be carried out in compliance with applicable statutes and with the regulations of governmental authorities.
| 20. | Participant’s Entitlement |
Except as otherwise provided in this Plan, Options previously granted under this Plan, whether or not then exercisable, are not affected by any change in the relationship between, or ownership of, the Corporation and an affiliated corporation. For greater certainty, all Options remain valid and exercisable in accordance with the terms and conditions of this Plan and are not affected by reason only that, at any time, an affiliated corporation ceases to be an affiliated corporation.
| 21. | Withholding Taxes |
The exercise of each Option granted under this Plan is subject to the condition that if at any time the Corporation determines, in its discretion, that the satisfaction of withholding tax or other withholding liabilities is necessary or desirable in respect of such exercise, such exercise is not effective unless such withholding has been effected to the satisfaction of the Corporation. In such circumstances, the Corporation may require that a Participant pay to the Corporation, in addition to and in the same manner as the Exercise Price for the Shares, such amount as the Corporation is obliged to remit to the relevant taxing authority in respect of the exercise of the Option. Any such additional payment is due no later than the date as of which any amount with respect to the Option exercised first becomes includable in the gross income of the Participant for tax purposes.
| 22. | Rights of Participant |
No Participant has any claim or right to be granted an Option (including, without limitation, an Option granted in substitution for any Option that has expired pursuant to the terms of this Plan), and the granting of any Option is not to be construed as giving a Participant a right to remain in the employ of the Corporation or an affiliated corporation. No Participant has any rights as a shareholder of the Corporation in respect of Shares issuable on the exercise of rights to acquire Shares under any Option until the allotment and issuance to the Participant of certificates representing such Shares.
| 23. | Indemnification |
Every Director will at all times be indemnified and saved harmless by the Corporation from and against all costs, charges and expenses whatsoever including any income tax liability arising from any such indemnification, that such Director may sustain or incur by reason of any action, suit or proceeding, taken or threatened against the Director, otherwise than by the Corporation, for or in respect of any act done or omitted by the Director in respect of this Plan, such costs, charges and expenses to include any amount paid to settle such action, suit or proceeding or in satisfaction of any judgement rendered therein. This indemnification is in addition to any rights of indemnification a Director may have under the Articles of the Corporation, any agreement, any vote of shareholders or disinterested directors or otherwise.
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| 24. | Participation in the Plan |
The participation of any Participant in the Plan is entirely voluntary and not obligatory and shall not be interpreted as conferring upon such Participant any rights or privileges other than those rights and privileges expressly provided in the Plan. In particular, participation in the Plan does not constitute a condition of employment nor a commitment on the part of the Corporation to ensure the continued employment of such Participant. The Plan does not provide any guarantee against any loss which may result from fluctuations in the market value of the Shares. The Corporation does not assume responsibility for the income or other tax consequences for the Participants and they are advised to consult with their own tax advisors.
| 25. | Governing Law |
The Plan, and determinations made and actions taken in connection with the Plan, shall be governed by the laws of the Province of British Columbia and the federal laws of Canada and construed in accordance therewith.
| 26. | U.S. Participants |
| (a) | This section shall only apply to a Participant who is a U.S. citizen, U.S. permanent resident or U.S. tax resident or a Participant for whom a benefit under this Plan would otherwise be subject to U.S. taxation under the U.S. Internal Revenue Code of 1986, as amended (the “ U.S. Code ”), and the rulings and regulations in effect thereunder (a “ U.S. Participant ”). |
| (b) | Option awards will be designed and operated in such a manner that they are either exempt from the application of, or comply with, the requirements of Section 409A of the U.S. Internal Revenue Code and the U.S. Treasury Regulations and other U.S. Internal Revenue Service guidance promulgated thereunder as in effect from time to time (“ Section 409A ”) and will be construed and interpreted in accordance with such intent. To the extent that an Option award, or the settlement or deferral thereof, is subject to Section 409A, the Option will be granted, paid, settled or deferred in a manner that will meet the requirements of Section 409A, such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Section 409A. |
| (b) | Options granted hereunder are intended to be treated as nonqualified stock options under the U.S. Code. Notwithstanding Section 3(b), the aggregate number of Shares reserved for issuance under the Plan shall not exceed the greater of (i) 15% of the issued and outstanding Common Shares of the Corporation as at the date of grant (on a non-diluted basis), and (ii) 3,800,000. |
| 27. | United States Securities Laws Matters |
No Options shall be granted in the United States of America, its territories and possessions, any state of the United States and the District of Columbia (the " United States ") and no Common Shares shall be issued in the United States upon exercise of any such Options unless such securities are registered under the U.S. Securities Act and any applicable state securities laws or an exemption from such registration is available. Any Options issued in the United States, and any Common Shares issued upon exercise thereof, will be "restricted securities" (as such term is defined in Rule 144(a)(3) under the U.S. Securities Act). Any certificate or instrument representing Options granted in the United States or Common Shares issued in the United States upon exercise of any such Options pursuant to an exemption from registration under the U.S. Securities Act and applicable state securities laws shall bear the following legend restricting transfer under applicable United States federal and state securities laws:
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“THE SECURITIES REPRESENTED HEREBY [ and for Options, the following will be added: AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF] HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO THE CORPORATION, (B) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND REGULATIONS, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY (1) RULE 144 THEREUNDER, IF AVAILABLE, OR (2) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS, AND, IN CONNECTION WITH ANY TRANSFERS PURSUANT TO (C)(1) OR (D) ABOVE, THE SELLER HAS FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OF RECOGNIZED STANDING OR OTHER EVIDENCE, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE CORPORATION, TO THAT EFFECT. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”
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Schedule 1
MOGO FINANCE TECHNOLOGY INC.
STOCK OPTION PLAN AGREEMENT
NOW THEREFORE this agreement is entered into this [ ] day of [ ], [ ] (the “ Date of Grant ”) between Mogo Finance Technology Inc. (the “ Corporation ”) and _____________________(the “ Participant ”) pursuant to the Stock Option Plan (the “ Plan ”) implemented by the Corporation effective November 15, 2013 as amended to date, a copy of which is annexed hereto.
| 1. | Pursuant to the Plan, the Corporation hereby grants non-assignable, non-transferable options (collectively, the “ Options ”) to acquire _______________ Shares (as defined in the Plan) at an exercise price of $[ ] per Share (the “ Exercise Price ”) and agrees to issue Shares to the Participant in accordance with the terms of the Plan upon the due exercise of the Options. |
| 2. | The Options will vest and be exercisable as follows: |
|
Fraction of Total Number of
Shares that may be Purchased |
Exercise Period |
|
|
1/4
|
Shall vest on the first anniversary of the date of grant; and | |
| 1/48 | Shall vest at the end of each month following the first anniversary of the date of grant up to and including the fourth anniversary of the date of grant; |
with the result that the entire Option subject to the grant shall be vested and exercisable as of the fourth anniversary of the date of grant. Once a portion of an Option that has vested becomes exercisable, it remains exercisable until expiration or termination of the Option, unless otherwise specified by the Board in connection with the grant of such Option or pursuant to the Plan.
| 3. | The exercise of the Options granted hereby, issuance of Shares and ownership of the Shares are subject to the terms and conditions of the Plan (all of which are incorporated into and form part of this Stock Option Plan Agreement) and this Stock Option Plan Agreement. |
| 4. | Nothing in the Plan or in this Stock Option Plan Agreement will affect the Corporation’s right, or that of an affiliated corporation, to terminate the employment of, term of office of, or consulting agreement or arrangement with a Participant at any time for any reason whatsoever. Upon such termination, a Participant’s rights to exercise Options will be subject to restrictions and time limits for the exercise of Options. Complete details of such restrictions are set out in the Plan, and in particular in Section 8 thereof. |
| 5. | Each notice relating to the Option, including the exercise thereof, must be in writing. All notices to the Corporation must be delivered personally or by prepaid registered mail and must be addressed to the secretary of the Corporation. All notices to the Participant will be addressed to the principal address of the Participant on file with the Corporation. Either the Corporation or the Participant may designate a different address by written notice to the other. Such notices are deemed to be received, if delivered personally, on the date of delivery, and if sent by prepaid, registered mail, on the fifth business day following the date of mailing. Any notice given by either the Participant or the Corporation is not binding on the recipient thereof until received. |
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| 6. | The Participant hereby agrees that: |
| (a) | any rule, regulation or determination, including the interpretation by the Board or the Administrators of the Plan, the Option granted hereunder and the exercise thereof, is final and conclusive for all purposes and binding on all persons including the Corporation and the Participant; and |
| (b) | the grant of the Option does not affect in any way the right of the Corporation or any affiliated corporation to terminate the employment of the Participant. |
| 7. | The exercise of the Options must be exempt or not subject to the registration under the applicable United States federal and state securities laws. Furthermore, by its acceptance of this Option, the Participant acknowledges and agrees that any Common Shares issued in the United States of America, its territories and possessions, any state of the United States and the District of Columbia (the “ United States ”) upon the exercise of any Options pursuant to an exemption from registration under the United States Securities Act of 1933, as amended, and applicable state securities laws shall bear the following legend restricting transfer under applicable United States federal and state securities laws: |
“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE CORPORATION THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE CORPORATION; (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT; (C) IN ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION PROVIDED BY (1) RULE 144 OF THE U.S. SECURITIES ACT, IF AVAILABLE, OR (2) RULE 144a THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS; OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS, AND, IN THE CASE OF PARAGRAPH (C)(1) OR (D), THE SELLER FURNISHES TO THE CORPORATION AN OPINION OF COUNSEL OF RECOGNIZED STANDING IN FORM AND SUBSTANCE OR OTHER EVIDENCE SATISFACTORY TO THE CORPORATION TO SUCH EFFECT. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE GOOD DELIVERY IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”
| 8. | This Stock Option Plan Agreement shall be binding upon and enure to the benefit of the Corporation, its successors and assigns and the Participant and the legal representative of the Participant’s estate and any other person who acquires Shares by bequest or inheritance. |
| 9. | By executing this Stock Option Plan Agreement, the Participant confirms and acknowledges that the Participant has not been induced to enter into this agreement or acquire any Options by expectation of employment or continued employment with the Corporation or its subsidiaries. |
| 10. | This Stock Option Plan Agreement has been made in and is to be construed under and in accordance with the laws of the Province of British Columbia and the laws of Canada applicable therein. |
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|
MOGO FINANCE TECHNOLOGY INC.
|
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| Per: |
|
||
|
|
Authorized Signatory
|
||
|
SIGNED, SEALED AND DELIVERED in the presence of
(Witness) |
) ) ) ) ) ) |
(Signature of Participant) |
|
| 15 |
Exhibit A to Schedule 1
NOTICE TO EXERCISE
| TO: | The Secretary of Mogo Finance Technology Inc. (the “ Corporation ”) |
| (a) | The undersigned hereby elects to purchase ________________ Shares (as defined in the Stock Option Plan of the Corporation dated November 15, 2013 as amended to date (the “Plan” ) pursuant to the terms of the stock option plan agreement dated [ ] [ ], [ ] (the “ Option Agreement ”) between the undersigned and the Corporation, and tenders herewith payment in full of the purchase price thereof. |
| (b) | Please issue a certificate or certificates representing the Shares in the name of the undersigned, whose address is as follows: |
| ___________________________________ | |
| ___________________________________ | |
| ___________________________________ | |
| ___________________________________ |
| (c) | The undersigned hereby represents, warrants and certifies as follows (only one of the following must be checked): |
| A. ¨ | The undersigned (i) at the time of exercise of the Options is not in the United States of America, its territories or possessions, any state of the United States or the District of Columbia (the “ United States ”) and is not exercising this Option on behalf of a person in the United States and (ii) did not execute or deliver this Notice of Exercise form in the United States. |
| B. ¨ | The undersigned has delivered an opinion of counsel of recognized standing or other evidence in form and substance reasonably satisfactory to the Corporation to the effect that an exemption from the registration requirements of the United States Securities Act of 1933, as amended (the “ U.S. Securities Act ”), and applicable state securities laws is available for the issuance of the Shares. |
Note : The undersigned understands that unless Box A is checked, the certificates representing the Shares will bear a legend restricting transfer without registration under the U.S. Securities Act and applicable state securities laws unless an exemption from registration is available.
Note : Certificates representing Shares will not be registered or delivered to an address in the United States unless Box B above is checked.
Note : If Box B is checked, any opinion or other evidence tendered must be in form and substance reasonably satisfactory to the Corporation. Participants planning to deliver an opinion of counsel or other evidence in connection with the exercise of Options should contact the Corporation in advance to determine whether any opinions or other evidence to be tendered will be acceptable to the Corporation.
| 16 |
Dated this __________ day of _____________________________,
| (Signature of Participant) | ||
| (Name of Participant – Please Print) | ||
| 17 |
Exhibit 4.2
MOGO FINANCE TECHNOLOGY INC.
RESTRICTED SHARE UNIT PLAN
| 1. | INTRODUCTION |
| 1.1 | Purpose |
The Restricted Share Unit Plan of Mogo Finance Technology Inc. (the “ Corporation ”) has been established to enhance the Corporation’s ability to provide eligible directors, officers and employees of the Corporation and its Subsidiaries with the opportunity to acquire restricted share units in order to allow them to participate in the Corporation’s long-term success and to promote a greater alignment of interests between the Corporation’s directors, officers, employees and shareholders.
| 1.2 | Definitions |
For purposes of the Plan:
| (a) | “ Account ” means the account set up on behalf of each Participant in accordance with Section 3.6; |
| (b) | “ Act ” means the Securities Act (British Columbia) as amended from time to time; |
| (c) | “ Affiliate ” has the meaning ascribed thereto in the Act; |
| (d) | “ Applicable Withholding Taxes ” has the meaning set forth in Section 2.3 of the Plan; |
| (e) | “ Associate ” has the meaning ascribed thereto in the Act; |
| (f) | “ Award Date ” means the date on which an RSU is awarded by the Board to an Eligible Person or such other date as may be specified by the Board at the time of the authorization of any such RSU award; |
| (g) | “ Board ” means the Board of Directors of the Corporation; |
| (h) | “ Change of Control ” shall mean: |
| (i) | any transaction at any time and by whatever means pursuant to which any Person together with any Affiliate or Associate of such Person (other than the Corporation or any of its Subsidiaries, or any employee benefit plan of the Corporation or its Subsidiaries, including any trustee of any such employee benefit plan acting as trustee) hereafter acquires the direct or indirect “beneficial ownership” (within the meaning of the term “beneficially own” in the Business Corporations Act (British Columbia) (the “ BCBCA ”)), of securities of the Corporation representing fifty percent (50%) or more of the combined voting power of the Corporation’s then issued and outstanding securities in any manner whatsoever including, without limitation, as a result of a take-over bid, an exchange of securities, an amalgamation of the Corporation with any other entity, an arrangement, a capital reorganization or any other business combination or reorganization; or |
| (ii) | the occurrence of a transaction requiring approval of the Corporation’s shareholders involving the acquisition of the Corporation or all or substantially all of its business by an entity by way of a purchase of assets, amalgamation, arrangement or otherwise; |
| - 2 - |
| (i) | “ Change of Control Price ” has the meaning set out at Section 3.5 of the Plan; |
| (j) | “ Committee ” means the committee of the Board responsible for recommending to the Board the compensation of Eligible Persons, which at the effective date of the Plan is the Corporate Governance, Compensation and Nominating Committee; |
| (k) | “ Corporation ” means Mogo Finance Technology Inc. and its successors and assigns; |
| (l) | “ Eligible Person ” means, at any Award Date, any director, officer or employee of the Corporation or its direct and indirect subsidiaries; |
| (m) | “ Incentive Plan ” means any stock option plan (including the Stock Option Plan), employee stock purchase plan, deferred stock unit plan or any other compensation or incentive mechanism of the Corporation involving the issuance or potential issuance of Shares, including a share purchase from treasury which is financially assisted by the Corporation by way of a loan, guarantee or otherwise; |
| (n) | “ Insider ” has the meaning ascribed thereto in the TSX Company Manual; |
| (o) | “ Participant ” means an Eligible Person to whom or which RSUs have been awarded; |
| (p) | “ Person ” means an individual, sole proprietorship, partnership, unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, and a natural person in his or her capacity as trustee, executor, administrator or other legal representative; |
| (q) | “ Plan ” means this Restricted Share Unit Plan as amended from time to time; |
| (r) | “ Regulatory Approval ” means the approval of the TSX or any other regulatory authority or governmental agency having lawful jurisdiction over the Plan and/or any RSUs awarded hereunder; |
| (s) | “ Restricted Share Unit ” or “ RSU ” means a unit awarded to a Participant that gives such Participant the right to receive, on the basis set out in the Plan, a Share; |
| (t) | “ RSU Agreement ” means an agreement, substantially in the form of the agreement set out in Schedule A hereto subject to any specific variations approved by the Board, between the Corporation and a Participant setting out the terms of the RSUs awarded to such Participant; |
| (u) | “ Services ” has the meaning set out at Section 3.1(a) of the Plan; |
| (v) | “ Share ” means a common share of the Corporation; |
| (w) | “ Stock Option Plan ” means the Corporation’s stock option plan in effect as of the date hereof as same may amended from time to time; |
| (x) | “ Subsidiary ” shall have the meaning ascribed thereto in the Act; |
| (y) | “ TSX ” means the Toronto Stock Exchange; and |
| (z) | “ Vesting Date ” means the date on which the RSUs of a Participant vest in accordance with Section 3.1 and relevant RSU Agreement. |
| - 3 - |
| 1.3 | Effective Date of the Plan |
The effective date of the Plan shall be the closing date of the Corporation’s initial public offering. The Board shall review and confirm the terms of the Plan from time to time.
| 2. | ADMINISTRATION |
| 2.1 | Authority of the Board |
The Board shall be responsible for the general administration of the Plan and the proper execution of its provisions, the interpretation of the Plan and the determination of all questions arising hereunder. Subject to the provisions of the Plan, without limiting the generality of the foregoing, the Board has the power and authority to:
| (a) | determine which Eligible Persons are to be awarded RSUs and the number of RSUs to be awarded to those Eligible Persons; |
| (b) | determine the terms under which such RSUs are awarded including, without limitation, those related to transferability, vesting and forfeiture; |
| (c) | prescribe the form of RSU Agreement with respect to a particular award of RSUs; |
| (d) | interpret the Plan and determine all questions arising out of the Plan and any RSUs awarded pursuant to the Plan, which interpretations and determinations will be conclusive and binding on the Corporation and all other affected Persons; |
| (e) | prescribe, amend and rescind rules and procedures relating to the Plan; |
| (f) | subject to such additional limitations and restrictions as the Board may impose, delegate to the Committee some or all of its authority under the Plan pursuant to Section 2.2; and/or |
| (g) | employ such legal counsel, independent auditors, third party service providers and consultants as it deems desirable for the administration of the Plan and to rely upon any opinion or computation received therefrom. |
The Board may also require that any participant in the Plan provide certain representations, warranties and certifications to the Corporation to satisfy the requirements of applicable securities laws, including without limitation exemptions from the registration requirements of the United States Securities Act of 1933, as amended (the “ U.S. Securities Act ”), and applicable state securities laws.
The Board’s guidelines, rules, regulations, interpretations and determinations shall be conclusive and binding upon the Corporation and all other Persons, including, in particular and without limitation, the Participants.
| 2.2 | Use of Committees |
The Board may delegate all or such portion of its powers under this Plan as it may determine to the Committee, either indefinitely or for such period of time as it may specify. Thereafter the Committee may exercise the powers and discharge the duties of the Board in respect of the Plan so delegated to the same extent as the Board is hereby authorised so to do. If such the Committee is appointed for this purpose, all references herein to the Board will be deemed to be references to the Committee.
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| 2.3 | Taxes and Other Source Deductions |
So as to ensure that the Corporation will be able to comply with the applicable provisions of any federal, provincial, state or local law relating to the withholding of tax or other required deductions, the Corporation shall be authorized to deduct from any amount payable to a Participant, either under this Plan or otherwise, such amount of taxes and other amounts as it may be required by law to withhold pursuant to applicable laws, in such manner as it determines (the “ Applicable Withholding Taxes ”). The Corporation may require a Participant, as a condition to the settlement of any RSU, to pay or reimburse the Corporation for any Applicable Withholding Taxes. The Corporation shall also have the right in its discretion to satisfy any such liability for Applicable Withholding Taxes or other required deduction amounts by selling or requiring a Participant to sell Shares which would otherwise be delivered or provided to the Participant hereunder.
| 2.4 | Information |
Each Participant shall provide the Corporation with all information that the Corporation requires in order to administer the Plan.
| 2.5 | Exemption from Plan Participation |
Notwithstanding any other provision of the Plan, if an Eligible Person is resident in a jurisdiction in which the award of RSUs hereunder might be considered to be income which is subject to taxation at the time of such award, such Eligible Person may elect not to participate in the Plan by providing a written notice to the Corporate Secretary of the Corporation.
| 3. | AWARD OF RSU s |
| 3.1 | Award and Vesting of RSUs |
| (a) | Subject to the terms of the Plan, the Board may from time to time award to any Eligible Person the number of RSUs the Board deems appropriate in respect of services rendered to the Corporation or a direct or indirect subsidiary of the Corporation by such Eligible Person (the “ Services ”). |
| (b) | RSUs shall consist of an award of units, each of which represents the right of the Participant to receive one (1) Share subject to the terms and conditions contained herein and such additional terms and conditions as the Board deems appropriate, consistent with applicable laws. |
| (c) | The Board shall have the discretion to determine the date(s) upon which each RSU vests under the Plan (each, a “ Vesting Date ”) or any other vesting requirements, which Vesting Dates and other vesting requirements shall be set forth in the applicable RSU Agreement provided, however, that each awarded RSU shall vest not later than the third anniversary of its Award Date. Unless otherwise determined by the Board at or after the applicable Award Date, RSUs awarded pursuant to this Plan shall vest as follows: |
| a. | 25% of each award of RSUs shall vest on the first anniversary of its Award Date; |
| b. | 25% of each award of RSUs shall vest on the second anniversary of its Award Date; and |
| c. | 50% of each award of RSUs shall vest on the third anniversary of its Award Date. |
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| 3.2 | RSU Agreement |
Upon the award of RSUs, the Corporation will deliver to any Eligible Person an RSU Agreement dated as of its Award Date, containing the terms of the RSUs and executed by the Corporation. Upon return to the Corporation of the RSU Agreement countersigned by the Eligible Person, such Eligible Person will be a Participant in the Plan and have the right to receive Shares on the terms set out in the RSU Agreement and in the Plan. Subject to any specific variations approved by the Board, all terms and conditions set out herein will be deemed to be incorporated into and form part of each RSU Agreement made hereunder.
| 3.3 | Shares Reserved |
The maximum number of Shares which may be made subject to issuance under RSUs awarded under this Plan shall not exceed 500,000 Shares subject to adjustment pursuant to Section 3.10.
| 3.4 | Limitations |
The number of Shares:
| (a) | issued to Insiders of the Corporation, within any one year period, and |
| (b) | issuable to Insiders of the Corporation, at any time, |
under the Plan, when combined with all of the Corporation’s other security-based compensation arrangements, must not exceed 10% of the Corporation’s total issued and outstanding Shares as at the applicable Award Date.
| 3.5 | Change of Control |
Unless otherwise determined by the Board at or after the applicable Award Date, upon the occurrence of a Change of Control, all outstanding RSUs at that time shall automatically and irrevocably vest in full, notwithstanding any Vesting Date(s) described in any RSU Agreements, which Vesting Date(s) may be subsequent to the date of such Change of Control. Unless otherwise determined by the Board at or after the Award Date or in accordance with this Section, upon the occurrence of a Change of Control all outstanding RSUs shall be paid out in cash at the Change of Control Price (as defined below) as of the date such Change of Control is determined to have occurred, or as of such other date as the Board may determine prior to the Change of Control. Further, the Board shall have the right to provide for the conversion or exchange of any outstanding RSUs into or for RSUs or any other appropriate securities in any entity participating in or resulting from the Change of Control; provided, however, that any such converted or exchanged RSUs shall vest no later than the third anniversary of their original applicable Award Date other than in circumstances where such later vesting date would not, in the opinion of the Board acting reasonably, lead to material adverse tax consequences for the applicable Participant(s). In addition, and notwithstanding Section 4.1, the Board shall have the right to determine, at its discretion, that outstanding RSUs shall not vest and shall, instead, be cancelled in the event of a Change of Control. For the purposes of this Plan, “ Change of Control Price ” means the highest price per Share paid in any transaction reported on a securities exchange or paid or offered in any bona fide transaction related to a potential or actual Change of Control of the Corporation at any time during the five (5) trading days preceding the Change of Control, as determined by the Board.
| 3.6 | Participant’s Account |
The Corporation shall maintain an account for each Participant (the “ Account ”) and, upon the award of RSUs to a Participant, the Board shall cause the Participant’s Account to be credited with the number of RSUs so awarded. If any RSU held by a Participant should fail to vest or should vest and be satisfied by delivery of a Share to the applicable Participant, then such RSU shall be cancelled from such Participant’s Account.
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| 3.7 | Vested RSUs |
Subject to arrangements being made to fund Applicable Withholding Taxes to the satisfaction of the Board in accordance with Section 2.3, the issuance of a Share in satisfaction of any vested RSU shall be made as soon as practicable after the applicable Vesting Date thereof and, in any event, no later than sixty (60) days following the end of that calendar year.
| 3.8 | Termination of Participant’s Relationship with the Corporation |
Unless otherwise determined by the Board or specified in an applicable RSU Agreement:
| (a) | For a Participant that is an officer or employee of the Corporation, upon the voluntary resignation (other than upon bona fide retirement as determined by the Board) or termination for cause (under applicable laws or any applicable employment agreement) of a Participant, all of such Participant’s RSUs which remain unvested in the Participant’s Account shall immediately cease to vest and be forfeited and be of no further force and/or effect whatsoever without any compensation to such Participant whatsoever; |
| (b) | For a Participant that is an officer or employee of the Corporation, upon the retirement, termination without cause or death of a Participant, (I) such Participant or such Participant’s legal representative, as the case may be, shall have a number of RSUs become vested in a linear manner calculated as follows: with respect to each award of RSUs (1) the original number of RSUs awarded multiplied by (A) the number of completed months of employment since the Award Date divided by (B) the number of months required to achieve the full vesting of such award of RSUs less (2) the actual number of RSUs that have previously become vested, and all such vested RSUs shall be settled in accordance with Section 3.7 and (II) except as otherwise determined in accordance with Section 3.8(b)(I), all of such Participant’s RSUs which remain unvested in the Participant’s Account shall immediately cease to vest and be forfeited and be of no further force and/or effect whatsoever without any compensation to such Participant whatsoever; |
| (c) | For a Participant that is a director of the Corporation, upon the legal disqualification of such Participant from serving as a director of the Corporation or the removal or non-election of such Participant as a director of the Corporation following material misconduct on the part of such Participant (as determined by the Board in its discretion), all of such Participant’s RSUs which remain unvested in the Participant’s Account shall immediately cease to vest and be forfeited and be of no further force and/or effect whatsoever without any compensation to such Participant whatsoever; and |
| (d) | For a Participant that is a director of the Corporation, if such director does not stand for re-election or fails to be re-elected as a director of the Corporation in circumstances other than those described in (c) above, or upon the death of such Participant, (I) such Participant or such Participant’s legal representative, as the case may be, shall have a number of RSUs become vested in a linear manner calculated as follows: with respect to each award of RSUs (1) the original number of RSUs awarded multiplied by (A) the number of completed months of service on the Board since the Award Date divided by (B) the number of months required to achieve the full vesting of such award of RSUs less (2) the actual number of RSUs that have previously become vested, and all such vested RSUs shall be settled in accordance with Section 3.7 and (II) except as otherwise determined in accordance with Section 3.8(b)(I), all of such Participant’s RSUs which remain unvested in the Participant’s Account shall immediately cease to vest and be forfeited and be of no further force and/or effect whatsoever without any compensation to such Participant whatsoever. |
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For the purposes of this Plan, any change to an officer’s, employee’s or director’s status within the Corporation or any Subsidiary of the Corporation shall not be considered a termination and such officer’s, employee’s or directors’ rights under any outstanding RSUs shall be the same as if such change in status had not occurred. For greater certainty, if a Participant ceases to be an officer, employee or director of the Corporation but continues to be an Eligible Person in another capacity, such change shall not be considered a termination and such officer’s, employee’s or directors’ rights under any outstanding RSUs shall be the same as if such change in status had not occurred.
For the purposes of this Section 3.8: (1) the date of termination of an officer’s or employee’s employment shall be the date designated in writing by the Corporation or its Subsidiary, as the case may be, as the effective date of termination without regard to any period of notice or reasonable notice that the Corporation or Subsidiary, as the case may be, may be required by contract or at law to provide to such officer or employee in connection with such termination; (2) the date that a director ceases to be a member of the Board shall be the date on which such individual ceases to be a director in accordance with applicable law; and (3) the date of termination of any Participant who dies shall be the date of death of such Participant.
| 3.9 | No Compensation for Cancelled RSUs |
Section 3.8 applies regardless of whether the Participant received compensation in respect of dismissal or was entitled to a period of notice of termination which would otherwise have permitted a greater portion of the RSUs to vest with the Participant.
| 3.10 | Adjustments to RSUs |
In the event of any change in the outstanding Shares by reason of a stock split, spin-off, share dividend, share combination or reclassification, recapitalization, merger, or similar event, the Board may, subject to applicable laws, adjust appropriately the Account of each Participant and the RSUs outstanding under the Plan shall be adjusted in such manner, if any, as the Board may in its discretion deem appropriate to preserve proportionally the interests of Participants under the Plan.
| 3.11 | No Fractional Shares |
No fractional Shares shall be issued upon the vesting of RSUs awarded under the Plan and, accordingly, if a Participant would become entitled to a fractional Share upon the vesting of an RSU, such Participant shall only have the right to the next lowest whole number of Shares and no payment or other adjustment will be made with respect to the fractional interest so disregarded, and any fractional interest in a Share that would otherwise be delivered upon the vesting of RSUs will be cancelled.
| 4. | GENERAL |
| 4.1 | Amendment, Suspension, or Termination of Plan |
| (a) | Subject to Section 4.1(b), Section 4.1(c), the rules and policies of the TSX (if the Corporation has any securities listed on the TSX at such time) and applicable laws, the Board may, without notice or shareholder approval, at any time or from time to time, amend the Plan or any RSU Agreement for any purpose, including but not limited to the purposes of: |
| (i) | making any amendments to the vesting provisions of each RSU set out in any RSU Agreement; |
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| (ii) | making any amendments to the provisions set out in Section 3.8; |
| (iii) | making any amendments to add covenants of the Corporation for the protection of Participants, provided that the Board shall be of the good faith opinion that such additions will not be prejudicial to the rights or interests of Participants; |
| (iv) | making any amendments not inconsistent with the Plan as may be necessary or desirable with respect to matter or questions, which in the good faith opinion of the Board, having in mind the best interests of the Participants, it may be expedient to make, provided that the Board shall be of the opinion that such amendments will not be prejudicial to the interests of the Participants; or |
| (v) | making any such changes or corrections which, on the advice of counsel to the Corporation, are required for the purposes of curing or correcting any ambiguity or defect or inconsistent provision or clerical omission or mistake or manifest error, provided that the Board shall be of the opinion that such changes or correction will not be prejudicial to the rights and interests of the Participants. |
| (b) | Notwithstanding any other provision of this Plan, none of the following amendments shall be made to this Plan without the approval of the TSX (if the Corporation has any securities listed on the TSX) and the approval of the shareholders of the Corporation: |
| (i) | amendments to the Plan which would increase the number of Shares issuable under the Plan, otherwise than in accordance with Section 3.10 hereof; |
| (ii) | amendments to the Plan which would increase the number of Shares issuable to Insiders under the Plan, otherwise than in accordance with Section 3.10 hereof; |
| (iii) | amendments to the Plan which would increase the number of Shares issuable to directors of the Corporation under the Plan, otherwise than in accordance with Section 3.10 hereof; or |
| (iv) | an amendment to this Section 4.1. |
| (c) | Subject to Section 4.2, the Board shall not alter or impair any rights or increase any obligations with respect to an RSU previously awarded under the Plan without the consent of the holder thereof. |
| (d) | The Board may from time to time suspend the Plan in whole or in part and may at any time terminate the Plan without prior notice provided, however, that any such suspension or termination shall not adversely affect the RSUs previously awarded to a Participant at the time of such suspension or termination, without the consent of the affected Participant. |
| (e) | If the Board terminates or suspends the Plan, no new RSUs will be credited to the account of a Participant; however, previously credited RSUs shall remain outstanding. |
| (f) | On termination of the Plan, RSUs shall be paid in accordance with the terms and conditions of the Plan existing at the time of termination. The Plan will finally cease to operate for all purposes when the last remaining Participant receives payment of all vested RSUs recorded in the Participant’s Account. |
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| 4.2 | Compliance with Laws |
| (a) | The administration of the Plan shall be subject to and made in conformity with all applicable laws and any applicable regulations of a duly constituted authority. |
| (b) | If the Board, after consultation with the Corporation’s accountants, determines that it is not feasible or desirable to honour an election in respect to any RSUs or to honour any other provision of the Plan under generally accepted accounting principles as applied to the Plan and the Accounts established hereunder, the Board shall make such changes to the Plan as the Board reasonably determines, after consultation with the Corporation’s accountants, are required in order to avoid adverse accounting consequences to the Corporation with respect to the Plan and the Accounts established hereunder, and the Corporation’s obligations under the Plan shall be satisfied by such other reasonable means as the Board shall in its good faith determine. |
| 4.3 | Reorganization of the Corporation |
The existence of any RSUs shall not affect in any way the right or power of the Corporation or its shareholders to make or authorize any adjustment, recapitalization, reorganization or other change in the Corporation’s capital structure or its business, or any amalgamation, combination, merger or consolidation involving the Corporation (including, without limitation, any Change of Control) or to create or issue any bonds, debentures, shares or other securities of the Corporation or the rights and conditions attaching thereto or to effect the dissolution or liquidation of the Corporation or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar nature or otherwise (including, without limitation, any Change of Control).
| 4.4 | General Restrictions and Assignment |
Except as required by law, the rights of a Participant under the Plan are not capable of being assigned, transferred, alienated, sold, encumbered, pledged, mortgaged or charged and are not capable of being subject to attachment or legal process for the payment of any debts or obligations of the Participant.
Rights and obligations under the Plan may be assigned by the Corporation to a successor to the Corporation or to the business of the Corporation.
RSUs are non-transferable (subject to the provisions of Section 3.8(b)), and certificates representing RSUs will not be issued by the Corporation.
| 4.5 | No Right to Service |
Neither participation in the Plan nor any action taken under the Plan shall give or be deemed to give any Participant a right to continued appointment as a member of the Board, or as an officer or employee and shall not interfere with any right of the shareholders of the Corporation to remove any Participant as a member of the Board at any time. Nothing contained in the Plan or in any RSU Agreement will interfere in any way with the right of the Corporation, to lawfully terminate any Eligible Person or Participant’s office or employment at any time pursuant to the arrangements pertaining to same. Participation in the Plan by an Eligible Person is strictly voluntary.
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| 4.6 | No Shareholder Rights |
Under no circumstances shall RSUs be considered Shares nor shall they entitle any Participant to exercise voting rights or any other rights attaching to the ownership of Shares, nor shall any Participant be considered the owner of any Shares by virtue of the award of RSUs.
| 4.7 | Unfunded and Unsecured Plan |
The Plan shall be unfunded and the Corporation will not secure its obligations under the Plan. To the extent any Participant or his or her estate holds any rights by virtue of an award of RSUs under the Plan, such rights (unless otherwise determined by the Board) shall be no greater than the rights of an unsecured creditor of the Corporation.
| 4.8 | No Representation or Warranty |
The Corporation makes no representation or warranty as to the future market value of RSUs and/or Shares issued in accordance with the provisions of the Plan or to the effect of the Income Tax Act (Canada), the United States Internal Revenue Code, or any other taxing statute governing the RSUs and/or the Shares issuable hereunder or the tax consequences to a Participant. Compliance with applicable laws as to the disclosure and resale obligations of each Participant is the responsibility of such Participant and not the Corporation.
| 4.9 | No Other Benefit |
No amount will be paid to, or in respect of, a Participant under the Plan to compensate for a downward fluctuation in the price of a Share or the value of an RSU, nor will any other form of benefit be conferred upon, or in respect of, a Participant for such purpose.
| 4.10 | Governing Law |
The Plan shall be governed by, and interpreted in accordance with, the laws of the Province of British Columbia and the laws of Canada applicable therein, without regard to principles of conflict of laws.
| 4.11 | Interpretation |
In this text words importing the singular meaning shall include the plural and vice versa, and words importing the masculine shall include the feminine gender.
| 4.12 | Notices |
The form of all communication relating to the Plan shall be in writing and delivered by recognised overnight courier, certified mail, fax or electronic mail to the proper address or, optionally, to any individual personally. Except as otherwise provided in any RSU Agreement, all notices to the Corporation or the Board shall be addressed to the Corporation at its principal business office at 201-2590 Granville Street, Vancouver, British Columbia, V6B 5C6 Attn: Chief Financial Officer with a copy by email to: GregF@mogo.ca. All notices to Participants, former Participants, beneficiaries or other Persons acting for or on behalf of such Persons which are not delivered personally to an individual shall be addressed to such Person by the Corporation or its designee at the last address for such Person maintained in the records of the Corporation.
| 4.13 | Severability |
The invalidity or unenforceability of any provision of this Plan shall not affect the validity or enforceability of any other provision and any invalid or unenforceable provision shall be severed from this Plan.
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| 4.14 | Compliance with Section 409A |
| (a) | This section shall only apply to a Participant who is a U.S. citizen, U.S. permanent resident or U.S. tax resident or a Participant for whom a benefit under this Plan would otherwise be subject to U.S. taxation under the U.S. Internal Revenue Code of 1986, as amended, and the rulings and regulations in effect thereunder (a “ U.S. Participant ”). |
| (b) | RSU awards will be designed and operated in such a manner that they are either exempt from the application of, or comply with, the requirements of Section 409A of the U.S. Internal Revenue Code and the U.S. Treasury Regulations and other U.S. Internal Revenue Service guidance promulgated thereunder as in effect from time to time (“ Section 409A ”) and will be construed and interpreted in accordance with such intent. To the extent that an RSU award or payment, or the settlement or deferral thereof, is subject to Section 409A, the RSU will be granted, paid, settled or deferred in a manner that will meet the requirements of Section 409A, such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Section 409A. |
| (c) | Notwithstanding Section 3.5, for any U.S. Participant, the Board shall not exercise discretion to have RSUs converted or exchanged or canceled in connection with a Change of Control, as provided for in the third and fourth sentences of Section 3.5. |
| (d) | For purposes of Section 3.8(b), “retirement” and “termination without cause” shall have the following definitions for a U.S. Participant: |
| (i) | “ retirement ” means a “separation from service” under U.S. Treasury Regulation 1.409A-1(h) from the Corporation or a subsidiary which is a “service recipient” (as defined under U.S. Treasury Regulation 1.409A-1(h)(3)) in relation to the Participant on or after age sixty-five (65); and |
| (ii) | “termination without cause” means a “separation from service” under U.S. Treasury Regulation 1.409A-1(h) by the Corporation or a subsidiary which is a “service recipient” (as defined under U.S. Treasury Regulation 1.409A-1(h)(3)) without cause, as defined in the Participant’s employment contract, and in the absence of such a definition shall mean any of the following acts or omissions: |
| (A) | The willful failure of the Participant to follow the reasonable and lawful instructions of the Corporation or a subsidiary; |
| (B) | The willful failure of the Participant to perform the reasonable duties assigned to the Participant by the Corporation or a subsidiary; |
| (C) | Willful misconduct by a Participant; |
| (D) | A material breach or non-observance of any of the provisions in any employment contract between the Participant and the Corporation or any subsidiary; |
| (E) | Any conduct of the Participant that tends to bring him or the Corporation (or a subsidiary) into disrepute and which is not corrected within a reasonable time after the Participant receives written notice from the Board; or |
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| (F) | Any other act or omission constituting cause at common law. |
| (e) | Notwithstanding Section 3.8(b), settlement of any RSUs accelerated upon a retirement or termination without cause shall be subject to delay in settlement by six months and one day if the Participant qualifies a “specified employee” as defined in Section 409A, except if the qualifying termination of service is on account of the Participant’s death. The determination of whether any U.S. Participant is a “specified employee” shall be determined by the Board in accordance with U.S. Treasury Regulation 1.409A-1(i). |
| (f) | No amendment under Section 4.1 shall be made if such change would cause a violation of Section 409A. |
| (g) | Each Participant is solely responsible and liable for the satisfaction of all taxes and penalties that may be imposed on or for the account of such Participant in connection with this Plan (including any taxes and penalties under Section 409A), and neither the Corporation nor any subsidiary shall have any obligation to indemnify or otherwise hold such Participant or beneficiary or the Participant’s estate harmless from any or all such taxes or penalties. |
| 4.15 | United States Securities Law Matters |
No RSUs shall be granted in the United States of America, its territories and possessions, any state of the United States and the District of Columbia (the " United States ") and no Shares shall be issued in the United States upon vesting of any such RSUs unless such securities are registered under the U.S. Securities Act and any applicable state securities laws or an exemption from such registration is available. Any RSUs issued in the United States, and any Shares issued upon vesting thereof, will be "restricted securities" (as such term is defined in Rule 144(a)(3) under the U.S. Securities Act). Any certificate or instrument representing RSUs granted in the United States or Shares issued in the United States upon vesting of any such RSUs pursuant to an exemption from registration under the U.S. Securities Act and applicable state securities laws shall bear the following legend restricting transfer under applicable United States federal and state securities laws:
“THE SECURITIES REPRESENTED HEREBY [and for RSUs, the following will be added: AND THE SECURITIES ISSUABLE UPON VESTING HEREOF] HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) TO THE CORPORATION, (B) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH REGULATION S UNDER THE U.S. SECURITIES ACT AND IN COMPLIANCE WITH APPLICABLE LOCAL LAWS AND REGULATIONS, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION UNDER THE U.S. SECURITIES ACT PROVIDED BY (1) RULE 144 THEREUNDER, IF AVAILABLE, OR (2) RULE 144A THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS, AND, IN CONNECTION WITH ANY TRANSFERS PURSUANT TO (C)(1) OR (D) ABOVE, THE SELLER HAS FURNISHED TO THE CORPORATION AN OPINION OF COUNSEL OF RECOGNIZED STANDING OR OTHER EVIDENCE, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE CORPORATION, TO THAT EFFECT. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE “GOOD DELIVERY” IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”
SCHEDULE a – FORM OF RSU AGREEMENT
MOGO FINANCE TECHNOLOGY INC.
RESTRICTED SHARE UNIT PLAN – RSU AGREEMENT
This RSU Agreement is entered into between Mogo Finance Technology Inc. (the “ Corporation ”) and the Eligible Person named below, pursuant to the Corporation’s Restricted Share Unit Plan (the “ Plan ”), a copy of which is attached hereto, and confirms that:
| 1. | on ___________________ (the “Award Date”); |
| 2. | ______________________ (the “Eligible Person”); |
| 3. | was awarded _____________________ Restricted Share Units (the “RSUs”) in accordance with the terms of the Plan; |
| 4. | the RSUs will vest as follows: |
| Number of RSUs | Vesting On |
| ______________________ | ______________________ |
| ______________________ | ______________________ |
| ______________________ | ______________________ |
all on the terms and subject to the conditions set out in the Plan.
By signing this agreement, the Participant:
| (a) | acknowledges that such Participant has read and understands the Plan, agrees with the terms and conditions thereof which shall be deemed to be incorporated into and form part of this RSU Agreement (subject to any specific variations contained in this RSU Agreement); |
| (b) | acknowledges that such Participant will be solely responsible for paying any Applicable Withholding Taxes (as defined in the Plan) arising from the award or vesting of any RSU, as provided in Section 2.3 of the Plan; |
| (c) | where allowed by applicable legislation, agrees to assume any applicable employer’s social security, Canada Pension Plan, Employment Insurance and/or similar contributions due upon the award or vesting of any RSU; |
| (d) | agrees that an RSU does not carry any voting rights; |
| (e) | acknowledges that the value of the RSUs awarded herein is in Canadian dollars, is subject to stock market fluctuations and is not guaranteed; |
| (f) | acknowledges that any notice required to be provided by the Participant to the Corporation under the Plan must be in writing and will only be effective upon its receipt by the Corporation’s contact person indicated in the Plan; |
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| (g) | recognizes that, at the sole discretion of the Corporation, the Plan can be administered by a designee of the Corporation and any communication from or to the designee shall be deemed to be from or to the Corporation; and |
| (h) | acknowledges and agrees that any Shares issued in the United States of America, its territories and possessions, any state of the United States and the District of Columbia (the “ United States ”) upon the vesting of any RSUs pursuant to an exemption from registration under the United States Securities Act of 1933, as amended, and applicable state securities laws shall bear the following legend restricting transfer under applicable United States federal and state securities laws: |
“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "U.S. SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE CORPORATION THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE CORPORATION; (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT; (C) IN ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION PROVIDED BY (1) RULE 144 OF THE U.S. SECURITIES ACT, IF AVAILABLE, OR (2) RULE 144a THEREUNDER, IF AVAILABLE, AND IN EACH CASE IN COMPLIANCE WITH APPLICABLE STATE SECURITIES LAWS; OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S. SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS, AND, IN THE CASE OF PARAGRAPH (C)(1) OR (D), THE SELLER FURNISHES TO THE CORPORATION AN OPINION OF COUNSEL OF RECOGNIZED STANDING IN FORM AND SUBSTANCE OR OTHER EVIDENCE SATISFACTORY TO THE CORPORATION TO SUCH EFFECT. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE GOOD DELIVERY IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.”
IN WITNESS WHEREOF the Corporation and the Eligible Person have executed this RSU Agreement as of _____________________.
MOGO FINANCE TECHNOLOGY INC.
| By: | ______________________________ |
| Name: | David Feller |
| Title: | CEO |
____________________________________
Name of Eligible Person
____________________________________
Signature of Eligible Person
| - 3 - |
Note to Plan Participants
This RSU Agreement must be signed where indicated and returned to the Corporation within 30 days of receipt. Failure to acknowledge acceptance of this award will result in the cancellation of your RSUs.
Exhibit 5.1 and 23.1
[Stikeman Elliott LLP Letterhead]
June 19, 2018
Mogo Finance Technology Inc.
2100-401 West Georgia St.
Vancouver, British Columbia
Canada
| Re: | Mogo Finance Technology Inc. – Registration Statement on Form S-8 |
Ladies and Gentlemen:
We have acted as Canadian counsel for Mogo Finance Technology Inc. (the “ Company ”), a Company incorporated under the Business Corporations Act (British Columbia), in connection with the Registration Statement on Form S-8 (the “ Registration Statement ”) being filed by the Company under the Securities Act of 1933, as amended (the “ Securities Act ”), with respect to 3,800,000 common shares of the Company (the “ Option Shares ”), issuable under the Company’s Stock Option Plan (effective November 15, 2013, as amended) (the “ Stock Option Plan ”) and of 500,000 common shares of the Company (the “ Unit Shares ”, and, together with the Option Shares, the “ Shares ”) issuable under the Company’s Restricted Share Unit Plan (effective June 25, 2015) (the “ RSU Plan ”, and, together with the Stock Option Plan, the “ Plans ”).
In connection with the Registration Statement, we have examined such records of the Company and such documents of the Company as we have deemed necessary as a basis for the opinions expressed herein. In particular, as to certain questions of fact material to the opinions hereinafter expressed, we have relied solely and without independent verification upon a certificate of an officer of the Company. We have not conducted any independent enquiries or investigations in respect of the opinions provided hereunder. In all those examinations we have assumed the capacity of all individuals, the genuineness of all signatures and the authenticity of all documents submitted to us as originals, the conformity to authentic original documents of all documents submitted to us as certified or photostatic copies and the authenticity of the originals of those documents and that all facts set forth in the certificates of the officer of the Company are true and accurate as of the date hereof.
Our opinion below is expressed only with respect to the laws of the Province of British Columbia and the federal laws of Canada applicable therein (the “ Jurisdiction ”) and is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K of the Securities Act.
Our opinion is expressed with respect to the laws of the Jurisdiction in effect on the date of this opinion. We have no responsibility or obligation to: (i) update this opinion, (ii) take into account or inform the addressees or any other person of any changes in law, facts or other developments subsequent to this date that do or may affect the opinions we express, or (iii) advise the addressee or any other person of any other change in any matter addressed in this opinion. Nor do we have any responsibility or obligation to consider the applicability or correctness of this opinion to any person other than the addressee.
Based upon and subject to the foregoing and to the qualifications set forth herein, we are of the opinion that:
| (a) | the Option Shares will, at the time of their issuance upon the due and proper exercise of options granted under the Stock Option Plan in accordance with the terms of the Stock Option Plan, be validly issued and outstanding as fully paid and non-assessable common shares of the Company, and |
| (b) | the Unit Shares will, at the time of their issuance upon the settlement of duly and properly vested restricted share units granted under the RSU Plan in accordance with the terms of the RSU Plan, be validly issued and outstanding as fully paid and non-assessable common shares of the Company. |
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the Registration Statement. In giving this consent, we do not thereby admit that we are included in the category of persons whose consent is required under Section 7 of the Securities Act, or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.
This opinion is furnished to you in connection with the filing by the Company of the Registration Statement and may not be relied upon for any other purpose without our express written consent. No opinion may be implied or inferred beyond the opinion expressly stated herein.
| Yours truly, | |
| /s/ Stikeman Elliott LLP |
Exhibit 23.2
Consent of Independent Auditor
We consent to the incorporation by reference in this Registration Statement on Form S-8 of our report dated March 6, 2018, with respect to the consolidated financial statements of Mogo Finance Technology Inc. as at and for the years ended December 31, 2017 and 2016 which appears in Exhibit 99.65, to the Registration Statement on Form 40-F for the registration of the common shares of Mogo Finance Technology Inc., without par value (the “ Form 40-F ”).
/s/ MNP LLP
Winnipeg, Manitoba, Canada
June 19, 2018